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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549



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FORM 10-K



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|x | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ------------------------------------------------------------------------------------

For the Fiscal Year Ended December 31, 2005

or



| ̈ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

For the Transition Period from  to

COMMISSION FILE NUMBER: 333-57715



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SUNCOM WIRELESS, INC.

(Exact name of Registrant as specified in its charter)



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|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Delaware                                                       |  | 23-2930873                             
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. employer identification number)

1100 Cassatt Road

Berwyn, Pennsylvania 19312

(Address and zip code of principal executive
offices)

(610) 651-5900

(Registrants telephone number, including area code)



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

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



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All of the registrants equity securities are owned indirectly by SunCom Wireless Holdings, Inc., which meets the conditions set forth in General Instructions
I(1)(a) and (b) of Form 10-K and is, therefore, filing this form with the reduced disclosure format pursuant to General Instruction I(2).

Indicate by
check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes ̈No  x

Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes ̈No  x

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated
filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act.



|                         |  |                    |  |                          
|------------------------ |  | ------------------ |  | -------------------------
|Large accelerated filer ̈ |  | Accelerated filer ̈ |  | Non-accelerated filer   x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).     Yes ̈No  x

As of March 16, 2006, 100 shares of registrants common stock were outstanding.

All of the registrants equity securities are held by SunCom Wireless Investment Co., LLC, a direct, wholly-owned subsidiary of SunCom Wireless Holdings, Inc. Accordingly, as of June 30, 2005, the last day
of the registrants most recently completed second fiscal quarter, there were no shares of the registrants voting or non-voting stock held by non-affiliates.

DOCUMENTS INCORPORATED BY REFERENCE

None.



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SUNCOM WIRELESS, INC.

FORM 10-K

TABLE OF CONTENTS



|        |  |                                                                                                              |  |     
|------- |  | ------------------------------------------------------------------------------------------------------------ |  | ----
|        |  | PART I                                                                                                       |  |     
|        |  |                                                                                                              |  | Page
|Item 1  |  | Business                                                                                                     |  | 1   
|Item 1A |  | Risk Factors                                                                                                 |  | 17  
|Item 1B |  | Unresolved Staff Comments                                                                                    |  | 22  
|Item 2  |  | Properties                                                                                                   |  | 22  
|Item 3  |  | Legal Proceedings                                                                                            |  | 22  
|Item 4  |  | Submission of Matters to a Vote of Security Holders                                                          |  | 22  
|        |  |                                                                                                             
|        |  | PART II                                                                                                      |  |     
|        |  |                                                                                                             
|Item 5  |  | Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |  | 23  
|Item 6  |  | Selected Financial Data                                                                                      |  | 24  
|Item 7  |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                        |  | 26  
|Item 7A |  | Quantitative and Qualitative Disclosures about Market Risk                                                   |  | 43  
|Item 8  |  | Financial Statements & Supplementary Data                                                                    |  | F-1 
|        |  | Report of Independent Registered Public Accounting Firm                                                      |  | F-2 
|        |  | Consolidated Balance Sheets                                                                                  |  | F-3 
|        |  | Consolidated Statements of Operations and Comprehensive Income (Loss)                                        |  | F-4 
|        |  | Consolidated Statements of Stockholders Equity (Deficit)                                                    |  | F-5 
|        |  | Consolidated Statements of Cash Flows                                                                        |  | F-6 
|        |  | Notes to Consolidated Financial Statements                                                                   |  | F-7 
|Item 9  |  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                         |  | 44  
|Item 9A |  | Controls and Procedures                                                                                      |  | 44  
|Item 9B |  | Other Information                                                                                            |  | 44  
|        |  |                                                                                                             
|        |  | PART III                                                                                                     |  |     
|        |  |                                                                                                             
|Item 10 |  | Directors and Executive Officers of the Registrant                                                           |  | 45  
|Item 11 |  | Executive Compensation                                                                                       |  | 45  
|Item 12 |  | Security Ownership of Certain Beneficial Owners and Management                                               |  | 45  
|Item 13 |  | Certain Relationships and Related Transactions                                                               |  | 45  
|Item 14 |  | Principal Accountant Fees and Services                                                                       |  | 45  
|        |  |                                                                                                             
|        |  | PART IV                                                                                                      |  |     
|        |  |                                                                                                             
|Item 15 |  | Exhibits and Financial Statement Schedules                                                                   |  | 46  



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PRELIMINARY NOTE

This annual report on Form 10-K is for the year ended December 31, 2005. This annual report modifies and supersedes documents filed prior to this annual report. The Securities and Exchange Commission, or the
SEC, allows us to incorporate by reference certain information that we file with them, such as exhibits, which means that we can disclose important information to you by referring you directly to those documents. Information
incorporated by reference is considered to be part of this annual report. In addition, information that we file with the SEC in the future will automatically update and supersede information contained in this annual report.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by forward-looking words such as anticipate,believe, could, estimate,
expect, intend, may, should, will and would or similar words. You should read statements that contain these words carefully because they discuss our future expectations, contain projections of our future results of operations or of our
financial position or state other forward-looking information. We believe that it is important to communicate our future expectations to our investors. However, there may be events in the future that we are not able to accurately predict or
control. The risk factors set forth under Item 1A of this annual report, as well as any cautionary language in this report, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the
expectations we describe in our forward-looking statements. You should be aware that the occurrence of the events described in the risk factors set forth under Item 1A of this annual report could have a material adverse effect on our business,
results of operations and financial position.



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PART I

ITEM 1. BUSINESS

Introduction

Our principal offices are located at 1100 Cassatt Road, Berwyn, Pennsylvania 19312, and our telephone number at that address is (610) 651-5900. Our Internet address is http://www.suncom.com. The
information in our website is not part of this report.

SunCom Wireless, Inc. is a direct, wholly-owned subsidiary of SunCom Wireless Investment Co., LLC.
SunCom Wireless Investment Co., LLC is a direct, wholly-owned subsidiary of SunCom Wireless Holdings, Inc. Accordingly, SunCom Wireless, Inc. and its subsidiaries are indirect, wholly-owned subsidiaries of SunCom Wireless Holdings, Inc. In this
report, we refer to: SunCom Wireless Holdings, Inc. as Holdings;SunCom Wireless Investment Co., LLC as SunCom Investment Company; and to SunCom Wireless, Inc. as SunCom. References to we,usandour refer
to SunCom Wireless, Inc. and its wholly-owned subsidiaries collectively, unless the context requires otherwise.

Overview

We provide digital wireless communications services in the southeastern United States, Puerto Rico and the U.S. Virgin Islands. As of December 31,
2005, our wireless communications network covered approximately 14.8 million potential customers in a contiguous geographic area primarily encompassing portions of North Carolina, South Carolina, Tennessee and Georgia. In addition, we operate a
wireless communications network covering approximately 4.1 million potential customers in Puerto Rico and the U.S. Virgin Islands.

We
provide wireless communications services under the SunCom Wireless brand name. From 1998 until December 2004, we were a member of the AT&T Wireless network and a strategic partner with AT&T Wireless. Beginning in 1998, AT&T Wireless
contributed to us personal communications services, or PCS, licenses covering various markets in the southeastern United States in exchange for an equity position in Holdings. As part of our transactions with AT&T Wireless, we were
granted the right to be the exclusive provider of wireless mobility services using co-branding with AT&T Corp. within our region.

In
October 2004, Cingular Wireless acquired all of the outstanding stock of AT&T Wireless through a merger of a Cingular Wireless subsidiary with and into AT&T Wireless. In connection with this transaction, SunCom, AT&T Wireless and
Cingular Wireless (and certain of their subsidiaries) entered into certain agreements to modify our relationships with AT&T Wireless. Under these agreements, which are described in detail below, AT&T Wireless surrendered to Holdings,
following the October 2004 consummation of the AT&T Wireless-Cingular Wireless merger, all of the equity interests in Holdings held by AT&T Wireless, and the parties concurrently terminated the agreement under which AT&T Wireless had
granted us the exclusive right to provide AT&T Wireless branded wireless services within our region. The termination of the exclusivity arrangement permitted Cingular Wireless entry into our service area and provided us the opportunity to offer
service in markets where we were previously prohibited from doing so.

Two of the agreements with AT&T Wireless and Cingular Wireless
were entered into on July 7, 2004.



| |  |  | Triton Holdings Agreement. On October 26, 2004 (the date Cingular Wireless consummated its acquisition of AT&T Wireless), pursuant to an agreement dated July 7,
2004 by and among Holdings, AT&T Wireless Services, Inc., AT&T Wireless PCS LLC and Cingular Wireless LLC, which we refer to as the Triton Holdings Agreement, AT&T Wireless PCS surrendered to Holdings all of the Holdings stock
owned by AT&T Wireless. Upon the surrender by AT&T Wireless PCS of its Holdings stock, Holdings First Amended and Restated Stockholders Agreement was terminated. In addition, Holdings Investors Stockholders Agreement,
dated as of February 4, 1998, as amended, by and among Holdings initial cash equity investors and certain of its management stockholders, also was terminated pursuant to its terms upon termination of the First Amended and Restated
Stockholders Agreement. The termination of the First Amended and Restated Stockholders Agreement allowed Cingular Wireless to operate in regions where SunCom once had the right to operate exclusively and allowed SunCom to operate in
areas where it was once prohibited from doing so. Also pursuant to the Triton Holdings Agreement, AT&T Wireless transferred to SunCom its interest in the entity that controls the SunCom brand name and related trademarks and waived
the payment of a $3.5 million dividend previously declared by Holdings on its Series A preferred stock.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Triton PCS Agreement. Pursuant to an agreement dated July 7, 2004 by and among SunCom, AT&T Wireless, AT&T Wireless PCS LLC and Cingular
Wireless, which we refer to as the Triton PCS Agreement, on October 26,
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | 2004, SunComs roaming agreement with AT&T Wireless was terminated and SunComs roaming agreement with Cingular Wireless was amended to extend
the term and reduce the roaming rates payable to SunCom and its affiliates thereunder. Without the exclusivity agreement that previously applied to AT&T Wireless, Cingular Wireless does not rely on our network for service to the same degree that
AT&T Wireless did in the past. As a result, lower roaming rates had a negative impact on our revenue for the year ended December 31, 2005. However, since the rates are reciprocal, we are able to offer our customers wide-area rate plans at
acceptable rates of return due to lower expense associated with reduced roaming rates. In addition, under the Triton PCS Agreement, AT&T Wireless transferred certain Federal Communications Commission, or FCC, licenses covering Savannah,
Georgia, and Asheville, Wilmington and Jacksonville, North Carolina, to SunCom in exchange for certain FCC licenses held by SunCom covering Savannah and Augusta, Georgia. As additional consideration for this license exchange, Cingular Wireless also
paid SunCom approximately $4.7 million.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

When the Triton Holdings Agreement and the Triton PCS
Agreement were entered into in July 2004, the parties also announced that they had entered into a non-binding letter of intent to consider a possible exchange of wireless network assets. The proposal to enter into an exchange transaction arose
during the course of the broad-ranging discussion of the parties future business relationships. After a series of negotiations over the subsequent three months, Holdings, AT&T Wireless and Cingular Wireless entered into the Exchange
Agreement described below.



| |  |  | Exchange Agreement. On September 21, 2004, we entered into an Exchange Agreement with AT&T Wireless and Cingular Wireless, which we refer to as the Exchange
Agreement. On December 1, 2004, pursuant to the closing of the first stage of the Exchange Agreement, SunCom transferred PCS network assets held for use in its Virginia markets to AT&T Wireless in exchange for PCS network assets held by
AT&T Wireless for use in certain of its North Carolina markets, in Puerto Rico and in the U.S. Virgin Islands and the payment by Cingular Wireless to SunCom of $175 million. On November 22, 2005, pursuant to the closing of the second stage
of the Exchange Agreement and subsequent to receiving FCC approval, the parties exchanged equity interests in the subsidiaries holding the FCC licenses.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Between the first and second closings, the parties entered into spectrum lease agreements, which allowed each party to use the licensed PCS spectrum necessary to operate the businesses acquired pursuant to the first
closing of the Exchange Agreement. Under one of the spectrum leases, SunCom had access to Cingular Wireless spectrum in certain of SunComs North Carolina markets and in Puerto Rico and the U.S. Virgin Islands. This spectrum lease
provided SunCom with exclusive access to the spectrum, but control of the spectrum remained with Cingular Wireless. This spectrum lease terminated automatically upon the consummation of the second closing. A second spectrum lease provided SunCom
with access to 10 megahertz of additional spectrum in Puerto Rico. Similar to the first spectrum lease, SunCom had exclusive access to the covered spectrum, but control of the spectrum remained with Cingular Wireless. This spectrum lease expired on
December 1, 2005. This second spectrum lease existed because AT&T Wireless had been operating both Time Division Multiple Access, or TDMA, technology and global system for mobile communications and general packet radio service, or
GSM/GPRS,technology in the Puerto Rico market with 35 megahertz of spectrum. With the successful migration of most of the Puerto Rico subscribers from TDMA technology to GSM/GPRS technology, SunCom was able to provide the same service level
with 25 megahertz of spectrum as of December 1, 2005, the lease expiration date.

As a result of these transactions, we are no longer
the exclusive provider of AT&T Wireless (now Cingular Wireless) PCS service in our markets. A decline in roaming revenue, largely as a result of the termination of our exclusivity arrangements with AT&T Wireless, has had, and will continue
to have, a negative impact on our operating margins. In addition, incremental expenses related to the SunCom brand launch in our recently acquired North Carolina, Puerto Rico and the U.S. Virgin Islands markets and the re-launch of the SunCom brand
in our previously existing markets, has had, and in the near term will continue to have, a negative impact on our operating margins. Therefore, until we further leverage our fixed costs over a larger subscriber base, our operating results will be
lower than comparable historic periods.

Additionally, 2005 operating results have been negatively impacted by the cost to migrate our
recently acquired subscribers in North Carolina and Puerto Rico to our systems. Before migrating the acquired GSM/GPRS subscribers in these markets to our systems, we needed to ensure that each subscribers handset was compatible with our
network and billing platform. Ensuring compatibility required that each subscribers handset was individually converted or replaced with a new handset. This subscriber migration was completed in the third quarter of 2005. Costs associated with
this process for the year ended December 31, 2005 were approximately $13.4 million and $23.0 million for our continental United States segment and our Puerto Rico and U.S. Virgin Islands segment, respectively, and are reflected in our results
of operations for the year ended December 31, 2005.

We currently market our wireless service under the SunCom Wireless brand name.
Our strategy is to provide extensive coverage to customers within our region, to offer our customers high-quality, innovative voice and data services with coast-to-coast coverage and to benefit from roaming revenues generated by other carriers
wireless customers who roam into our covered area.



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We believe our markets are strategically attractive because of their strong demographic characteristics
for wireless communications services. According to the 2005 Paul Kagan Associates Report, our service area includes 11 of the top 100 markets in the country with population densities that are higher than the national average. We currently provide
wireless voice and data services over two overlapping networks. One network uses TDMA technology, and the second network utilizes GSM/GPRS technology, which is capable of providing enhanced voice and data services.

Since we began offering service in our markets, our subscriber base and total revenues have grown significantly. From our initial launch of personal
communications services in January 1999, our subscriber base has grown to 965,822 subscribers as of December 31, 2005. As the result of our growing subscriber base, total revenues have increased from $131.5 million for the year ending
December 31, 1999 to $826.2 million for the year ending December 31, 2005. Revenues consist primarily of monthly access, airtime, feature, long distance and roaming charges billed to our subscribers, equipment revenues generated by the
sale of wireless handsets and accessories to our subscribers and roaming revenues generated by charges to other wireless carriers for their subscribers use of our network. As the result of the termination of Holdings First Amended and
Restated Stockholders Agreement and the exclusivity arrangement with AT&T Wireless contained in that agreement, roaming revenue declined from the year ended December 31, 2004. Our net loss has increased from a loss of $149.4 million
for the year ended December 31, 1999 to a net loss of $501.8 million for the year ended December 31, 2005, and we expect to incur net losses in the foreseeable future. The net loss increase is primarily due to increased costs, including an
additional call center, resulting from operating in two non-contiguous geographic territories with a combined subscriber base comparable to that of our prior contiguous territory, higher marketing expenses to promote the SunCom Wireless brand,
higher interest expense due to increased borrowings and higher depreciation expense related to accelerating depreciation on our TDMA assets. Also contributing to the net loss increase were the customer migration costs discussed above, an asset
impairment charge on certain FCC licenses held in the continental United States segment and incremental costs of operating two fully-deployed network technologies over an expanded market footprint. As a result of our net loss for 2005, our
accumulated deficit increased to $815.3 million as of December 31, 2005. Since the inception of our personal communications services in January 1999, our long-term debt has increased from $465.7 million to $1.7 billion. This increase is due
primarily to the increased funding required to build-out our network, which includes 2,593 cell sites and twelve switches.

Our goal is to
provide our customers with simple, easy-to-use wireless services with superior call quality, personalized customer care and competitive pricing. We utilize a mix of sales and distribution channels, including as of December 31, 2005, a network
of 115 company-owned SunCom retail stores, local retailers, direct sales representatives covering corporate accounts, E-commerce and telemarketing.

Recent Development

In January 2006, we announced that we will reorganize our continental United States operations during
the first half of 2006. This reorganization will consolidate operations from a more decentralized structure and will result in the termination of approximately 49 positions, or 3% of our workforce. In addition, approximately 20 employees will be
relocated as a result of the streamlining. These changes are a result of our recent strategic planning process. The total charge for severance and other employee termination expenses is expected to be approximately $1.6 million. We are currently
evaluating the financial impact of other costs associated with the reorganization, including relocation costs of certain personnel, exit costs of the leases associated with certain administrative facilities and charges associated with certain
leasehold improvements and the related leases.

Reportable Segments

Beginning in 2005, as a result of our acquisition of AT&T Wireless business in certain North Carolina markets, Puerto Rico and the U.S. Virgin Islands, we began operating as two reportable segments, which we
operate and manage as strategic business units. Our reporting segments are based upon geographic area of operation; one segment consists of our operations in the continental United States, and the other consists of our operations in Puerto Rico and
the U.S. Virgin Islands. For further discussion of our segments, see Item 7 Managements Discussion and Analysis of Financial Condition and Results of Operations  Results of Operations and Item 8 Financial
Statements and Supplementary DataNotes to the Consolidated Financial StatementsNote 5.

Continental United States Segment

The continental United States segment provides digital wireless communication services in the southeastern United States, including
North Carolina, South Carolina, Tennessee and Georgia, in an area that covers approximately 14.8 million potential customers. As of December 31, 2005, we had 698,971 wireless subscribers in this operating segment. Our wireless services are
mainly distributed through our company-owned retail stores, local retailers, direct sales associates and telemarketing. As of



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December 31, 2005, there were 90 retail stores and 27 direct sales representatives in this area, and we operated two customer care facilities in
Richmond, Virginia and Charleston, South Carolina. Our continental United States network currently markets our GSM/GPRS technology, which supports advanced data technology and allows for greater functionality of phones and greater network
efficiency. TDMA technology is also available in all of our continental U.S. markets for subscribers who have yet to migrate to GSM/GPRS. As of December 31, 2005, our continental United States network included 2,340 cell sites and ten switches.

Puerto Rico and the U.S. Virgin Islands Segment

We acquired the Puerto Rico and U.S. Virgin Islands segment during the fourth quarter of 2004 as a result of the Exchange Agreement we entered into with AT&T Wireless and Cingular Wireless. Puerto Rico is a U.S.
dollar-denominated and FCC regulated commonwealth of the United States. San Juan, the capital of Puerto Rico, is currently one of the 25 largest U.S. wireless markets in terms of population. Our operations in this segment cover approximately
4.1 million potential customers, and as of December 31, 2005, we had 266,851 subscribers and 25 company-owned SunCom retail stores in our Puerto Rico market. Our Puerto Rico and U.S. Virgin Islands network currently markets GSM/GPRS
technology, with most of the subscribers in this area utilizing GSM/GPRS technology. As of December 31, 2005, our Puerto Rico network included 253 cell sites and two switches.

Business Strategy and Competitive Strengths

Our objective is to become a leading provider of
wireless communications services in the markets we serve by utilizing our competitive strengths and growing our subscriber base. We intend to achieve this objective by pursuing the following business strategies:

Continental United States



| |  |  | Provide Enhanced Value. We offer our customers rate plans tailored to their personal needs at competitive prices. Our affordable, simple pricing plans, including the
Truth in Wireless Rate Plans, which emphasize no hidden fees, and the UnPlan, which provides essentially unlimited calling from a subscribers local calling area for a fixed price, are designed to promote the use of wireless services.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Attractive Licensed Area. We believe that we can continue to increase our subscriber base by penetrating our existing markets. Our markets have favorable demographic
characteristics for wireless communications services. According to the 2005 Paul Kagan Associates Report, our continental United States segment includes 9 of the top 100 markets in the country with population densities that are higher than the
national average.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Network Quality. Our market research indicates that scope and quality of coverage are extremely important to customers in their choice of a wireless service
provider. We are committed to making the capital investment required to maintain and operate a superior, high-quality network. Within our continental United States segment, we offer personal communications service to a population of
approximately 14.8 million people in 27 markets. We operate a comprehensive network, which includes 2,340 cell sites and ten switches, offering both GSM/GPRS and TDMA digital technology. Our network is compatible with the networks of Cingular
Wireless, T-Mobile and other wireless communications service providers that use either GSM/GPRS or TDMA technology.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Deliver Quality Customer Service. We believe that superior customer service is a critical element in attracting and retaining customers. Our point-of-sale activation
process is designed to ensure quick and easy service initiation, including customer qualification. Through our interactive voice response system, or IVR,and our state-of-the-art customer care facilities in Richmond, Virginia and Charleston,
South Carolina, we emphasize proactive and responsive customer care, including rapid call-answer times, welcome packages and anniversary calls. During 2005, we supplemented these facilities with customer care services provided by Center Partners in
Fort Collins, Colorado.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Puerto Rico and U.S. Virgin Islands



| |  |  | Network Quality. Within our Puerto Rico and U.S. Virgin Islands segment, we offer personal communications service to a population of approximately 4.1 million
people in three markets. We operate a comprehensive network, which includes 253 cell sites and two switches, offering both GSM/GPRS and TDMA digital technology. Our network is compatible with the networks of Cingular Wireless and other wireless
communications service providers that use either GSM/GPRS or TDMA technology.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provide Enhanced Features. According to our market research, a significant portion of the subscribers within our Puerto Rico segment utilize their
wireless handset as their primary means of communication. As such, our advertising
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | emphasizes that our rate plans include such features as unlimited calling, text and picture messaging, e-mail and internet capabilities. These features are
designed to promote the use of wireless services within our Puerto Rico and U.S. Virgin Islands segment.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Attractive Licensed Area. We believe that we can continue to increase our subscriber base by penetrating our Puerto Rico and U.S. Virgin Islands markets that we acquired
from Cingular Wireless in December 2004. According to the 2005 Paul Kagan Associates Report, San Juan, one of the three Puerto Rico segment markets in which we operate, is one of the top 25 largest U.S. markets in terms of population.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Deliver Quality Customer Service. Our point-of-sale activation process is designed to ensure quick and easy service initiation, including customer qualification. Through
our IVR system and our state-of-the-art customer care facility in Caguas, Puerto Rico, we emphasize proactive and responsive customer care, including rapid call-answer times, welcome packages and anniversary calls. Although we outsource our Puerto
Rico customer care facility to Atento de Puerto Rico, we manage the operations of this customer care center.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

License Acquisition
Transactions

Termination of Urban Comm-North Carolina, Inc. Acquisition

During the third quarter of 2005, we exercised our termination right and cancelled our planned purchase of Urban Comm  North Carolina, Inc., or
Urban. The purchase agreement, which was finalized on October 28, 2004 but required the acceptance of Urbans creditors and the approval of the Bankruptcy Court, called for SunCom to acquire the outstanding stock of Urban, whose
sole assets consisted of FCC wireless licenses in 20 basic trading areas for $113.0 million in cash. During September 2005, SunCom was refunded a $5.0 million deposit related to the planned purchase.

Tower Sale

In March 2005, we agreed to sell 169
wireless communications towers located in North Carolina, South Carolina and Puerto Rico to Global Signal Acquisitions LLC, a wholly-owned subsidiary of Global Signal Inc. As of December 31, 2005, we had completed the sale of 160 of the
original 169 towers, as well as an additional seven optional towers, to Global Signal, including related assets and certain liabilities, for $52.3 million, reflecting a purchase price of approximately $0.3 million per site. In June 2005, we entered
into a master lease agreement with Global Signal, pursuant to which we agreed to pay Global Signal monthly rent for the continued use of space that we occupied on the towers prior to their sale. The lease has an initial term of ten years, plus three
five-year renewal options.

Subscriber Sale

On October 7, 2005, we entered into an agreement with Cingular Wireless, which was effective as of September 20, 2005, pursuant to which we transferred to Cingular Wireless 29,139 customers from our North Carolina and Puerto Rico
networks. We originally acquired the transferred customers pursuant to the December 2004 exchange of network assets with Cingular Wireless, but the customers were maintained on Cingulars billing system for transition purposes following the
exchange. As consideration for the sale of these customers, Cingular agreed to pay us $3.1 million and to effect a settlement under the parties transitional billing arrangements for the affected customers.

Sales, Marketing and Distribution

Our sales strategy
is to utilize multiple distribution channels to minimize customer acquisition costs and to maximize penetration within our licensed service area. Our distribution channels include a network of company-owned retail stores, a direct sales force for
corporate accounts, independent agent retailers, telemarketing and e-commerce. During 2005, we focused on increasing our retail distribution in the North Carolina markets we acquired from AT&T Wireless in December 2004.



| |  |  | Company-Owned Retail Stores. We make extensive use of company-owned retail stores for the distribution and sale of our handsets and services. We believe that
company-owned retail stores offer a considerable competitive advantage by providing a strong local presence, which is required to achieve high retail penetration in suburban and rural areas and the lowest customer acquisition cost. We had 115
company-owned SunCom retail stores open as of December 31, 2005. Of these 115 stores, 90 were located within the continental United States and 25 were located in Puerto Rico and the U.S. Virgin Islands.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Direct Sales. We focus our direct sales force on corporate users. As of December 31, 2005, our direct corporate sales force consisted of 37 dedicated professionals
targeting wireless decision-makers within mid-sized corporations. Of these 37 direct sales associates, 27 were located within the continental United States and ten were located in Puerto Rico and the U.S. Virgin Islands.
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| |  |  | Agent Distribution. We have distribution agreements with strategically-aligned regional agent retailers. These agents have 401 distribution points in the continental
United States and 260 distribution points in Puerto Rico and the U.S. Virgin Islands.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Direct Marketing. We use direct marketing efforts such as direct mail and telemarketing to generate customer leads. Telemarketing sales allow us to maintain low selling
costs and to sell additional features or customized services.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Website. We have established an online store on our website, http://www.suncom.com. Our online store conveys our marketing message and generates customers through
online purchasing. We deliver all of the information a customer requires to make a purchasing decision on our website. Customers are able to choose rate plans, features, handsets and accessories. The online store provides a secure environment for
transactions, and customers purchasing through the online store encounter a transaction experience similar to that of customers purchasing service through other channels.
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We have developed our marketing strategy based on market research within our continental United States and Puerto Rico markets. We believe that our
simple, attractive pricing plans, network reliability, targeted advertising and superior customer care will allow us to increase our subscriber base by maintaining customer satisfaction, thereby reducing customer turnover.

The following are key components of our marketing strategy:



| |  |  | Pricing. Our pricing plans are competitive and straightforward. We offer our customers large packages of minutes within our regional calling areas plus roaming access to
the nations two largest GSM/GPRS networks. Most of our rate plans allow customers to make and receive calls without paying additional roaming or long distance charges within our regional calling area. It is by virtue of our extensive network
and roaming arrangements with roaming partners, that we can offer such competitive rate plans. Our Truth in Wireless Rate Plans, which emphasize no hidden fees, and the UnPlan, which provides essentially unlimited calling from a subscribers
local calling area at a fixed price are two examples of such rate plans.
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| |  |  | Network Quality. Our commitment to making the capital investment necessary to maintain and operate a superior, high-quality network allows us to achieve coverage
and call completion metrics that exceed those of our competitors.
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| |  |  | Advertising. We believe our most successful marketing strategy is to establish a strong local presence in each of our markets. We are directing our media and promotional
efforts at the local communities we serve with advertisements in local publications and sponsorship of local and regional events. We combine our local efforts with mass marketing strategies and tactics to build the SunCom brand locally. Our media
effort includes television, radio, newspaper, magazine, outdoor and Internet advertisements to promote our brand. In addition, we use newspaper and radio advertising and our web page to promote specific product offerings and direct marketing
programs for targeted audiences.
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| |  |  | Customer Care. We are committed to building strong customer relationships by providing our customers with service that exceeds expectations. Within our continental
United States segment, we currently operate state-of-the-art customer care facilities in Richmond, Virginia and Charleston, South Carolina, which house our customer service and collections personnel. These locations include approximately 432
customer care representatives and a sophisticated customer care information system, including an IVR call routing system. During 2005, we supplemented these facilities with customer care services provided by Center Partners in Fort Collins,
Colorado. Within our Puerto Rico segment, we currently operate a state-of-the-art customer care facility in Caguas, Puerto Rico, which includes approximately 213 customer care representatives. Although we outsource our Puerto Rico customer care
facility to Atento de Puerto Rico, we manage the operations of this customer care center.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Network Infrastructure

The principal objective for the build-out of our network was to maximize service levels within targeted demographic segments and geographic areas. Our
network, offering both GSM/GPRS and TDMA technology, serves 27 markets in the continental United States, including 2,340 cell sites and ten switches and serves three markets in Puerto Rico and the U.S. Virgin Islands, including 253 cell sites and
two switches. Our digital wireless network connects to local and long distance exchange carriers. We have interconnection agreements with telephone companies operating or providing services in the area where we are currently operating our digital
personal communications services network. We use AT&T as our long distance carrier.



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Network Operations

We have agreements for switched interconnection/backhaul, long distance, roaming, network monitoring and information technology services in order to effectively maintain, operate and expand our network.

Switched Interconnection/Backhaul. Our network is connected to the public switched telephone network to facilitate the origination and
termination of traffic on our network.

Long Distance. We have a wholesale long distance agreement with AT&T that provides
cost-effective rates for long distance services.

Roaming. Through our agreements with Cingular Wireless and T-Mobile, our
customers have roaming capabilities on Cingular Wireless and T-Mobiles nationwide networks. Further, we have established roaming agreements with other domestic and international wireless carriers, including in-region roaming agreements
to enhance coverage where necessary in our service areas.

Network Monitoring Systems. Our network monitoring system provides
around-the-clock surveillance of our entire network. The network operations center is equipped with sophisticated systems that constantly monitor the status of all switches and cell sites, identify failures and dispatch technicians to resolve
issues. Operations support systems are utilized to constantly monitor system quality and identify devices that fail to meet performance thresholds. These same platforms generate statistics on system performance such as dropped calls, blocked calls
and handoff failures. Our network operations center located in Richmond, Virginia performs maintenance on common network elements such as voice mail, home location registers and short message centers.

Network Digital Technology

Our network utilizes both
GSM/GPRS and TDMA technology. In order to provide more advanced wireless data and voice services, we have deployed GSM/GPRS technology as an overlay to our TDMA network. We have deployed GSM/GPRS technology to provide more advanced data and voice
services to new subscribers and to our existing subscribers who migrate to this technology. In addition, our GSM/GPRS deployment has enabled us to earn roaming revenue from other wireless carriers who are selling GSM/GPRS handsets. GSM/GPRS and TDMA
technologies are currently used by two of the largest wireless communications companies in the United States: Cingular Wireless and T-Mobile. We currently plan to decommission our Puerto Rico and U.S. Virgin Islands TDMA network technology by
March 31, 2006 and our continental United States TDMA network technology by June 30, 2006.

Federal Regulation

The wireless telecommunications industry is subject to extensive governmental regulation at the federal level and, to a smaller degree, the state and
local levels. The information disclosed below is applicable to our licenses in the continental United States as well as Puerto Rico, unless specifically noted otherwise. We are subject to, among other federal statutes, the Communications Act of
1934, as amended from time to time, or the Communications Act, and the associated rules, regulations and policies promulgated by the FCC. Through the Communications Act, the FCC regulates aspects of the licensing, construction, operation,
acquisition and sale of personal communications services and cellular systems in the United States. Many FCC requirements impose certain restrictions on our business that could have the effect of increasing our costs. However, at this time, the FCC
does not regulate wireless communications service rates, and the Communications Act preempts state and local rate and entry regulation of our wireless services, as described below.

Personal communications services and cellular systems are subject to certain Federal Aviation Administration, or FAA, regulations governing the
location, lighting and construction of transmitter towers and antennas and may be subject to federal environmental laws and the FCCs environmental regulations. Also, we use common carrier point-to-point microwave facilities to connect the
transmitter, receivers and signaling equipment for some personal communications services system or cellular sites, and to link them to the main switching office. The FCC licenses these facilities separately and they are subject to regulation
regarding technical and service parameters.

Additionally, as discussed below, we are subject to certain state and local regulations and
approvals, including state or local zoning and land use regulations.

Licensing of Cellular and Personal Communications Services
Systems. We hold a variety of cellular, PCS and microwave licenses, as authorized by the FCC. A broadband PCS system operates under a protected geographic service area license granted by the FCC for a particular market on one of six
frequency blocks allocated for broadband PCS. Broadband PCS systems generally are used for two-way voice and high volume data applications. Narrowband PCS, in contrast, are used for non-voice



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applications such as paging and low volume data service and are separately licensed. The FCC has segmented the United States into PCS markets, resulting in
51 large regions, referred to as major trading areas, which are comprised of 493 smaller regions, referred to as basic trading areas. The FCC initially auctioned and awarded two broadband PCS licenses for each major trading area and four licenses
for each basic trading area. The two major trading area licenses authorize the use of 30 megahertz of spectrum. One of the basic trading area licenses is for 30 megahertz of spectrum, and the other three are for 10 megahertz each. The FCC permits
licensees to split their licenses and assign a portion, on either a geographic or frequency basis or both, to a third party. Two cellular licenses, 25 megahertz each, are also available in each market. Cellular markets are defined as either
metropolitan or rural service areas and do not correspond to the broadband PCS markets. Specialized mobile radio service licenses can also be used for two-way voice applications. In total, eight or more licenses suitable for two-way voice and high
volume data applications are available in a given geographic area.

All PCS licenses generally have 10-year terms, at the end of which they
must be renewed. The FCC will award a renewal expectancy to a PCS licensee that has:



| |  |  | provided substantial service during its past license term; and
| | - |  | --------------------------------------------------------------



| |  |  | substantially complied with applicable FCC rules and policies and the Communications Act.
| | - |  | -----------------------------------------------------------------------------------------

Cellular radio licenses also generally expire after a 10-year term and are renewable for periods of 10 years upon application to the FCC. Our one
cellular license, which covers the Myrtle Beach area, could be revoked for cause and our license renewal application denied if the FCC determines that a renewal would not serve the public interest. FCC rules provide that competing renewal
applications for cellular licenses will be considered in comparative hearings and establish the qualifications for competing applications and the standards to be applied in hearings. Under current policies, the FCC will grant incumbent cellular
licensees the same renewal expectancy granted to PCS licensees. We expect to meet all future application requirements with respect to the renewal of both our cellular and PCS licenses.

Build-Out and Microwave Relocation Obligations. PCS licensees generally must satisfy certain coverage requirements. In our case, we must
construct facilities sufficient to offer radio signal coverage to one-third of the population in each of our service area within five years of the original license grants and to two-thirds of the population within ten years. Alternatively, we can
make a showing of substantial service, a term which is not precisely defined under the FCCs rules although the FCC has established a safe harbor under which a mobile licensee will meet the substantial service
requirement if it provides coverage to at least 75 percent of the geographic area of at least 20 percent of the rural areas within the licensed area. Licensees that fail to meet the coverage requirements may be subject to forfeiture of their
licenses. We have met the five-year construction deadline for all of our PCS licenses. We have also met all of our ten-year construction deadlines that have come due, and these licenses have been successfully renewed. We currently hold another seven
PCS licenses with ten-year construction deadlines that occur in 2007. We hold other PCS licenses, each obtained through the partitioning or disaggregation of an existing license, where the coverage obligation for the entire license area was assumed
by the initial licensee. Likewise, our cellular license is not subject to any further coverage requirements. In 2003, the FCC adopted a Notice of Proposed Rulemaking seeking comment on proposals to expand licensee build-out requirements. Among the
proposals examined were proposals to adopt additional coverage requirements beyond the initial 10-year license term and proposals to reclaim spectrum that is not in use by a defined period of time. In July 2004, the FCC acknowledged a preference for
market-based mechanisms to facilitate spectrum access, but also stated that it may be appropriate at some time to revert to a re-licensing approach if spectrum is not being used. The FCC therefore sought further comment on possible re-licensing
approaches and construction obligations for current and future licensees who hold licenses beyond their first term.

When it was licensed,
PCS spectrum was encumbered by existing licensees that operate certain fixed microwave systems. To secure a sufficient amount of unencumbered spectrum to operate our PCS systems efficiently and with adequate population coverage, we have relocated
several of these incumbent licensees. In an effort to balance the competing interests of existing microwave users and newly authorized PCS licensees, the FCC adopted:



| |  |  | a transition plan to relocate such microwave operators to other spectrum blocks; and
| | - |  | ------------------------------------------------------------------------------------



| |  |  | a cost sharing plan so that if the relocation of an incumbent benefits more than one PCS licensee, those licensees will share the cost of the relocation.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

The transition and cost sharing plans expired on April 4, 2005, at which time remaining microwave incumbents in the PCS spectrum became
responsible for the costs of relocating to alternate spectrum locations. Our cellular license is not encumbered by existing microwave licenses.

Spectrum Caps and Spectrum Leasing. Prior to 2003, the FCC had specific spectrum aggregation limits, known as spectrum caps, for attributable interests in broadband PCS, specialized mobile radio services and cellular licensees
in any



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geographical area. Although there is no longer a specified limit on spectrum holdings, the FCC evaluates commercial wireless transactions on a case-by-case
basis to determine whether such transactions will result in too much concentration in wireless markets. While the FCC has permitted licensees to own up to 80 megahertz of spectrum in particular markets, recent transactions indicate that the FCC
currently uses a soft spectrum cap of 70 megahertz when evaluating the competitive impact of a proposed transaction.

FCC rules
permit spectrum licensees to enter leasing agreements with third parties. They allow wireless licensees, like us, to lease their spectrum to third parties on either a short-term or long-term basis. Two leasing options are available. The first, which
requires prior FCC notice but not prior FCC approval, allows parties to lease spectrum as long as the licensee retains a certain degree of control over the license. The second, which requires prior FCC approval, allows parties to lease spectrum
where the lessee is in actual control of the license, although the licensee retains legal control. FCC rules also provide for private commons spectrum access arrangements under which spectrum licensees can make their spectrum available
for use by advanced technologies in a manner similar to that by which unlicensed users gain access to unlicensed spectrum. We currently do not lease or otherwise make available any spectrum under any option.

New Spectrum Opportunities and Advanced Wireless Data Services. In addition to the spectrum currently licensed for PCS, cellular and
specialized mobile radio services, the FCC has allocated additional spectrum for wireless carrier use. While this spectrum may be used by new companies that would compete directly with us, this spectrum could also be acquired by existing wireless
companies and used to provide advanced or third generation data services, such as those we plan to offer over our GSM/GPRS network. This new spectrum includes 30 megahertz in the upper 700 megahertz band that is currently used by television
broadcasters during their transition to digital television; ending in February 2009; 90 megahertz in the 1710-1755 and 2110-2155 megahertz bands that currently has both governmental and non-governmental users, including the multipoint distribution
service; and 20 megahertz of spectrum that includes the so-called H block at 1915-1920 megahertz paired with 1995-2000 megahertz, and the so-called J block at 2020-2025 megahertz paired with 2175-2180 megahertz (which are currently used by
unlicensed PCS, mobile satellite services, broadcast auxiliary service and fixed service users and licensees). New spectrum licenses will be awarded by auction and the FCC has scheduled the auction for licenses in the 1710-1755 and 2110-2155
megahertz bands to begin June 29, 2006. The FCC also has changed the spectrum allocation available to certain mobile satellite service operators to allow them to integrate an ancillary terrestrial component into their networks, thereby enabling
mobile satellite service operators to provide terrestrial wireless services to consumers in spectrum previously reserved only for satellite services. It is unclear what impact, if any, these allocations will have on our current operations.

In June 2004, the FCC announced it would auction over 200 broadband PCS licenses beginning January 12, 2005. The auction start date
was later extended to January 26, 2005. These licenses were returned to the FCC as a result of license cancellations or terminations and the list of licenses available for auction included licenses within our current service area. The auction
rules restricted parties that did not qualify under the FCCs rules as a designated entity (a small business), including us, from bidding on some of the licenses. We did not participate in the auction, but Lafayette, in which SunCom
Wireless Affiliate Company LLC, a direct, wholly-owned subsidiary of Holdings, has a minority, non-controlling ownership interest, participated in the auction as a designated entity, and was the high bidder for one license. The winning bid price for
this license was approximately $0.4 million.

In February 2006, the FCC launched a rulemaking proceeding to reform its designated entity
rules for upcoming auctions, including the June 2006 Advanced Wireless Services auction. The FCC tentatively concluded that it should prohibit the award of designated entity benefits to any entity with a material relationship with a
large in-region incumbent wireless service provider, but the FCC sought comment on how these terms should be defined. We cannot predict how the final rules could affect competition for new spectrum in future FCC auctions, or how they
could affect our ability, and the ability of our competitors, to partner with designated entities in those auctions.

Transfers and
Assignments of Cellular and PCS Licenses. The Communications Act and FCC rules require the FCCs prior approval of the assignment or transfer of control of a license for a PCS or cellular system. However, in an Order released in
September 2004, the FCC determined that it will forbear from the prior approval requirement in certain situations. The new rules provide for immediate processing of transfer and assignment applications where the parties certify that they comply with
foreign ownership and other basic licensee qualification requirements and that the proposed transaction will not result in overlap with other spectrum interests of the transferee, is not subject to transfer restrictions under the FCCs
designated entity rules, does not require any waivers of FCC rules, and does not involve any licenses subject to pending revocation or termination proceedings. Transactions that meet these criteria will be eligible for overnight electronic
processing. Non-controlling interests in an entity that holds an FCC license generally may be bought or sold without FCC approval.

We may
also be required to obtain approval of the Federal Trade Commission and the Department of Justice, as well as state or local regulatory authorities having competent jurisdiction, if we sell or acquire PCS or cellular interests over a certain size.



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Foreign Ownership. Under existing law, no more than 20% of an FCC licensees capital
stock may be owned, directly or indirectly, or voted by non-U.S. citizens or their representatives, by a foreign government or its representatives or by a foreign corporation. If an FCC licensee is controlled by another entity, up to 25% of that
entitys capital stock may be owned or voted by non-U.S. citizens or their representatives, by a foreign government or its representatives or by a foreign corporation. Foreign ownership above the 25% level may be allowed should the FCC find
such higher levels not inconsistent with the public interest. The FCC has ruled that higher levels of foreign ownership, even up to 100%, are presumptively consistent with the public interest with respect to investors from certain nations. If our
foreign ownership were to exceed the permitted level, the FCC could revoke our FCC licenses, although we could seek a declaratory ruling from the FCC allowing the foreign ownership or take other actions to reduce our foreign ownership percentage to
avoid the loss of our licenses. We have no knowledge of any present foreign ownership that exceeds these limitations in violation of the FCCs restrictions.

Enhanced 911 Services. Commercial mobile radio service providers are required to transmit 911 calls and relay a callers automatic number identification and cell site to designated public safety
answering points. This ability to relay a telephone number and originating cell site is known as Phase I enhanced 911, or E-911, deployment. FCC regulations also require wireless carriers to identify within certain parameters the
location of 911 callers by adoption of either network-based or handset-based technologies. This more exact location reporting is known as Phase II E-911, and the FCC has adopted specific rules governing the accuracy of location information and
deployment of the location capability. We are deploying a network-based technology to provide Phase II service. Current FCC rules do not specify the size of the geographic areas over which location accuracy measurements must be calculated. In
October 2004, an association of public safety officials requested the FCC to clarify that carriers must satisfy the location accuracy requirements for each local public safety answering point area it serves, rather than averaging the results over a
larger area, such as the carriers entire network. An FCC advisory council, however, has recommended that accuracy measurements be reported on a statewide basis. The FCC has not yet ruled on this issue. Depending on its ultimate decision, we
could be required to incur additional costs to improve our location accuracy capabilities in certain areas.

FCC rules originally required
carriers to provide Phase I service as of April 1, 1998, or within six months of a request from a public safety answering point, whichever is later, and to provide Phase II service as of October 1, 2001, or within six months of a request
from a public safety answering point, whichever is later. Our Phase II service initial deadline was extended by the FCC to March 1, 2003, as was the deadline for other regional and local carriers. The six-month time frames for beginning Phase I
or Phase II service do not apply if a public safety answering point does not have the equipment and other facilities necessary to receive and use the provided data. Public safety answering points and wireless carriers are permitted to extend these
implementation timelines by mutual agreement. We file E911 quarterly reports with the FCC to identify our ongoing efforts to implement Phase I and Phase II service.

Radiofrequency Emissions. FCC guidelines adopted in 1996 limit the permissible human exposure to radiofrequency radiation from transmitters and other facilities. In December 2001, the FCCs Office of
Engineering and Technology, or OET, dismissed a Petition for Inquiry filed by EMR Network to initiate a proceeding to revise the FCCs radio frequency guidelines. In August 2003, the full FCC upheld the OET, and EMR Network subsequently
challenged the FCCs decision in federal court. In December 2004, the United States Court of Appeals for the District of Columbia Circuit affirmed the FCC decision, and in June 2005, the United States Supreme Court declined to consider a
petition for a writ of certiorari filed by EMR Network seeking to have the lower courts decision overturned. In June 2003, the FCC adopted a Notice of Proposed Rulemaking seeking comment on proposed amendments to the current regulations
relating to the compliance of transmitter facilities with radiofrequency guidelines and to procedures for evaluating radiofrequency exposure from mobile devices, such as handsets. This Notice remains pending, and it is not clear what effect, if any,
any amendments to such regulations would have on our business.

Media reports have suggested that, and studies have been undertaken to
determine whether, certain radio frequency emissions from wireless handsets may be linked to various health concerns, including cancer, and/or may interfere with various electronic medical devices, including hearing aids and pacemakers. Concerns
over radio frequency emissions may have the effect of discouraging the use of wireless handsets, which would decrease demand for our services. However, reports and fact sheets from the British National Radiological Protection Board and Swedish
Radiation Protection Authority released in 2004, the National Cancer Institute released in January 2002, the American Health Foundation released in December 2000 and the Danish Cancer Society released in February 2001, found no evidence that cell
phones cause cancer, although some of the reports indicated that further study might be appropriate. Most recently, an October 2005 study published by researchers at the Washington University School of Medicine found that the electromagnetic
radiation produced by cell phones does not promote cancer in mouse, hamster or human cells. However, a study released by European researchers in December 2004 said that the exposure to radio frequency emissions damaged DNA in cells in laboratory
tests conducted over a period of four years. While the researchers did not then link radio frequency emissions to adverse health effects, the researchers did call for further study. Additional studies of radio frequency emissions are ongoing. The
ultimate findings of these studies will not be known until they are completed and made public. Meanwhile, the National Cancer Institute has cautioned that all such studies have limitations, given the relatively short amount of time cellular phones
have been widely available. In addition, the Federal Trade Commission issued a consumer alert in February 2002 for cell phone users who want to limit their exposure to radio frequency emissions from



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their cell phones. The alert advises, among other things, that cell phone users should limit use of their cell phones to short conversations and avoid cell
phone use in areas where the signal is poor. Several lawsuits seeking to force wireless carriers to supply headsets with phones and to compensate consumers who have purchased radiation-reducing devices were dismissed by the courts in 2002 because of
a lack of scientific evidence, but other lawsuits remain pending. We cannot predict the impact of these or other health related lawsuits on our business.

Interconnection. Under amendments to the Communications Act enacted in 1996, all telecommunications carriers, including PCS and cellular licensees, have a duty to interconnect with other carriers and local
exchange carriers have additional specific obligations to interconnect. The amendments and the FCCs implementing rules modified the previous regime for interconnection between local exchange carriers and wireless communications services
providers, such as us, and adopted a series of requirements that have benefited the wireless industry. These requirements included compensation to carriers for terminating traffic originated by other carriers, a ban on any charges to other carriers
by originating carriers, and specific rules governing the prices that can be charged for terminating compensation. Under the rules, prices for termination of traffic and certain other functions provided by local exchange carriers are set using a
methodology known as total element long run incremental cost, or TELRIC. TELRIC is a forward-looking cost model that sets prices based on what the cost would be to provide network elements or facilities over the most efficient
technology and network configuration. The statute also permits carriers to appeal public utility decisions implementing the statute and rules to United States District Courts, rather than state courts. As a result of these FCC rules, the charges
that cellular and PCS operators pay to interconnect their traffic to the public switched telephone network have declined significantly from pre-1996 levels.

The initial FCC interconnection rules material to our operations have become final and unappealable following a May 2002 Supreme Court decision affirming the rules. Subsequently, the FCC issued a clarification of its
interconnection rules, initiated a rulemaking to modify the TELRIC rules and initiated a third proceeding which, collectively, have created some uncertainty. More specifically:



| |  |  | In August 2003, the FCC released a clarification of its TELRIC rules that could increase our costs of interconnection.
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | In September 2003, the FCC initiated a rulemaking to consider broader modifications to the TELRIC rules, which could increase or decrease our costs of interconnection. This
proceeding remains pending.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In 2001, the FCC initiated a proceeding that could greatly modify the current regime of payments for interconnection. In February 2005, the FCC decided to seek comment on seven
specific interconnection proposals filed by different industry groups and others in the proceeding, which have varying impacts on wireless carriers. In February 2005, the FCC also determined that local exchange carriers may no longer file
wireless termination tariffs regarding termination rates to be charged to wireless carriers as part of the interconnection negotiation process. In addition, key members of Congress have expressed strong interest in reviewing and
modifying the current interconnection system of payments during the next two years. If the FCC or Congress modifies the current regime of payments for interconnection, our costs for interconnection could change.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Universal Service Funds. The FCC and many states have established universal service programs to ensure affordable, quality local
telecommunications services for all U.S. residents. Under the FCCs rules, wireless providers are potentially eligible to receive universal service subsidies; however, they also are required to contribute to both federal and state universal
service funds. The FCC rules require telecommunications carriers generally (subject to limited exemptions) to contribute funding to existing universal service programs for high cost carriers and low income customers and to new universal service
programs to support services to schools, libraries and rural health care providers. In December 2002 and January 2003, the FCC released orders that increased, from 15 to 28.5 percent, the percentage of revenues that wireless providers must subject
to universal service contributions to avoid having to calculate those contributions based on actual interstate traffic levels, and that required wireless providers to elect whether or not to use this safe harbor on a company-wide basis.

The FCC has been reviewing wireless carriers continued eligibility to receive universal service funding, as well as the appropriate
amount of funding for various eligible telecommunications carriers, in two proceedings. In February 2004, the Federal-State Joint Board on Universal Service issued a recommended decision proposing that the FCC modify the current
universal service rules. If adopted, the proposals would limit support to a single connection per customer and would narrow the circumstances under which a new service provider would be able to qualify for support. In June 2004, the FCC asked for
public comment on the Federal-State Joint Board recommended decision, and in February 2005 the FCC decided that wireless carriers should remain eligible to receive universal service fund payments and that there should be no primary line
restriction or limitation of support to a single line. The FCC did tighten the standards for its designation of wireless carriers as eligible to receive universal support by imposing new eligibility requirements, public interest
determinations, and annual certification and reporting requirements, and the FCC encouraged states to adopt similar requirements as part of their universal service designation processes. In a second proceeding launched in 2004, the Federal-State
Joint Board is considering the basis and amount of



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universal service support that telecommunications carriers should receive, including whether the current funding structure should be replaced with a
forward-looking cost approach and whether wireless carrier support should be based on wireline incumbent costs or wireless carrier costs. Because we are now receiving universal service funding in Puerto Rico as a result of a recent transaction, any
changes could limit our ability to continue to receive some or all of the universal service support that we are receiving in Puerto Rico, or to receive such funding in Georgia, North Carolina, Tennessee, and Virginia, where we have applied for
Eligible Telecommunications Carrier status. Regardless of our ability to receive universal service funding for the supported services we provide, we are required to fund these federal programs and may also be required to contribute to state
universal service programs.

Outage Reporting.On August 4, 2004, the FCC adopted new rules that require wireless providers to
report to the FCC about significant disruptions, network degradations or outages to their systems. Under the new rules, we are required to report to the FCC whenever we have a significant network disruption that lasts for at least 30 minutes and the
number of end-user minutes potentially affected is at least 900,000. We also must report significant network problems that impact 911 usage or service at airports, nuclear power plants and key government and military facilities or when critical
transmission and network control technologies are disrupted. Several parties have petitioned the FCC to eliminate or modify these new rules and those petitions remain pending.

Electronic Surveillance. The FCC has adopted rules requiring providers of wireless services that are interconnected to the public switched
telephone network to provide functions to facilitate electronic surveillance by law enforcement officials. The Communications Assistance for Law Enforcement Act, or CALEA, requires telecommunications carriers to modify their equipment,
facilities, and services to ensure that they are able to comply with authorized electronic surveillance. These modifications were required to be completed by June 2000, unless carriers were granted temporary waivers, which we and many other wireless
providers requested. One of our waiver requests remains pending at the FCC. Additional wireless carrier obligations to assist law enforcement agencies were adopted in response to the September 11 terrorist attacks as part of the USA Patriot
Act.

In August 2004, the FCC released a Notice of Proposed Rulemaking and Declaratory Ruling proposing new rules governing CALEA. The
notice largely endorses proposals by federal law enforcement agencies in a February 2004 filing. If adopted, the rules proposed in the notice would subject a wider range of services to CALEA, greatly limit the availability of waivers from the CALEA
rules and shift costs for complying with CALEA from law enforcement agencies to service providers and customers. These changes could increase our costs and/or subject us to FCC enforcement actions. In September 2005, the FCC released an order that
was limited to determining that facilities-based providers of broadband Internet access and interconnected voice over Internet protocol services are covered by CALEA and must come into compliance within 18 months. The order indicated that the FCC
would defer, until an unspecified later date, decisions on the remaining issues raised in the notice.

Telephone Numbers. Like
other telecommunications carriers, we must have access to telephone numbers to serve our customers and to meet demand for new service. The FCC has adopted rules that could affect SunComs access to and use of telephone numbers. The most
significant FCC rules are intended to promote the efficient use of telephone numbers by all telecommunications carriers. Under these rules:



| |  |  | Carriers must meet specified number usage thresholds before they can obtain additional telephone numbers. The current threshold requires carriers to show that they are using 75% of
all numbers assigned to them in a particular rate center. The FCC has adopted a safety valve mechanism that could permit carriers to obtain telephone numbers under certain circumstances even if they do not meet the usage thresholds.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Carriers must share blocks of telephone numbers, a requirement known as number pooling. Under number pooling, numbers previously assigned in blocks of 10,000 are
assigned in blocks of 1,000, which significantly increases the efficiency of number assignment. In connection with the number pooling requirement, the FCC also adopted rules intended to increase the availability of blocks of 1,000 numbers, including
a requirement that numbers be assigned sequentially within existing blocks of 10,000 numbers.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Carriers must provide detailed reports on their number usage, and the reports are subject to third-party audits. Carriers that do not comply with reporting requirements are
ineligible to receive numbering resources.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | States may implement technology-specific and service-specific area code overlays to relieve the exhaustion of existing area codes, but only with specific FCC permission.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The FCC also has shown a willingness to delegate to the states a larger role in number conservation. Examples of state
conservation methods include number pooling and number rationing. Since 1999, the FCC has granted interim number conservation authority to several state commissions, including North Carolina and South Carolina, states within our operating region.



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The FCCs number conservation rules could benefit or harm us and other telecommunications carriers.
If the rules achieve the goal of reducing demand for telephone numbers, then the costs associated with potential changes to the telephone numbering system will be delayed or avoided. The rules may, however, affect individual carriers by making it
more difficult for them to obtain and use telephone numbers. In particular, number pooling imposes significant costs on carriers to modify their systems and operations. In addition, technology-specific and service-specific area code overlays could
result in segregation of wireless providers, including us, into separate area codes, which could have negative effects on customer perception of wireless service.

Wireless providers are also required to implement telephone number portability, which enables customers to keep their telephone numbers when they change carriers. Wireless number portability was implemented for the
top 100 metropolitan statistical areas in November 2003, and generally became available in the rest of the country in May 2004. Under the FCCs rules, numbers may be ported to and from both wireless and landline providers. Thus, while
portability makes it easier for customers to change wireless providers, it also makes it easier for them to switch from landline to wireless service. In September 2004, the FCC released a Notice of Proposed Rulemaking seeking comment on proposals to
reduce the time interval for porting numbers between wireless and landline carriers. If adopted, the reduced porting period would make it more attractive for customers to switch their service from landline to wireless providers.

Environmental Processing. The antenna structures we use are subject to the FCCs rules implementing the National Environmental Policy
Act and the National Historic Preservation Act, or the NHPA. Under these rules, any structure that may significantly affect the human environment or that may affect historic properties may not be constructed until the wireless provider has
filed an environmental assessment and obtained approval from the FCC. Processing of environmental assessments can delay construction of antenna facilities, particularly if the FCC determines that additional information is required or if there is
community opposition. In October 2004, the FCC released a Report and Order adopting a national agreement governing review of towers under the NHPA. The agreement defines when historic preservation analysis is required and not required for new and
modified towers, creates new procedures for historic preservation review, including deadlines for reviewing entities, and outlines procedures for communications with Indian tribes and Native Hawaiian groups. In October 2005, the FCC released a
declaratory ruling that further details and clarifies those procedures.

With regard to environmental policies affecting antenna
structures, the FCC released a Notice of Inquiry in August 2003 on the potential effects of towers on migratory birds and in December 2004, the FCC sought comment on a report on this subject that was filed in the Notice of Inquiry proceeding. While
this proceeding remains pending, environmental groups filed a petition with the United States Court of Appeals for the District of Columbia Circuit in April 2005, seeking to force the FCC to modify its environmental processing rules to address
issues under the Migratory Bird Treaty Act. There is no schedule for court action on this petition.

Rate Integration. The FCC
has determined that the interstate, interexchange offerings (commonly referred to as long distance) of wireless carriers are subject to the interstate, interexchange rate averaging and integration provisions of the Communications Act.
Rate averaging and integration requires carriers to average interstate long distance wireless communications service rates between high cost and urban areas, and to offer comparable rates to all customers, including those living in Alaska, Hawaii,
Puerto Rico, and the Virgin Islands. The United States Court of Appeals for the District of Columbia Circuit, however, rejected the FCCs application of these requirements to wireless carriers, remanding the issue to the FCC to further consider
whether wireless carriers should be required to average and integrate their long distance rates across all U.S. territories. The FCC has stated that, pending the outcome of additional proceedings to review the matter, the rate averaging and
integration rules are not applicable to wireless carriers.

Privacy. The FCC has adopted rules limiting the use of customer
proprietary network information, or CPNI, by telecommunications carriers, including us, in marketing a broad range of telecommunications and other services to their customers and the customers of affiliated companies. The rules give wireless
carriers discretion to use CPNI, without customer approval, to market all customer equipment and information services used in connection with the provision of wireless services. The FCC also allows all telephone companies to use CPNI to solicit lost
customers. FCC rules require that customer permission be obtained affirmatively to use such information to market non-communications services or to provide such information to unrelated third parties, but give carriers flexibility in obtaining that
consent. In late 2005, the FCC launched an investigation of carrier compliance with the CPNI rules. In February 2006, along with all other carriers, we were required to submit a statement to the FCC certifying that we are in compliance with the
rules. Also in February 2006, the FCC launched a rulemaking proceeding to consider new rules aimed at strengthening the protection afforded to CPNI. The FCC tentatively concluded that carriers should file annual compliance certificates along with a
summary of all consumer complaints received in the past year regarding unauthorized release of CPNI and a summary of actions taken against third parties who attempt to obtain CPNI through fraudulent means.

Billing. Prior to 2005, the FCC imposed two fundamental billing rules on wireless carriers: (i) clearly identify the name of the service
provider for each charge; and (ii) display a toll-free inquiry number for customers on all paper copy bills. In May



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2004, the FCC released a Public Notice seeking comment on a petition filed by the National Association of State Utility Consumer Advocates, or NASUCA,
asking the FCC to prohibit wireless and other carriers from using line-item charges on customer bills to recover their costs for various federal, state and local regulatory obligations. In response to the NASUCA petition, the FCC issued a March 2005
order that does not prohibit line-item charges as NASUCA requested, but established new rules requiring wireless carriers to describe each line-item charge using plain, clear language that does not mislead customers regarding whether each charge is
mandated by the government. The new rules, frequently referred to as the truth-in-billing rules, also preempt state regulations that either require or prohibit the use of line-item charges for wireless service. In conjunction with the
adoption of these new rules, the FCC launched an additional proceeding to determine whether it should: (i) require wireless carriers to disclose all line item charges to customers at the point of sale, (ii) require customer bills to
include a separate section for government mandated line-item charges, (iii) preempt any state or local regulations of wireless billing that are more stringent than its own, or (iv) allow wireless carriers to combine various
government-mandated charges into one line item. The truth-in-billing rules are currently subject to a pending appeal to the United States Court of Appeals for the Eleventh Circuit. Depending on the outcome of this appeal, as well as the
additional FCC proceeding, we may need to clarify or remove certain line-item charges that are currently listed on our customer bills. If we are unable to recoup these charges through other means, the FCCs decision and new proposals could
have an impact on our revenues.

The FCC is also currently considering two petitions related to early termination fees charged by wireless
carriers filed in 2005. The petitions seek a declaratory ruling stating that early termination fees are part of the rates charged by wireless carriers, and therefore exempt from state regulation under the Communications Act. One of the
petitions was filed by SunCom in response to a court order in a pending South Carolina class-action lawsuit regarding SunComs early termination fees, and the other was filed by the Cellular Telecommunications and Internet Association in
response to similar lawsuits filed against various wireless carriers in a number of states. If the FCC grants the petitions, the likely result will be to preempt state courts from adjudicating any disputes related to early termination fees.

Access for Individuals with Disabilities. The FCC requires telecommunications services providers, including us, to offer
equipment and services that are accessible to and usable by persons with disabilities, if that equipment can be made available without much difficulty or expense. The rules require us to develop a process to evaluate the accessibility, usability and
compatibility of covered services and equipment. In addition to these general obligations, in July 2003 the FCC adopted new hearing aid compatibility rules requiring that digital wireless phones be capable of effective use with hearing aids. The new
rules incorporate two technical standards: one relating to reduced radiofrequency emissions, and one relating to compatibility with telecoils, a component used in certain types of hearing aids. With regard to the reduced radiofrequency emissions
standard, carriers of our size were required to offer two compliant phones by September 2005. Due to the late availability of compliant phones and related materials from vendors, SunCom and other GSM carriers did not meet this deadline, but filed
petitions for waiver with the FCC seeking extensions. We sought an extension until December 2005, and notified the FCC in early January that we are now in compliance with the rules. The FCC has not yet ruled on these waiver requests. Although we
currently offer at least two phones that comply with the standard when operating in the 1900 MHz (PCS) band, we will be required by August 2006, to have at least two phones which meet the standard for the 800 MHz (cellular) band as well as the 1900
MHz band. In addition, by February 2008, at least 50 percent of the wireless phone models offered by us must be compliant with this standard. With regard to the telecoil compatibility standard, carriers of our size must offer two compliant phones by
September 2006. While we expect our vendors ultimately to develop equipment compatible with the rules, we cannot be certain that we will be able to obtain this equipment by the FCC deadlines, or that we will not be required to make material changes
to our product line.

Wireless Spam. In August 2004, the FCC adopted rules pursuant to the Controlling the Assault of
Non-Solicited Pornography and Marketing Act of 2003, or the CAN-SPAM Act. These rules include a general prohibition on sending commercial messages directly to any address referencing an Internet domain associated with wireless
subscriber messaging services without the customers express prior authorization. We are permitted to send transactional or relationship messages to our subscribers and are required to submit to the FCC the names of all Internet
domains on which we offer mobile messaging services.

Public Safety Interference. In July 2004, the FCC adopted an order to resolve
interference that has been occurring between commercial, private and public safety wireless users in the 800 megahertz band. The FCC supplemented and modified the Order in December 2004. While most of the interference issues have involved the Nextel
network, interference problems have arisen in some markets due to the operations of commercial cellular providers. Because we operate a cellular system in Myrtle Beach, we will be subject to FCCs new rules, under which we must respond to any
interference problems according to specific timelines and guidelines. In addition, if a public safety wireless user can show that interference is causing a clear and imminent danger to life or property, the FCC can require a cellular provider to
immediately discontinue operation pending the resolution of the interference problem.



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State Regulation and Local Approvals

The Communications Act preempts state and local regulation of the entry of or the rates charged by any provider of private mobile radio service or of commercial mobile radio service, which includes PCS and cellular
service. The Communications Act permits states to regulate the other terms and conditions of commercial mobile radio service. The FCC has not clearly defined what is meant by the other terms and conditions of commercial
mobile radio service, but has upheld the legality of state universal service requirements on commercial mobile radio service carriers. The FCC also has held that private lawsuits based on state law claims concerning how wireless rates are promoted
or disclosed may not be preempted by the Communications Act. Regulators and Attorneys General in several states are reviewing wireless carrier billing practices and network reliability and coverage issues. In some states, regulators are advocating
new rules, and in others, Attorneys General are filing class action lawsuits against wireless carriers related to their billing practices that are purportedly deceptive. Should similar regulations be adopted or lawsuits filed against wireless
carriers in the states in which we operate, there could be a material adverse impact on our business. To try to protect ourself against potential lawsuits or state or federal regulation, we have adopted the Cellular Telecommunications &
Internet Association Voluntary Consumer Code that requires disclosure of certain billing and coverage information to consumers.

State and local governments are permitted to manage public rights of way and can require fair and reasonable compensation from telecommunications providers, including PCS providers, so long as the compensation required is publicly disclosed
by the government. The sitting of cells/base stations also remains subject to state and local jurisdiction, although proceedings are pending at the FCC relating to the scope of that authority. States also may impose competitively neutral
requirements that are necessary for universal service or to defray the costs of state enhanced 911 services programs, to protect the public safety and welfare, to ensure continued service quality and to safeguard the rights of consumers.

There are several state and local legislative initiatives that are underway to ban the use of wireless phones in motor vehicles. New York and New
Jersey have enacted statewide bans on driving while holding a wireless phone, and similar legislation has been introduced in other states, including Virginia, Georgia and Kentucky. Officials in a handful of communities, including the District of
Columbia, have enacted ordinances banning or restricting the use of cell phones by drivers. Should this become a nationwide initiative, wireless communications services providers could experience a decline in the number of minutes used by
subscribers. In general, states continue to consider restrictions on wireless phone use while driving, and some states are also beginning to collect data on whether wireless phone use contributes to traffic accidents. On the federal level, the
National Transportation Safety Board has recommended a ban on the use of mobile phones by novice drivers while operating a motor vehicle.

The foregoing does not purport to describe all present and proposed federal, state and local regulations and legislation relating to the wireless telecommunications industry. Other existing federal regulations and, in many jurisdictions,
state and local franchise requirements are the subject of a variety of judicial proceedings, legislative hearings and administrative and legislative proposals that could change, in varying degrees, the manner in which wireless providers operate.
Moreover, it is widely expected that Congress will begin the process of substantially rewriting the Telecommunications Act of 1996 in the near future. Neither the outcome of these proceedings nor their impact upon our operations or the wireless
industry can be predicted at this time.

Competition

We compete, in the majority of our markets, against three of the four nationwide wireless carriers: Cingular Wireless, Verizon and Sprint/Nextel. Within our North Carolina, South Carolina, Georgia and Tennessee
markets, additional competitors include ALLTEL Corporation, Hargray Wireless, Leap Wireless and U.S. Cellular. Within our Puerto Rico and U.S. Virgin Islands markets, additional competitors include Puerto Rico Telephone Company, Centennial
Communications and Movistar. Historically, the most dominant competitors were the cellular incumbents, which in our markets were primarily Verizon, ALLTEL Corporation and U.S. Cellular. However, with the advent of PCS, other carriers such as
Cingular Wireless, Sprint/Nextel and T-Mobile have gained significant market share. In addition, wireless resellers operating as mobile virtual network operators, or MVNOs, such as Virgin Mobile USA, are beginning to attract a significant
number of subscribers, and entities such as ESPN and major cable operators have entered the wireless market as MVNOs in 2005. We believe that we are a leading service provider based on the fact that we have been able to expand our subscriber base
through internal growth or acquisition every year since inception. In addition, our service levels and commitment to customer care have earned us various awards and recognition by third parties, including magazines and newspapers circulated within
our service areas. Since our competitors do not disclose their subscriber count in specific regional service areas, we cannot accurately determine market share for each of these companies where we do business.



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The principal competitive factors within our business consist of:



| |  |  | network quality, which is the coverage provided by our cell sites and infrastructure as well as roaming agreements with carriers that enable our customers to utilize their networks
when traveling outside of our coverage area;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | quality customer care, which includes the speed and accuracy of customer issue resolution;
| | - |  | ------------------------------------------------------------------------------------------



| |  |  | price, which includes the monthly charges we bill our wireless subscribers; and
| | - |  | -------------------------------------------------------------------------------



| |  |  | products offered, which include a variety of handsets and accessories with multiple capabilities, including data services.
| | - |  | --------------------------------------------------------------------------------------------------------------------------

Upon review of these factors, we believe that we compete favorably in our market, as evidenced by our increasing subscriber base in each year since our
inception. In addition to the above mentioned competitive factors, our ability to compete successfully will depend, in part, on our ability to anticipate and respond to other competitive factors affecting the industry, including new services that
may be introduced, changes in consumer preferences, demographic trends, economic conditions and competitors discount pricing and bundling strategies, all of which could adversely affect our operating margins.

Wireless providers are increasingly competing in the provision of both voice and non-voice services. Non-voice services, including data transmission,
text messaging, e-mail and Internet access are now available from PCS providers and enhanced specialized mobile radio carriers. In many cases, non-voice services are offered in conjunction with or as adjuncts to voice services. Our GSM/GPRS network
overlay provides us the technology to offer more advanced wireless data services. Some of the national wireless carriers, such as Cingular Wireless, are beginning to bundle their wireless offerings with landline local or long distance services, a
practice that could make these carriers wireless services more attractive to customers. Cable operators also are entering the wireless market as MVNOs with offers of bundled wireless and landline services, high-speed data and cable service.

Intellectual Property

Our brand name
is SunCom. As a result of the consummation of the Triton Holdings Agreement described above under Overview, we own Affiliate License Co., LLC, which is the owner of the SUNCOM family of service marks. The SUNCOM service mark is
registered with the United States Patent and Trademark Office (Reg. Nos. 2,367,621 and 2,576,959). The following services marks containing the word SUNCOM are also registered with the United States Patent and Trademark Office: SUNCOM and DESIGN
(Reg. No. 2,831,052); SUNCOM CONNECT (Reg. No. 2,576,974); SUNCOM FYI (Reg. No. 2,793,440); SUNCOM INET (Reg. No. 2,886,969); SUNCOM KEEP TALKING (Reg. No. 2,793,501); SUNCOM PREPAID TO GO (Reg. No. 2,796,493); SUNCOM
STATES ( Reg. No. 2,793,422); SUNCOM SUBSCRIPTION WIRELESS (Reg. No. 2,887,121); SUNCOM SUPERSTATES (Reg. No. 2,796,672); SUNCOM TO GO (Reg. No. 2,,796,492); SUNCOM UNLIMITED (Reg. No. 2,793,470); SUNCOM UNPLAN (Reg.
No. 2,887,120); SUNCOM USA (Reg. No. 2,793,471); SUNCOM WELCOME HOME (Reg. No. 2,793,536); and SUNCOM WIRELESS and DESIGN (Reg. No. 2,860,451). In addition, the following marks that we use are registered with the United States
Patent and Trademark Office: EVERYTHING UNDER THE SUN (Reg. No. 2,370,076); M-NET (Reg. Nos. 2,437,645 and 2,464,250); and WE GET IT (Reg. No. 2,448,313).

Employees

As of December 31, 2005, we had 1,959 employees. We believe that our relations with
our employees are good.

Available Information

Holdings Board of Directors has established an Audit Committee, Compensation Committee and Nominating/Corporate Governance Committee and has adopted a written charter for each committee. Holdings Audit Committee also acts as the
audit committee of SunCom. In addition, Holdings Board has adopted (i) Corporate Governance Principles and (ii) a Code of Ethics for Senior Financial Managers. Each committee charter, our Corporate Governance Principles and the Code
of Ethics for Senior Financial Managers is available on our web site at www.suncom.com.



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ITEM 1A. RISK FACTORS

Our business faces many risks. The risks described below may not be the only risks
we face. Additional risks that we do not yet know of, or that we currently think are immaterial, may also impair our business operations or financial results. If any of the events or circumstances described in the following risks actually occurs,
our business, financial condition or results of operations could suffer and the trading price of our notes could decline.

If we are
unable to continue as a going concern, we may be required to substantially modify our business plan, restructure our balance sheet or file for bankruptcy protection.

Absent Holdings determination to make additional investments in us or our ability to secure additional financing, to generate more cash flows from operations in 2006 or to restructure our balance sheet, we may
not have sufficient cash on hand to pay the interest on our debt securities beginning in early 2007. We can offer no assurance that the actions we take to address these conditions will be successful. Inclusion of a going concern
modification in the report of our independent registered public accounting firm may have a negative impact on our ability to obtain financing with acceptable terms and may adversely impact the trading price of our notes.

We have experienced losses during four of the last five years, and we may be unable to regain profitability.

We reported significant net losses in four of the last five fiscal years. In 2004, we reported net income of $562.1 million. However, our profitability in
2004 was related to the gain arising from the consummation of our transactions with AT&T Wireless and Cingular Wireless. We may not achieve profitability or maintain profitability, if achieved, on a consistent basis. In addition, our operating
expenses may increase in the future as we continue to upgrade our technology. If our gross profit does not grow to offset any such increased expenses, it will be more difficult to reverse our history of losses. Our improved financial performance
will primarily depend on our ability to:



| |  |  | grow our subscriber base;
| | - |  | -------------------------



| |  |  | achieve our projected market penetration;
| | - |  | -----------------------------------------



| |  |  | manage customer turnover rates effectively;
| | - |  | -------------------------------------------



| |  |  | price our services competitively; and
| | - |  | -------------------------------------



| |  |  | control our operating and non-operating expenses.
| | - |  | -------------------------------------------------

We may
not be able to successfully accomplish these tasks, and if we do not, we may not be able to achieve profitability. Continued losses would likely cause the trading price of our notes to decrease.

We are highly leveraged and do not project sufficient cash flow to fund our debt service and operating expenses past early 2007. Accordingly, absent
Holdings determination to make additional investments in us or our ability to secure another source of liquidity this year, we will need to restructure our balance sheet and/or implement an alternative financial plan, such as a significant
asset sale, to reduce our debt.

As of December 31, 2005, we had total consolidated long-term indebtedness of approximately $1.7
billion, represented by a senior secured term loan, a series of senior notes and two series of senior subordinated notes. The annual debt service on this long-term indebtedness is approximately $150 million. Our projected cash flow from operations
is not expected to be sufficient to pay such debt service and fund our operating expenses and capital expenditure requirements past early 2007. Our inability to pay such debt service could result in a default on such indebtedness which, unless cured
or waived, would have a material adverse effect on our liquidity and financial position. Accordingly, we have retained financial and legal advisors to assist us in evaluating options to improve our financial condition. While no definitive course of
action has yet been adopted, absent Holdings determination to make additional investments in us or our ability to secure another source of liquidity this year, we will need to restructure our balance sheet, which may occur through a so-called
prepackaged or prearranged bankruptcy, and/or implement an alternative financial plan, such as the sale of a significant portion of our assets, to reduce our long-term debt. There can be no assurance that any such
deleveraging efforts will be successful and, if not, we may have to seek federal bankruptcy protection. In this connection, certain holders of our debt securities have raised legal questions regarding the $189 million dividend paid by us to our
immediate parent, SunCom Wireless Investment Co., LLC, in November 2004. We continue to believe that such dividend was properly paid and we have been advised by Holdings that the dividend amount has not been utilized or otherwise distributed and
remains an asset of SunCom Wireless Investment Co., LLC. Our independent registered public accounting firm, in their report on their audit of our financial statements as of December 31, 2005, has expressed substantial doubt about our ability to
continue as a going concern.



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Our future growth may require significant additional capital, and our substantial indebtedness could
impair our ability to fund our capital requirements.

We believe that we have sufficient funds to finance our planned capital
expenditures for network expansion and upgrades into early 2007, but we may require additional capital in the event of unforeseen delays, cost overruns, unanticipated expenses, regulatory changes, engineering design changes and other technological
risks or if we acquire additional licenses. Currently, planned capital expenditures primarily consist of the continued coverage expansion of GSM/GPRS technology to increase capacity and enhance the network to support our expected increase in
subscribers. GSM digital technology has positioned us to earn roaming revenue from other wireless carriers, such as T-Mobile and Cingular Wireless, which are selling GSM handsets. Sources of funding for our future capital requirements may include
any or all of the following:



| |  |  | public offerings or private placements of debt securities;
| | - |  | ----------------------------------------------------------



| |  |  | commercial bank loans; and
| | - |  | --------------------------



| |  |  | equipment lease financing.
| | - |  | --------------------------

Due to our highly leveraged
capital structure, additional financing may not be available to us, or, if it were available, it may not be available on a timely basis, on terms acceptable to us and within the limitations contained in the indentures governing our 93/8% notes, our 83/4% notes, our 81/2% notes, the documentation governing our senior secured term loan or any new financing arrangements. Failure to
obtain any appropriate financing, should the need for it develop, could result in the delay or abandonment of our development and expansion plans and our failure to meet regulatory requirements. It could also impair our ability to meet our debt
service requirements and could have a material adverse effect on our business.

Our debt instruments contain
restrictive covenants that may limit our operating flexibility.

The indentures governing our 93/8% notes, our 83/4% notes and our 81/2% notes, as well as the documentation governing our senior secured term loan, contain significant covenants that
limit our ability to engage in various transactions. In addition, under each of these documents, the occurrence of specific events, in some cases after notice and grace periods, would constitute an event of default permitting acceleration of the
respective indebtedness.

These events include:



| |  |  | failure to comply with a documents covenants;
| | - |  | ----------------------------------------------



| |  |  | material inaccuracies of representations and warranties;
| | - |  | --------------------------------------------------------



| |  |  | specified defaults under or acceleration of other indebtedness; and
| | - |  | -------------------------------------------------------------------



| |  |  | events of bankruptcy or insolvency.
| | - |  | -----------------------------------

The limitations
imposed by our outstanding indebtedness are substantial, and failure to comply with them could have a material adverse effect on our business. We are currently in compliance with our debt covenants.

Our average revenue per user has declined for several years and may not stabilize.

Our average revenue per user, or ARPU, has weakened over the past several years, declining from $58.78 in 2001 to $54.79 in 2005. This trend has
resulted primarily from:



| |  |  | increased competition, which has reduced pricing generally; and
| | - |  | ---------------------------------------------------------------



| |  |  | expansion of subscriber bases to customers on lower price plans, such as prepaid plans and similar plans targeting different market segments.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------

As neither of these trends show signs of abating in the near term, we believe that ARPU will continue to be under pressure, notwithstanding increasing
revenue from data services.



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We have had and may continue to have difficulty penetrating the North Carolina markets we acquired
from AT&T Wireless, which has adversely affected our results of operations and may continue to do so in the near future.

The
success of our acquisition of AT&T Wireless systems in North Carolina will depend upon our ability to successfully penetrate this market. We no longer operate in Virginia, a market we knew well, and we now operate in the recently acquired
North Carolina market, where the SunCom brand is relatively new. As a result of our recent entry into the acquired North Carolina market and the customer turnover experienced as a result of challenges encountered during the migration of acquired
AT&T Wireless subscribers to our systems, we currently hold a smaller market position than we did upon the closing of our Exchange Agreement with AT&T Wireless and Cingular Wireless. In addition, our market position is smaller than that of
several of our competitors, including Cingular Wireless and Verizon Wireless. We may not be able to successfully build strong brand identity and compete in this market.

Substantial competition in all aspects of our business could continue to cause reduced pricing and have adverse effects on our profit margins.

There is substantial competition in all aspects of the wireless communications industry. Our competitors are principally the three nationwide carriers,
Cingular Wireless, Verizon Wireless and Sprint/Nextel, and a large number of regional providers of cellular, PCS and other wireless communications services, resellers and wireline telephone service providers. We expect robust competition to continue
in the wake of Cingular Wireless acquisition of AT&T Wireless and the mergers of Sprint and Nextel and Alltel and Western Wireless. Competition continues to intensify as wireless carriers include more equipment discounts and bundled
services in their offerings, including more minutes and free long distance and roaming services. This contributes to downward pressure on revenue growth and profit margins, and we expect this trend to continue.

Many of our competitors have substantial financial, technical, marketing, distribution and other resources. As a response to the intensifying
competition, the need for cost reduction and the requirements for additional radio spectrum, we believe that the industry will continue to consolidate. This may produce larger and more formidable competitors with greater financial ability to
continue to reduce prices to increase their customer base. As a result, our market share and profit margins may decrease.

Our business
could be harmed by adverse regulatory changes.

U.S. telecommunications providers are subject to federal and state regulations that may
change at any time. The FCC regulates the licensing, construction, operation, sale and interconnection arrangements of wireless telecommunications systems to varying degrees, as do some state and local regulatory agencies. In addition, the FCC, in
conjunction with the FAA, regulates tower marking and lighting. We cannot assure you that the FCC, the FAA or the state and local agencies having jurisdiction over our business will not adopt regulations or take other actions that would adversely
affect our business.

FCC regulations and government policy in general promote robust competition, and new rules or changes to existing
rules, such as rules providing for spectrum leasing and requiring wireless local number portability for customers changing wireless local carriers, could increase this trend and result in higher churn and lower margins.

Our inability to effectively manage our planned growth could adversely affect our operations.

We have experienced rapid growth and development in a relatively short period of time and expect to continue to experience growth in the future. The
management of such growth will require, among other things, continued development of our financial and management controls and management information systems, stringent control of costs, increased marketing activities, ability to attract and retain
qualified management personnel and the training of new personnel. Failure to successfully manage our expected growth and development could have a material adverse effect on our business, results of operations and financial condition.

The wireless industry is experiencing rapid technological change, and we may lose customers if we fail to keep up with these changes.

The wireless telecommunications industry is experiencing significant technological change, as evidenced by the ongoing improvements in the capacity and
quality of digital technology, the development and commercial acceptance of advanced wireless data services, shorter development cycles for new products and enhancements and changes in end-user requirements and preferences. New communications
technologies, such as Wi-Fi and voice over Internet, are being developed and deployed by competitors, which may affect our ability to grow our wireless data and voice businesses. We may lose customers if we fail to keep up with these
changes, and there is no guarantee that any new technologies developed and deployed by us will have long-term marketability.



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A high rate of customer turnover would negatively impact our business and could reduce our revenues.

Many providers in the personal communications services industry, including SunCom, have experienced a high rate of customer turnover.
The rate of customer turnover may be the result of several factors, including network coverage, reliability issues such as blocked and dropped calls, handset problems, non-use of phones, change of employment, affordability, customer care concerns
and other competitive factors. Our strategy to address customer turnover may not be successful, or the rate of customer turnover may be unacceptable. A high rate of customer turnover could reduce our revenues and could have a material adverse effect
on our competitive position and results of operations.

If our wireless service offerings or customer care service do not meet customer
expectations, it could limit our ability to retain or attract customers.

Customer acceptance of the services we offer is and will
continue to be affected by technology-based differences and by the operational performance, quality, reliability and coverage of our wireless networks. Consumer demand could be impacted by differences in technology, footprint and service areas,
network quality, consumer perceptions, customer care levels and rate plans. We may have difficulty retaining customers if we are unable to meet our customers expectations for network quality and coverage, billing systems or customer care. An
inability to address those issues could limit our ability to expand our network capacity or subscriber base and place us at a competitive disadvantage to other wireless service providers in our markets. These issues could affect our ability to
attract new subscribers as well.

Our FCC licenses are one of our principal assets, and our business could be harmed if the value of
these licenses decreases or if our licenses are revoked by the FCC.

One of our principal assets is our portfolio of FCC licenses to
provide cellular and personal communications services. The market for the purchase and sale of wireless licenses may not exist in the future or the values of our licenses in that market may fall. If the market value of our licenses were to decrease,
we may incur impairment losses or a material loss upon the sale of any of our licenses. The future value of these licenses will largely be determined by the success of our business, but may also be affected by the availability of alternative
spectrum in our license areas. In addition to the spectrum currently licensed for PCS, cellular and specialized mobile radio services, the FCC has announced plans to auction substantial additional Advanced Wireless Services spectrum for wireless
carrier use in June 2006. While this spectrum may be used by new companies that would compete directly with us, this spectrum could also be acquired by existing wireless companies and used to provide advanced or third generation data services, such
as those we plan to offer over our GSM/GPRS network.

The loss or revocation of any of our licenses by the FCC would have a material
adverse effect on our business. Our personal communications services licenses began to be subject to renewal in 2005, and our cellular license for Myrtle Beach is subject to renewal in 2010. Our FCC licenses are also subject to fines or to potential
revocation if we do not comply with the FCCs rules.

Our Universal Service Funding may be reduced or eliminated.

Under the FCCs current rules, Universal Service Funds are distributed to competitive carriers, including wireless carriers, operating in areas
where the established landline carriers also receive such funding. In 2005, we received approximately $14.0 million of Universal Service Funds for our operations in Puerto Rico, and have applied for Eligible Telecommunications Carrier status in
Georgia, North Carolina, Tennessee and Virginia. However, the Universal Service Fund rules are currently under review and could be substantially modified. As a result, there is no assurance that we will continue to receive any Universal Service
Funds in the future, and the loss or reduction of this revenue could negatively impact our profitability.

Roaming revenue represents a
significant portion of our total revenues, and its seasonality will subject our revenue and operating income (loss) to seasonal fluctuations.

In 2005, 2004 and 2003, approximately 12.5%, 17.8% and 22.3%, respectively, of our revenues were derived from roaming charges incurred by other wireless providers for use of our network by their customers who had traveled within our
coverage area. A significant portion of that revenue was derived from Cingular Wireless customers. In our July 7, 2004 agreements with Cingular Wireless, we agreed to reduce the roaming rates Cingular Wireless pays to us for its
customers use of our network. In addition, the Puerto Rico and U.S. Virgin Islands market generates less roaming revenue than did our former Virginia market. If roaming minutes of use were to decline significantly, we would not be able to
maintain the roaming revenue we have historically realized and our results of operations could suffer.

Our coverage area includes a number
of resort areas that contribute to our roaming revenue. As a result, our roaming revenue increases during vacation periods, introducing a measure of seasonality to our revenue and operating income (loss).



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Termination or impairment of our relationship with a small number of key suppliers or vendors could
adversely affect our revenues and results of operations.

We have developed relationships with a small number of key vendors for our
supply of wireless handsets and devices, telecommunications infrastructure equipment, billing and customer care services and for information systems. We do not have operational or financial control over our key suppliers and have limited influence
with respect to the manner in which these key suppliers conduct their businesses. If these companies were unable to honor, or otherwise failed to honor their obligations to us, or terminate their relationship with us, we could experience disruptions
of our business and adverse effects on our revenues and results of operations.

Our success depends on our ability to attract and retain
qualified personnel.

A small number of key executive officers manage our business. Their loss could have a material adverse effect on
our operations. We believe that our future success will also depend in large part on our continued ability to attract and retain highly qualified technical and management personnel. We believe that there is, and will continue to be, intense
competition for qualified personnel in the personal communications services industry as the emerging personal communications services market develops, and we cannot assure you that we will be successful in retaining our key personnel or in
attracting and retaining other highly qualified technical and management personnel. We do not presently maintain key-man life insurance on any of our executives or other employees.

Equipment failure and disasters may adversely affect our operations.

A major equipment failure or a natural disaster, terrorist act or other breach of network security that affects our wireless telephone switching offices, microwave links, third-party owned local and long distance
networks on which we rely, our cell sites or other equipment or the networks of other providers on which our customers roam could have a material adverse effect on our operations. While we have insurance coverage for some of these events, our
inability to operate our wireless system, even for a limited time period, may result in a loss of customers or impair our ability to attract new customers, which would have a material adverse effect on our business, results of operations and
financial condition.

If hand-held phones pose health and safety risks, we may be subject to new regulations, and there may be a
decrease in demand for our services.

Media reports have suggested that, and studies have been undertaken to determine whether, certain
radio frequency emissions from wireless handsets may be linked to various health concerns, including cancer, and may interfere with various electronic medical devices, including hearing aids and pacemakers. In addition, lawsuits have been filed
against other participants in the wireless industry alleging various adverse health consequences as a result of wireless phone usage. While many of these lawsuits were dismissed because of a lack of scientific evidence linking wireless handsets with
cancer, other lawsuits were recently sent back to the trial court for further review. In addition, future lawsuits could be filed based on new evidence.

If consumers health concerns over radio frequency emissions increase, they may be discouraged from using wireless handsets, and regulators may impose restrictions on the location and operation of cell sites.
These concerns could have an adverse effect on the wireless communications industry and expose wireless providers to further litigation, which, even if not successful, can be costly to defend. We cannot assure you that government authorities will
not increase regulation of wireless handsets and cell sites as a result of these health concerns or that wireless companies will not be held liable for costs or damages associated with these concerns. The actual or perceived risk of radio frequency
emissions could also adversely affect us through a reduced subscriber growth rate, a reduction in subscribers, reduced network usage per subscriber or reduced financing available to the wireless communications industry.

Our institutional investors invest in other wireless communications services companies, and conflicts of interest may arise from these investments and
from other directorships held by Holdings directors that may not be resolved in our favor.

Our principal institutional investors,
or their affiliates, may have investments in wireless communications services companies other than SunCom. These institutional investors may in the future invest in other entities that compete with us. In addition, several of Holdings
directors serve as directors of other communications services companies. As a result, these directors may be subject to conflicts of interest during their tenure as directors of Holdings. Because of these potential conflicts, these directors may be
required to disclose periodically financial or business opportunities to us and to the other companies to which they owe fiduciary duties.



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ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

ITEM 2. PROPERTIES

SunCom maintains its executive offices in Berwyn, Pennsylvania. We also maintain
regional offices in Richmond, Virginia, Charleston, South Carolina, Charlotte and Raleigh, North Carolina and San Juan, Puerto Rico. We lease these facilities.

ITEM 3. LEGAL PROCEEDINGS

We are not a party to any lawsuit or proceeding, which, in our opinion, is
likely to have a material adverse effect on our business or operations.

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

Omitted pursuant to General Instruction I(2)
of Form 10-K.



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PART II

ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER REPURCHASES OF EQUITY SECURITIES

There is no established trading market for the common equity of SunCom or any of its subsidiaries.

In the fourth quarter of 2004, SunCom paid a
one-time, $189.0 million cash dividend on its common stock to the sole stockholder, SunCom Investment Company. SunCom does not anticipate paying any cash dividends on its common stock in the foreseeable future, and any dividends paid must comply
with the covenants contained in the indentures governing our senior and subordinated notes as well as those contained in our senior secured term loan agreement.

SunCom has no securities authorized for issuance under equity compensation plans.

.



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ITEM 6. SELECTED FINANCIAL DATA

The following tables present selected financial data derived from audited
financial statements of SunCom for the years ended December 31, 2005, 2004, 2003, 2002 and 2001. In addition, unaudited subscriber data for the same periods is presented. The following financial information is qualified by reference to and
should be read in conjunction with Managements Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes appearing elsewhere in this report or in
previous annual filings on Form 10-K.



|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------- | --------- | - | ---- | - | -------- | ---- |  | - | -------- | - |  | ---- | -------- | - |  | - | -------- | -
|                                                                                                                                                                                                                                                                                                    |  | Year Ended December 31, |          
|                                                                                                                                                                                                                                                                                                    |  | 2005                    |           |   | 2004 |   |          | 2003 |  |   | 2002     |   |  | 2001 |         
|                                                                                                                                                                                                                                                                                                    |  | (Dollars in thousands)  |          
|Statement of Operations Data:                                                                                                                                                                                                                                                                       |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Revenues:                                                                                                                                                                                                                                                                                           |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Service                                                                                                                                                                                                                                                                                             |  | $                       | 635,038   |   |      | $ | 603,242  |      |  | $ | 576,359  |   |  | $    | 502,402  |   |  | $ | 387,381  |  
|Roaming                                                                                                                                                                                                                                                                                             |  |                         | 103,605   |   |      |   | 145,999  |      |  |   | 180,314  |   |  |      | 175,405  |   |  |   | 126,909  |  
|Equipment                                                                                                                                                                                                                                                                                           |  |                         | 87,515    |   |      |   | 68,959   |      |  |   | 53,426   |   |  |      | 38,178   |   |  |   | 25,810   |  
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Total revenues                                                                                                                                                                                                                                                                                      |  |                         | 826,158   |   |      |   | 818,200  |      |  |   | 810,099  |   |  |      | 715,985  |   |  |   | 540,100  |  
|Expenses:                                                                                                                                                                                                                                                                                           |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Costs of service and equipment (excluding the below amortization and asset impairment, excluding depreciation and asset disposal of $272,235,
$147,895, $131,968, $114,007 and $90,851, respectively, and excluding non-cash compensation of $665, $2,181, $3,300, $3,646 and $2,544, respectively) |  |                         | 437,240   |   |      |   | 367,240  |      |  |   | 348,856  |   |  |      | 296,598  |   |  |   | 248,013  |  
|Selling, general and administrative (excluding depreciation and asset disposal of $9,771, $13,313, $16,826, $16,072 and $16,657, respectively,
and excluding non-cash compensation of $8,418, $17,784, $25,510, $17,784 and $14,647, respectively)                                                  |  |                         | 357,660   |   |      |   | 242,453  |      |  |   | 235,677  |   |  |      | 253,129  |   |  |   | 228,259  |  
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |     
|Termination benefits and other related charges                                                                                                                                                                                                                                                      |  |                         |          |   |      |   |         |      |  |   | 2,731    |   |  |      |         |   |  |   |         |  
|Non-cash compensation                                                                                                                                                                                                                                                                               |  |                         | 9,083     |   |      |   | 19,965   |      |  |   | 28,810   |   |  |      | 21,430   |   |  |   | 17,191   |  
|Asset impairment                                                                                                                                                                                                                                                                                    |  |                         | 47,700    |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Depreciation and asset disposal (1)                                                                                                                                                                                                                                                                 |  |                         | 282,006   |   |      |   | 161,208  |      |  |   | 148,794  |   |  |      | 130,079  |   |  |   | 107,508  |  
|Amortization                                                                                                                                                                                                                                                                                        |  |                         | 59,449    |   |      |   | 13,162   |      |  |   | 4,300    |   |  |      | 4,926    |   |  |   | 19,225   |  
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Total operating expenses                                                                                                                                                                                                                                                                            |  |                         | 1,193,138 |   |      |   | 804,028  |      |  |   | 769,168  |   |  |      | 706,162  |   |  |   | 620,196  |  
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Income (loss) from operations                                                                                                                                                                                                                                                                       |  |                         | (366,980  | ) |      |   | 14,172   |      |  |   | 40,931   |   |  |      | 9,823    |   |  |   | (80,096  | )
|Interest expense                                                                                                                                                                                                                                                                                    |  |                         | (148,871  | ) |      |   | (128,627 | )    |  |   | (141,210 | ) |  |      | (144,086 | ) |  |   | (117,499 | )
|Other expense (2)                                                                                                                                                                                                                                                                                   |  |                         | (157      | ) |      |   | (3,092   | )    |  |   | (2,898   | ) |  |      | (7,693   | ) |  |   | (18,034  | )
|Debt extinguishment costs                                                                                                                                                                                                                                                                           |  |                         |          |   |      |   |         |      |  |   | (41,171  | ) |  |      |         |   |  |   |         |  
|Interest and other income (3)                                                                                                                                                                                                                                                                       |  |                         | 8,480     |   |      |   | 2,548    |      |  |   | 2,285    |   |  |      | 6,292    |   |  |   | 18,322   |  
|Other gain (4)                                                                                                                                                                                                                                                                                      |  |                         |          |   |      |   | 679,515  |      |  |   |         |   |  |      |         |   |  |   |         |  
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Income (loss) before taxes                                                                                                                                                                                                                                                                          |  | $                       | (507,528  | ) |      | $ | 564,516  |      |  | $ | (142,063 | ) |  | $    | (135,664 | ) |  | $ | (197,307 | )
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |     
|Income tax (provision) benefit                                                                                                                                                                                                                                                                      |  |                         | 5,693     |   |      |   | (2,440   | )    |  |   | (11,907  | ) |  |      | (24,650  | ) |  |   | (1,083   | )
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  
|Net income (loss)                                                                                                                                                                                                                                                                                   |  | $                       | (501,835  | ) |      | $ | 562,076  |      |  | $ | (153,970 | ) |  | $    | (160,314 | ) |  | $ | (198,390 | )
|                                                                                                                                                                                                                                                                                                    |  |                         |           |   |      |   |          |      |  |   |          |   |  |      |          |   |  |   |          |  



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|                                             |  |                                        |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|-------------------------------------------- |  | -------------------------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | - |  | ---- | --------- | - |  | - | --------- | -
|                                             |  | As of December 31,                     |          
|                                             |  | 2005                                   |           |   | 2004 |   |           | 2003 |  |   | 2002      |   |  | 2001 |          
|                                             |  | (in thousands)                         |          
|Balance Sheet Data:                          |  |                                        |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|Cash and cash equivalents                    |  | $                                      | 15,800    |   |      | $ | 8,351     |      |  | $ | 3,366     |   |  | $    | 14,133    |   |  | $ | 5,847     |  
|Short-term investments                       |  |                                        | 139,050   |   |      |   | 305,500   |      |  |   | 102,600   |   |  |      | 198,317   |   |  |   | 365,241   |  
|Working capital                              |  |                                        | 114,194   |   |      |   | 278,742   |      |  |   | 52,545    |   |  |      | 172,612   |   |  |   | 283,655   |  
|Property, plant and equipment, net           |  |                                        | 650,284   |   |      |   | 814,127   |      |  |   | 788,870   |   |  |      | 796,503   |   |  |   | 793,175   |  
|Intangible assets, net                       |  |                                        | 844,113   |   |      |   | 984,052   |      |  |   | 488,883   |   |  |      | 395,249   |   |  |   | 283,847   |  
|Total assets                                 |  |                                        | 1,809,804 |   |      |   | 2,262,830 |      |  |   | 1,519,933 |   |  |      | 1,618,093 |   |  |   | 1,682,683 |  
|Long-term debt and capital lease obligations |  |                                        | 1,689,351 |   |      |   | 1,688,318 |      |  |   | 1,443,788 |   |  |      | 1,413,263 |   |  |   | 1,344,291 |  
|Stockholders equity (deficit)               |  |                                        | (260,061  | ) |      |   | 232,691   |      |  |   | (179,308  | ) |  |      | (59,664   | ) |  |   | 76,085    |  
|                                             | 
|                                             |  | For the Years Ended December 31,       |          
|                                             |  | 2005                                   |           |   | 2004 |   |           | 2003 |  |   | 2002      |   |  | 2001 |          
|                                             |  | (in thousands, except subscriber data) |          
|Other Data:                                  |  |                                        |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|Subscribers (end of period)                  |  |                                        | 965,822   |   |      |   | 951,745   |      |  |   | 894,659   |   |  |      | 830,159   |   |  |   | 685,653   |  
|Cash flows from:                             |  |                                        |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|Operating activities                         |  | $                                      | (79,546   | ) |      | $ | 87,631    |      |  | $ | 136,919   |   |  | $    | 54,271    |   |  | $ | (3,321    | )
|Investing activities                         |  |                                        | 85,318    |   |      |   | (113,679  | )    |  |   | (78,649   | ) |  |      | (69,713   | ) |  |   | (683,422  | )
|Financing activities                         |  |                                        | 1,677     |   |      |   | 31,033    |      |  |   | (69,037   | ) |  |      | 23,728    |   |  |   | 690,973   |  

---

|(1) | Includes net losses of $4.7 million, $0.7 million, $4.4 million, $3.9 million and $0.2 million on the sale or disposal of assets for the years ended December 31, 2005, 2004,
2003, 2002 and 2001, respectively.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes losses of $0.0, $3.1 million, $2.0 million, $5.4 million and $12.9 million on our interest rate swap arrangements for the years ended December 31, 2005, 2004, 2003,
2002 and 2001, respectively.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Includes a gain on debt extinguishment of $0.5 million as well as interest income for the year ended December 31, 2004. Amounts for the years ended December 31, 2005,
2003, 2002 and 2001 consist of interest income on our cash and short term investments.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Includes an aggregate gain of $679.5 million resulting from the consummation of the Triton PCS Agreement and the Exchange Agreement. Refer to Overview in Item 1
Business for more information about each of these agreements.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Introduction

The following discussion and analysis is based upon our consolidated financial statements as of the dates and for the periods
presented in this section. You should read this discussion and analysis in conjunction with our consolidated financial statements and the related notes contained elsewhere in this report.

SunCom is a provider of digital wireless communications services in the southeastern United States, Puerto Rico and the U.S. Virgin Islands. As of
December 31, 2005, we operated in a licensed area which covered approximately 14.8 million potential customers in a contiguous geographic area encompassing portions of North Carolina, South Carolina, Tennessee and Georgia. In addition, we
operate a wireless communications network covering approximately 4.1 million potential customers in Puerto Rico and the U.S. Virgin Islands.

We provide wireless communications services under the SunCom Wireless brand name. From 1998 until December 2004, we were a member of the AT&T Wireless network and a strategic partner with AT&T Wireless. Beginning in 1998, AT&T
Wireless contributed PCS licenses to us covering various markets in the southeastern United States in exchange for an equity position in Holdings. As part of our transactions with AT&T Wireless, we were granted the right to be the exclusive
provider of wireless mobility services using co-branding with AT&T Corp. within our markets.

In October 2004, Cingular Wireless
acquired all of the outstanding stock of AT&T Wireless through a merger of a Cingular Wireless subsidiary with and into AT&T Wireless. In connection with this transaction, SunCom, AT&T Wireless and Cingular Wireless (and certain of their
subsidiaries) entered into various agreements to modify our relationships with AT&T Wireless. Under these agreements, which are described in the Overview section of Item 1 of this annual report, AT&T Wireless surrendered to
Holdings, following the October 2004 consummation of the AT&T Wireless-Cingular Wireless merger, all of the equity interests in Holdings held by AT&T Wireless, and the parties concurrently terminated the agreement under which AT&T
Wireless had granted us the exclusive right to provide AT&T Wireless branded wireless services within our region. The termination of the exclusivity arrangement permits Cingular Wireless entry in our service area and provides us the opportunity
to offer service in markets where we were previously prohibited.

Without the exclusivity agreement that previously applied to AT&T
Wireless, Cingular Wireless does not rely on our network for service to the same degree that AT&T Wireless did in the past. As a result, lower roaming rates had a negative impact on our revenue for the year ended December 31, 2005. However,
since the rates are reciprocal, we are able to offer our customers wide-area rate plans at acceptable rates of return due to lower expense associated with reduced roaming rates.

In addition, in December 2004, SunCom and Cingular Wireless completed a major exchange of wireless network properties, under which Cingular Wireless
received our network assets and customers in Virginia and we received certain AT&T Wireless network assets and customers in North Carolina, Puerto Rico and the U.S. Virgin Islands, plus $175 million in cash. This exchange transaction transformed
the geographic strategic focus of our wireless network by giving us a substantial new presence in the Charlotte, Raleigh/Durham and Greensboro, North Carolina markets and entry into the Puerto Rico market. Our entry into these markets allows us to
operate a contiguous footprint in the Carolinas and provides us with a greater ability to grow our subscriber base and associated service revenue. However, roaming revenue has declined as Puerto Rico and the U.S. Virgin Islands markets generate less
roaming revenue than our former Virginia market and there is a trend of declining roaming rates in the wireless marketplace.

Our strategy
is to offer our customers high-quality, innovative voice and data services with coast-to-coast coverage, to provide extensive coverage to customers within our region and to generate revenue through relationships with other carriers whose customers
roam into our covered area.

We believe our markets are strategically attractive because of their strong demographic characteristics for
wireless communications services. According to the 2005 Paul Kagan Associates Report, our service area includes 11 of the top 100 markets in the country with population densities that are higher than the national average. We currently provide
wireless voice and data services over two overlapping networks. One network utilizes TDMA technology, and the second network utilizes GSM/GPRS technology, which is capable of providing enhanced voice and data services.

Since we began offering service in our markets, our subscriber base and total revenues have grown significantly. From our initial launch of personal
communications services in January 1999, our subscriber base has grown to 965,822 subscribers as of December 31, 2005. As the result of our growing subscriber base, total revenues have increased from $131.5 million for the year ending
December 31, 1999 to $826.2 million for the year ending December 31, 2005. Revenues consist primarily of monthly access, airtime, feature, long distance and roaming charges billed to our subscribers, equipment revenues generated by the
sale of wireless handsets and accessories to our subscribers and roaming revenues generated by charges to other wireless carriers for their



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subscribers use of our network. As the result of the termination of Holdings First Amended and Restated Stockholders Agreement and the
exclusivity arrangement with AT&T Wireless contained in that agreement, roaming revenue declined from the year ended December 31, 2004. A decline in roaming revenue has had, and will continue to have, a negative impact on our operating
margins. In addition, incremental expenses related to the SunCom brand launch in our recently acquired North Carolina, Puerto Rico and the U.S. Virgin Islands markets and the re-launch of the SunCom brand in our previously existing markets, has had,
and in the near term will continue to have, a negative impact on our operating margins. Therefore, until we further leverage our fixed costs over a larger subscriber base, our operating results will be lower than comparable historic periods.

Our net loss has increased from a loss of $149.4 million for the year ended December 31, 1999 to net loss of $501.8 million for the
year ended December 31, 2005, and we expect to incur net losses for the foreseeable future. The net loss increase is primarily due to increased costs, including an additional call center, resulting from operating in two separate geographic
territories with a combined subscriber base comparable to that of our prior contiguous territory, higher marketing expenses to promote the SunCom Wireless brand, higher interest expense due to increased borrowings and higher depreciation expense
related to accelerating depreciation on our TDMA assets. Also contributing to the net loss increase were the customer migration costs incurred to transition the acquired AT&T subscribers to our systems, an asset impairment charge on certain FCC
licenses held in the continental United States reporting unit and the incremental costs of operating two fully-deployed network technologies over an expanded market footprint. As a result of our net loss in 2005, our accumulated deficit increased to
$815.3 million as of December 31, 2005. Since the inception of our personal communications services in January 1999, our long-term debt has increased from $465.7 million to $1.7 billion. This increase is due primarily to the increased funding
required to build-out our network, which includes 2,593 cell sites and twelve switches.

The construction of our network and the marketing
and distribution of wireless communications products and services have required, and will continue to require, substantial capital. Our capital outlays have included license acquisition costs, capital expenditures for network construction, funding
of operating cash flow losses and other working capital costs and debt service related expenditures. We will have additional capital requirements for future upgrades due to advances in new technology. Approximately $195.1 million of Holdings
short-term investments are held by SunCom Investment Company, our immediate parent, and therefore not currently available to us. Our projected cash flow from operations is not expected to be sufficient to pay our debt service and fund our operating
expenses and required capital expenditures past early 2007. The annual debt service on our long-term indebtedness is approximately $150 million. Our inability to pay such debt service could result in a default on such indebtedness, which, unless
cured or waived, would have a material adverse effect on our liquidity and financial position. Through March 16, 2006, Holdings management and its board of directors have not taken any actions to make additional investments in us. Holdings has
retained financial and legal advisors to assist it in evaluating options to improve our financial condition. While no definitive course of action has yet been adopted, absent Holdings determination to make additional investments in us or our
ability to obtain another source of liquidity this year, we will need to restructure our balance sheet, which may occur through a so-called prepackaged or prearranged bankruptcy, and/or implement an alternative financial
plan, such as the sale of a significant portion of our assets, to reduce our long-term debt. If Holdings and SunCom are able to obtain an acceptable financial restructuring of our debt, Holdings will consider, but has undertaken no obligation to,
making additional investments in us. There can be no assurance that any such deleveraging efforts will be successful and, if not, we may have to seek federal bankruptcy protection. Certain holders of our debt securities have raised legal questions
regarding the $189 million dividend paid by us to SunCom Investment Company in November 2004. We continue to believe that such dividend was properly paid. Our independent registered public accounting firm, in their report on their audit of our
financial statements as of December 31, 2005, has expressed substantial doubt about our ability to continue as a going concern.

Critical Accounting
Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated
financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to bad debts, inventories, income taxes, contingencies and
litigation. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.



| |  |  | We recognize revenues as services are rendered. Unbilled revenues result from service provided from the billing cycle end date to the end of the month and from other carriers
customers using our network. Unearned revenues result from billing subscribers in advance for recurring charges such as access and features. In accordance with Emerging Issues Task Force, or EITF, 00-21 Accounting for Revenue
Arrangements with Multiple Deliverables, in a subscriber activation, the total proceeds are allocated to the associated deliverables. When equipment cost exceeds equipment revenue, referred to as equipment margin, the activation fee
collected, up to the amount of the equipment margin, is recognized immediately as equipment revenue. Any subscriber activation fee collected in excess of the equipment margin is deferred and recognized over the estimated subscribers life.
Equipment sales are a separate earnings process from other services we offer and are recognized upon delivery to the customer and reflect charges to customers for wireless handset equipment purchases.
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| |  |  | We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our subscribers to make required payments. If the financial condition of a material
portion of our subscribers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. We estimate our allowance for doubtful accounts by applying estimated loss percentages against the
aging of our accounts receivable balances. The estimated loss percentages are updated periodically and are based on our historical write-off experience, net of recoveries.
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| |  |  | We write down our inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon
assumptions about future demand and market conditions. If actual market conditions are less favorable than those we projected, additional inventory write-downs may be required.
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| |  |  | We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. While we have considered future taxable income and
ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance, in the event we were to determine that we would be able to realize our deferred tax assets in the future in excess of its net recorded amount, an
adjustment to the net deferred tax asset would increase income in the period we made that determination. Likewise, should we determine that we would not be able to realize all or part of our net deferred tax asset in the future, an adjustment to the
net deferred tax asset would be charged to income in the period we made that determination. We establish additional provisions for income taxes when, despite the belief that our tax positions are fully supportable, there remain certain positions
that are likely to be challenged and may or may not be sustained on review by tax authorities. We adjust these additional accruals in light of changing facts and circumstances.
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| |  |  | We assess the impairment of long-lived assets, other than indefinite-lived intangible assets, whenever events or changes in circumstances indicate the carrying value may not be
recoverable. Factors we consider important that could trigger an impairment review include significant underperformance relative to historical or projected future operating results or significant changes in the manner of use of the assets or in the
strategy for our overall business. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. When we determine that the
carrying value of a long-lived asset is not recoverable, we measure any impairment based upon a projected discounted cash flow method using a discount rate we determine to be commensurate with the risk involved. Our indefinite-lived intangible
assets are FCC licenses and goodwill. We test investments in FCC licenses and goodwill for impairment annually or more frequently if events or changes in circumstances indicate that these indefinite-lived intangible assets may be impaired. The
impairment test consists of a comparison of the fair value with the carrying value. In accordance with Statement of Financial Accounting Standards, or SFAS, No. 142 and our interpretation of EITF 02-7 Unit of Accounting for Testing
Impairment of Indefinite-lived Intangible Assets, goodwill and FCC licenses are tested for impairment at the reporting unit level.
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| |  |  | We estimate the useful lives of our property, plant and equipment and our finite-lived intangible assets in order to calculate depreciation and amortization expense on these assets.
We periodically evaluate our useful lives, considering such factors as industry trends, new technologies and significant changes in the manner of use of the assets or in the strategy for our overall business. The actual useful lives may be different
than our estimated useful lives, which would thereby result in different carrying values of our property, plant, equipment and intangible assets. These evaluations could result in a change in our depreciable lives and, therefore, our depreciation
and amortization expense in future periods.
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Revenue

We derive our revenue from the following sources:



| |  |  | Service. We sell wireless personal communications services. The various types of service revenue associated with wireless communications services for our subscribers
include monthly recurring charges for access, features and fees and monthly non-recurring airtime charges for local, long distance and roaming airtime used in excess of pre-subscribed usage. Our customers roaming charges are rate plan
dependent and are based on the number of pooled minutes included in their plans. Service revenue also includes non-recurring activation service charges and Universal Service Fund program revenue.
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| |  |  | Equipment. We sell wireless personal communications handsets, data devices and accessories that are used by our customers in connection with our wireless services.
Equipment sales are a separate earnings process from other services offered by SunCom, and we recognize equipment sales upon delivery to the customer and reflect charges to customers for wireless handset equipment purchases.
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| |  |  | Roaming. We charge per minute fees and per kilobyte fees to other wireless telecommunications companies for their customers use of our network facilities to
utilize wireless services. In addition, our roaming revenue is contingent upon our roaming partners subscriber growth, their use of our network as well as industry consolidation.
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We believe our roaming revenues are subject to seasonality, as we expect to derive increased revenues from roaming during vacation periods, reflecting
the large number of tourists visiting resorts in our coverage area. As a result of our roaming agreement with Cingular Wireless and our new service area resulting from our exchange transaction with Cingular Wireless and AT&T Wireless in the
fourth quarter of 2004, roaming rates payable to SunCom decreased in the year ended December 31, 2005, resulting in significantly decreased revenue.

Costs and Expenses

Our costs of services and equipment include:



| |  |  | Equipment.We purchase personal communications services handsets and accessories from third party vendors to resell to our customers for use in connection with our services.
Because, when selling directly to our customers, we subsidize the sale of handsets to encourage the use of our services, the cost of handsets is higher than the resale price to the customer. We do not manufacture any of this equipment.
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| |  |  | Roaming Fees.We incur fees to other wireless communications companies based on airtime usage by our customers on other wireless communications networks.
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| |  |  | Transport and Variable Interconnect.We incur charges associated with interconnection with wireline and other wireless carriers networks. These fees include fixed
monthly connection costs and other variable fees based on minutes of use by our customers.
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| |  |  | Variable Long Distance.We pay usage charges to long distance companies for long distance service provided to our customers. These variable charges are based on our
subscribers usage, applied at pre-negotiated rates with the other carriers.
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| |  |  | Cell Site Costs.We incur expenses for the rent of towers, network facilities, engineering operations, field technicians and related utility and maintenance charges.
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Other expenses include:



| |  |  | Selling, General and Administrative. Our selling expense includes advertising and promotional costs, commission expense for our sales associates and agents and fixed
charges such as store rent and retail associates salaries. General and administrative expense includes customer care, billing, financial services and bad debt, information technology, finance, accounting and legal services. Certain portions of
functions such as customer care, billing, finance, accounting, human resources and legal services are centralized in order to achieve economies of scale.
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| |  |  | Asset impairment. We performed our annual goodwill and indefinite-lived intangible asset impairment analysis, and based upon this evaluation, we recorded a non-cash asset
impairment charge on our FCC licenses during the year ended December 31, 2005. We did not incur any impairment charges during the years ended December 31, 2003 and 2004.
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| |  |  | Depreciation, Asset Disposal and Amortization.Depreciation of property and equipment is computed using the straight-line method, generally over three to twelve years, based
upon estimated useful lives. Leasehold improvements are amortized over the lesser of the useful lives of the assets or the term of the lease. Network development costs incurred to ready our network for use are capitalized. Depreciation of network
development costs begins when the network equipment is ready for its intended use and is depreciated over the estimated useful life of the asset. Gains and losses incurred on the sale or disposal of company assets, including fixed assets and
subscribers are recognized within the statement of operations. Amortization of finite-lived intangible assets, including branding and income leases, is computed using the straight-line method based upon estimated useful lives. Subscriber list
intangibles are amortized based on the expected turnover rate of the associated subscribers. As the subscriber base decreases due to turnover, the related amortization decreases proportionately to the decline in the number of subscribers. We do not
amortize our FCC licenses, as we believe they have indefinite lives.
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| |  |  | Termination Benefits and Other Related Charges. For the year ended December 31, 2003, we recorded expenses related to a workforce reduction that occurred in January
2003. These expenses consisted primarily of one-time termination benefits and relocation expenses. We did not record any expenses related to workforce reduction in the years ended December 31, 2004 and 2005.
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| |  |  | Non-cash Compensation.As of December 31, 2005, we recorded $6.1 million of deferred compensation associated with the issuances of Holdings common stock to
employees and directors. We generally recognize this compensation over four to five years as the stock vests.
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| |  |  | Interest Expense (Income). Interest expense through December 31, 2005 consisted primarily of interest on our senior secured term loan that expires in 2009, our
93/8% senior subordinated notes due 2011, our 83/4% senior subordinated notes due 2011 and our 81/2% senior notes due 2013, net of capitalized interest. Interest expense also includes the amortization of deferred
costs incurred in connection with our issuance of debt instruments. Interest income is earned primarily on our cash and cash equivalents and short-term investments.
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| |  |  | Other Expense. Other expense primarily includes losses incurred on our previously held interest rate swap agreements. As of December 31, 2005 and 2004, we did not have
any interest rate swap arrangements.
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| |  |  | Debt Extinguishment Costs. For the year ended December 31, 2003, we recorded expenses related to the retirement of our old credit facility and our 11% subordinated
notes. These expenses consisted primarily of a premium paid to holders of the 11% subordinated notes who tendered their notes, tender offer fees and the write-off of deferred financing costs. We did not record any debt extinguishment costs in the
years ended December 31, 2004 and 2005.
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| |  |  | Other Income and Gain.For the year ended December 31, 2004, other income and gain consisted primarily of the gains resulting from the consummation of our definitive
agreements with AT&T Wireless and Cingular Wireless and the repurchase of a portion of our 93/8% notes and our 83/4% notes. We did not
record any other income or gain for the year ended December 31, 2005 and 2003.
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| |  |  | Income Tax (Expense) Benefit. We recognize deferred tax assets and liabilities based on differences between the financial reporting and tax bases of assets and liabilities,
applying enacted statutory rates in effect for the year in which the differences are expected to reverse. Pursuant to the provisions of SFAS No. 109, Accounting For Income Taxes, we provide valuation allowances for deferred tax
assets for which we do not consider realization of such assets to be more likely than not. We establish additional provisions for income taxes when, despite the belief that our tax positions are fully supportable, there remain certain positions that
are likely to be challenged and may or may not be sustained on review by tax authorities. We adjust these additional accruals in light of changing facts and circumstances.
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Our ability to improve our margins will depend on our ability to grow our subscriber base and to manage our variable costs, including selling costs per
gross added subscriber, general and administrative expense and costs of maintaining and upgrading our network. We expect our operating costs to grow as our operations expand and our customer base and call volumes increase. Over time, these expenses
should represent a reduced percentage of revenues as our customer base grows.

Results of Operations

Beginning in 2005, as a result of our acquisition of AT&T Wireless business in certain North Carolina markets, Puerto Rico and the U.S. Virgin
Islands, we began operating as two reportable segments, which we operate and manage as strategic business units. Our reporting segments are based upon geographic area of operation; one segment consists of our operations in the continental United
States and the other consists of our operations in Puerto Rico and the U.S. Virgin Islands. Because we only owned and operated the newly acquired North Carolina and Puerto Rico and U.S. Virgin Islands markets for one month during the year ended
December 31, 2004, we do not have sufficient information to compare and discuss year-over-year results for the reportable segments. As such, the discussion and analysis below was prepared on a consolidated basis, with relevant segment
information provided as deemed useful. For further discussion of our segments, see Item 8 Financial Statements and Supplementary DataNotes to the Consolidated Financial StatementsNote 5 Segment Information.

Year ended December 31, 2005 compared to the year ended December 31, 2004

Net subscriber additions were positive 43,216 and negative 14,344 for the year ended December 31, 2005 and 2004, respectively. This change was driven
primarily by an increase in gross subscriber additions, offset partially by higher subscriber churn. We believe the year-over-year gross subscriber addition increase was the result of a significant marketing and branding initiative associated with
our launch of the SunCom brand in the recently acquired Puerto Rico markets and the re-launch of the SunCom brand in our previously-owned markets. This increase in gross subscriber additions was partially offset by lower penetration in the newly
acquired North Carolina market, which primarily resulted from challenges establishing the SunCom brand in the newly acquired North Carolina market, when compared to our penetration of our former Virginia market. Total subscribers were 965,822 as of
December 31, 2005, an increase of 14,077, or 1.5%, over our subscriber total as of December 31, 2004. The increase in total subscribers was attributable to the net subscriber additions, partially offset by the sale of 29,139 subscribers to
Cingular Wireless in September 2005. Continental United States subscribers decreased from 710,528 subscribers as of December 31, 2004 to 698,971 subscribers as of December 31, 2005, which was the result of the subscriber sale, offset
partially by net subscriber additions. Puerto Rico and U.S. Virgin Islands subscribers increased from 241,217 subscribers as of December 31, 2004 to 266,851 subscribers as of December 31, 2005, which was the result of net subscriber
additions.



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|                               |  |                                      |  |                                    |  |             
|------------------------------ |  | ------------------------------------ |  | ---------------------------------- |  | ------------
|                               |  | For the year ended December 31, 2005
|                               |  | ContinentalUnited States             |  | Puerto Rico andU.S. Virgin Islands |  | Consolidated
|Gross Additions                |  | 280,079                              |  | 123,624                            |  | 403,703     
|Net Additions                  |  | 17,091                               |  | 26,125                             |  | 43,216      
|Sale of Enterprise Subscribers |  | 28,648                               |  | 491                                |  | 29,139      
|Ending Subscribers             |  | 698,971                              |  | 266,851                            |  | 965,822     

Monthly subscriber churn was 3.2% and 2.8% for the year ended December 31, 2005 and 2004,
respectively. This increase resulted primarily from increased voluntary subscriber deactivations due to the transitions negative impact on the recently acquired subscribers in the North Carolina and Puerto Rico markets. In addition,
involuntary churn increased due to deactivations resulting from certain service offerings to credit challenged subscribers, which are prone to higher churn. Monthly subscriber churn for the continental U.S. market and the Puerto Rico and U.S. Virgin
Islands markets for the year ended December 31, 2005 was 3.1% and 3.3%, respectively. Monthly subscriber churn is calculated by dividing subscriber deactivations by our average subscriber base for the respective period. We believe that churn
may decrease in 2006 as a result of the reduced impact of the exchange transaction on our subscribers.



|                         |  |                                      |   |  |                                    |   |  |              |  
|------------------------ |  | ------------------------------------ | - |  | ---------------------------------- | - |  | ------------ | -
|                         |  | For the year ended December 31, 2005 |  
|                         |  | ContinentalUnited States             |   |  | Puerto Rico andU.S. Virgin Islands |   |  | Consolidated |  
|Monthly Subscriber Churn |  | 3.1                                  | % |  | 3.3                                | % |  | 3.2          | %

Average revenue per user, or ARPU, was $54.79 and $55.35 for the year ended
December 31, 2005 and 2004, respectively. ARPU reflects the average amount billed to subscribers based on rate plan and calling feature offerings. The ARPU decrease of $0.56, or 1.0%, was primarily the result of a decrease in average access
revenue per subscriber and a decrease in the amount of cost recovery fees billed as the result of our Truth in Wireless pricing strategy, partially offset by an increase in revenue from usage of new features offered for an additional
fee. ARPU for the continental U.S. and Puerto Rico for the year ended December 31, 2005 was $54.62 and $55.28, respectively. As the result of the anticipated mix of new rate plan offerings, such as add-a-line, and increased pricing competition,
we expect ARPU to decline for the foreseeable future. ARPU is calculated by dividing service revenue, excluding service revenue credits made to existing subscribers and revenue not generated by wireless subscribers, by our average subscriber base
for the respective period. For more details regarding our calculation of ARPU, refer to Reconciliation of Non-GAAP Financial Measures below.



|     |  |                                      |       |                                    |   |              |  |   |      
|---- |  | ------------------------------------ | ----- | ---------------------------------- | - | ------------ |  | - | -----
|     |  | For the year ended December 31, 2005
|     |  | ContinentalUnited States             |       | Puerto Rico andU.S. Virgin Islands |   | Consolidated
|ARPU |  | $                                    | 54.62 |                                    | $ | 55.28        |  | $ | 54.79

Total revenue increased 1.0% to $826.2 million for the year ended December 31, 2005 from
$818.2 million for the year ended December 31, 2004. Service revenue for the year ended December 31, 2005 was $635.0 million, an increase of $31.8 million, or 5.3%, compared to $603.2 million for the year ended December 31, 2004. The
increase in service revenue was due primarily to a larger average subscriber base, partially offset by lower ARPU. We expect subscriber growth in the future, which we expect will offset the ARPU decrease, and hence, we expect service revenue to
continue to increase. Roaming revenue was $103.6 million for the year ended December 31, 2005, a decrease of $42.4 million, or 29.0%, compared to $146.0 million for the year ended December 31, 2004. The decrease in roaming revenue was
primarily the result of reductions in roaming rates associated with the termination of our previously existing AT&T Wireless roaming agreement and the amendment of our Cingular Wireless roaming agreement in October 2004. The decrease in roaming
revenue related to these transactions was partially offset by an increase in roaming revenue related to our roaming agreement with T-Mobile, which commenced during 2004. Although we expect the growth of the wireless industry to continue, we believe
that our roaming revenues will decrease in the future due to the industry trend of declining roaming rates and the impact of AT&T Wireless merger with Cingular Wireless on our roaming traffic.Equipment revenue was $87.5 million for
the year ended December 31, 2005, an increase of $18.5 million, or 26.8%, compared to $69.0 million for the year ended December 31, 2004. The equipment revenue increase was due primarily to an increase in gross subscriber additions, an
increase in handset sales to existing subscribers and an increase in handset prices resulting from the transition from TDMA handsets to GSM/GPRS handsets, which offer more advanced capabilities.



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Cost of service (excluding amortization, depreciation, asset disposal and non-cash compensation) was
$270.1 million for the year ended December 31, 2005, an increase of $25.7 million, or 10.5%, compared to $244.4 million for the year ended December 31, 2004. This increase was primarily related to the increased costs of operating two
fully-deployed network technologies over an expanded market footprint as a result of the exchange transaction with AT&T Wireless and Cingular Wireless in December 2004. Our expanded network and subscriber growth resulted in increased
interconnect fees of $13.1 million and cell site and network repair and maintenance costs of $18.9 million. These increases were partially offset by a decline in incollect costs, which decreased from $75.2 million for the year ended
December 31, 2004 to $66.1 million for the year ended December 31, 2005, or $9.1 million. This decrease resulted primarily from the termination of our AT&T Wireless roaming agreement and the amendment of our Cingular Wireless roaming
agreement in October 2004, which resulted in lower per minute rates that are in line with current market rates. As a result of the variable components of cost of service, such as interconnect and toll, our cost of service may increase in conjunction
with the growth of our subscriber base. Cost of service as a percentage of service revenue was 42.5% and 40.5% for the year ended December 31, 2005 and 2004, respectively. The increase of 2.0% was attributable to higher network costs, such as
interconnect and cell site expenses, partially offset by increased service revenue and a lower incollect rate per minute of use. Cost of service as a percentage of service revenue may decline in the future, as we expect to leverage the fixed
components of cost of service, such as cell site rent, against increased revenue.

Cost of equipment was $167.1 million for the year ended
December 31, 2005, an increase of $44.2 million, or 36.0%, compared to $122.9 million for the year ended December 31, 2004. The increase in cost of equipment was largely a result of costs associated with providing certain subscribers in
the acquired North Carolina and Puerto Rico markets with a new handset compatible with our systems. This migration resulted in approximately $17.5 million of equipment costs for the year ended December 31, 2005. Of this amount, $5.3 million was
related to our continental United States segment and $12.2 million was related to our Puerto Rico and U.S. Virgin Islands segment. In addition, sales to new subscribers increased as the result of higher gross subscriber additions, and sales to
existing subscribers increased due to their transition from TDMA handsets to GSM/GPRS handsets.

Selling, general and administrative
expenses (excluding amortization, depreciation, asset disposal and non-cash compensation) were $357.7 million for the year ended December 31, 2005, an increase of $115.2 million, or 47.5%, compared to $242.5 million for the year ended
December 31, 2004. Selling expenses increased by $50.2 million, or 52.1%, primarily due to (i) an increase in advertising and promotional costs of $29.6 million resulting from the launch of our SunCom brand, (ii) higher commission
expense of $13.0 million as the result of increased gross subscriber additions and (iii) higher fixed costs, such as retail store rent and personnel costs, of $7.6 million due to increased sales distribution as the result of an exchange
transaction with AT&T Wireless and Cingular Wireless in December 2004. General and administrative expenses increased $65.0 million, or 44.5%, primarily due to increases in customer care costs of approximately $30.9 million, of which
approximately $18.1 million was as a result of migrating recently acquired subscribers in the acquired North Carolina and Puerto Rico markets to our systems. Of this $18.1 million, $7.3 million was related to our continental United States segment
and $10.8 million was related to our Puerto Rico segment. The incremental migration costs in customer care include such items as temporary help, temporary facilities, fees related to number porting and amounts paid to indirect agents to assist with
the subscriber migration process. The remainder of the increase in customer care costs was largely due to operating three customer care centers during 2005, compared to two centers for the majority of 2004. In addition, bad debt expense was
approximately $8.4 million higher due to the transitions negative impact on the recently acquired subscribers in the North Carolina and Puerto Rico markets and certain service offerings to credit challenged subscribers. In addition, headcount
costs, such as salary, bonus and benefits, increased approximately $6.8 million as a result of increased headcount necessary because of the non-contiguous nature of our footprint subsequent to our exchange transaction with Cingular Wireless and
AT&T Wireless. Last, legal expense was approximately $2.5 million higher than the comparable period in 2004 due to the termination of our planned purchase of Urban and the related write-off of deferred legal fees as well as legal services
performed for other company projects. As a result of the variable components of selling, general and administrative expense, such as customer care personnel and billing costs, our selling, general and administrative expenses may increase as a
function of the growth of our subscriber base. General and administrative expense as a percentage of service revenue was 33.2% and 24.2% for the year ended December 31, 2005 and 2004, respectively. This 9.0% increase is primarily attributable
to an increase in the expenses discussed above. Because we substantially completed the migration of our recently acquired North Carolina and Puerto Rico markets in the third quarter of 2005, general and administrative expenses as a percentage of
service revenue should decline in the near term. General and administrative expense as a percentage of service revenue may further decline in the future, as we expect to leverage our fixed general and administrative costs, such as headcount and
facilities costs, against increased revenue.

Cost per gross addition, or CPGA, was $431 and $434 for the year ended
December 31, 2005 and 2004, respectively. The CPGA decrease of $3 was primarily the result of greater leverage on fixed acquisition costs, such as salaries and rent, due to higher gross subscriber additions and lower net equipment costs,
partially offset by increased advertising and promotional spending during the year ended December 31, 2005 related to our SunCom brand launch. CPGA is calculated by dividing the sum of equipment margin for handsets sold to new subscribers
(equipment revenue less cost of equipment, which costs have historically exceeded the related revenue) plus selling expenses related to adding new subscribers by total gross subscriber additions during the relevant period. Retail customer service
expenses and the equipment margin on handsets sold to existing subscribers, including handset upgrade transactions, are excluded, as these costs are incurred specifically for existing subscribers. For more details regarding our calculation of CPGA,
refer to Reconciliation of Non-GAAP Financial Measures below.



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Non-cash compensation expense was $9.1 million for the year ended December 31, 2005, a decrease of
$10.9 million, or 54.5%, compared to $20.0 million for the year ended December 31, 2004. Non-cash compensation represents the amortization of Holdings restricted stock, valued at the date of grant, over the applicable vesting period. In
addition, contributions of Holdings Class A common stock made to our 401(k) savings plan are also included in non-cash compensation. The decrease reflects a lower average share price for recent grants as well as a decreased number of
Holdings restricted Class A common shares vesting during the period, as compared to the same period in 2004.

Asset impairment
expense was $47.7 million for the year ended December 31, 2005. There was no asset impairment expense for the year ended December 31, 2004. During the fiscal year ended December 31, 2005, we performed our annual impairment evaluation
of our long-lived intangible assets. Based on this evaluation, we determined that certain FCC licenses held by our continental United States segment were impaired. As a result of this evaluation, we recorded a non-cash impairment charge of
$47.7 million on these assets for the fiscal year ended December 31, 2005.

Depreciation, asset disposal and amortization expense
was $341.5 million for the year ended December 31, 2005, an increase of $167.1 million, or 95.8%, compared to $174.4 million for the year ended December 31, 2004. This increase was primarily attributable to a $107.7 million increase in
depreciation expense resulting from the acceleration of the depreciation of our TDMA wireless communications equipment. This acceleration resulted from an increased projected rate of migration for our TDMA subscriber base to our overlapping next
generation GSM/GPRS network, which we completed in the second and fourth quarters of 2005, as well as a higher rate of churn for these customers during 2005 than we planned. We accelerated depreciation to fully depreciate our continental United
States TDMA equipment by June 30, 2006 and our Puerto Rico and U.S. Virgin Islands TDMA equipment by March 31, 2006. The increase was also driven by a $46.3 million increase in amortization expense relating to the intangible assets
acquired in the transactions with Cingular Wireless and AT&T Wireless during the fourth quarter of 2004, including subscriber lists, income leases and the SunCom brand. Last, we recognized a $5.1 million loss on the sale of 29,139 subscribers to
Cingular Wireless on September 20, 2005. See Note 17 to our consolidated financial statements included in Item 8 of this Form 10-K for more information.

Interest expense was $148.9 million, net of capitalized interest of $1.0 million, for the year ended December 31, 2005. Interest expense was $128.6 million, net of capitalized interest of $0.8 million, for the
year ended December 31, 2004. The increase of $20.3 million, or 15.8%, relates primarily to the increase of $14.8 million of interest expense on our $250 million senior secured term loan that was entered into in November 2004. During the year
ended December 31, 2005, we repaid $2.5 million of principal on the senior secured term loan, leaving $247.5 million outstanding as of December 31, 2005. In addition, we did not receive any benefit in 2005 related to the interest rate
swaps that were terminated in the third and fourth quarters of 2004. These terminated swaps decreased interest expense by $5.6 million in the year ended December 31, 2004.

We had a weighted average interest rate of 8.44% for the year ended December 31, 2005 on our average obligation for our senior and subordinated debt
as well as our senior secured term loan, compared with an 8.32% weighted average interest rate for the year ended December 31, 2004.

Other expense was $0.2 million for the year ended December 31, 2005, a decrease of $2.9 million, compared to $3.1 million for the year ended December 31, 2004. Other expense for the year ended December 31, 2005 consisted of
additional costs related to the Cingular Wireless and AT&T Wireless exchange transaction consummated in the fourth quarter of 2004. Other expense for the year ended December 31, 2004 consisted of losses associated with the retirement of our
interest rate swap derivative instruments.

Interest and other income was $8.5 million for the year ended December 31, 2005, an
increase of $6.0 million, compared to $2.5 million for the year ended December 31, 2004. This increase was due primarily to higher average cash and short-term investment balances as well as higher interest rates on those balances for the period
ended December 31, 2005.

There was no other gain for the year ended December 31, 2005. For the year ended December 31,
2004, other gain was $679.5 million, which included a $663.1 million gain, net of $3.5 million of expenses, from the consummation of our Exchange Agreement with AT&T Wireless and Cingular Wireless and a $16.5 million gain from the consummation
of the Triton PCS Agreement with AT&T Wireless and Cingular Wireless.

Income tax benefit was $5.7 million for the year ended
December 31, 2005, a change of $8.1 million, compared to $2.4 million of income tax expense for the year ended December 31, 2004. The change was primarily a result of recording an impairment charge on our FCC licenses during the year ended
December 31, 2005 and the related tax benefit of $18.2 million resulting from the write-off. In addition, we recorded federal alternative minimum tax in 2004 as a result of the exchange transaction with Cingular Wireless and AT&T Wireless
in December 2004. These decreases were partially offset by the recognition of a greater deferred tax liability associated with the licenses that we acquired in the exchange transaction in December 2004. Pursuant to our



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adoption of Statement of Financial Accounting Standards No. 142, we can no longer reasonably estimate the period of reversal, if any, for the deferred
tax liabilities related to our licensing costs; therefore, we will continue to incur deferred tax expense as additional deferred tax liabilities associated with the amortization of the tax basis of our FCC licenses are incurred.

Net loss was $501.8 million for the year ended 2005, compared to a net income of $562.1 million for the year ended December 31, 2004.
The net loss increase of $1.1 billion resulted primarily from the items discussed above.

Year ended December 31,
2004 compared to the year ended December 31, 2003

Net subscriber additions were negative 14,344 and positive 64,500 for the
year ended December 31, 2004 and 2003, respectively. The decrease was driven by a combination of higher subscriber churn on a larger subscriber base and a reduction in our gross subscriber additions. Total subscribers were 951,745 as of
December 31, 2004, an increase of 6.4% over our subscriber total as of December 31, 2003. The increase was attributable to the net subscriber increase of 71,430 resulting from the exchange transaction with AT&T Wireless and Cingular
Wireless, offset partially by negative net adds.

Monthly subscriber churn was 2.8% and 2.3% for the years ended December 31, 2004 and
2003, respectively. This increase stemmed primarily from increased voluntary subscriber deactivations resulting from the implementation of a service plan restructuring during the second and third quarters of 2004, which increased fees on our UnPlan
offering. In addition, churn increased as a result of certain rate plan offerings to credit-challenged subscribers. Our voluntary churn also increased as a result of the uncertainty regarding our relationship with AT&T Wireless during the period
from the announcement of the AT&T Wireless and Cingular Wireless merger until its consummation in October 2004. In addition, as of May 2004, we offered local number portability to all markets in our service area.

ARPU was $55.35 and $55.78 for the year ended December 31, 2004 and 2003, respectively. ARPU reflects the average amount billed to subscribers based
on rate plan offerings. ARPU is exclusive of service revenue credits made to retain existing subscribers and revenue not generated by wireless subscribers of $0.22 and $0.72 per average subscriber for the years ended December 31, 2004 and 2003,
respectively. The ARPU decrease of $0.43, or 0.8%, was primarily the result of a decrease in billable overage and roaming charges, offset partially by an increase in fees charged to recoup expenditures incurred to comply with federal mandates and
increases in revenue related to new handset features.

Total revenue increased 1.0% to $818.2 million for the year ended December 31,
2004 from $810.1 million for the year ended December 31, 2003. Service revenue for the year ended December 31, 2004 was $603.2 million, an increase of $26.8 million, or 4.6%, compared to $576.4 million for the year ended December 31,
2003. The increase in service revenue was due primarily to an increased number of average subscribers during 2004, partially offset by a slight decrease in ARPU. Roaming revenue was $146.0 million for the year ended December 31, 2004, a
decrease of $34.3 million, or 19.0%, compared to $180.3 million for the year ended December 31, 2003. The decrease in roaming revenue was primarily the result of reductions in contractual roaming rates agreed to with other carriers. Roaming
minutes for the year ended December 31, 2004 were 1.1 billion, which was flat compared to the year ended December 31, 2003. TDMA minutes decreased for the year as the result of certain factors affecting the traffic from our largest roaming
partners. This included AT&T Wireless reduced customer growth as well as Cingular Wireless successful transition to GSM/GPRS, which allows them to utilize their own network in a large portion of our territory. These decreases were
offset by increased GSM/GPRS roaming minutes of use resulting from the successful completion of our GSM/GPRS overlay and the implementation of a new roaming agreement with T- Mobile. In addition, we received a $2.0 million payment in October 2004,
resulting from the settlement with one of our roaming partners related to handset programming issues. Equipment revenue was $69.0 million for the year ended December 31, 2004, an increase of $15.6 million, or 29.2%, compared to $53.4 million
for the year ended December 31, 2003. Equipment revenue includes the revenue earned on the sale of a handset or handset accessories to new and existing subscribers. The equipment revenue increase was due primarily to an increase in handset
sales to existing subscribers as well as increased prices resulting from the transition of TDMA handsets to GSM/GPRS handsets, which offer more advanced capabilities.

Cost of service (excluding amortization, depreciation, asset disposal and non-cash compensation) was $244.4 million for the year ended December 31, 2004, an increase of $0.2 million, or 0.1%, compared to $244.2
million for the year ended December 31, 2003. The increase was primarily related to operating two network technologies as well as a higher volume of traffic on our network driven by rate plan offerings and subscriber growth. These increases
were partially offset by a reduction in roaming expense resulting primarily from contractual rate decreases that occurred during the second half of 2004. Cost of service as a percentage of service revenue was 40.5% and 42.4% for the year ended
December 31, 2004 and 2003, respectively. The decrease of 1.9% was primarily attributable to a lower incollect expense rate per minute of use.

Cost of equipment was $122.9 million for the year ended December 31, 2004, an increase of $18.3 million, or 17.5%, compared to $104.6 million for the year ended December 31, 2003. Cost of equipment includes the cost associated
with the sale of a handset or handset accessories to new and existing subscribers. The cost of equipment increase was driven primarily by an increase in handset sales to existing subscribers and increased costs of handsets resulting from the
transition of TDMA handsets to GSM/GPRS handsets.



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Selling, general and administrative expenses (excluding amortization, depreciation, asset disposal and
non-cash compensation) were $242.5 million for the year ended December 31, 2004, an increase of $6.8 million, or 2.9%, compared to $235.7 million for the year ended December 31, 2003. Selling expenses decreased by $4.6 million, or 4.6%,
primarily due to a decrease in advertising and promotional costs for the year ended December 31, 2004. General and administrative expenses increased $11.4 million, or 8.4%, primarily due to increases in headcount costs of $5.5 million,
consulting fees of $1.7 million and existing customer based marketing expenses of $1.4 million. General and administrative expense as a percentage of service revenue was 24.2% and 23.4% for the year ended December 31, 2004 and 2003,
respectively. This 0.8% increase was primarily attributable to an increase in the expenses discussed above. These higher expenses were partially offset by lower bad debt expense of $0.8 million during the year ended December 31, 2004.

CPGA was $434 and $437 for the year ended December 31, 2004 and 2003, respectively. The CPGA decrease of $3, or 0.7%, was primarily
the result of decreased advertising and promotional spending for the year ended December 31, 2004, offset partially by increased fixed acquisition costs such as store rent and retail headcount.

There were no termination benefits and other related charges for the year ended December 31, 2004. Termination benefits and other related charges
were $2.7 million for the year ended December 31, 2003. These expenses, which consisted primarily of severance and relocation costs, resulted from the streamlining of our operations during January 2003.

Non-cash compensation expense was $20.0 million for the year ended December 31, 2004, a decrease of $8.8 million, or 30.6%, compared to $28.8
million for the year ended December 31, 2003. Non-cash compensation represents the amortization of Holdings restricted stock, valued at the date of grant, over the applicable vesting period. In addition, contributions of Holdings
Class A common stock made to our 401(k) savings plan are also included in non-cash compensation. The decrease reflects a lower average share price for recent grants as well as a reduced number of Holdings restricted Class A common
shares vesting during the year ended December 31, 2004, compared to the year ended December 31, 2003. This was the result of the acceleration of a portion of our retired Chief Operating Officers restricted shares during the second
quarter of 2003 in accordance with his retirement agreement.

Depreciation, asset disposal and amortization expense was $174.4 million for
the year ended December 31, 2004, an increase of $21.3 million, or 13.9%, compared to $153.1 million for the year ended December 31, 2003. The increase was primarily driven by a $12.6 million incremental increase resulting from the
acceleration of depreciation on our TDMA wireless communication equipment which resulted from the successful launch of our overlapping next generation GSM/GPRS network in all of our covered markets. In addition, we experienced increased depreciation
expense resulting from capital expenditures during the year. These increases in depreciation and asset disposal expense were partially offset by a $4.4 million loss recognized during the year ended December 31, 2003 in connection with the
disposal of certain cell site equipment deemed to be obsolete. Amortization expense increased due to the acceleration of $2.6 million of our brand license agreement with AT&T Wireless as a result of their merger with Cingular Wireless and the
understanding that the post-merger company will not utilize the AT&T brand as well as the acceleration of $3.6 million of our roaming agreement with AT&T Wireless resulting from its termination. In addition, amortization expense increased as
the result of commencing amortization on our newly acquired intangibles, including the SunCom brand, subscriber lists and income leases, which we received in the various transactions with AT&T Wireless and Cingular Wireless.

Interest expense was $128.6 million, net of capitalized interest of $0.8 million, for the year ended December 31, 2004. Interest expense was $141.2
million, net of capitalized interest of $1.7 million, for the year ended December 31, 2003. The decrease of $12.6 million, or 8.9%, relates primarily to a decrease of $25.3 million of interest expense on our 11% subordinated notes, which we
repurchased in June and July 2003 and a decrease of $12.2 million of interest expense on our former bank credit facility, which was retired in June 2003, offset partially by an increase of $23.0 million of interest expense related to our June 2003
offering of $725.0 million aggregate principal amount of 81/2% senior notes and an increase of $1.7 million on our new senior secured term loan.

We had a weighted average interest rate of 8.32% for the year ended December 31, 2004 on our average obligation for our senior and subordinated debt
and senior secured term loan, compared with our weighted average interest rate of 9.06% for the year ended December 31, 2003.

Other
expense was $3.1 million for the year ended December 31, 2004, an increase of $0.2 million, or 6.9%, compared to $2.9 million for the year ended December 31, 2003. The 2004 other expense line item consisted of losses associated with the
retirement of our five interest rate swap derivative instruments. The 2003 other expense line item consisted primarily of a $2.0 million loss on our former interest rate swap derivative instruments, which were extinguished in June 2003, and a $0.9
million loss incurred from our investment in Lafayette.



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There were no debt extinguishment costs for the year ended December 31, 2004. Debt extinguishment
costs were $41.2 million for the year ended December 31, 2003. These expenses, which consisted primarily of tender offer premium, tender offer fees and the write-off of deferred financing costs, resulted from the repurchase of $512.0 million
aggregate principal amount of our 11% subordinated notes and the repayment of all outstanding borrowings under our former bank credit facility.

Interest income, other income and other gains were $682.1 million for the year ended December 31, 2004, an increase of $679.8 million compared to $2.3 million for the year ended December 31, 2003. This increase stemmed primarily
from a $663.1 million gain, net of $3.5 million of expenses, from the consummation of our Exchange Agreement with AT&T Wireless, a $16.5 million gain from the consummation of the Triton PCS Agreement with AT&T Wireless and Cingular Wireless,
and a $0.5 million gain associated with the partial repurchase of our 93/8% and 83/4% subordinated notes and the termination of our old credit facility.

Income tax expense was $2.4 million for the year ended December 31, 2004, a decrease of $9.5 million, or 79.8% compared to $11.9 million for the
year ended December 31, 2003. This decrease stems primarily from the recognition of a deferred tax benefit resulting from the divestiture of FCC licenses associated with the consummation of our definitive agreements with AT&T Wireless and
Cingular Wireless during 2004. Pursuant to our adoption of SFAS No. 142, we can no longer reasonably estimate the period of reversal, if any, for the deferred tax liabilities related to our licensing costs, therefore, we will continue to incur
deferred tax expense as additional deferred tax liabilities associated with the amortization of the tax basis of our FCC licenses are incurred.

Net income was $562.1 million for the year ended December 31, 2004, compared to a net loss of $154.0 million for the year ended December 31, 2003. The net income increase of $716.1 million was due primarily to the gain resulting
from the consummation of the Triton PCS Agreement and the Exchange Agreement with AT&T Wireless and Cingular Wireless during the year ended December 31, 2004.

Liquidity and Capital Resources

The construction of our network and the marketing and distribution
of wireless communications products and services have required, and will continue to require, substantial capital. Our capital outlays have included license acquisition costs, capital expenditures for network construction, funding of operating cash
flow losses and other working capital costs and debt service related expenditures. We will have additional capital requirements for future upgrades due to advances in new technology. Approximately $195.1 million of Holdings short-term
investments are held by SunCom Investment Company, our immediate parent, and therefore not currently available to us. Our projected cash flow from operations is not expected to be sufficient to pay our debt service and fund our operating expenses
and required capital expenditures past early 2007. The annual debt service on our long-term indebtedness is approximately $150 million. Our inability to pay such debt service could result in a default on such indebtedness, which, unless cured or
waived, would have a material adverse effect on our liquidity and financial position. Through March 16, 2006, Holdings management and its board of directors have not taken any actions to make additional investments in us. Holdings has retained
financial and legal advisors to assist it in evaluating options to improve our financial condition. While no definitive course of action has yet been adopted, absent Holdings determination to make additional investments in us or our ability to
obtain another source of liquidity this year, we will need to restructure our balance sheet, which may occur through a so-called prepackaged or prearranged bankruptcy, and/or implement an alternative financial plan, such as
the sale of a significant portion of our assets, to reduce our long-term debt. If Holdings and SunCom are able to obtain an acceptable financial restructuring of our debt, Holdings will consider, but has undertaken no obligation to, making
additional investments in us. There can be no assurance that any such deleveraging efforts will be successful and, if not, we may have to seek federal bankruptcy protection. Certain holders of our debt securities have raised legal questions
regarding the $189 million dividend paid by us to SunCom Investment Company in November 2004. We continue to believe that such dividend was properly paid.

Capital Needs

We currently anticipate that our future capital needs will principally consist of funds required for:



| |  |  | capital expenditures to expand and enhance our network;
| | - |  | -------------------------------------------------------



| |  |  | capital expenditures related to increased retail distribution and information systems functionality;
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | operating expenses related to our network;
| | - |  | ------------------------------------------



| |  |  | operating expenses related to the acquisition and retention of subscribers;
| | - |  | ---------------------------------------------------------------------------



| |  |  | debt service requirements related to our long-term debt and capital lease obligations;
| | - |  | --------------------------------------------------------------------------------------



| |  |  | potential material increases in the cost of compliance with regulatory mandates; and
| | - |  | ------------------------------------------------------------------------------------



| |  |  | other general corporate expenditures.
| | - |  | -------------------------------------

We expect capital
expenditures, which were made historically to enhance and expand our wireless network in order to increase capacity and to satisfy subscriber needs and competitive requirements, to decrease. Although we anticipate an overall



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decrease in capital expenditures as the result of the completion of our GSM/GPRS overlay and integration of our newly acquired North Carolina and Puerto Rico
markets, we will continue to upgrade our network capacity and service quality to support our anticipated subscriber needs and growth. We estimate that capital expenditures will be approximately $75.0 million to $90.0 million for 2006. Capital
expenditures were $138.0 million, $77.8 million and $145.9 million for the years ended December 31, 2005, 2004 and 2003, respectively.

Capital
Resources

As of December 31, 2005, our capital resources were comprised of approximately $15.8 million in cash and cash
equivalents and $139.1 million of short-term investments. Historically, we have met the cash needs of our business principally by raising capital from issuances of debt securities. To the extent we can generate sufficient cash flow from our
operating activities, we will be able to use less of our available liquidity and will have less, if any, need to raise capital from the capital markets. To the extent we generate lower cash flow from our operating activities, we will be required to
use more of our available liquidity to fund operations or raise additional capital from the capital markets. We may be unable to raise additional capital on acceptable terms, if at all. Our ability to generate cash flow from operating activities is
dependent upon, among other things:



| |  |  | the amount of revenue we are able to generate from our customers;
| | - |  | -----------------------------------------------------------------



| |  |  | the amount of operating expenses required to provide our services;
| | - |  | ------------------------------------------------------------------



| |  |  | the cost of acquiring and retaining customers, including the subsidies we incur to provide handsets to both our new and existing customers; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | our ability to continue to grow our customer base.
| | - |  | --------------------------------------------------

Short-term Investments.Our short-term investments consist of auction rate securities, which had a book value and a fair value of $139.1 million and $305.5 million as of December 31, 2005 and 2004, respectively. Auction rate
securities are securities with an underlying component of a long-term debt or an equity instrument. These auction rate securities trade or mature on a shorter term than the underlying instrument based on an auction bid that resets the interest rate
of the security. The auction or reset dates occur at intervals that are typically less than three months, which provides high liquidity to otherwise longer term investments. These securities are classified as available-for-sale as the securities are
not held to the maturity date of the underlying security nor are they held for sale in the near term to generate profits on short-term differences in price. As of December 31, 2005, approximately $195.1 million of Holdings short-term
investments were maintained in a subsidiary that is not consolidated into SunCom.

Senior Secured Term Loan. On November 18,
2004, in connection with our entry into a new $250 million senior secured term loan, we terminated our former $100 million senior revolving credit facility, dated June 13, 2003, none of which was outstanding as of November 18, 2004.
Borrowings under the new senior secured term loan mature in 19 quarterly installments of 0.25% of the aggregate amount of the term loans beginning on March 31, 2005, with the outstanding balance due on November 18, 2009. The term loans are
senior in right of payment to all of our senior and senior subordinated debt, are guaranteed by all of our subsidiaries, other than Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C., and are secured by a pledge of the limited
liability company interests of Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C. Holdings is not a guarantor of the senior secured term loan. As of December 31, 2005, we had $247.5 million outstanding under the new term
loans and were in compliance with all covenants.

Senior and Senior Subordinated Notes. We have three outstanding series of debt
securities: our 93/8% senior subordinated notes due 2011, referred to as the 93/8% notes; our 83/4% senior subordinated notes due 2011, referred to as the 83/4% notes; and our 81/2% senior notes due 2013, referred to as the 81/2% notes. (See Note 11 to our consolidated financial statements included under Item 8 of this annual
report for more information). All three series of notes are guaranteed by all of our subsidiaries, other than Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C. The indentures covering each series of notes contain substantially
similar covenants, and as of December 31, 2005, we were in compliance with all such covenants.

On November 1, 2004, we repurchased $3.0 million principal amount of our 93/8% notes and $3.0 million principal amount of our 83/4% notes in open-market transactions for aggregate cash consideration of approximately $4.7 million, representing
principal repurchase consideration plus accrued and unpaid interest from the last interest payment date. In connection with the note repurchase, we recognized approximately $1.4 million of gain on our consolidated statement of operations and
comprehensive income (loss) for the year ended 2004. We did not purchase any of our notes during the year ended December 31, 2005.

We may from time to time seek to retire our outstanding debt securities through cash purchases and/or exchanges for other securities, in open market purchases, privately negotiated transactions or otherwise. Such
repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.



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Interest Rate Swap Agreements.During 2004, we were a party to five-interest rate swap
derivatives, having an aggregate notional amount of approximately $300.0 million. We had historically utilized interest rate swap agreements to manage changes in market conditions related to interest rate payments on its fixed and variable rate debt
obligations. In the second half of 2004, we terminated our swap agreements for aggregate cash consideration of approximately $3.1 million. During the year ended December 31, 2005, we were not a party to any interest rate swap arrangements.

Credit Ratings.Our credit ratings impact our ability to obtain short and long-term financing and the cost of such financing. In
determining our credit ratings, the rating agencies consider a number of factors, including our profitability, operating cash flow, total debt outstanding, interest requirements, liquidity needs and availability of liquidity. Other factors
considered may include our business strategy, the condition of our industry and our position within the industry. Although we understand that these are among the factors considered by the rating agencies, each agency might calculate and weigh each
factor differently. A rating is not a recommendation to buy, sell or hold a security, and ratings are subject to revision at any time by the assigning agency.

Our credit ratings as of January 31, 2006 were as follows:



|                  |  |                          |  |                   |  |                         |  |         
|----------------- |  | ------------------------ |  | ----------------- |  | ----------------------- |  | --------
|Rating Agency     |  | Senior SecuredTerm Loans |  | Senior DebtRating |  | SubordinatedDebt Rating |  | Outlook 
|Moodys           |  | B2                       |  | Caa1              |  | Ca                      |  | Negative
|Standard & Poors |  | B                        |  | CCC-              |  | CCC-                    |  | Negative

More information about Moodys and Standard and Poors ratings generally can be found at
their respective websites at http://www.moodys.com and http://www.standardandpoors.com. The information at these websites is not part of this annual report, has not been reviewed or verified by us and is referenced for
information purposes only.

Historical Cash Flows

As of December 31, 2005, we had $15.8 million in cash and cash equivalents, compared to $8.4 million in cash and cash equivalents at December 31, 2004. In addition, we had $139.1 million of short-term
investments as of December 31, 2005, compared to $305.5 million of short-term investments as of December 31, 2004. Net working capital was $114.2 million at December 31, 2005 and $278.7 million at December 31, 2004, reflecting a
reduction in total cash, cash equivalents and short-term investments resulting primarily from capital expenditures and interest payments. Cash used by operating activities was $79.5 million for the year ended December 31, 2005, a decrease of
$167.1 million, compared to $87.6 million provided for the year ended December 31, 2004. The increase in cash used by operating activities was primarily due to a decrease in roaming revenue of $42.4 million, non-recurring transition costs of
$36.4 million incurred during the year ended December 31, 2005 to integrate subscribers acquired in the North Carolina and Puerto Rico markets onto our systems, increased advertising and promotional spending of $29.6 million related to the
launch of the SunCom brand and higher interest expense of $20.2 million, offset partially by an increase in cash provided by working capital of $9.3 million. Cash provided by investing activities was $85.3 million for the year ended
December 31, 2005, an increase of $199.0 million, compared to $113.7 million used for the year ended December 31, 2004. The increase in cash provided by investing activities was primarily driven by a net increase of $369.4 million in
auction rate security sales and the receipt of $49.3 million from our sale of wireless communication towers to Global Signal Inc. during the year ended 2005. This increase was offset partially by an increase in capital expenditures of $60.2 million
during the year ended December 31, 2005 and $176.0 million of proceeds related to the asset exchange with Cingular Wireless during the year ended December 31, 2004. Cash provided by financing activities was $1.7 million for the year ended
December 31, 2005, compared to $31.0 million for the year ended December 31, 2004. The decrease in net cash provided by financing activities of $29.3 million was due primarily to $250.0 million of borrowings under our senior secured term
loan for the year ended December 31, 2004, offset partially by a $189.0 million dividend paid to SunCom Investment Company during the year ended December 31, 2004 and a $12.9 million increase in the bank overdraft change for the year ended
December 31, 2005.

As of December 31, 2004, we had $8.4 million in cash and cash equivalents, compared to $3.4 million in cash
and cash equivalents at December 31, 2003. In addition, we had $305.5 million of short-term investments as of December 31, 2004, compared to $102.6 million of short-term investments as of December 31, 2003. Net working capital was
$278.7 million at December 31, 2004 and $52.5 million at December 31, 2003. Cash provided by operating activities was $87.6 million for the year ended December 31, 2004, a decrease of $49.3 million, or 36.0%, compared to $136.9
million for the year ended December 31, 2003. The decrease in cash provided by operating activities was primarily due to a decrease in roaming revenue as well as a decrease in cash provided by working capital, which resulted predominantly from
the timing of vendor payments. Cash used in investing activities was $113.7 million for the year ended December 31, 2004, an increase of $35.1 million, or 44.7%, compared to $78.6 million for the year ended December 31, 2003. The increase
in cash used in investing activities was primarily related to a net increase of $298.6 million in auction rate securities purchases, $6.7 million of direct costs related to the various transactions with AT&T Wireless and Cingular Wireless and
$5.0 million in FCC license deposits, offset partially by a decrease in capital expenditures of $68.1 million, a decrease in FCC license acquisitions of $26.2 million and the receipt of $176.0 million in connection with the consummation of the
Exchange Agreement with AT&T Wireless and Cingular Wireless. Net cash provided



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by financing activities was $31.0 million for the year ended December 31, 2004, compared to net cash used in financing activities of $69.0 million for
the year ended December 31, 2003. The increase in net cash provided by financing activities of $100.0 million, or 144.9%, was due primarily to borrowings under our new senior secured term loan of $250.0 million. In addition, we spent $51.7
million of cash for the year ended December 31, 2003 related to the extinguishment of debt and termination of interest rate swap agreements, compared to $3.1 million spent on such items in the year ended December 31, 2004. These increases
were offset by a $189.0 million dividend paid to SunCom Investment Company.

Contractual Obligations and Commercial Commitments

The table below sets forth our best estimates as to the amounts and timing of future contractual payments for our contractual
obligations as of December 31, 2005. These disclosures are also included in the notes to the consolidated financial statements, and the relevant footnotes are cross-referenced in the table below. The information in the table reflects future
unconditional payments and is based upon, among other things, the terms of the relevant agreements and appropriate classification of items under accounting principles generally accepted in the United States, or GAAP, currently in effect.
Future events, including additional issuances of our securities and refinancing of those securities, could cause actual payments to differ significantly from these amounts.



|                                                  |  |       |           |                  |   |           |  |           |         |               |   |                                       |  |   |         |  |   
|------------------------------------------------- |  | ----- | --------- | ---------------- | - | --------- |  | --------- | ------- | ------------- | - | ------------------------------------- |  | - | ------- |  | --
|Payments Due by Period (1) (Dollars in thousands)
|Contractual Obligation                            |  | Total |           | Less than 1 year |   | 1-2 years |  | 3-5 years |         | After 5 Years |   | Financial StatementFootnote Reference
|Long-term debt (2)                                |  | $     | 1,690,987 |                  | $ | 2,500     |  | $         | 5,000   |               | $ | 970,339                               |  | $ | 713,148 |  | 11
|Capital lease obligations (3)                     |  |       | 1,150     |                  |   | 286       |  |           | 621     |               |   | 243                                   |  |   |        |  | 11
|Interest obligations (4)                          |  |       | 898,799   |                  |   | 147,731   |  |           | 294,889 |               |   | 368,705                               |  |   | 87,474  |  | 11
|Operating leases (5)                              |  |       | 501,603   |                  |   | 66,059    |  |           | 123,369 |               |   | 146,187                               |  |   | 165,988 |  | 18
|Purchase obligations (6)                          |  |       | 23,772    |                  |   | 20,719    |  |           | 3,053   |               |   |                                      |  |   |        |  | 18
|                                                  |  |       |           |                  |   |           |  |           |         |               |   |                                       |  |   |         |  |   
|Total cash contractual obligations                |  | $     | 3,116,311 |                  | $ | 237,295   |  | $         | 426,932 |               | $ | 1,485,474                             |  | $ | 966,610 |  |   

---

|(1) | Payments are included in the period by which they are contractually required to be made. Actual payments may be made prior to the contractually required date.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Amounts are equal to the annual maturities of our long-term debt.
|--- | -----------------------------------------------------------------

|(3) | Amounts are equal to the annual maturities of our capital lease obligations.
|--- | ----------------------------------------------------------------------------

|(4) | Amounts are equal to total interest payments on our outstanding term loans and our 81/2% notes, 83/4% notes and
93/8% notes, and assume the notes are repaid and not refinanced at maturity. Term loan
interest has been calculated utilizing the effective interest rate as of December 31, 2005. Fluctuations in future interest rates could materially effect our senior secured term loan interest obligations.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Represents our commitments associated with operating leases as of December 31, 2005.
|--- | ------------------------------------------------------------------------------------

|(6) | Amounts represent unconditional purchase obligations for equipment and software, as well as certain committed amounts for the support of our administrative and network systems.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We are a party to various arrangements that are conditional in nature and obligate us to make payments only upon the
occurrence of certain events, such as the delivery of functioning software or products. Because it is not possible to predict the timing or amounts that may be due under these conditional arrangements, no amounts have been included in the table
above.

Off Balance Sheet Arrangements

As of December 31, 2005, we had no off balance sheet arrangements.

Reconciliation of Non-GAAP
Financial Measures

We utilize certain financial measures that are not calculated in accordance with GAAP, to assess our financial
performance. A non-GAAP financial measure is defined as a numerical measure of a companys financial performance that (i) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the
comparable measure calculated and presented in accordance with GAAP in the statement of income or statement of cash flows; or (ii) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from
the comparable measure so calculated and presented. The discussion of each non-GAAP financial measure we use in this report appears above under Results of Operations. A brief description of the calculation of each measure is included
where the particular measure is first discussed. Our method of computation may or may not be comparable to other similarly titled measures of other companies. The following tables reconcile our non-GAAP financial measures with our financial
statements presented in accordance with GAAP.



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|                                              |                                                  |                         |         |   |      |   |         |      |  |   |        
|--------------------------------------------- | ------------------------------------------------ | ----------------------- | ------- | - | ---- | - | ------- | ---- |  | - | -------
|                                              |                                                  | Year Ended December 31,
|Average Revenue Per User (ARPU)               |                                                  | 2005                    |         |   | 2004 |   |         | 2003
|                                              | Consolidated (Dollars in thousands, except ARPU)
|Service revenue                               |                                                  | $                       | 635,038 |   |      | $ | 603,242 |      |  | $ | 576,359
|Subscriber retention credits                  |                                                  |                         | 4,405   |   |      |   | 3,431   |      |  |   | 7,512  
|Revenue not generated by wireless subscribers |                                                  |                         | (14,090 | ) |      |   | (1,000  | )    |  |   |       
|                                              |                                                  |                         |         |   |      |   |         |      |  |   |        
|Adjusted service revenue                      |                                                  |                         | 625,353 |   |      |   | 605,673 |      |  |   | 583,871
|                                              |                                                  |                         |        
|Average subscribers                           |                                                  |                         | 951,142 |   |      |   | 911,826 |      |  |   | 872,250
|ARPU                                          |                                                  | $                       | 54.79   |   |      | $ | 55.35   |      |  | $ | 55.78  



|                                              |                                     |                              |         |                                           |   |         |  
|--------------------------------------------- | ----------------------------------- | ---------------------------- | ------- | ----------------------------------------- | - | ------- | -
|                                              |                                     | Year Ended December 31, 2005 |        
|Average Revenue Per User (ARPU)               |                                     | Continental U.Ssegment       |         | Puerto Rico andU.S. VirginIslands segment |  
|                                              | (Dollars in thousands, except ARPU) |                             
|Service revenue                               |                                     | $                            | 456,882 |                                           | $ | 178,156 |  
|Subscriber retention credits                  |                                     |                              | 3,434   |                                           |   | 971     |  
|Revenue not generated by wireless subscribers |                                     |                              |        |                                           |   | (14,090 | )
|                                              |                                     |                              |         |                                           |   |         |  
|Adjusted service revenue                      |                                     |                              | 460,316 |                                           |   | 165,037 |  
|                                              |                                     |                             
|Average subscribers                           |                                     |                              | 702,364 |                                           |   | 248,778 |  
|ARPU                                          |                                     | $                            | 54.62   |                                           | $ | 55.28   |  

We believe ARPU, which calculates the average service revenue billed to an individual subscriber,
is a useful measure to evaluate our past billable service revenue and to assist in forecasting our future billable service revenue. ARPU is exclusive of service revenue credits made to retain existing subscribers and revenue not generated by
wireless subscribers. Service retention credits are discretionary reductions of the amount billed to a subscriber. We have no contractual obligation to issue these credits; therefore, ARPU reflects the amount subscribers have contractually agreed to
pay us based on their specific usage pattern. Revenue not generated by wireless subscribers, which primarily consists of Universal Service Fund program revenue, is excluded from our calculation of ARPU, as this revenue does not reflect amounts
billed to subscribers. The increase in Universal Service Fund program revenue for the year ended December 31, 2005 resulted from operating the Puerto Rico market for twelve months, compared to only one month during the year ended
December 31, 2004. ARPU is calculated by dividing service revenue, exclusive of service revenue credits made to existing subscribers and revenue not generated by wireless subscribers, by our average subscriber base for the respective period. As
presented, average subscribers is calculated by adding the average subscriber amount calculated for the quarterly periods during the period and dividing by the number of quarters in the period.



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|                                                                 |                                     |                         |           |   |      |   |         |      |  |   |         |  
|---------------------------------------------------------------- | ----------------------------------- | ----------------------- | --------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                 |                                     | Year Ended December 31, |          
|Cost Per Gross Addition (CPGA)                                   |                                     | 2005                    |           |   | 2004 |   |         | 2003 | 
|                                                                 | (Dollars in thousands, except CPGA) |                        
|Selling expenses                                                 |                                     | $                       | 146,549   |   |      | $ | 96,365  |      |  | $ | 100,957 |  
|Total cost of equipment  transactions with new subscribers      |                                     |                         | 90,052    |   |      |   | 79,081  |      |  |   | 74,309  |  
|                                                                 |                                     |                         |           |   |      |   |         |      |  |   |         |  
|CPGA operating expenses                                          |                                     |                         | 236,601   |   |      |   | 175,446 |      |  |   | 175,266 |  
|Cost of service                                                  |                                     |                         | 270,117   |   |      |   | 244,360 |      |  |   | 244,226 |  
|Total cost of equipment  transactions with existing subscribers |                                     |                         | 77,071    |   |      |   | 43,799  |      |  |   | 30,321  |  
|General and administrative expense                               |                                     |                         | 211,111   |   |      |   | 146,088 |      |  |   | 134,720 |  
|Termination benefits and other related charges                   |                                     |                         |          |   |      |   |        |      |  |   | 2,731   |  
|Non-cash compensation                                            |                                     |                         | 9,083     |   |      |   | 19,965  |      |  |   | 28,810  |  
|Asset impairment                                                 |                                     |                         | 47,700    |   |      |   |        |      |  |   |        |  
|Depreciation and asset disposal                                  |                                     |                         | 282,006   |   |      |   | 161,208 |      |  |   | 148,794 |  
|Amortization                                                     |                                     |                         | 59,449    |   |      |   | 13,162  |      |  |   | 4,300   |  
|                                                                 |                                     |                         |           |   |      |   |         |      |  |   |         |  
|Total operating expenses                                         |                                     | $                       | 1,193,138 |   |      | $ | 804,028 |      |  | $ | 769,168 |  
|                                                                 |                                     |                         |          
|CPGA operating expenses (from above)                             |                                     | $                       | 236,601   |   |      | $ | 175,446 |      |  | $ | 175,266 |  
|Equipment revenue  transactions with new subscribers            |                                     |                         | (62,454   | ) |      |   | (48,889 | )    |  |   | (41,212 | )
|                                                                 |                                     |                         |           |   |      |   |         |      |  |   |         |  
|CPGA costs, net                                                  |                                     | $                       | 174,147   |   |      | $ | 126,557 |      |  | $ | 134,054 |  
|                                                                 |                                     |                         |          
|Gross subscriber additions                                       |                                     |                         | 403,703   |   |      |   | 291,916 |      |  |   | 306,600 |  
|CPGA                                                             |                                     | $                       | 431       |   |      | $ | 434     |      |  | $ | 437     |  

We believe CPGA is a useful measure that quantifies the incremental costs to acquire a new
subscriber. This measure also provides a gauge to compare our average acquisition costs per new subscriber to that of other wireless communication providers. CPGA is calculated by dividing the sum of equipment margin for handsets sold to new
subscribers (equipment revenue less cost of equipment, which costs have historically exceeded the related revenue) and selling expenses related to adding new subscribers by total gross subscriber additions during the relevant period. Retail customer
service expenses are excluded from CPGA, as these costs are incurred specifically for existing subscribers.

Relationship with Lafayette Communications
Company L.L.C.

On November 29, 2004, SunCom Wireless Affiliate Company, LLC, a direct, wholly-owned subsidiary of Holdings,
reacquired a 39% interest in Lafayette for $39,000. Under section 24.709 of the FCC rules, Lafayette has been designated as an entrepreneur and is eligible to hold certain PCS licenses.

On December 23, 2004, Lafayette sold us PCS licenses covering a population of approximately 167,200 people in the Danville, Virginia basic service
area for approximately $50,000.

In February 2005, Lafayette was the successful bidder on a PCS license in the Hickory-Lenior-Morgantown,
North Carolina basic trading area. The winning bid was approximately $0.4 million. The FCC issued this license to Lafayette on June 30, 2005.

New
Accounting Pronouncements

In October 2005, the FASB issued FASB Staff Position No. FAS 13-1, Accounting for Rental Costs Incurred
during a Construction Period, or FSP No. 13-1, to give guidance to a lessee on determining whether rental costs associated with operating leases may be capitalized during a construction period. Specifically, FSP No. 13-1
stipulates that such costs shall be (a) recognized as rental expense, (b) included in income from continuing operations and (c) allocated over the lease term according to the guidance in SFAS No. 13, Accounting for
Leases, and FASB Technical Bulletin No. 85-3, Accounting for Operating Leases with Scheduled Rent Increases. The guidance in FSP No. 13-1 is effective for the first reporting period beginning after December 15, 2005,
with early adoption permitted for financial statements or interim financial statements that have not yet been issued. We already account for such rental costs in accordance with FSP No. 13-1, and therefore, the issuance of FSP No. 13-1
will not have an additional impact on our consolidated financial statements.

On June 1, 2005, the FASB issued SFAS No. 154,
Accounting Changes and Error Corrections. SFAS No. 154 replaces Accounting Principles Board Opinion No. 20, Accounting Changes and SFAS No. 3, Reporting Accounting Changes in Interim Financial
Statements. SFAS No. 154 requires that a voluntary change in accounting principle be applied retrospectively to all prior period financial statements presented. SFAS No. 154 also requires that a change in method of depreciating or
amortizing a long-lived non-financial asset be accounted for prospectively as a change in estimate, and correction of errors in previously issued financial statements should be termed a restatement. SFAS No. 154 is effective for accounting
changes and correction of errors made in fiscal years beginning after December 15, 2005. We do not expect this Statement to have a material effect on our financial statements or our results of operations.



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On December 15, 2004, the FASB issued the revised SFAS No. 123, Share-Based
Payment, which addresses the accounting for share-based payment transactions in which an entity obtains employee services in exchange for (a) equity instruments of the entity or (b) liabilities that are based on the fair value of the
entitys equity instruments or that may be settled by the issuance of such equity instruments. This statement eliminates the ability to account for employee share-based payment transactions using Accounting Principles Board Opinion No. 25
and requires instead that such transactions be accounted for using the grant-date fair value based method. SFAS No. 123R applies to all awards granted or modified after the Statements effective date. In addition, compensation cost for the
unvested portion of previously granted awards that remain outstanding on the Statements effective date shall be recognized on or after the effective date, as the related services are rendered, based on the awards grant-date fair value as
previously calculated for the pro-forma disclosure under SFAS No. 123. The requirements of SFAS No. 123R were to become effective as of the beginning of the third quarter of 2005; however, on April 14, 2005, the Securities and
Exchange Commission, or the SEC, announced the adoption of a new rule that amends the compliance dates for SFAS No. 123R. The SECs new rule allows us to implement SFAS No. 123R as of January 1, 2006. The SECs new
rule does not change the accounting required by SFAS No. 123R; it changes only the dates for compliance with the standard. We currently use the grant-date fair value based method to account for Holdings restricted stock awards, and as
such, this Statement will not have a material effect on our financial statements or our results of operations.

On November 24, 2004,
the FASB issued SFAS No. 151, Inventory Costsan amendment of ARB 43, Chapter 4. This statement amends the guidance in ARB No. 43, Chapter 4, Inventory Pricing, to clarify the accounting for abnormal amounts of
idle facility expense, freight, handling costs and wasted material. This statement requires that those items be recognized as current-period charges. In addition, this statement requires that allocation of fixed production overhead to the costs of
conversion be based on the normal capacity of the production facilities. This statement will be effective for inventory costs incurred during fiscal years beginning after June 15, 2005. We do not expect this statement to have a material effect
on our financial statements or our results of operations.

Inflation

We do not believe that inflation has had a material impact on our operations.



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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are highly leveraged and, as a
result, our cash flows and earnings are exposed to fluctuations in interest rates. Our debt obligations are U.S. dollar denominated. Our market risk, therefore, is the potential loss arising from adverse changes in interest rates. As of
December 31, 2005, our debt can be categorized as follows (in thousands):



|                                       |  |   |        
|-------------------------------------- |  | - | -------
|Fixed interest rates:                  |  |   |        
|Senior notes                           |  | $ | 713,148
|Senior subordinated notes              |  | $ | 730,339
|                                       | 
|Subject to interest rate fluctuations: |  |   |        
|Senior secured term loan               |  | $ | 247,500

Our interest rate risk management program focuses on minimizing exposure to interest rate
movements, setting an optimal mixture of floating and fixed rate debt and minimizing liquidity risk.

Our cash and cash equivalents consist
of short-term assets having initial maturities of three months or less, and our investments consist of auction rate securities with maturities of one year or less. While these investments are subject to a degree of interest rate risk, this risk is
not considered to be material relative to our overall investment income position.

If market rates rise over the remaining term of the
senior secured term loan, we would realize increased annual interest expense of approximately $1.2 million for each 50 basis point increase in rates. If market rates decline over the remaining term of the senior secured term loan, we would
realize decreased annual interest expense of approximately $1.2 million for each 50 basis point decrease in rates.



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ITEM 8. FINANCIAL STATEMENTS & SUPPLEMENTARY DATA

SUNCOM WIRELESS, INC.

INDEX TO FINANCIAL STATEMENTS



|                                                                                                                           |  |    
|-------------------------------------------------------------------------------------------------------------------------- |  | ---
|Consolidated Financial Statements:                                                                                         |  |    
|Report of Independent Registered Public Accounting Firm                                                                    |  | F-2
|Consolidated Balance Sheets as of December 31, 2005 and 2004                                                               |  | F-3
|Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2005, 2004 and 2003 |  | F-4
|Consolidated Statements of Stockholders Equity (Deficit) for the years ended December 31, 2005, 2004 and 2003             |  | F-5
|Consolidated Statements of Cash Flows for the years ended December 31, 2005, 2004 and 2003                                 |  | F-6
|Notes to Consolidated Financial Statements                                                                                 |  | F-7
|                                                                                                                           | 
|Schedule I  Valuation and Qualifying Accounts                                                                             |  | 47 



F - 1



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##### Table of Contents

Report of Independent Registered Public Accounting Firm

To Board of Directors and

Stockholder of SunCom Wireless, Inc.:

In our opinion, the consolidated financial statements listed in the index appearing under Item 8 of this Form 10-K present fairly, in all material respects, the financial position of SunCom Wireless, Inc. and its subsidiaries (the
Company) at December 31, 2005 and 2004, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2005 in conformity with accounting principles generally accepted in
the United States of America. In addition, in our opinion, the financial statement schedule listed in the index appearing under Item 15(a)(1) of this Form 10-K, presents fairly, in all material respects, the information set forth therein when
read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Companys management. Our responsibility is to express an opinion on these
financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1(b) to the
consolidated financial statements, the Company has substantial debt obligations, a history of significant losses, a stockholders deficit of $260.1 million at December 31, 2005 and negative cash flows from operations of $79.5 million for
the year ended December 31, 2005. Based upon the Companys forecast, it will not have sufficient resources to meet its working capital requirements, capital expenditures, contractual debt maturities, interest payments and other activities
past early 2007 without restructuring its long-term debt obligations or generating positive cash flows from operations. These matters raise substantial doubt about the Companys ability to continue as a going concern. Managements plan in
regard to these matters is also described in Note 1(b). The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

March 16, 2006



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##### Table of Contents

SunCom Wireless, Inc.

Consolidated Balance Sheets



|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|-------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------- | --------- | - | ---------------- | - | --------- | -
|                                                                                                                           |  | December 31,2005                         |           |   | December 31,2004 |  
|                                                                                                                           |  | (Dollars in thousands, except par value) |          
|ASSETS:                                                                                                                    |  |                                          |           |   |                  |   |           |  
|Current assets:                                                                                                            |  |                                          |           |   |                  |   |           |  
|Cash and cash equivalents                                                                                                  |  | $                                        | 15,800    |   |                  | $ | 8,351     |  
|Short-term investments                                                                                                     |  |                                          | 139,050   |   |                  |   | 305,500   |  
|Accounts receivable, net of allowance for doubtful accounts of $12,352 and $7,585, respectively                            |  |                                          | 82,898    |   |                  |   | 79,290    |  
|Accounts receivable  roaming partners                                                                                     |  |                                          | 18,188    |   |                  |   | 18,348    |  
|Due from related parties                                                                                                   |  |                                          | 5,703     |   |                  |   | 7,349     |  
|Inventory, net                                                                                                             |  |                                          | 23,930    |   |                  |   | 18,216    |  
|Prepaid expenses                                                                                                           |  |                                          | 13,492    |   |                  |   | 11,611    |  
|Other current assets                                                                                                       |  |                                          | 12,022    |   |                  |   | 10,806    |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total current assets                                                                                                       |  |                                          | 311,083   |   |                  |   | 459,471   |  
|                                                                                                                           |  |                                         
|Long term assets:                                                                                                          |  |                                          |           |   |                  |   |           |  
|Property and equipment, net                                                                                                |  |                                          | 650,284   |   |                  |   | 814,127   |  
|Intangible assets, net                                                                                                     |  |                                          | 844,113   |   |                  |   | 984,052   |  
|Other long-term assets                                                                                                     |  |                                          | 4,324     |   |                  |   | 5,180     |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total assets                                                                                                               |  | $                                        | 1,809,804 |   |                  | $ | 2,262,830 |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT):                                                                            |  |                                          |           |   |                  |   |           |  
|Current liabilities:                                                                                                       |  |                                          |           |   |                  |   |           |  
|Accounts payable                                                                                                           |  | $                                        | 97,355    |   |                  | $ | 85,896    |  
|Accrued liabilities                                                                                                        |  |                                          | 73,477    |   |                  |   | 67,365    |  
|Current portion of long term debt                                                                                          |  |                                          | 2,786     |   |                  |   | 3,484     |  
|Other current liabilities                                                                                                  |  |                                          | 23,271    |   |                  |   | 23,984    |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total current liabilities                                                                                                  |  |                                          | 196,889   |   |                  |   | 180,729   |  
|                                                                                                                           |  |                                         
|Long-term debt:                                                                                                            |  |                                          |           |   |                  |   |           |  
|Capital lease obligations                                                                                                  |  |                                          | 864       |   |                  |   | 269       |  
|Senior secured term loan                                                                                                   |  |                                          | 245,000   |   |                  |   | 247,500   |  
|Senior notes                                                                                                               |  |                                          | 713,148   |   |                  |   | 712,055   |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Senior long-term debt                                                                                                      |  |                                          | 959,012   |   |                  |   | 959,824   |  
|                                                                                                                           |  |                                         
|Subordinated notes                                                                                                         |  |                                          | 730,339   |   |                  |   | 728,494   |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total long-term debt                                                                                                       |  |                                          | 1,689,351 |   |                  |   | 1,688,318 |  
|                                                                                                                           |  |                                         
|Deferred income taxes, net                                                                                                 |  |                                          | 130,803   |   |                  |   | 139,321   |  
|Deferred revenue                                                                                                           |  |                                          | 1,809     |   |                  |   | 659       |  
|Deferred gain on sale of property and equipment                                                                            |  |                                          | 48,530    |   |                  |   | 19,099    |  
|Other                                                                                                                      |  |                                          | 2,483     |   |                  |   | 2,013     |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total liabilities                                                                                                          |  |                                          | 2,069,865 |   |                  |   | 2,030,139 |  
|                                                                                                                           |  |                                         
|Commitments and contingencies (Note 18)                                                                                    |  |                                          |          |   |                  |   |          |  
|                                                                                                                           |  |                                         
|Stockholders equity (deficit)                                                                                             |  |                                          |           |   |                  |   |           |  
|Common Stock, $0.01 par value, 1,000 shares authorized, 100 shares issued and outstanding as of December 31, 2005 and
2004 |  |                                          |          |   |                  |   |          |  
|Additional paid-in capital                                                                                                 |  |                                          | 561,396   |   |                  |   | 560,934   |  
|Accumulated deficit                                                                                                        |  |                                          | (815,252  | ) |                  |   | (313,417  | )
|SunCom Wireless Holdings, Inc. common stock held in trust                                                                  |  |                                          | (145      | ) |                  |   | (94       | )
|Deferred compensation                                                                                                      |  |                                          | (6,060    | ) |                  |   | (14,732   | )
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total stockholders equity (deficit)                                                                                       |  |                                          | (260,061  | ) |                  |   | 232,691   |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  
|Total liabilities and stockholders equity (deficit)                                                                       |  | $                                        | 1,809,804 |   |                  | $ | 2,262,830 |  
|                                                                                                                           |  |                                          |           |   |                  |   |           |  

See accompanying notes to consolidated financial statements.



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##### Table of Contents

SunCom Wireless, Inc.

Consolidated Statements of Operations and Comprehensive Income (Loss)



|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -------------------------------- | --------- | - | ---- | - | -------- | ---- |  | -- | -------- | -
|                                                                                                                                                                                                                                                 |  | For the Years Ended December 31, |          
|                                                                                                                                                                                                                                                 |  | 2005                             |           |   | 2004 |   |          | 2003 | 
|                                                                                                                                                                                                                                                 |  | (Dollars in thousands)           |          
|Revenues:                                                                                                                                                                                                                                        |  |                                  |           |   |      |   |          |      |  |    |          |  
|Service                                                                                                                                                                                                                                          |  | $                                | 635,038   |   |      | $ | 603,242  |      |  | $  | 576,359  |  
|Roaming                                                                                                                                                                                                                                          |  |                                  | 103,605   |   |      |   | 145,999  |      |  |    | 180,314  |  
|Equipment                                                                                                                                                                                                                                        |  |                                  | 87,515    |   |      |   | 68,959   |      |  |    | 53,426   |  
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Total revenues                                                                                                                                                                                                                                   |  |                                  | 826,158   |   |      |   | 818,200  |      |  |    | 810,099  |  
|Operating Expenses:                                                                                                                                                                                                                              |  |                                  |           |   |      |   |          |      |  |    |          |  
|Cost of service (excluding the below amortization and asset impairment, excluding depreciation and asset disposal of $272,235, $147,895 and
$131,968, respectively, and excluding non-cash compensation of $665, $2,181 and $3,300 respectively) |  |                                  | 270,117   |   |      |   | 244,360  |      |  |    | 244,226  |  
|Cost of equipment                                                                                                                                                                                                                                |  |                                  | 167,123   |   |      |   | 122,880  |      |  |    | 104,630  |  
|Selling, general and administrative (excluding depreciation and asset disposal of $9,771, $13,313 and $16,826, respectively, and excluding
non-cash compensation of $8,418, $17,784 and $25,510, respectively)                                   |  |                                  | 357,660   |   |      |   | 242,453  |      |  |    | 235,677  |  
|Termination benefits and other related charges                                                                                                                                                                                                   |  |                                  |          |   |      |   |         |      |  |    | 2,731    |  
|Non-cash compensation                                                                                                                                                                                                                            |  |                                  | 9,083     |   |      |   | 19,965   |      |  |    | 28,810   |  
|Asset impairment                                                                                                                                                                                                                                 |  |                                  | 47,700    |   |      |   |         |      |  |    |         |  
|Depreciation and asset disposal                                                                                                                                                                                                                  |  |                                  | 282,006   |   |      |   | 161,208  |      |  |    | 148,794  |  
|Amortization                                                                                                                                                                                                                                     |  |                                  | 59,449    |   |      |   | 13,162   |      |  |    | 4,300    |  
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Total operating expenses                                                                                                                                                                                                                         |  |                                  | 1,193,138 |   |      |   | 804,028  |      |  |    | 769,168  |  
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Income (loss) from operations                                                                                                                                                                                                                    |  |                                  | (366,980  | ) |      |   | 14,172   |      |  |    | 40,931   |  
|Interest expense                                                                                                                                                                                                                                 |  |                                  | (148,871  | ) |      |   | (128,627 | )    |  |    | (141,210 | )
|Other expense                                                                                                                                                                                                                                    |  |                                  | (157      | ) |      |   | (3,092   | )    |  |    | (2,898   | )
|Debt extinguishment costs                                                                                                                                                                                                                        |  |                                  |          |   |      |   |         |      |  |    | (41,171  | )
|Interest and other income                                                                                                                                                                                                                        |  |                                  | 8,480     |   |      |   | 2,548    |      |  |    | 2,285    |  
|Other gain                                                                                                                                                                                                                                       |  |                                  |          |   |      |   | 679,515  |      |  |    |         |  
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Income (loss) before taxes                                                                                                                                                                                                                       |  |                                  | (507,528  | ) |      |   | 564,516  |      |  |    | (142,063 | )
|Income tax (provision) benefit                                                                                                                                                                                                                   |  |                                  | 5,693     |   |      |   | (2,440   | )    |  |    | (11,907  | )
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Net income (loss)                                                                                                                                                                                                                                |  |                                  | (501,835  | ) |      |   | 562,076  |      |  |    | (153,970 | )
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Other comprehensive income (loss), net of tax:                                                                                                                                                                                                   |  |                                  |           |   |      |   |          |      |  |    |          |  
|Unrealized gain on derivative instruments                                                                                                                                                                                                        |  |                                  |          |   |      |   |         |      |  | $  | 1,429    |  
|Plus: reclassification adjustment for previous unrealized losses                                                                                                                                                                                 |  |                                  |          |   |      |   |         |      |  |    | 4,030    |  
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  
|Comprehensive income (loss)                                                                                                                                                                                                                      |  | ($                               | 501,835   | ) |      | $ | 562,076  |      |  | ($ | 148,511  | )
|                                                                                                                                                                                                                                                 |  |                                  |           |   |      |   |          |      |  |    |          |  

See accompanying notes to consolidated financial statements.



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##### Table of Contents

SunCom Wireless, Inc.

Consolidated Statements of Stockholders Equity (Deficit)

(Dollars in thousands)



|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|------------------------------------- |  | ----------------- |  | ------ | - | ------------------------ | - | -------- | -------------------- |  | - | -------------------------------- | - |  | ------------------------------------------ | ---- | - | ------------------ | - | ------ | --------------------------------- |  | - | -------- | - |  | - | -------- | -
|                                      |  | CommonStockShares |  | Amount |   | AdditionalPaid InCapital |   |          | DeferredCompensation |  |   | HoldingsCommonStock Held inTrust |   |  | AccumulatedOtherComprehensiveIncome (Loss) |      |   | AccumulatedDeficit |   |        | TotalStockholdersEquity(Deficit) | 
|Balance at December 31, 2002          |  | 100               |  | $      |  |                          | $ | 741,872  |                      |  | $ | (74,554                          | ) |  | $                                          |     |   |                    | $ | (5,459 | )                                 |  | $ | (721,523 | ) |  | $ | (59,664  | )
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Capital contribution from parent      |  |                  |  |        |  |                          |   | 57       |                      |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | 57       |  
|Deferred compensation                 |  |                  |  |        |  |                          |   | (10,964  | )                    |  |   | 10,964                           |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   |         |  
|Non-cash compensation                 |  |                  |  |        |  |                          |   |         |                      |  |   | 28,810                           |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | 28,810   |  
|Fair value of cash flow hedges        |  |                  |  |        |  |                          |   |         |                      |  |   |                                 |   |  |                                            |     |   |                    |   | 5,459  |                                   |  |   |         |   |  |   | 5,459    |  
|Net loss                              |  |                  |  |        |  |                          |   |         |                      |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   | (153,970 | ) |  |   | (153,970 | )
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Balance at December 31, 2003          |  | 100               |  | $      |  |                          | $ | 730,965  |                      |  | $ | (34,780                          | ) |  | $                                          |     |   |                    | $ |       |                                   |  | $ | (875,493 | ) |  | $ | (179,308 | )
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Capital contribution from parent, net |  |                  |  |        |  |                          |   | 18,958   |                      |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | 18,958   |  
|Deferred compensation                 |  |                  |  |        |  |                          |   | (931     | )                    |  |   | 1,025                            |   |  |                                            | (94  | ) |                    |   |       |                                   |  |   |         |   |  |   |         |  
|Non-cash compensation                 |  |                  |  |        |  |                          |   | 942      |                      |  |   | 19,023                           |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | 19,965   |  
|Dividend paid                         |  |                  |  |        |  |                          |   | (189,000 | )                    |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | (189,000 | )
|Net income                            |  |                  |  |        |  |                          |   |         |                      |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   | 562,076  |   |  |   | 562,076  |  
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Balance at December 31, 2004          |  | 100               |  | $      |  |                          | $ | 560,934  |                      |  | $ | (14,732                          | ) |  | $                                          | (94  | ) |                    | $ |       |                                   |  | $ | (313,417 | ) |  | $ | 232,691  |  
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Deferred compensation                 |  |                  |  |        |  |                          |   | 462      |                      |  |   | (411                             | ) |  |                                            | (51  | ) |                    |   |       |                                   |  |   |         |   |  |   |         |  
|Non-cash compensation                 |  |                  |  |        |  |                          |   |         |                      |  |   | 9,083                            |   |  |                                            |     |   |                    |   |       |                                   |  |   |         |   |  |   | 9,083    |  
|Net loss                              |  |                  |  |        |  |                          |   |         |                      |  |   |                                 |   |  |                                            |     |   |                    |   |       |                                   |  |   | (501,835 | ) |  |   | (501,835 | )
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  
|Balance at December 31, 2005          |  | 100               |  | $      |  |                          | $ | 561,396  |                      |  | $ | (6,060                           | ) |  | $                                          | (145 | ) |                    | $ |       |                                   |  | $ | (815,252 | ) |  | $ | (260,061 | )
|                                      |  |                   |  |        |   |                          |   |          |                      |  |   |                                  |   |  |                                            |      |   |                    |   |        |                                   |  |   |          |   |  |   |          |  

See accompanying notes to consolidated financial statements.



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##### Table of Contents

SunCom Wireless, Inc.

Consolidated Statements of Cash Flows



|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  
|----------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------- | ---------- | - | ---- | - | -------- | ---- |  | - | -------- | -
|                                                                                                                                                      |  | For the Years Ended December 31, |           
|                                                                                                                                                      |  | 2005                             |            |   | 2004 |   |          | 2003 | 
|                                                                                                                                                      |  | (Dollars in thousands)           |           
|Cash flows from operating activities:                                                                                                                 |  |                                  |            |   |      |   |          |      |  |   |          |  
|Net income (loss)                                                                                                                                     |  | $                                | (501,835   | ) |      | $ | 562,076  |      |  | $ | (153,970 | )
|Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities, net of effects from acquisitions and
divestitures: |  |                                  |            |   |      |   |          |      |  |   |          |  
|Asset impairment                                                                                                                                      |  |                                  | 47,700     |   |      |   |         |      |  |   |         |  
|Depreciation, asset disposal and amortization                                                                                                         |  |                                  | 341,455    |   |      |   | 174,370  |      |  |   | 153,094  |  
|Accretion of interest                                                                                                                                 |  |                                  | 4,863      |   |      |   | 3,459    |      |  |   | 21,662   |  
|Loss on equity investment                                                                                                                             |  |                                  |           |   |      |   |         |      |  |   | 875      |  
|Bad debt expense                                                                                                                                      |  |                                  | 16,145     |   |      |   | 7,761    |      |  |   | 8,530    |  
|Non-cash compensation                                                                                                                                 |  |                                  | 9,083      |   |      |   | 19,965   |      |  |   | 28,810   |  
|Deferred income taxes                                                                                                                                 |  |                                  | (6,130     | ) |      |   | (2,851   | )    |  |   | 10,347   |  
|(Gain) loss on debt extinguishment                                                                                                                    |  |                                  |           |   |      |   | (468     | )    |  |   | 41,171   |  
|Other non-operating (gains) losses                                                                                                                    |  |                                  | 157        |   |      |   | (679,515 | )    |  |   |         |  
|Loss on derivative instruments                                                                                                                        |  |                                  |           |   |      |   | 3,092    |      |  |   | 2,023    |  
|Change in operating assets and liabilities:                                                                                                           |  |                                  |            |   |      |   |          |      |  |   |          |  
|Accounts receivable                                                                                                                                   |  |                                  | (8,976     | ) |      |   | (5,208   | )    |  |   | 403      |  
|Inventory                                                                                                                                             |  |                                  | (5,714     | ) |      |   | 5,332    |      |  |   | 4,166    |  
|Prepaid expenses and other current assets                                                                                                             |  |                                  | (7,856     | ) |      |   | (2,427   | )    |  |   | (2,709   | )
|Intangible and other assets                                                                                                                           |  |                                  | 955        |   |      |   | 3,867    |      |  |   | (3,489   | )
|Accounts payable                                                                                                                                      |  |                                  | 28,336     |   |      |   | 1,875    |      |  |   | 15,079   |  
|Accrued payroll and liabilities                                                                                                                       |  |                                  | 3,290      |   |      |   | (20      | )    |  |   | 5,369    |  
|Deferred revenue                                                                                                                                      |  |                                  | 1,349      |   |      |   | (508     | )    |  |   | 1,669    |  
|Accrued interest                                                                                                                                      |  |                                  | (437       | ) |      |   | 304      |      |  |   | 2,633    |  
|Other liabilities                                                                                                                                     |  |                                  | (1,931     | ) |      |   | (3,473   | )    |  |   | 1,256    |  
|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  
|Net cash provided by (used in) operating activities                                                                                                   |  |                                  | (79,546    | ) |      |   | 87,631   |      |  |   | 136,919  |  
|                                                                                                                                                      |  |                                  |           
|Cash flows from investing activities:                                                                                                                 |  |                                  |            |   |      |   |          |      |  |   |          |  
|Purchase of available for sale securities                                                                                                             |  |                                  | (1,061,225 | ) |      |   | (652,500 | )    |  |   | (675,200 | )
|Proceeds from sale of available for sale securities                                                                                                   |  |                                  | 1,227,675  |   |      |   | 449,600  |      |  |   | 770,917  |  
|Capital expenditures                                                                                                                                  |  |                                  | (137,967   | ) |      |   | (77,795  | )    |  |   | (145,874 | )
|Net investments in and advances to non-consolidated entity                                                                                            |  |                                  |           |   |      |   |         |      |  |   | (875     | )
|Repayments from non-consolidated entity                                                                                                               |  |                                  |           |   |      |   |         |      |  |   | 58       |  
|Proceeds from exchange of FCC licenses                                                                                                                |  |                                  |           |   |      |   | 4,698    |      |  |   |         |  
|Deposits on FCC licenses                                                                                                                              |  |                                  |           |   |      |   | (5,000   | )    |  |   |         |  
|Refund of FCC license deposit                                                                                                                         |  |                                  | 5,000      |   |      |   |         |      |  |   |         |  
|Proceeds from sale of assets                                                                                                                          |  |                                  | 53,214     |   |      |   | 570      |      |  |   | 738      |  
|Acquisition of FCC licenses                                                                                                                           |  |                                  |           |   |      |   | (2,161   | )    |  |   | (28,413  | )
|Proceeds from asset exchange                                                                                                                          |  |                                  |           |   |      |   | 176,000  |      |  |   |         |  
|Payment of direct costs on business transactions                                                                                                      |  |                                  | (1,280     | ) |      |   | (6,657   | )    |  |   |         |  
|Other                                                                                                                                                 |  |                                  | (99        | ) |      |   | (434     | )    |  |   |         |  
|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  
|Net cash provided by (used in) investing activities                                                                                                   |  |                                  | 85,318     |   |      |   | (113,679 | )    |  |   | (78,649  | )
|                                                                                                                                                      |  |                                  |           
|Cash flows from financing activities:                                                                                                                 |  |                                  |            |   |      |   |          |      |  |   |          |  
|Dividends paid                                                                                                                                        |  |                                  |           |   |      |   | (189,000 | )    |  |   |         |  
|Proceeds from issuance of debt, net of discount                                                                                                       |  |                                  |           |   |      |   |         |      |  |   | 710,500  |  
|Borrowings under senior secured term loan                                                                                                             |  |                                  |           |   |      |   | 250,000  |      |  |   |         |  
|Payments under senior secured term loan                                                                                                               |  |                                  | (2,500     | ) |      |   |         |      |  |   |         |  
|Payments under senior secured credit facility                                                                                                         |  |                                  |           |   |      |   |         |      |  |   | (207,961 | )
|Payments of subordinated debt                                                                                                                         |  |                                  |           |   |      |   | (4,463   | )    |  |   | (511,989 | )
|Payment of debt extinguishment costs                                                                                                                  |  |                                  |           |   |      |   | (10      | )    |  |   | (31,342  | )
|Change in bank overdraft                                                                                                                              |  |                                  | 3,663      |   |      |   | (9,212   | )    |  |   | (3,171   | )
|Payment of deferred financing costs                                                                                                                   |  |                                  | (28        | ) |      |   | (4,947   | )    |  |   | (2,680   | )
|Extinguishment of interest rate swaps                                                                                                                 |  |                                  |           |   |      |   | (3,092   | )    |  |   | (20,383  | )
|Principal payments under capital lease obligations                                                                                                    |  |                                  | (1,104     | ) |      |   | (1,536   | )    |  |   | (1,948   | )
|(Advances to) repayments from related party, net                                                                                                      |  |                                  | 1,646      |   |      |   | (6,707   | )    |  |   | (120     | )
|Other                                                                                                                                                 |  |                                  |           |   |      |   |         |      |  |   | 57       |  
|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  
|Net cash provided by (used in) financing activities                                                                                                   |  |                                  | 1,677      |   |      |   | 31,033   |      |  |   | (69,037  | )
|                                                                                                                                                      |  |                                  |           
|Net increase (decrease) in cash and cash equivalents                                                                                                  |  |                                  | 7,449      |   |      |   | 4,985    |      |  |   | (10,767  | )
|Cash and cash equivalents, beginning of period                                                                                                        |  |                                  | 8,351      |   |      |   | 3,366    |      |  |   | 14,133   |  
|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  
|Cash and cash equivalents, end of period                                                                                                              |  | $                                | 15,800     |   |      | $ | 8,351    |      |  | $ | 3,366    |  
|                                                                                                                                                      |  |                                  |            |   |      |   |          |      |  |   |          |  

See accompanying notes to consolidated financial statements.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended December 31, 2005, 2004 and 2003

1. Summary of Operations and Significant Accounting Policies

SunCom Wireless, Inc. (SunCom) is a direct,
wholly-owned subsidiary of SunCom Wireless Investment Co., LLC (SunCom Investment Company). SunCom Investment Company is a direct, wholly-owned subsidiary of SunCom Wireless Holdings, Inc. (Holdings). Accordingly, SunCom
Wireless, Inc. and its subsidiaries are indirect, wholly-owned subsidiaries of Holdings. SunCom has no independent assets or operations, and all of SunComs subsidiaries, other than Triton PCS Property Company L.L.C. and Triton PCS License
Company L.L.C., have guaranteed on a full, unconditional and joint and several basis SunComs 81/2% senior
notes due 2013 (the 81/2% Notes), its 93/8% senior subordinated notes due 2011 (the 93/8% Notes) and its 83/4% senior subordinated notes due 2011
(the 83/4% Notes). The 81/2% Notes are effectively subordinated in right of payment to all of SunComs senior secured debt, including its current senior secured term loan (the Term Loan).
The 93/8% Notes and the 83/4% Notes constitute unsecured obligations of SunCom and rank subordinate in right of payment to all of SunComs existing and future senior debt, including the 81/2% Notes and the Term Loan.

The consolidated accounts include SunCom and its wholly-owned subsidiaries (collectively, the Company). The Companys more significant
accounting policies follow:

(a) Nature of Operations

In February 1998, the Company entered into a joint venture with the predecessor to AT&T Wireless Services, Inc. (AT&T Wireless)
whereby AT&T Wireless contributed to the Company personal communications services licenses for 20 megahertz of authorized frequencies covering approximately 13.6 million potential subscribers in a contiguous geographic area encompassing
portions of Virginia, North Carolina, South Carolina, Tennessee, Georgia and Kentucky. As part of this agreement, the Company was granted the right to be the exclusive provider of wireless mobility services using equal emphasis co-branding with
AT&T Corp. in the Companys licensed markets. In connection with Cingular Wireless LLC (Cingular Wireless) acquiring AT&T Wireless in October 2004, the Company, AT&T Wireless and Cingular Wireless entered into certain
agreements. Pursuant to one of these agreements, AT&T Wireless PCS LLC (AT&T Wireless PCS) surrendered to Holdings all of the Holdings stock held by it, thereby terminating Holdings First Amended and Restated
Stockholders Agreement, as amended (the Stockholders Agreement), including the exclusivity provisions contained therein. In December 2004, the Company also transferred personal communications services (PCS)
network assets held for use in its Virginia markets to AT&T Wireless in exchange for PCS network assets held by AT&T Wireless for use in certain of its North Carolina markets, in Puerto Rico and in the U.S. Virgin Islands and the payment by
Cingular Wireless to the Company of $175 million. For a description of the Companys current relationship with AT&T Wireless and Cingular Wireless, see Note 3.

As of December 31, 2005, the Company offered service in 30 markets covering approximately 18.9 million potential subscribers, and the Companys network in these markets included 2,593 cell sites, eight
Time Division Multiple Access (TDMA) switches and four Global System for Mobile Communications and General Packet Radio Service (GSM/GPRS) switches.

(b) Liquidity and Capital Resources

The construction of SunComs network and the marketing and distribution of wireless communications products and services have required, and will continue to require, substantial capital. SunComs capital outlays have included
license acquisition costs, capital expenditures for network construction, funding of operating cash flow losses and other working capital costs and debt service related expenditures. SunCom will have additional capital requirements for future
upgrades due to advances in new technology. Approximately $195.1 million of Holdings short-term investments are held by SunCom Investment Company, the immediate parent of SunCom, and therefore not currently available to SunCom. SunComs
projected cash flow from operations is not expected to be sufficient to pay its debt service and fund its operating expenses and required capital expenditures past early 2007. The annual debt service on SunComs long-term indebtedness is
approximately $150 million. SunComs inability to pay such debt service could result in a default on such indebtedness, which, unless cured or waived, would have a material adverse effect on its liquidity and financial position. Through March
16, 2006, Holdings management and its board of directors have not taken any actions to make additional investments in SunCom. Holdings has retained financial and legal advisors to assist it in evaluating options to improve SunComs
financial condition. While no definitive course of action has yet been adopted, absent Holdings determination to make additional investments in SunCom or SunComs ability to obtain another source of liquidity this year, SunCom will need
to restructure its balance sheet, which may occur through a so-called prepackaged or prearranged bankruptcy, and/or implement an alternative financial plan, such as the sale of a significant portion of its assets, to reduce
SunComs long-term debt. If Holdings and SunCom are able to obtain an acceptable financial restructuring of SunComs debt, Holdings will consider, but has undertaken no obligation to, making additional investments in SunCom. There can be
no assurance that any such deleveraging efforts will be successful and, if not, SunCom may have to seek federal bankruptcy protection. Certain holders of SunComs debt securities have raised legal questions regarding the $189 million dividend
paid by SunCom to SunCom Investment Company in November 2004. SunCom continues to believe that such dividend was properly paid.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



(c) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the financial statements and the reported amount of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

(d) Cash and Cash Equivalents and Marketable Securities

Cash and cash equivalents include cash on hand, demand deposits and short-term investments with initial maturities of three months or less.
The Company maintains cash balances at financial institutions, which at times exceed the $100,000 Federal Deposit Insurance Corporation limit. Bank overdraft balances are classified as a current liability.

The Company invests its excess cash in marketable securities consisting principally of auction rate securities, which are accounted for in accordance
with Statement of Financial Accounting Standards (SFAS) No. 115, Accounting for Certain Investments in Debt and Equity Securities. These investments, which are classified as available-for-sale securities, are recorded at
their fair values and unrealized gains and losses, if applicable, are reported as part of accumulated other comprehensive income on the consolidated balance sheet. The Company has established investment guidelines that maintain safety and liquidity,
and these guidelines are reviewed periodically by management.

(e) Inventory

Inventory, consisting primarily of wireless handsets and accessories held for resale, is valued at lower of cost or market. Cost is determined by the
first-in, first-out method. Market is determined using replacement cost. Losses on sales of wireless phones are recognized in the period in which sales are made as a cost of acquiring or retaining subscribers.

(f) Construction in Progress

Construction in progress includes expenditures for the design, construction and testing of the Companys PCS network and also includes costs associated with developing information systems. The Company capitalizes interest on
certain of its construction in progress activities. When the assets are placed in service, the Company transfers the assets to the appropriate property and equipment category and depreciates these assets over their respective estimated useful
lives.

(g) Investment in PCS Licenses

Investments in PCS licenses are recorded at their estimated fair value at the time of acquisition. As there is an observable market for PCS licenses, the Company believes that Federal Communications Commission
(FCC) licenses qualify as indefinite life intangibles. In accordance with SFAS No. 142 and the Companys interpretation of EITF 02-7 Unit of Accounting for Testing Impairment of Indefinite-lived Intangible Assets,
PCS licenses are tested for impairment at the reporting unit level. A reporting units investment in PCS licenses is tested for impairment annually or more frequently if events or changes in circumstances indicate that the PCS licenses may be
impaired. The impairment test consists of a comparison of the fair value with the carrying value. Fair value is determined with the assistance of a fair market valuation performed by an independent valuation company. See Note 9 for further
information regarding the Companys PCS licenses and the related impairment tests.

(h) Goodwill

Goodwill is the excess of the purchase price over the fair value of net identifiable assets acquired in business combinations accounted for as a purchase.
In accordance with SFAS No. 142, goodwill is tested for impairment by comparing the fair value of the Companys reporting units to their carrying values. This test for impairment is performed at least annually. The Company determines
fair value for its reporting units using a market approach. See Note 4 and Note 9 for further information regarding goodwill and the related impairment tests.



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SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



(i) Deferred Costs

Costs incurred in connection with the negotiation and documentation of debt instruments are deferred and amortized over the terms of the underlying
obligation. Costs incurred in connection with the issuance and sale of equity securities are deferred and netted against the proceeds of the stock issuance upon completion of the transaction. Costs incurred in connection with acquisitions are
deferred and included in the aggregate purchase price allocated to the net assets acquired upon completion of the transaction. Costs incurred in connection with divestitures are deferred and applied against the gains or loss incurred from the
transaction.

(j) Long-Lived Assets

Property and equipment is carried at original cost. Depreciation is calculated based on the straight-line method over the estimated useful lives of the assets, which are five to twelve years for network infrastructure
and equipment and three to five years for office furniture and equipment. Depreciation lives may be shortened due to changes in technology, the rate of migration of the Companys subscriber base from its TDMA network to its GSM/GPRS network or
other industry conditions. During 2004, as a result of the Companys successful launch of its overlapping next generation GSM/GPRS network in all of its covered markets, the useful lives of all TDMA equipment were shortened so that this TDMA
equipment would be fully depreciated by December 31, 2008. During the second quarter and fourth quarter of 2005, the Company further accelerated depreciation of wireless communications equipment related to its TDMA network. As a result, the
TDMA network equipment of the continental United States reporting unit will be fully depreciated by June 30, 2006 and those of the Puerto Rico and U.S. Virgin Islands reporting unit will be fully depreciated by March 31, 2006. The
additional depreciation resulted from a more aggressive migration from the Companys TDMA network to its GSM/GPRS network, as well as a higher rate of churn for these customers than originally planned.

In addition, the Company capitalizes interest on expenditures related to the build-out of its network. Expenditures for repairs and maintenance are
charged to expense as incurred. When property is retired or otherwise disposed of, the cost of the property and the related accumulated depreciation are removed from the accounts, and any resulting gains or losses are reflected in the statement of
operations. Capital leases are included under property and equipment with the corresponding amortization included in accumulated depreciation. The related financial obligations under the capital leases are included in current and long-term
obligations. Capital lease assets are amortized over the useful lives of the respective assets, or the lease term, whichever is shorter.

The Company periodically evaluates the carrying value of long-lived assets, other than indefinite-lived intangible assets, when events and circumstances warrant such review. The carrying value of a long-lived asset is considered impaired
when the anticipated undiscounted cash flows expected to result from the use and eventual disposal of such assets are less than the carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair
value of the long-lived asset. Fair value is determined by using the anticipated cash flows discounted at a rate commensurate with the risk involved.

(k) Revenue Recognition

Revenues consist of charges to customers for activation, monthly
access, airtime, roaming charges, long-distance charges, features, fees, Universal Service Fund program revenue and equipment sales as well as revenues earned from other carriers customers using the Companys network. Revenues are
recognized as services are rendered. Unbilled revenues result from service provided from the billing cycle date to the end of the month and from other carriers customers using the Companys systems. Unearned revenues result from billing
subscribers in advance for recurring charges such as access and features. In accordance with Emerging Issues Task Force (EITF) 00-21 Accounting for Revenue Arrangements with Multiple Deliverables in a subscriber activation,
the total proceeds are allocated to the associated deliverables. When equipment cost exceeds equipment revenue, referred to as equipment margin, the activation fee collected, up to the amount of the equipment margin, is recognized immediately as
equipment revenue. Any subscriber activation fee collected in excess of the equipment margin is deferred and recognized over the estimated subscribers life. Equipment sales are a separate earnings process from other services we offer and are
recognized upon delivery to the customer and reflect charges to customers for wireless handset equipment purchases.

(l) Income
Taxes

Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using statutory tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



(m) Financial Instruments

Derivative financial instruments are accounted for in accordance with SFAS No. 133. Derivatives, which qualify as a cash-flow hedge, are reflected on
the balance sheet at their fair market value and changes in their fair value are reflected in accumulated other comprehensive income and reclassified into earnings as the underlying hedge items affect earnings. Financial instruments, which do not
qualify as a cash flow hedge, are reflected on the balance sheet at their fair market value and changes in their fair value are recorded as other income or expense on the income statement. Derivatives, which qualify as a fair value hedge, are
reflected on the balance sheet at their fair market value and changes in their fair value are reflected in adjustments to the carrying value of the matched debt. As of December 31, 2005, the Company was not a party to any derivative financial
instruments. (see Note 13)

(n) Advertising Costs

The Company expenses the costs of producing advertisements as incurred and expenses the costs of communicating the advertisement when the advertisement
occurs. Total advertising expense amounted to $61.1 million in 2005, $30.5 million in 2004 and $32.6 million in 2003.

(o)
Concentrations of Credit Risk

Financial instruments, which potentially subject the Company to concentration of credit risk, consist
principally of cash, cash equivalents, short-term investments and accounts receivable. The Companys credit risk is managed through diversification and by investing its cash, cash equivalents and short-term investments in high-quality
investment holdings.

Concentrations of credit risk with respect to accounts receivable are limited due to a large customer base. Initial
credit evaluations of customers financial condition are performed and security deposits are obtained for customers with a higher credit risk profile. The Company maintains reserves for potential credit losses. The Company estimates its
allowance for doubtful accounts by applying estimated loss percentages against its aging of accounts receivable balances. The estimated loss percentages are updated periodically and are based on the Companys historical write-off experience,
net of recoveries.

(p) Stock Compensation

The Company accounts for Holdings stock compensation under the intrinsic value method of Accounting Principles Board Opinion 25. Pro forma compensation expense is calculated for the fair value of stock
compensation using the Black-Scholes model for Holdings stock issued under Holdings employee stock purchase plan. With regard to the pro forma net income (loss), there was no offsetting impact to the tax provision related to pro forma
compensation expense because of historical net losses and recognition of a valuation allowance against the associated net operating loss carryforwards during the periods that the employee stock purchase plan was active. Holdings employee stock
purchase plan was suspended in January 2003; therefore, there was no pro forma compensation expense calculated for the years ended December 31, 2005 and 2004 related to the employee stock purchase plan.

Assumptions, for the year ended December 31, 2003, include an expected life of three months, weighted average risk-free interest rate of 1.2%, a
dividend yield of 0.0% and expected volatility of 150%. Had compensation expense for grants of stock-based compensation been determined consistent with SFAS No. 123, Accounting for Stock-Based Compensation the pro forma net income
(loss) would have been:



|                                                                                                                                            |  |                                  |          |   |      |   |         |      |  |   |          |  
|------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------- | -------- | - | ---- | - | ------- | ---- |  | - | -------- | -
|                                                                                                                                            |  | For the Years Ended December 31, |         
|                                                                                                                                            |  | 2005                             |          |   | 2004 |   |         | 2003 | 
|                                                                                                                                            |  | (Dollars in thousands)           |         
|Net income (loss)                                                                                                                           |  | $                                | (501,835 | ) |      | $ | 562,076 |      |  | $ | (153,970 | )
|Add: stock-based employee compensation expense included in reported net income (loss), net of related tax effects                           |  |                                  | 9,083    |   |      |   | 19,965  |      |  |   | 28,810   |  
|Deduct: total stock-based employee compensation expense determined under fair value based method for all awards, net of related tax
effects |  |                                  | (9,083   | ) |      |   | (19,965 | )    |  |   | (28,834  | )
|                                                                                                                                            |  |                                  |          |   |      |   |         |      |  |   |          |  
|Pro forma net income (loss)                                                                                                                 |  | $                                | (501,835 | ) |      | $ | 562,076 |      |  | $ | (153,994 | )
|                                                                                                                                            |  |                                  |          |   |      |   |         |      |  |   |          |  



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



(q) Segments

The accounting policies of operating and reportable segments, as defined by SFAS No. 131, Disclosures about Segments of an Enterprise and
Related Information, are the same as those described elsewhere in this footnote. Revenue for all segments is derived from external parties. See Note 5, Segment Information, for further discussion of the Companys reportable segments.

(r) Reclassifications

Certain reclassifications have been made to prior period financial statements to conform to the current period presentation.

(s) New Accounting Pronouncements

In October 2005, the Financial Accounting Standards Board (the FASB)
issued FASB Staff Position No. FAS 13-1, Accounting for Rental Costs Incurred during a Construction Period (FSP No. 13-1), to give guidance to a lessee on determining whether rental costs associated with operating leases
may be capitalized during a construction period. Specifically, FSP No. 13-1 stipulates that such costs shall be (a) recognized as rental expense, (b) included in income from continuing operations, and (c) allocated over the lease
term according to the guidance in SFAS No. 13, Accounting for Leases, and FASB Technical Bulletin No. 85-3, Accounting for Operating Leases with Scheduled Rent Increases. The guidance in FSP No. 13-1 is
effective for the first reporting period beginning after December 15, 2005, with early adoption permitted for financial statements or interim financial statements that have not yet been issued. The Company already accounts for such rental costs
in accordance with FSP No. 13-1; therefore the issuance of FSP No. 13-1 will not have an additional impact on the Companys consolidated financial statements.

On June 1, 2005, the FASB issued SFAS No. 154, Accounting Changes and Error Corrections (SFAS No. 154). SFAS
No. 154 replaces Accounting Principles Board Opinion No. 20, Accounting Changes and SFAS No. 3, Reporting Accounting Changes in Interim Financial Statements. SFAS No. 154 requires that a voluntary change
in accounting principle be applied retrospectively to all prior period financial statements presented. SFAS No. 154 also requires that a change in method of depreciating or amortizing a long-lived non-financial asset be accounted for
prospectively as a change in estimate, and correction of errors in previously issued financial statements should be termed a restatement. SFAS No. 154 is effective for accounting changes and correction of errors made in fiscal years beginning
after December 15, 2005. The Company does not expect this Statement to have a material effect on its financial statements or its results of operations.

On December 15, 2004, the FASB issued the revised SFAS No. 123, Share-Based Payment (SFAS No. 123R), which addresses the accounting for share-based payment transactions in which
an entity obtains employee services in exchange for (a) equity instruments of the entity or (b) liabilities that are based on the fair value of the entitys equity instruments or that may be settled by the issuance of such equity
instruments. This statement eliminates the ability to account for employee share-based payment transactions using Accounting Principles Board Opinion No. 25 and requires instead that such transactions be accounted for using the grant-date fair
value based method. SFAS No. 123R applies to all awards granted or modified after the Statements effective date. In addition, compensation cost for the unvested portion of previously granted awards that remain outstanding on the
Statements effective date shall be recognized on or after the effective date, as the related services are rendered, based on the awards grant-date fair value as previously calculated for the pro-forma disclosure under SFAS No. 123.
The requirements of SFAS No. 123R were to become effective as of the beginning of the third quarter of 2005; however, on April 14, 2005, the Securities and Exchange Commission (SEC) announced the adoption of a new rule that
amends the compliance dates for SFAS No. 123R. The SECs new rule allows the Company to implement SFAS No. 123R as of January 1, 2006. The SECs new rule does not change the accounting required by SFAS No. 123R; it
changes only the dates for compliance with the standard. The Company currently uses the grant-date fair value based method to account for Holdings restricted stock awards, and as such, this Statement will not have a material effect on its
financial statements or its results of operations.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



On November 24, 2004, the FASB issued SFAS No. 151, Inventory Costsan amendment
of ARB 43, Chapter 4 (SFAS No. 151). This statement amends the guidance in ARB No. 43, Chapter 4, Inventory Pricing, to clarify the accounting for abnormal amounts of idle facility expense, freight, handling
costs and wasted material. This statement requires that those items be recognized as current-period charges. In addition, this Statement requires that allocation of fixed production overhead to the costs of conversion be based on the normal capacity
of the production facilities. This Statement will be effective for inventory costs incurred during fiscal years beginning after June 15, 2005. The Company does not expect this Statement to have a material effect on its financial statements
or its results of operations.

2. AT&T Transaction

On October 8, 1997, Holdings entered into a Securities Purchase Agreement with AT&T Wireless PCS (as successor to AT&T Wireless PCS, Inc.) and the stockholders of Holdings, whereby the Company became the
exclusive provider of wireless mobility services in the Southeast region. As discussed above in Note 1, following the closing of AT&T Wireless merger with Cingular Wireless LLC in October 2004, the Company consummated certain agreements
with AT&T Wireless and Cingular Wireless. Pursuant to these agreements, AT&T Wireless PCS surrendered to Holdings all of Holdings stock held by it, thereby terminating Holdings Stockholders Agreement, including the
exclusivity provisions contained therein. This footnote describes the Companys relationship with AT&T Wireless Services, Inc. and AT&T Wireless PCS prior to the October 26, 2004 termination of the Stockholders Agreement. For
a description of the Companys current relationship with AT&T Wireless and Cingular Wireless, see Note 3.

In February 1998,
Holdings issued 732,371 shares of Series A convertible preferred stock and 366,131 shares of Series D convertible preferred stock to AT&T Wireless PCS in exchange for 20 megahertz PCS licenses covering certain areas in the southeastern
United States and the execution of certain related agreements, as further described below. The fair value of these FCC licenses was $92.8 million. This amount was substantially in excess of the tax basis of such licenses, and accordingly, the
Company recorded a deferred tax liability, upon the closing of the transaction.

In addition, the Company and AT&T Wireless PCS and the
other stockholders of Holdings at that time consented to executing the following agreements:

(a) Stockholders Agreement

The Stockholders Agreement was to expire on February 4, 2009. The agreement was amended and restated on
October 27, 1999 in connection with Holdings initial public offering and included following material terms and conditions:

Exclusivity - None of Holdings stockholders who were parties to the Stockholders Agreement, or their affiliates, were permitted to provide or resell, or act as the agent for any person offering,
within the defined territory, wireless mobility telecommunications services initiated or terminated using TDMA and frequencies licensed by the FCC or, in certain circumstances (such as if AT&T Wireless PCS and its affiliates moved to a successor
technology in a majority of the defined southeastern region), a successor technology (Company Communications Services), except AT&T Wireless PCS and its affiliates were permitted (but never exercised their right) to resell or act as
agent for the Company in connection with the provision of Company Communications Services, (i) provide or resell wireless telecommunications services to or from certain specific locations, and (ii) resell Company Communications Services
for another person in any area where the Company has not placed a system into commercial service, provided that AT&T Wireless PCS had provided the Company with prior written notice of AT&T Wireless PCSs intention to do so and only dual
band/dual mode phones were used in connection with such resale activities.

Preferred Provider Status - With respect
to the markets listed in the AT&T Wireless roaming agreement, Holdings and AT&T Wireless PCS agreed to cause their respective affiliates in their home carrier capacities to program and direct the programming of customer equipment so that the
other party in its capacity as the serving carrier would be the preferred provider in such markets, and refrain from inducing any of its customers to change such programming.

Build-out - The Company was required to conform to certain requirements regarding the construction of the Companys PCS
network.

Share Transfers Holdings stockholders who were parties to the Stockholders Agreement
were required to comply with certain restrictions on transfer, including a right of first negotiation in favor of AT&T Wireless.



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SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



(b) License Agreement

Pursuant to a Network Membership License Agreement, dated February 4, 1998 (as amended, the License Agreement), among
AT&T Corp., the Company and AT&T Wireless, AT&T Corp. granted to the Company a royalty-free, nontransferable, nonsublicensable, limited right and license to use certain licensed marks solely in connection with certain licensed
activities.

The License Agreements initial fair value was determined to be $8.4 million with an estimated useful
life of 10 years. As of December 31, 2003, the net book value of this intangible asset was $3.4 million. On February 17, 2004, AT&T Wireless and Cingular Wireless entered into an Agreement and Plan of Merger. Subsequently,
AT&T Wireless and Cingular Wireless indicated that the merged entity would not continue the use of the AT&T brand, which affected the benefits provided to the Company under its co-branding arrangement with AT&T Wireless. As a result,
beginning in the first quarter of 2004, the Company accelerated the amortization of the License Agreement to fully amortize this intangible over its revised useful life, which ended on October 26, 2004 (the date Cingular Wireless consummated
its acquisition of AT&T Wireless). The impact of this change for the year ended December 31, 2004, was an increase in amortization expense and a decrease in net income of approximately $2.6 million.

(c) Roaming Agreement

Pursuant to an Intercarrier Roamer Service Agreement, dated as of February 4, 1998 (as amended, the Roaming Agreement), between AT&T Wireless and the Company, each of AT&T Wireless and the Company agreed to provide
PCS service for registered customers of the other carrier while such customers were out of the home carriers geographic area and in the geographic area where the serving carrier (itself or through affiliates) held a license or permit to
construct and operate PCS service. The fair value of the Roaming Agreement, as determined by an independent appraisal, was $5.5 million, with an estimated useful life of 20 years. The Roaming Agreements value was attributable to the
exclusivity component of the Stockholders Agreement, which resulted in AT&T Wireless customers roaming onto the Companys network more frequently than the Companys subscribers roaming onto AT&T Wireless network.

As described in Note 3 below, on October 26, 2004, pursuant to the Triton PCS Agreement, the Roaming Agreement was
terminated upon consummation of the AT&T Wireless and Cingular Wireless merger. Accordingly, during the third quarter of 2004, the Company accelerated the amortization of the Roaming Agreement to fully amortize this intangible over its revised
useful life, which ended on October 26, 2004. The impact of this change for the year ended December 31, 2004, was an increase in amortization expense and a decrease in net income of approximately $3.6 million.

3. Current Relationship with AT&T Wireless and Cingular Wireless

In February 2004, AT&T Wireless and Cingular Wireless entered into an Agreement and Plan of Merger pursuant to which Cingular Wireless agreed to acquire all of the outstanding stock of AT&T Wireless through a
merger of a Cingular Wireless subsidiary with and into AT&T Wireless, with AT&T Wireless as the surviving corporation of the merger. The announcement of Cingular Wireless planned acquisition of AT&T Wireless signaled a fundamental
change in the long-standing strategic partnership between SunCom and AT&T Wireless, and it precipitated a protracted series of negotiations among SunCom, AT&T Wireless and Cingular Wireless during the period from February 2004 to September
2004. In the course of those negotiations, the three parties discussed a broad range of topics relating to the effect of Cingular Wireless proposed acquisition of AT&T Wireless on their current and future business relationships. Through
this extended process of negotiation, the parties entered into three primary definitive agreements, each dealing with a separate and distinct group of business issues. Reflecting the complexity and time-consuming nature of the negotiations, these
three definitive agreements were separately negotiated and documented, had separate and distinct closing conditions, had different affiliated entities as parties, were executed at different times and were consummated at different times.

Two of the agreements with AT&T Wireless and Cingular Wireless were entered into on July 7, 2004.



| |  |  | Triton Holdings Agreement. On October 26, 2004 (the date Cingular Wireless consummated its acquisition of AT&T Wireless), pursuant to an agreement
dated July 7, 2004 by and among Holdings, AT&T Wireless, AT&T Wireless PCS and Cingular Wireless (the Triton Holdings Agreement), AT&T Wireless PCS surrendered to Holdings all of the Holdings stock owned by
AT&T Wireless. Upon the surrender by AT&T Wireless PCS of its Holdings stock, Holdings Stockholders Agreement was terminated. In addition, Holdings Investors Stockholders Agreement, dated as of February 4, 1998,
as amended, by and among Holdings initial cash equity investors and certain of its management stockholders, also was terminated pursuant to its terms upon termination
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



| | of the Stockholders Agreement. The termination of Holdings Stockholders Agreement allows the combined Cingular Wireless/AT&T Wireless
to operate in regions where the Company once had the right to operate exclusively and allows the Company to operate in areas where it was once prohibited. Also pursuant to the Triton Holdings Agreement, AT&T Wireless transferred to Holdings its
interest in the entity that controls the SunCom brand name and related trademarks and waived the payment of a $3.5 million dividend previously declared by Holdings on its Series A preferred stock.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Triton PCS Agreement. Pursuant to an agreement dated July 7, 2004 by and among SunCom, AT&T Wireless, AT&T Wireless PCS and Cingular Wireless, on
October 26, 2004, the Roaming Agreement was terminated and SunComs roaming agreement with Cingular Wireless was amended to extend the term and reduce the roaming rates payable to the Company and its affiliates thereunder. Without the
exclusivity agreement that previously applied to AT&T Wireless, Cingular Wireless does not rely on the Companys network for service to the same degree that AT&T Wireless did in the past. However, since the rates are reciprocal, the
Company is able to offer its customers wide-area rate plans at acceptable rates of return due to lower expense associated with reduced roaming rates. This change makes the Company less dependent on roaming revenue, which is not directly within the
Companys control, and allows the Companys subscriber revenues to produce a greater proportion of its revenue. In addition, AT&T Wireless transferred certain FCC licenses covering Savannah, Georgia, and Asheville, Wilmington and
Jacksonville, North Carolina, to the Company in exchange for certain FCC licenses held by the Company covering Savannah and Augusta, Georgia. As additional consideration for this license exchange, Cingular Wireless has also paid the Company
approximately $4.7 million.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | In connection with the consummation of the Triton PCS Agreement on October 26, 2004, the Company recognized a non-operating gain of $16.5 million for the year ended
December 31, 2004. This gain was the result of the Company receiving cash of approximately $4.7 million, FCC licenses with a value of approximately $10.9 million and a new roaming agreement with Cingular Wireless with a non-reciprocal TDMA
component with a fair value of approximately $2.9 million. In exchange, the Company transferred FCC licenses with a book value of approximately $2.0 million.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

When the Triton Holdings Agreement and the Triton PCS Agreement were entered into in July 2004, the parties also announced that they had entered into a non-binding letter of intent to consider a possible exchange of
wireless network assets. The proposal to enter into an exchange transaction arose during the course of the broad-ranging discussion of the parties future business relationships. After a series of negotiations over the next three months,
Holdings, AT&T Wireless and Cingular Wireless entered into the Exchange Agreement described below.



| |  |  | Exchange Agreement. On September 21, 2004, Holdings and SunCom entered into an Exchange Agreement with AT&T Wireless and Cingular Wireless LLC (the Exchange
Agreement). On December 1, 2004, pursuant to the closing of the first stage of the Exchange Agreement, the Company transferred PCS network assets held for use in its Virginia markets to AT&T Wireless in exchange for PCS network assets
held by AT&T Wireless for use in certain of its North Carolina markets, in Puerto Rico and in the U.S. Virgin Islands and the payment by Cingular Wireless to the Company of $175 million. On November 22, 2005, pursuant to closing of the
second stage of the Exchange Agreement and subsequent to receiving FCC approval, the parties exchanged equity interests in the subsidiaries holding the FCC licenses.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Between the first and second closings, the parties entered into spectrum lease agreements, which allowed each party to use the licensed PCS spectrum
necessary to operate the businesses acquired pursuant to the first closing of the Exchange Agreement. Under one of the spectrum leases, SunCom had access to Cingular Wireless spectrum in certain of SunComs North Carolina markets and in
Puerto Rico and the U.S. Virgin Islands. This spectrum lease provided SunCom with exclusive access to the spectrum, but control of the spectrum remained with Cingular Wireless. This spectrum lease terminated automatically upon the consummation of
the second closing. A second spectrum lease provided SunCom with access to 10 megahertz of additional spectrum in Puerto Rico. Similar to the first spectrum lease, SunCom had exclusive access to the spectrum at issue, but control of the spectrum
remained with Cingular Wireless. This spectrum lease expired on December 1, 2005. This second spectrum lease existed because AT&T Wireless had been operating both TDMA technology and GSM/GPRS technology in the Puerto Rico market with 35
megahertz of spectrum. With the successful migration of most of the Puerto Rico subscribers from TDMA technology to GSM/GPRS technology, SunCom was able to provide the same service level with 25 megahertz of spectrum as of December 1, 2005, the
lease termination date. See Note 4 for additional disclosure regarding the Companys accounting treatment of the Exchange Agreement.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



In connection with the consummation of the Exchange Agreement, the Company recognized a
non-operating pre-tax gain of $663.1 million, net of expenses of $3.5 million for the year ended December 31, 2004. This gain was the result of the Company exchanging tangible and intangible assets in its Virginia markets (the Virginia
Markets) with a book value of approximately $422.0 million and a fair value of approximately $1,079.5 million. In addition, the Company recognized a gain of approximately $9.1 million as the result of eliminating liabilities associated with
the divested Virginia assets.

As a result of these transactions, the Company is no longer the exclusive provider of AT&T Wireless (now
Cingular Wireless) PCS service in its markets and the exclusivity, resale and other provisions of the Stockholders Agreement discussed in Note 2 above have been terminated. The Company currently markets wireless service under the SunCom
Wireless brand name.

4. Exchange Transaction

As described in Note 3, on December 1, 2004, pursuant to the terms of the Exchange Agreement, the Company transferred PCS network assets held for use in the Virginia markets to AT&T Wireless in exchange for PCS network assets held
by AT&T Wireless for use in certain of its North Carolina markets, in Puerto Rico and in the U.S. Virgin Islands (NC/PR) and the payment by Cingular Wireless to the Company of $175 million. The estimated value of the exchange, based
on the fair value of the components valued by the Company with the assistance of an independent third party valuation company, was approximately $1.2 billion. The following schedule summarizes the purchase price allocation, consideration and direct
transaction costs.



|                                                          |  |                                           |          
|--------------------------------------------------------- |  | ----------------------------------------- | ---------
|                                                          |  | December 1, 2004Purchase Price Allocation
|                                                          |  | (Dollars in thousands)                   
|Fair value of consideration and direct transaction costs: |  |                                           |          
|Due to seller of NC/PR                                    |  | $                                         | 847      
|Fair value of Virginia Markets working capital divested   |  |                                           | 16,759   
|Fair value of Virginia Markets tangible assets divested   |  |                                           | 341,238  
|Fair value of Virginia Markets intangible assets divested |  |                                           | 721,476  
|Deferred tax liability                                    |  |                                           | 93,828   
|Direct transaction costs                                  |  |                                           | 3,684    
|                                                          |  |                                           |          
|Total fair value of consideration                         |  | $                                         | 1,177,832
|                                                          |  |                                           |          
|Allocation of purchase price:                             |  |                                           |          
|Cash received                                             |  | $                                         | 175,000  
|Fair value of NC/PR working capital acquired              |  |                                           | 48,378   
|Fair value of NC/PR tangible assets acquired              |  |                                           | 361,704  
|Fair value of NC/PR intangible assets acquired            |  |                                           | 503,685  
|Goodwill                                                  |  |                                           | 89,065   
|                                                          |  |                                           |          
|Total purchase price allocation                           |  | $                                         | 1,177,832
|                                                          |  |                                           |          

The asset exchange was accounted for as a purchase in accordance with SFAS No. 141
Business Combinations. The Companys consolidated results of operations include the operating results of NC/PR from the acquisition date, which was December 1, 2004. The acquired assets were recorded at their estimated fair
market value at the date of acquisition and costs directly attributable to the completion of the acquisition have been allocated to the appropriate asset.

During the year ended December 31, 2005, the preliminary purchase price was adjusted to reflect the working capital and accounts receivable settlement and resolution of certain outstanding tax issues. As a
result, the Company adjusted goodwill to reflect a $7.6 million increase in accounts receivable, a $1.7 million decrease in other current liabilities and a $2.4 million decrease in the deferred tax liability balance.

After the adjustment, the final purchase price allocations include the following intangibles (i) $333.9 million of FCC licenses with indefinite
useful lives, (ii) $157.1 million of subscriber lists with a useful life of approximately 7 years, (iii) $89.1 million of goodwill, and (iv) $12.7 million of income leases with useful lives ranging between 23 and 25 years. The
weighted average amortization period of finite-lived intangible assets acquired in the Exchange Transaction was approximately 8 years. The purchase price allocations also include $361.7 million of property and equipment (e.g. equipment shelters,
towers, telephone and switching equipment, cell site equipment), which is being depreciated over 3 to 10 years. The exchange resulted in the recognition of a gain on our consolidated statements of operations and comprehensive income (loss) for the
year ended December 31, 2004 of approximately $663.1 million, which is net of $3.5 million of direct costs related to the divestiture of the Virginia Markets. Of the $89.1 million of goodwill recorded in the Exchange Transaction, $22.3 million
is deductible for tax purposes over 15 years.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



The following unaudited pro forma financial information is not necessarily indicative of the
Companys results of operations that would have occurred had the acquisition of NC/PR and the disposition of the Virginia Markets taken place at January 1, 2003.



|               |  |                                  |          |   |      |   |          |  
|-------------- |  | -------------------------------- | -------- | - | ---- | - | -------- | -
|               |  | For the Years Ended December 31, |         
|               |  | 2004                             |          |   | 2003 |  
|               |  | (Dollars in thousands)           |         
|Total revenues |  | $                                | 881,165  |   |      | $ | 815,995  |  
|               |  |                                  |          |   |      |   |          |  
|Net loss       |  | $                                | (179,301 | ) |      | $ | (263,987 | )
|               |  |                                  |          |   |      |   |          |  

5. Segment Information

In 2005, as a result of the Companys acquisition of AT&T Wireless business in certain North Carolina markets, Puerto Rico and the U.S. Virgin Islands, the Company began operating as two reportable
segments, which it operates and manages as strategic business units. Reportable segments are defined as components of an enterprise for which separate financial information is available and is evaluated regularly by the chief operating decision
makers in deciding how to allocate resources and in assessing performance. The Companys reporting segments are based upon geographic area of operation; one segment consists of the Companys operations in the continental United States and
the other consists of the Companys operations in Puerto Rico and the U.S. Virgin Islands. The Corporate and other column below includes centralized services that largely support both segments. The Companys reporting segments
follow the same accounting policies used for the Companys consolidated financial statements.

Financial information by reportable
business segment is as follows:



|                                    |  |                         |         |       |   |         |  |   |        
|----------------------------------- |  | ----------------------- | ------- | ----- | - | ------- |  | - | -------
|                                    |  | Year ended December 31,
|(dollars in thousands)              |  | 2005                    |         | 2004* |   | 2003   
|Service Revenues                    |  |                         |         |       |   |         |  |   |        
|Continental United States           |  | $                       | 456,882 |       | $ | 588,543 |  | $ | 576,359
|Puerto Rico and U.S. Virgin Islands |  |                         | 178,156 |       |   | 14,699  |  |   |       
|Corporate and other                 |  |                         |        |       |   |        |  |   |       
|                                    |  |                         |         |       |   |         |  |   |        
|Consolidated                        |  | $                       | 635,038 |       | $ | 603,242 |  | $ | 576,359
|                                    |  |                         |         |       |   |         |  |   |        
|Roaming revenues                    |  |                         |         |       |   |         |  |   |        
|Continental United States           |  | $                       | 85,579  |       | $ | 145,649 |  | $ | 180,314
|Puerto Rico and U.S. Virgin Islands |  |                         | 18,026  |       |   | 350     |  |   |       
|Corporate and other                 |  |                         |        |       |   |        |  |   |       
|                                    |  |                         |         |       |   |         |  |   |        
|Consolidated                        |  | $                       | 103,605 |       | $ | 145,999 |  | $ | 180,314
|                                    |  |                         |         |       |   |         |  |   |        
|Equipment revenues                  |  |                         |         |       |   |         |  |   |        
|Continental United States           |  | $                       | 69,809  |       | $ | 68,145  |  | $ | 53,426 
|Puerto Rico and U.S. Virgin Islands |  |                         | 17,706  |       |   | 814     |  |   |       
|Corporate and other                 |  |                         |        |       |   |        |  |   |       
|                                    |  |                         |         |       |   |         |  |   |        
|Consolidated                        |  | $                       | 87,515  |       | $ | 68,959  |  | $ | 53,426 
|                                    |  |                         |         |       |   |         |  |   |        
|Total Revenues                      |  |                         |         |       |   |         |  |   |        
|Continental United States           |  | $                       | 612,270 |       | $ | 802,337 |  | $ | 810,099
|Puerto Rico and U.S. Virgin Islands |  |                         | 213,888 |       |   | 15,863  |  |   |       
|Corporate and other                 |  |                         |        |       |   |        |  |   |       
|                                    |  |                         |         |       |   |         |  |   |        
|Consolidated                        |  | $                       | 826,158 |       | $ | 818,200 |  | $ | 810,099
|                                    |  |                         |         |       |   |         |  |   |        



F - 16



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|----------------------------------- |  | - | -------- | - |  | - | ------- | - |  | - | ------- | -
|Depreciation and amortization       |  |   |          |   |  |   |         |   |  |   |         |  
|Continental United States           |  | $ | 248,646  |   |  | $ | 148,868 |   |  | $ | 137,550 |  
|Puerto Rico and U.S. Virgin Islands |  |   | 75,188   |   |  |   | 2,762   |   |  |   |        |  
|Corporate and other                 |  |   | 17,621   |   |  |   | 22,740  |   |  |   | 15,544  |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Consolidated                        |  | $ | 341,455  |   |  | $ | 174,370 |   |  | $ | 153,094 |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Non-cash compensation               |  |   |          |   |  |   |         |   |  |   |         |  
|Continental United States           |  | $ | 1,507    |   |  | $ | 3,332   |   |  | $ | 4,809   |  
|Puerto Rico and U.S. Virgin Islands |  |   | 56       |   |  |   |        |   |  |   |        |  
|Corporate and other                 |  |   | 7,520    |   |  |   | 16,633  |   |  |   | 24,001  |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Consolidated                        |  | $ | 9,083    |   |  | $ | 19,965  |   |  | $ | 28,810  |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Asset impairment                    |  |   |          |   |  |   |         |   |  |   |         |  
|Continental United States           |  | $ | 47,700   |   |  |   |        |   |  |   |        |  
|Puerto Rico and U.S. Virgin Islands |  |   |         |   |  |   |        |   |  |   |        |  
|Corporate and other                 |  |   |         |   |  |   |        |   |  |   |        |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Consolidated                        |  | $ | 47,700   |   |  | $ |        |   |  | $ |        |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Income (loss) from operations       |  |   |          |   |  |   |         |   |  |   |         |  
|Continental United States           |  | $ | (255,040 | ) |  | $ | 82,658  |   |  | $ | 100,794 |  
|Puerto Rico and U.S. Virgin Islands |  |   | (53,576  | ) |  |   | (589    | ) |  |   |        |  
|Corporate and other                 |  |   | (58,364  | ) |  |   | (67,897 | ) |  |   | (59,863 | )
|                                    |  |   |          |   |  |   |         |   |  |   |         |  
|Consolidated                        |  | $ | (366,980 | ) |  | $ | 14,172  |   |  | $ | 40,931  |  
|                                    |  |   |          |   |  |   |         |   |  |   |         |  

A reconciliation from segment income (loss) from operations to consolidated income (loss) before taxes is set
forth below:



|                                            |  |                         |          |   |      |   |          |      |  |   |          |  
|------------------------------------------- |  | ----------------------- | -------- | - | ---- | - | -------- | ---- |  | - | -------- | -
|                                            |  | Year ended December 31, |         
|(dollars in thousands)                      |  | 2005                    |          |   | 2004 |   |          | 2003 | 
|Total segment income (loss) from operations |  | $                       | (366,980 | ) |      | $ | 14,172   |      |  | $ | 40,931   |  
|Unallocated amounts:                        |  |                         |          |   |      |   |          |      |  |   |          |  
|Interest expense                            |  |                         | (148,871 | ) |      |   | (128,627 | )    |  |   | (141,210 | )
|Other expense                               |  |                         | (157     | ) |      |   | (3,092   | )    |  |   | (2,898   | )
|Debt extinguishment costs                   |  |                         |         |   |      |   |         |      |  |   | (41,171  | )
|Interest and other income                   |  |                         | 8,480    |   |      |   | 2,548    |      |  |   | 2,285    |  
|Other gain                                  |  |                         |         |   |      |   | 679,515  |      |  |   |         |  
|                                            |  |                         |          |   |      |   |          |      |  |   |          |  
|Consolidated income (loss) before taxes     |  | $                       | (507,528 | ) |      | $ | 564,516  |      |  | $ | (142,063 | )
|                                            |  |                         |          |   |      |   |          |      |  |   |          |  



|                                    |  |                    |           |      |   |          
|----------------------------------- |  | ------------------ | --------- | ---- | - | ---------
|                                    |  | As of December 31,
|(dollars in thousands)              |  | 2005               |           | 2004
|Total Assets                        |  |                    |           |      |   |          
|Continental United States           |  | $                  | 1,245,939 |      | $ | 1,469,708
|Puerto Rico and U.S. Virgin Islands |  |                    | 358,771   |      |   | 419,328  
|Corporate and other                 |  |                    | 205,094   |      |   | 373,794  
|                                    |  |                    |           |      |   |          
|Consolidated                        |  | $                  | 1,809,804 |      | $ | 2,262,830
|                                    |  |                    |           |      |   |          



F - 17



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



|                                    |  |                         |         |       |   |       
|----------------------------------- |  | ----------------------- | ------- | ----- | - | ------
|                                    |  | Year ended December 31,
|(dollars in thousands)              |  | 2005                    |         | 2004*
|Capital expenditures                |  |                         |         |       |   |       
|Continental United States           |  | $                       | 112,883 |       | $ | 71,462
|Puerto Rico and U.S. Virgin Islands |  |                         | 13,725  |       |   | 400   
|Corporate and other                 |  |                         | 11,359  |       |   | 5,933 
|                                    |  |                         |         |       |   |       
|Consolidated                        |  | $                       | 137,967 |       | $ | 77,795
|                                    |  |                         |         |       |   |       

---

|* | The first closing under the Exchange Agreement occurred on December 1, 2004. Results for the Puerto Rico and U.S. Virgin Islands segment for the year ended December 31,
2004 represent only one month of operations.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6. Stock Compensation and Employee Benefits

Restricted Awards

Holdings has made
grants of restricted stock to provide an incentive to key employees and non-management directors and to further align the interests of such individuals with those of its stockholders. Grants of restricted stock generally are made annually under the
stock and incentive plans and deferred compensation is recorded for these awards based upon the stocks fair value at the date of issuance. Grants generally vest over a four to five year period.

The following table summarizes restricted stock activity under Holdings Stock and Incentive Plan and Holdings Directors Stock and
Incentive Plan in 2003, 2004 and 2005, respectively:



|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|------------------------------------------- |  | ------------------------------------------------ | ------- | - | --------------------------------------- | ---------- | - | ------------------------------------ | --------- | - | ------------------------------------ | - | ----
|                                            |  | DeferredCompensation                             |         |   | RestrictedIncentivePlan SharesAvailable |            |   | RestrictedIncentivePlan SharesIssued |           |   | WeightedAverage PerShare Grant Price
|                                            |  | (Dollars in thousands, except per share amounts)
|January 1, 2003                             |  | $                                                | 74,554  |   |                                         | 967,392    |   |                                      | 3,987,103 |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|Restricted stock grants                     |  | $                                                | 3,123   |   |                                         | (1,002,628 | ) |                                      | 1,002,628 |   |                                      | $ | 3.12
|Restricted stock forfeitures                |  | $                                                | (14,087 | ) |                                         | 508,472    |   |                                      | (508,472  | ) |                                      |   |     
|Amortization of deferred compensation       |  | $                                                | (28,810 | ) |                                         |            |   |                                      |           |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|December 31, 2003                           |  | $                                                | 34,780  |   |                                         | 473,236    |   |                                      | 4,481,259 |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|                                            |  |                                                  |         |  
|Additional Incentive Plan shares authorized |  |                                                  |         |   |                                         | 3,600,000  |   |                                      |           |   |                                      |   |     
|Restricted stock grants                     |  | $                                                | 5,209   |   |                                         | (1,328,750 | ) |                                      | 1,328,750 |   |                                      | $ | 3.92
|Restricted stock forfeitures                |  | $                                                | (6,140  | ) |                                         | 560,283    |   |                                      | (560,283  | ) |                                      |   |     
|Amortization of deferred compensation       |  | $                                                | (19,023 | ) |                                         |            |   |                                      |           |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|December 31, 2004                           |  | $                                                | 14,826  |   |                                         | 3,304,769  |   |                                      | 5,249,726 |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|Restricted stock grants                     |  | $                                                | 2,312   |   |                                         | (1,122,984 | ) |                                      | 1,122,984 |   |                                      | $ | 2.06
|Restricted stock forfeitures                |  | $                                                | (1,850  | ) |                                         | 313,460    |   |                                      | (313,460  | ) |                                      |   |     
|Amortization of deferred compensation       |  | $                                                | (9,083  | ) |                                         |            |   |                                      |           |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     
|December 31, 2005                           |  | $                                                | 6,205   |   |                                         | 2,495,245  |   |                                      | 6,059,250 |   |                                      |   |     
|                                            |  |                                                  |         |   |                                         |            |   |                                      |           |   |                                      |   |     



F - 18



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Retirement Plan

The Companys employees located in the continental United States are eligible to participate in the SunCom Wireless Management Company, Inc. Savings and Investment Plan, which permits employees located in the
continental United States to make contributions on a pre-tax salary reduction basis in accordance with applicable provisions of the Plan and the Internal Revenue Code. Covered employees are eligible to begin making salary reduction contributions as
of the first day of the calendar quarter following the employees completion of three months of employment. Covered employees are always fully vested in their pre-tax contributions. The Company matches a portion of its employees pre-tax
contributions. Covered employees vest in Company matching contributions at a rate of 25% per year of vesting service. The Companys contributions to the Savings and Investment Plan were $1.2 million in 2005, $1.3 million in 2004 and $1.2
million in 2003.

In addition, commencing in 2004, the Company authorized a retirement contribution equal to 3% of each eligible
employees compensation to the Savings and Investment Plan. Covered employees are eligible to begin receiving retirement contributions on the first day of the first calendar quarter following their completion of 12 months of service provided
they are not classified for payroll purposes at or above the level of Senior Vice President. Employees vest immediately in the retirement contribution, and the contributions generally will be made by the Company in the quarter subsequent to being
earned. The Company is permitted to make such retirement contributions in Holdings Class A common stock, cash or a combination of stock and cash. Holdings did not contribute any shares of its stock to the Savings and Investment Plan
during the year ended December 31, 2005. For the year ended December 31, 2004, Holdings contributed 299,872 shares of its Class A common stock, valued at an average price of $3.14 per share to the Savings and Investment Plan for
participants. In addition, the Company contributed approximately $1.8 million and $0.4 million of cash to the Savings and Investment Plan for participants during 2005 and 2004, respectively. As of December 31, 2005, the Company had accrued
compensation of approximately $0.4 million in connection with cash that was paid in January, 2006 for participants during the fourth quarter of 2005.

Pursuant to the Exchange Agreement, the Savings and Investment Plan was amended effective December 1, 2004 to provide that those former employees of AT&T Wireless associated with North Carolina who became
employees of the Company would receive past service credit for purposes of determining periods of service under the Savings and Investment Plan. In addition, those Company employees that terminated employment after July 8, 2004 with the Company
that were affected by the Exchange Agreement were fully vested in their accounts under the Savings and Investment Plan as of such date.

Effective December 1, 2004, SunCom Wireless Puerto Rico Operating Company LLC, SunComs wholly-owned subsidiary located in Puerto Rico, adopted the SunCom Wireless Puerto Rico 1165(e) Plan for the benefit of its employees located
in Puerto Rico. The 1165(e) Plan permits employees located in Puerto Rico to make contributions on a pre-tax salary reduction basis in accordance with applicable provisions of the Puerto Rico law. Covered employees are eligible to make salary
reduction contributions as of the first day of employment. After six months of employment, SunCom Wireless Puerto Rico Operating Company matches a portion of each employees pre-tax contributions, and these matching contributions vest
immediately. Matching contributions are made after each payroll period. For the year ended December 31, 2005, the Company contributed approximately $0.3 million of cash in connection with the SunCom Wireless Puerto Rico Operating Company LLC
1165(e) Plan. The Company contributed no cash to the 1165(e) Plan during the year ended December 31, 2004.

Also effective
December 1, 2004, SunCom Wireless Puerto Rico Operating Company LLC adopted the Profit-Sharing Plan for the benefit of its employees located in Puerto Rico. The plan permits the Company to contribute fixed amounts equal to 2% of each eligible
employees compensation. In addition, the Company is permitted to make discretionary contributions above the fixed 2%. Covered employees become eligible for a profit-sharing contribution after six months of service and must be employed on the
last day of the plan year to receive a profit-sharing contribution for the plan year. Employees vest in the profit-sharing contributions over a period of five years. Contributions to the profit-sharing plan are made annually. For the year ended
December 31, 2005, the Company contributed approximately $0.3 million of cash in connection with compensation earned under the SunCom Wireless Puerto Rico Operating Company profit-sharing plan during 2004. As of December 31, 2005, the
Company had accrued compensation of approximately $0.2 million related to compensation earned during the year ended December 31, 2005.

Employee Stock Purchase Plan

Holdings previously offered an employee stock purchase plan pursuant to which employees were
able to purchase shares of Holdings Class A common stock. In January 2003, due to a limited number of remaining shares available for issuance under the employee stock purchase plan, Holdings suspended participation in this plan. Under the
terms of this plan, Holdings Stock Plan Committee establishes offering periods during each calendar year in which employees could participate. The purchase price was determined at the discretion of the Stock Plan Committee but was not less
than the lesser of: (i) 85% of the fair market value on the first business day of each offering period or (ii) 85% of the fair market value on the last business day of the offering period. Holdings issued 36,504 shares of Class A
common stock, at an average per share price of $1.57, in January 2003.



F - 19



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Deferred Compensation Plan

In June 2004, the Company implemented a nonqualified deferred compensation plan for the benefit of certain management employees and members of
Holdings Board of Directors. This plan permits the deferral of earned compensation, including salary, bonus and stock grants. The Company may set aside assets in a trust in order to assist it in meeting the obligations of the plan when they
come due. The assets of the trust, if any, remain subject to the claims of the Companys general creditors under federal and state laws in the event of insolvency. Consequently, the trust qualifies as a grantor trust for income tax purposes
(i.e. a Rabbi Trust). In accordance with EITF 97-14, Accounting for Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust and Invested, Holdings stock contributed to the trust is recorded at
historical cost and classified as Common Stock Held in Trust. Since these investments are in Holdings stock, an offsetting amount is recorded as deferred compensation in the equity section of the balance sheet. Compensation contributed to the
plan in the form of cash is invested in diversified assets classified as trading securities, which are held by the Rabbi Trust. These assets are classified within other long-term assets on the balance sheet and are recorded at fair market value,
with changes recorded to other income and expense. The liabilities related to this plan are included in other long-term liabilities on the balance sheet, with changes in the liability related to the Rabbi Trust being recorded as adjustments to
compensation expense. As of December 31, 2005, the fair value of amounts held in the Rabbi Trust was approximately $0.2 million.

7. Investments

Marketable securities, consisting of auction rate securities, are categorized as available-for-sale and are stated at fair value, with
unrealized gains and losses, if applicable, reported as a component of accumulated other comprehensive income (loss) on the consolidated balance sheet. Purchases and sales of securities are reported on a trade-date basis, and interest is recorded
when earned. Maturities and gross unrealized gains (losses) at December 31, 2005 and 2004 are as follows:

2005

|                             |  |                   |  |       |         |            |   |                     |   |  |   |        
|---------------------------- |  | ----------------- |  | ----- | ------- | ---------- | - | ------------------- | - |  | - | -------
|                             |  | Maturity in Years |  | Cost  |         | Unrealized |   | EstimatedFair Value
|(Dollars in thousands)       |  |                   |  | Gains |         | Losses     |  
|Auction rate securities      |  | 1 or less         |  | $     | 139,050 |            |  |                     |  |  | $ | 139,050
|                             |  |                   |  |       |         |            |   |                     |   |  |   |        
|Total short-term investments |  |                   |  | $     | 139,050 |            |  |                     |  |  | $ | 139,050
|                             |  |                   |  |       |         |            |   |                     |   |  |   |        

2004

|                             |  |                  |  |       |         |            |   |                     |   |  |   |        
|---------------------------- |  | ---------------- |  | ----- | ------- | ---------- | - | ------------------- | - |  | - | -------
|                             |  | Maturityin Years |  | Cost  |         | Unrealized |   | EstimatedFair Value
|(Dollars in thousands)       |  |                  |  | Gains |         | Losses     |  
|Auction rate securities      |  | 1 or less        |  | $     | 305,500 |            |  |                     |  |  | $ | 305,500
|                             |  |                  |  |       |         |            |   |                     |   |  |   |        
|Total short-term investments |  |                  |  | $     | 305,500 |            |  |                     |  |  | $ | 305,500
|                             |  |                  |  |       |         |            |   |                     |   |  |   |        

8. Property and Equipment



|                                           |  |                        |           |   |      |   |           |  
|------------------------------------------ |  | ---------------------- | --------- | - | ---- | - | --------- | -
|                                           |  | December 31,           |          
|                                           |  | 2005                   |           |   | 2004 |  
|                                           |  | (Dollars in thousands) |          
|Property and equipment:                    |  |                        |           |   |      |   |           |  
|Land                                       |  | $                      | 313       |   |      | $ | 313       |  
|Network infrastructure and equipment       |  |                        | 1,204,516 |   |      |   | 1,121,938 |  
|Furniture, fixtures and computer equipment |  |                        | 108,704   |   |      |   | 88,832    |  
|Capital lease assets                       |  |                        | 1,556     |   |      |   | 5,664     |  
|Construction in progress                   |  |                        | 20,981    |   |      |   | 9,091     |  
|                                           |  |                        |           |   |      |   |           |  
|                                           |  | $                      | 1,336,070 |   |      | $ | 1,225,838 |  
|Less accumulated depreciation              |  |                        | (685,786  | ) |      |   | (411,711  | )
|                                           |  |                        |           |   |      |   |           |  
|Property and equipment, net                |  | $                      | 650,284   |   |      | $ | 814,127   |  
|                                           |  |                        |           |   |      |   |           |  



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



In April 2004, the Company reviewed the estimated service lives of its TDMA wireless communications
equipment. This review was undertaken as the result of the Companys successful launch of its overlapping GSM/GPRS network in all of its covered markets. Service lives were shortened to fully depreciate all TDMA equipment by the end of 2008.
TDMA equipment acquired after April 1, 2004 had a useful life no longer than 57 months. The impact of this change for the year ended December 31, 2004 was an increase in depreciation expense and a decrease in net income of approximately
$12.6 million.

During the second and fourth quarter of 2005, the Company further accelerated depreciation on its TDMA wireless
communications equipment by shortening service lives to fully depreciate all TDMA equipment by June 30, 2006 for the continental United States reporting unit and by March 31, 2006 for the Puerto Rico and U.S. Virgin Islands reporting unit.
This additional depreciation resulted from a more aggressive migration from the Companys TDMA network to its GSM/GPRS network as well as a higher rate of churn for these customers than the Company originally planned. The impact of these
changes for the year ended December 31, 2005 was an increase in depreciation expense and net loss of approximately $107.7 million. As of December 31, 2005, the Companys TDMA equipment had a net book value of $144.5 million. In
addition, during the fourth quarter of 2005, the Company accelerated the amortization of an intangible asset related to its roaming agreement with Cingular Wireless. The asset, which had an initial fair value of $2.9 million, resulted from the
non-reciprocal TDMA component of the roaming agreement entered into with Cingular Wireless during October 2004 as part of the Triton PCS Agreement. As a result of a significant decrease in TDMA roaming minutes of use and the related revenue for the
year ended December 31, 2005, the Company has accelerated amortization to fully amortize the asset by June 30, 2006. The impact for the year ended December 31, 2005 was an increase in amortization expense and net loss of approximately
$0.5 million. See Note 9 for further information regarding the Companys intangible assets.

Depreciation for the years ended
December 31, 2005, 2004 and 2003 totaled $277.3 million, $160.5 million and $144.4 million, respectively. During the years ended December 31, 2005, 2004 and 2003 the Company incurred charges of $4.7 million, $0.7 million and $4.4 million,
respectively, as the result of net losses on the sale of assets and charges on the disposal of cell site equipment deemed obsolete. These charges are included in depreciation and asset disposal expense in the statement of operations and
comprehensive income (loss). As of December 31, 2005, the Company had recorded $1.6 million of capital lease assets with related accumulated amortization of $0.5 million.

The Company is subject to asset retirement obligations associated with its cell site operating leases, which are subject to the provisions of SFAS
No. 143 Accounting for Asset Retirement Obligation. Cell site lease arrangements may contain clauses requiring restoration of the leased site at the end of the lease term, creating an asset retirement obligation. In addition to cell
site operating leases, leases related to retail and administrative locations are subject to the provisions of SFAS No. 143.

During
2005, SunCom incurred $0.3 million of accretion expense, which increased the carrying value of the Companys asset retirement obligation to $2.3 million. There were no liabilities settled or changes in asset retirement obligation cash flow
estimates in 2005. In addition, no assets are legally restricted for the purposes of settling asset retirement obligations.

9. Intangible Assets

In accordance with SFAS No. 142, the Company does not amortize goodwill and other indefinite-lived intangible assets, consisting
of FCC licensing costs. Although FCC licenses are issued with a stated term, generally 10 years, the renewal of FCC licenses is generally a routine matter involving a nominal fee, and the Company has determined that no legal, regulatory,
contractual, competitive, economic or other factors currently exist that limit the useful life of its FCC licenses. As such, the Company has determined that FCC licenses are deemed to be intangible assets that have indefinite useful lives.
Prospectively, the Company will continue to reevaluate periodically its determination of an indefinite useful life for its FCC licenses.

At least annually, the Company is required to test indefinite-lived intangible assets for impairment by comparing the fair value of the assets to their respective carrying values. In addition, the Company is required to test goodwill
at least annually for impairment by comparing the fair value of its reporting units to their respective carrying values. The Company determines fair value for its reporting units using a market approach. SFAS No. 142 requires goodwill to
be evaluated for impairment using a two-step test. The first step consists of a review for potential impairment, while the second step, if required, calculates the amount of impairment, if any. Additionally, goodwill must be tested for impairment
between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. These events or circumstances could include a significant change in the business
climate, including a significant sustained decline in an entitys market value, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. Other indefinite-lived
intangible assets must also be tested for impairment between annual tests if events or changes in circumstances indicate that the asset may be impaired. The continental United States reporting unit included



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



$63.0 million and $67.1 million of goodwill as of December 31, 2005 and 2004, respectively, and $481.2 million and $529.9 million of FCC licenses, net
of $16.8 million and $16.9 million, respectively, of accumulated amortization incurred prior to the adoption of SFAS No. 142, as of December 31, 2005 and 2004, respectively. The Puerto Rico reporting unit included $26.1 million and $33.5
million of goodwill as of December 31, 2005 and 2004, respectively, and $152.2 million of FCC licenses as of December 31, 2005 and 2004. The Company evaluated the carrying value of its FCC licenses and determined, with the assistance of a
fair market valuation performed by an independent valuation firm, that the licenses were impaired. The impairment is a result of several factors, including an increasing supply of FCC spectrum, and the corresponding decline in market value. As a
result, the Company recorded a $47.7 million impairment charge related to the continental United States segment, which charge was included in the asset impairment caption in the consolidated statement of operations for the year ended
December 31, 2005. The Company then evaluated the carrying value of its goodwill and determined that it was not impaired, as the fair value of each reporting unit exceeded its respective carrying value.

The following table summarizes the Companys intangible assets as of December 31, 2005 and 2004, respectively. See Notes 3 and 4 for further
discussion of the intangible assets acquired and divested in the various transactions with AT&T Wireless and Cingular Wireless.



|                               |  |                        |         |   |                  |   |           |   |  |            
|------------------------------ |  | ---------------------- | ------- | - | ---------------- | - | --------- | - |  | -----------
|                               |  | December 31,           |         |   | AmortizableLives
|                               |  | 2005                   |         |   | 2004             |   |          
|                               |  | (Dollars in thousands) |         |   |                 
|PCS Licenses                   |  | $                      | 650,262 |   |                  | $ | 699,016   |   |  | Indefinite 
|Subscriber lists               |  |                        | 148,882 |   |                  |   | 157,081   |   |  | 7 years    
|Bank financing                 |  |                        | 8,271   |   |                  |   | 8,243     |   |  | 5-10 years 
|SunCom brand                   |  |                        | 22,900  |   |                  |   | 22,900    |   |  | 5 years    
|Income leases                  |  |                        | 862     |   |                  |   | 12,696    |   |  | 23-25 years
|Goodwill                       |  |                        | 89,065  |   |                  |   | 100,579   |   |  | Indefinite 
|Other                          |  |                        | 4,915   |   |                  |   | 5,616     |   |  | 1-40 years 
|                               |  |                        |         |   |                  |   |           |   |  |            
|                               |  |                        | 925,157 |   |                  |   | 1,006,131 |   |  |            
|Less: accumulated amortization |  |                        | (81,044 | ) |                  |   | (22,079   | ) |  |            
|                               |  |                        |         |   |                  |   |           |   |  |            
|Intangible assets, net         |  | $                      | 844,113 |   |                  | $ | 984,052   |   |  |            

Amortization of intangibles for the years ended December 31, 2005, 2004 and 2003 totaled
$59.5 million, $13.1 million and $10.2 million, respectively. AT&T Wireless and Cingular Wireless agreements, subscriber lists, income leases, the SunCom brand, trademarks and other intangible asset amortization, which is recorded as
amortization expense on the consolidated statement of operations and comprehensive income (loss), was $58.2 million, $11.5 million and $2.7 million for the years ended December 31, 2005, 2004 and 2003, respectively. Subscriber list intangibles
are amortized based on the expected turnover rate of the associated subscribers. As the subscriber base decreases due to turnover, the related amortization decreases proportionately to the decline in the number of subscribers. Bank financing
amortization, which is recorded as interest expense or debt extinguishment costs, as applicable, on the consolidated statement of operations and comprehensive income (loss) was $1.3 million, $1.4 million and $5.5 million for the years ended
December 31, 2005, 2004 and 2003, respectively. Agent exclusivity agreement amortization, which is recorded as contra equipment revenue on the consolidated statement of operations and comprehensive income (loss), was $0.0 million, $0.2 million
and $2.0 million for the years ended December 31, 2005, 2004 and 2003, respectively.

Estimated aggregate amortization of intangibles
for the next five years is as follows:



|     |  |                |       
|---- |  | -------------- | ------
|Year |  | (in thousands)
|2006 |  | $              | 40,916
|2007 |  |                | 29,011
|2008 |  |                | 21,794
|2009 |  |                | 16,001
|2010 |  |                | 7,807 



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



10. Detail of Certain Liabilities

The following table summarizes certain current liabilities as of December 31, 2005 and 2004, respectively.



|                                                |  |                        |        |      |   |       
|----------------------------------------------- |  | ---------------------- | ------ | ---- | - | ------
|                                                |  | December 31,          
|                                                |  | 2005                   |        | 2004
|                                                |  | (Dollars in thousands)
|Accrued liabilities:                            |  |                        |        |      |   |       
|Bank overdraft liability                        |  | $                      | 17,172 |      | $ | 13,509
|Accrued payroll and related expenses            |  |                        | 20,962 |      |   | 15,232
|Accrued expenses                                |  |                        | 12,206 |      |   | 15,050
|Accrued interest                                |  |                        | 23,137 |      |   | 23,574
|                                                |  |                        |        |      |   |       
|Total accrued liabilities                       |  | $                      | 73,477 |      | $ | 67,365
|                                                |  |                       
|Other current liabilities:                      |  |                        |        |      |   |       
|Deferred revenue                                |  | $                      | 13,211 |      | $ | 13,012
|Deferred gain on sale of property and equipment |  |                        | 2,211  |      |   | 920   
|Security deposits                               |  |                        | 7,849  |      |   | 7,498 
|Other                                           |  |                        |       |      |   | 2,554 
|                                                |  |                        |        |      |   |       
|Total other current liabilities                 |  | $                      | 23,271 |      | $ | 23,984

11. Long Term Debt

The following table summarizes the Companys borrowings as of December 31, 2005 and 2004, respectively.



|                                             |  |                        |           |      |   |          
|-------------------------------------------- |  | ---------------------- | --------- | ---- | - | ---------
|                                             |  | December 31,          
|                                             |  | 2005                   |           | 2004
|                                             |  | (Dollars in thousands)
|Current portion of long-term debt:           |  |                        |           |      |   |          
|Current portion of capital lease obligations |  | $                      | 286       |      | $ | 984      
|Current portion of senior secured term loan  |  |                        | 2,500     |      |   | 2,500    
|                                             |  |                        |           |      |   |          
|Total current portion of long-term debt      |  |                        | 2,786     |      |   | 3,484    
|                                             |  |                       
|Long-term debt:                              |  |                        |           |      |   |          
|Capital lease obligations                    |  | $                      | 864       |      | $ | 269      
|Senior secured term loan                     |  |                        | 245,000   |      |   | 247,500  
|81/2% senior notes                           |  |                        | 713,148   |      |   | 712,055  
|93/8% senior subordinated notes              |  |                        | 339,542   |      |   | 338,460  
|83/4% senior subordinated notes              |  |                        | 390,797   |      |   | 390,034  
|                                             |  |                        |           |      |   |          
|Total long-term debt                         |  |                        | 1,689,351 |      |   | 1,688,318
|                                             |  |                       
|Total debt                                   |  | $                      | 1,692,137 |      | $ | 1,691,802
|                                             |  |                        |           |      |   |          

Interest expense, net of capitalized interest was $148.9 million, $128.6 million and $141.2
million for the years ended December 31, 2005, 2004 and 2003, respectively. The Company capitalized interest of $1.0 million, $0.8 million and $1.7 million in the years ended December 31, 2005, 2004 and 2003, respectively. The weighted
average interest rate for total debt outstanding during 2005 and 2004 was 8.44% and 8.32%, respectively. The Companys average interest rate at December 31, 2005 and 2004 was 8.58% and 8.28%, respectively.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Aggregate maturities are as follows:



|           |  |                        |          
|---------- |  | ---------------------- | ---------
|Year       |  | (Dollars in thousands)
|2006       |  | $                      | 2,786    
|2007       |  |                        | 2,857    
|2008       |  |                        | 2,764    
|2009       |  |                        | 240,239  
|2010       |  |                        | 4        
|Thereafter |  |                        | 1,443,487
|           |  |                        |          
|Total      |  | $                      | 1,692,137
|           |  |                        |          

Senior Secured Term Loan

On November 18, 2004, SunCom entered into a new term loan agreement with Lehman Commercial Paper Inc., as a lender and administrative agent, Merrill
Lynch, Pierce, Fenner & Smith Incorporated, as a lender and syndication agent, and the other lenders party thereto, pursuant to which the lenders provided up to $250 million in term loans. Other lenders may become parties to the term loan
agreement in the future. The following is a summary of the material terms of the senior secured term loan. In connection with SunComs entry into the senior secured term loan, SunCom terminated its previous $100 million credit facility.

All loans made under the senior secured term loan will mature in 19 quarterly installments of 0.25% of the aggregate amount of the terms
loans beginning on March 31, 2005, with the outstanding balance due on November 18, 2009.

SunComs obligations under the
senior secured term loan are guaranteed by substantially all of the domestic subsidiaries of SunCom, other than Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C. Holdings is not a guarantor of the senior secured term loan.
These obligations also are secured by (i) liens and security interests in substantially all of such subsidiaries personal property; (ii) a pledge of the SunComs capital stock; and (iii) a pledge of the capital stock and
membership interests of each of the domestic subsidiaries of SunCom including the membership interests of the non-guarantor subsidiaries.

The loans bear interest at either LIBOR, the London interbank offered rate, plus an applicable margin of 3.25%, or an alternate base rate, plus an applicable margin of 2.25%, at SunComs option. SunCom will also be required to pay a
prepayment premium of 2% of the principal amount of any loans prepaid before November 18, 2006.

The senior secured term loan contains
customary representations and warranties and affirmative and negative covenants. The senior secured term loan contains restrictions on SunComs and SunComs subsidiaries ability to dispose of assets, incur additional indebtedness,
incur guaranty obligations, pay dividends, make capital distributions, create liens on assets, make investments, engage in mergers or consolidations, engage in certain transactions with affiliates and otherwise restricts corporate activities. The
Company does not expect that such covenants will materially impact its ability or the ability of its subsidiaries to operate their respective businesses.

The senior secured term loan contains customary events of default, including the failure to pay principal when due or any interest or other amount that becomes due within a period of time after the due date thereof,
any representation or warranty being made that is incorrect in any material respect on or as of the date made, a default in the performance of certain covenants, certain insolvency events, certain change of control events and cross-defaults to other
indebtedness.

As of December 31, 2004, SunCom had drawn the entire $250.0 million under the senior secured term loan. During the year
ended December 31, 2005, SunCom repaid $2.5 million of principal, leaving $247.5 million of outstanding debt under the senior secured term loan as of December 31, 2005.

Senior Notes

81/2% Senior Notes

On June 13, 2003, SunCom completed a private offering of $725.0 million principal amount of its 81/2% Senior Notes due 2013 (the 81/2% Notes), pursuant to Rule 144A and Regulation S of the Securities Act. The net proceeds of the offering (after deducting the initial purchasers discount of approximately $14.5 million) were approximately $710.5
million. The effective interest rate of the 81/2% Notes for the year ended December 31, 2005 was 8.80%.

Cash interest is payable semiannually on June 1 and December 1.



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##### Table of Contents

The 81/2% Notes may be redeemed at the option of SunCom, in whole or in part, at various points in time after June 1, 2008 at redemption prices specified in the indenture governing the 81/2% Notes plus accrued and unpaid interest, if any.

The 81/2% Notes
are guaranteed on a senior basis by all of the subsidiaries of SunCom, other than Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C. (SunComs indirect subsidiaries that hold its real estate interests and FCC licenses,
respectively). Holdings is not a guarantor of the 81/2% Notes. The 81/2% Notes are effectively subordinated in right of payment to all of SunComs senior secured debt, including the
senior secured term loan.

Upon a change in control, each holder of the 81/2% Notes may require SunCom to repurchase such holders 81/2% Notes, in whole or in part, at a purchase price equal to 101% of the aggregate principal amount, as applicable, plus accrued, unpaid and additional interest, if any to the purchase date.

All outstanding principal and interest of the 81/2% Notes mature and require complete repayment on June 1, 2013.

Prior to their extinguishment during the second half of 2004, the Company had utilized interest rate swaps to hedge the fair value of a portion of the 81/2% Notes (see Note 13).

Senior Subordinated Debt

93/8% Senior Subordinated Notes

On January 19, 2001, SunCom completed a private offering of $350.0 million principal amount of the 93/8% Senior Subordinated Notes due 2011 (the 93/8% Notes), pursuant to Rule 144A and Regulation S of the Securities Act. The net proceeds of the offering (after deducting the initial purchasers
discount and expenses of approximately $12.5 million) were approximately $337.5 million. The effective interest rate of the 93/8% Notes for the year ended December 31, 2005 was 9.92%.

On November 1, 2004, SunCom repurchased $3.0
million principal amount of the 93/8% Notes for aggregate cash consideration of approximately $2.4 million, representing principal repurchase consideration plus accrued and unpaid interest from the last interest
payment date. In connection with the note repurchase, SunCom recognized approximately $0.6 million of gain within interest and other income on its consolidated statement of operations and comprehensive income (loss).

Cash interest is payable semiannually on August 1 and February 1.

The 93/8% Notes may be redeemed at the option of SunCom, in whole or in part, at
various points in time after February 1, 2006 at redemption prices specified in the indenture governing the 93/8% Notes plus accrued and unpaid interest, if any.

The 93/8% Notes are guaranteed on a subordinated basis by all of the subsidiaries of SunCom, other than Triton PCS Property Company
L.L.C. and Triton PCS License Company L.L.C. Holdings is not a guarantor of the 93/8% Notes. The guarantees are unsecured obligations of the guarantors, and are subordinated in right to the full payment of all
senior debt under the senior secured term loan, including all of their obligations as guarantors thereunder.

Upon a change in control,
each holder of the 93/8% Notes may require SunCom to repurchase such holders 93/8% Notes, in whole or in part, at a purchase price equal to 101% of the aggregate principal amount,
as applicable, plus accrued and unpaid interest to the purchase date.

All outstanding principal and interest of the 93/8% Notes mature and require complete repayment on February 1, 2011.

83/4% Senior Subordinated
Notes

On November 14, 2001, SunCom completed an offering
of $400 million principal amount of 83/4% Senior Subordinated Notes due 2011 (the 83/4% Notes), pursuant to Rule 144A and Regulation S of the Securities Act. The net
proceeds of the offering (after deducting the initial purchasers discount of $9.0 million and estimated expenses of $1.0 million) were approximately $390.0 million. The effective interest rate of the 83/4% Notes for the year ended December 31, 2005 was 9.10%.

On November 1, 2004, SunCom repurchased $3.0 million principal amount of the 83/4% Notes for the aggregate
cash consideration of approximately $2.3 million, representing principal repurchase consideration plus accrued and unpaid interest from the last interest payment date. In connection with the note repurchase, SunCom recognized approximately $0.8
million of gain within interest and other income on its consolidated statement of operations and comprehensive income (loss).



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##### Table of Contents

Cash interest is payable semiannually on May 15 and November 15.

The 83/4% Notes may be redeemed at the option of SunCom, in whole or in part, at various points in time after November 15, 2006 at
redemption prices specified in the indenture governing the 83/4% Notes plus accrued and unpaid interest, if any.

The 83/4% Notes are guaranteed on a subordinated basis by all of the subsidiaries of SunCom, other than Triton PCS Property Company L.L.C. and Triton PCS License Company L.L.C. Holdings is not a guarantor of
the 83/4% Notes. The guarantees are unsecured obligations of the guarantors, and are subordinated in right to the full payment of all senior debt under the senior secured term loan, including all of their obligations as guarantors
thereunder.

Upon a change in control, each holder of the 83/4% Notes may require
SunCom to repurchase such holders 83/4% Notes, in whole or in part, at a purchase price equal to 101% of the aggregate principal amount, as applicable, plus accrued and unpaid interest to the
purchase date.

All outstanding principal and interest of the 83/4% Notes mature and
require complete repayment on November 15, 2011.

Old Credit Facilities

On June 13, 2003, the Company repaid all outstanding borrowings and retired its then existing credit facility with a portion of the proceeds from the
sale of the 81/2% notes. In connection with the retirement of this credit facility, the Company wrote-off deferred financing costs of approximately $3.7 million for the year ended December 31, 2003, and recorded
these expenses as debt extinguishment costs on the consolidated statements of operations and comprehensive income (loss).

Also on
June 13, 2003, SunCom and Holdings (together referred to as the Obligors) entered into a new credit agreement with a group of financial institutions pursuant to which the institutions agreed to lend the Company up to $100 million in
revolving credit loans.

On November 18, 2004, in connection with SunComs entry into a new senior secured term loan, it
terminated its $100 million credit facility. At November 18, 2004, SunCom had no outstanding borrowings under its old credit facility. In connection with the retirement of this credit facility, the Company wrote-off deferred financing costs of
approximately $0.9 million during the year ended December 31, 2004.

Repayment of Senior Subordinated Notes

11% Senior Subordinated Notes

On May 30, 2003, SunCom commenced a tender offer to purchase any and all of its then outstanding $512.0 million aggregate principal amount of senior subordinated discount notes (the 11% Notes). On June 13, 2003, SunCom
used a portion of the proceeds from the sale of its 81/2% Notes to purchase approximately $408.6 million principal amount of 11% Notes deemed to have been validly tendered pursuant to the tender offer for aggregate
cash consideration of approximately $438.3 million, representing the tender offer consideration plus accrued and unpaid interest from the last interest payment date to, but excluding June 13, 2003. On July 14, 2003, in accordance with the
terms and the indenture governing the 11% Notes, SunCom redeemed the remaining principal for cash consideration of $111.4 million in the aggregate, which amount consisted of a redemption price of 105.5% of principal amount of the 11% Notes plus
accrued and unpaid interest to, but not including, the redemption date. In connection with the repurchase and redemption of the 11% Notes, SunCom incurred total costs of approximately $37.5 million for the year ended December 31, 2003, which
primarily included the tender offer premium, tender offer fee, and write-off of deferred financing costs related to the 11% Notes.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



12. Income Taxes

The components of income tax expense (benefit) are presented in the following table (in thousands):



|                                   |  |                          |        |   |      |   |        |      |  |   |       
|---------------------------------- |  | ------------------------ | ------ | - | ---- | - | ------ | ---- |  | - | ------
|                                   |  | Years Ended December 31,
|                                   |  | 2005                     |        |   | 2004 |   |        | 2003
|Current                            |  |                          |        |   |      |   |        |      |  |   |       
|Federal                            |  | $                        | 186    |   |      | $ | 4,035  |      |  | $ |      
|State                              |  |                          | 251    |   |      |   | 1,256  |      |  |   | 1,560 
|                                   |  |                          |        |   |      |   |        |      |  |   |       
|                                   |  |                          | 437    |   |      |   | 5,291  |      |  |   | 1,560 
|                                   |  |                          |        |   |      |   |        |      |  |   |       
|Deferred                           |  |                          |        |   |      |   |        |      |  |   |       
|Federal                            |  |                          | (5,199 | ) |      |   | (3,562 | )    |  |   | 8,818 
|State                              |  |                          | (3,534 | ) |      |   | 497    |      |  |   | 1,529 
|Foreign                            |  |                          | 2,603  |   |      |   | 214    |      |  |   |      
|                                   |  |                          |        |   |      |   |        |      |  |   |       
|                                   |  |                          | (6,130 | ) |      |   | (2,851 | )    |  |   | 10,347
|                                   |  |                          |        |   |      |   |        |      |  |   |       
|Total income tax expense (benefit) |  | $                        | (5,693 | ) |      | $ | 2,440  |      |  | $ | 11,907
|                                   |  |                          |        |   |      |   |        |      |  |   |       

The income tax expense differs from those computed using the statutory U.S. federal income tax
rate as set forth below:



|                                           |  |        |    |  |        |    |  |        |   
|------------------------------------------ |  | ------ | -- |  | ------ | -- |  | ------ | --
|                                           |  | 2005   |    |  | 2004   |    |  | 2003   |   
|U.S. federal statutory rate                |  | 35.00  | %  |  | 35.00  | %  |  | 35.00  | % 
|State income taxes, net of federal benefit |  | (0.42  | )% |  | 0.20   | %  |  | (1.41  | )%
|Foreign                                    |  | 0.33   |    |  | 0.02   | %  |  |       |   
|Change in federal valuation allowance      |  | (37.15 | )% |  | (37.96 | )% |  | (40.01 | )%
|Other, net                                 |  | 1.12   | %  |  | 3.17   | %  |  | (1.95  | )%
|                                           |  |        |    |  |        |    |  |        |   
|Effective tax rate                         |  | (1.12  | )% |  | 0.43   | %  |  | (8.37  | )%
|                                           |  |        |    |  |        |    |  |        |   

The tax effects of significant temporary differences that give rise to significant portions of the
deferred tax assets and deferred tax liabilities are as follows (in thousands):



|                                 |  |      |          |   |      |   |          |  
|-------------------------------- |  | ---- | -------- | - | ---- | - | -------- | -
|                                 |  | 2005 |          |   | 2004 |  
|Deferred tax assets:             |  |      |          |   |      |   |          |  
|Non-deductible accruals          |  | $    | 48,881   |   |      | $ | 31,636   |  
|Deferred gain                    |  |      | 19,345   |   |      |   | 7,767    |  
|Unrealized losses                |  |      |         |   |      |   | 1        |  
|Net operating loss carry forward |  |      | 331,298  |   |      |   | 268,743  |  
|Tax credits                      |  |      | 7,522    |   |      |   | 6,200    |  
|                                 |  |      |          |   |      |   |          |  
|                                 |  |      | 407,046  |   |      |   | 314,347  |  
|Valuation allowance              |  |      | (330,605 | ) |      |   | (170,341 | )
|                                 |  |      |          |   |      |   |          |  
|Net deferred tax assets          |  |      | 76,441   |   |      |   | 144,006  |  
|                                 |  |     
|Deferred liabilities             |  |      |          |   |      |   |          |  
|Unrealized gain                  |  |      | 3        |   |      |   |         |  
|Intangibles                      |  |      | 34,597   |   |      |   | 59,238   |  
|FCC licenses                     |  |      | 118,349  |   |      |   | 122,989  |  
|Depreciation and amortization    |  |      | 54,295   |   |      |   | 101,100  |  
|                                 |  |      |          |   |      |   |          |  
|Deferred tax liabilities         |  |      | 207,244  |   |      |   | 283,327  |  
|                                 |  |     
|Net deferred tax liabilities     |  | $    | 130,803  |   |      | $ | 139,321  |  
|                                 |  |      |          |   |      |   |          |  

In assessing the realizability of deferred tax assets, management considers whether it is more
likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary
differences become deductible. Management believes it is more likely than not that the Company will realize the benefits of the deferred tax assets, net of the existing valuation allowance at December 31, 2005 and 2004. As of December 31,
2005 and 2004, approximately $3.7 million and $7.1 million, respectively, of the gross deferred tax asset and related valuation allowance is attributable to restricted stock compensation. To the extent that such assets are realized in the future,
the benefit is applied to equity.



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##### Table of Contents

Internal Revenue Code Section 382 provides for the limitation on the use of net operating loss
(NOL) carryforwards in years subsequent to a more than 50% cumulative ownership change. A more than 50% cumulative ownership change occurred on December 12, 2001 and again on October 26, 2004. As a result, the total NOLs
available to offset taxable income are $898 million; these NOLs will carryforward until 2025.

13. Fair Value of Financial Instruments

Fair value estimates, assumptions, and methods used to estimate the fair value of the Companys financial instruments are made in accordance with
the requirements of SFAS No. 107, Disclosures about Fair Value of Financial Instruments. The Company has used available market information to derive its estimates. However, because these estimates are made as of a specific point in
time, they are not necessarily indicative of amounts the Company could realize currently. The use of different assumptions or estimating methods may have a material effect on the estimated fair value amounts.



|                         |  |                        |         |                     |   |                |  |                     |         |  |   |        
|------------------------ |  | ---------------------- | ------- | ------------------- | - | -------------- |  | ------------------- | ------- |  | - | -------
|                         |  | December 31,          
|                         |  | 2005                   |         | 2004               
|                         |  | CarryingAmount         |         | EstimatedFair value |   | CarryingAmount |  | EstimatedFair value
|                         |  | (Dollars in thousands)
|Long-term debt:          |  |                        |         |                     |   |                |  |                     |         |  |   |        
|Senior debt              |  | $                      | 713,148 |                     | $ | 683,313        |  | $                   | 712,055 |  | $ | 703,250
|Subordinated debt        |  |                        | 730,339 |                     |   | 544,855        |  |                     | 728,494 |  |   | 587,260
|Senior secured term loan |  |                        | 247,500 |                     |   | 247,500        |  |                     | 250,000 |  |   | 250,000
|Capital leases           |  |                        | 1,150   |                     |   | 1,150          |  |                     | 1,253   |  |   | 1,253  

The carrying amounts of cash and cash equivalents, short-term investments, and bank overdraft
liability are a reasonable estimate of their fair value due to the short-term nature of the instruments.

Long-term debt is comprised of
senior debt, subordinated debt, bank loans and capital leases. The fair value of senior and subordinated debt is stated at quoted market value. The carrying amounts of bank loans are a reasonable estimate of their fair value because market interest
rates are variable. Capital leases are recorded at their net present value, which approximates fair value.

The Company recognizes all
derivatives on the balance sheet at fair value. In accordance with SFAS No. 133 Accounting for Derivative Instruments and Hedging Activities, as amended, changes in the fair value for the effective portion of the gain or loss on a
derivative that was designated as, and met all the required criteria for, a cash flow hedge were recorded in accumulated other comprehensive income and reclassified into earnings as the underlying hedged items affected earnings. Amounts reclassified
into earnings related to interest rate swap agreements are included in interest expense. The ineffective portion of the gain or loss on a derivative was recognized in earnings within other income or expense. On June 13, 2003, SunCom terminated
all 13 of its previously existing interest rate swaps for aggregate cash consideration of $23.7 million, which included accrued and unpaid interest through the date of termination. In accordance with calculations under SFAS No. 133, as amended,
there was no hedge ineffectiveness for the year ended December 31, 2003. Approximately $20.4 million of cumulative expense had been realized in the statement of operations for interest rate swaps that no longer acted as hedges.

Subsequent to the June 13, 2003 terminations, SunCom entered into five new interest rate swap agreements for an aggregate notional amount of $300.0
million. SunCom utilized these interest rate swap derivatives to manage changes in market conditions related to interest rate payments on its fixed rate debt obligations. As a result, these swaps were classified as fair value hedges and changes in
the fair value of the interest rate swaps were recorded as an adjustment to the carrying value of the matched debt.

During the third and
fourth quarters of 2004, SunCom extinguished all five of its interest rate swap agreements. The Company incurred approximately $3.1 million of losses in connection with these terminations. These losses were recorded to other expense on the
consolidated statement of operations and comprehensive income (loss).

The Company was not a party to any interest rate swap agreements at
anytime during 2005.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



14. Relationship with Lafayette Communications Company L.L.C.

On June 20, 2003, Lafayette (in two separate transactions) sold 12 PCS licenses to the Company for an aggregate fair value of approximately $100.1
million. As a part of these transactions, the Company paid approximately $28.1 million to the FCC to satisfy Lafayettes outstanding obligations due to the FCC. In addition, all loans receivable from Lafayette to the Company were satisfied in
connection with these transactions. These licenses covered populations totaling approximately 4.3 million people, including all of South Carolina and parts of Virginia and Georgia. Subsequent to the sale of these PCS licenses, the Company
terminated its relationship with Lafayette on June 30, 2003 and divested its 39% interest in Lafayette.

On November 11, 2004,
Lafayette sold the Company a PCS license covering a population of approximately 147,600 people in the Savannah, Georgia basic trading area for an approximately $2.1 million.

On November 29, 2004, SunCom Wireless Affiliate Company, LLC, a direct, wholly-owned subsidiary of Holdings, reacquired a 39% interest in Lafayette
for $39,000. Under section 24.709 of the FCC rules, Lafayette has been designated an entrepreneur and is eligible to hold certain PCS licenses.

On December 23, 2004, Lafayette sold the Company a PCS license covering a population of approximately 167,200 people in the Danville, Virginia basic service area for approximately $50,000.

During the first quarter of 2005, Lafayette was the successful bidder on a PCS license in the Hickory-Lenoir-Morgantown, North Carolina basic trading
area for approximately $0.4 million. The FCC issued this license to Lafayette on June 30, 2005.

15. Termination of Urban Comm  North
Carolina, Inc. Acquisition

During the third quarter of 2005, the Company exercised its termination right and cancelled its planned
purchase of Urban Comm  North Carolina, Inc. (Urban). The purchase agreement, which was finalized on October 28, 2004 but required the acceptance of Urbans creditors and the approval of the Bankruptcy Court, had called
for the Company to acquire the outstanding stock of Urban, whose sole assets consisted of FCC wireless licenses in 20 basic trading areas for $113.0 million in cash. During September 2005, the Company was refunded a $5.0 million deposit paid in 2004
related to the planned purchase.

16. Deferred Gain on Sale of Property and Equipment

In 1999, the Company sold and transferred 187 of its towers, related assets and certain liabilities to American Tower Corporation (ATC). The
purchase price was $71.1 million, reflecting a price of approximately $0.4 million per tower. The Company also entered into a master lease agreement with ATC, pursuant to which the Company agreed to pay ATC monthly rent for the continued use of the
space that the Company occupied on the towers prior to the sale. The initial term of the lease was 12 years. The Company accounted for this sale-leaseback transaction in accordance with SFAS No. 98 Accounting for Leases and SFAS
No. 28 Accounting for Sales with Leasebacks. The carrying value of the towers sold was $25.7 million. After deducting $1.6 million of selling costs, the gain on the sale of the towers was approximately $43.8 million, of which $11.7
was recognized immediately to reflect the portion of the gain in excess of the present value of the future minimum lease payments, and $32.1 million was deferred and is being recognized over the remaining operating lease terms of the towers that are
leased-back by the Company. During the fourth quarter of 2004, SunCom transferred leases for 43 ATC-owned towers located within the Companys previously owned Virginia properties to Cingular Wireless in connection with the Companys
exchange agreement with AT&T Wireless and Cingular Wireless. This transfer resulted in the recognition of $5.9 million of the deferred gain on the Companys 1999 tower sale, which was included as a component of the gain on the exchange
transaction. As of December 31, 2005, $7.1 million of the deferred gain had been recognized.

On March 18, 2005, the Company
agreed to sell 169 wireless communications towers located in North Carolina, South Carolina and Puerto Rico to Global Signal Acquisitions LLC, a wholly-owned subsidiary of Global Signal Inc. (Global Signal). As of December 31, 2005,
the Company had completed the sale of 160 of the original 169 towers, as well as the sale of an additional seven optional towers, to Global Signal, including related assets and certain liabilities, for $52.3 million, reflecting a purchase price of
approximately $0.3 million per site.

On June 30, 2005, the Company entered into a master lease agreement with Global Signal, pursuant
to which the Company agreed to pay Global Signal monthly rent for the continued use of space that the Company occupied on the towers prior to their sale. The lease has an initial term of ten years, plus three five-year renewal options. The monthly
rental amount is subject to certain escalation clauses over the life of the initial lease and related options. The carrying value of the towers and the associated income lease intangible assets was $19.0 million. After deducting $0.6 million of
selling costs, the gain on the sale of the towers was approximately $32.7 million, of which $0.4 million was recognized immediately in the statement of operations as a reduction to depreciation and asset disposal expense, and $32.3 million was
deferred and will be recognized over the term of the operating lease. As of December 31, 2005, $0.3 million of deferred gain had been recognized.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



17. Subscriber Sale

On October 7, 2005, the Company entered into an agreement with Cingular Wireless, which was effective as of September 20, 2005, under which the Company transferred to Cingular Wireless 29,139 customers from
the Companys North Carolina and Puerto Rico networks. The Company originally acquired the transferred customers pursuant to the December 2004 exchange of network assets between SunCom and Cingular Wireless, but the customers were maintained on
Cingulars billing system for transition purposes following the exchange. As consideration for the sale of these customers, Cingular agreed to pay the Company $3.1 million and to effect a settlement under the parties transitional billing
arrangements for the affected customers. As a result of this transaction, the Company wrote-off approximately $8.2 million of subscriber intangible assets related to the transferred customers. After taking effect of the $3.1 million of proceeds, the
Company recorded a loss of $5.1 million for the year ended December 31, 2005, which is recorded in depreciation and asset disposal expense on the consolidated statement of operations.

18. Commitments and Contingencies

(a)Leases

The Company has entered into various leases for its offices, retail stores, land for
cell sites, cell sites and furniture and equipment under capital and operating leases expiring through 2054. The Company recognizes rent expense on a straight-line basis over the life of the lease, which includes estimated renewal periods, where
appropriate. As a result of recognizing rent expense on a straight-line basis, rent escalation expense is accrued on the balance sheet. The Company has various capital lease commitments, which total approximately $1.2 million as of December 31,
2005.

As of December 31, 2005, the future minimum rental payments under these lease agreements having an initial or remaining term in
excess of one year were as follows:



|                                              |  |                        |         |                                 |   |        |         |  |   |      
|--------------------------------------------- |  | ---------------------- | ------- | ------------------------------- | - | ------ | ------- |  | - | -----
|                                              |  | Operating              |         | OperatingSub-leaseRental Income |   |        | Capital
|                                              |  | (Dollars in thousands)
|(1) Future Minimum Lease Payments             |  |                        |         |                                 |   |        |         |  |   |      
|2006                                          |  | $                      | 66,059  |                                 | $ | (368   | )       |  | $ | 311  
|2007                                          |  |                        | 62,664  |                                 |   | (442   | )       |  |   | 372  
|2008                                          |  |                        | 60,705  |                                 |   | (442   | )       |  |   | 271  
|2009                                          |  |                        | 55,003  |                                 |   | (442   | )       |  |   | 240  
|2010                                          |  |                        | 48,584  |                                 |   | (442   | )       |  |   | 4    
|Thereafter                                    |  |                        | 208,588 |                                 |   | (995   | )       |  |   |     
|                                              |  |                        |         |                                 |   |        |         |  |   |      
|Total                                         |  | $                      | 501,603 |                                 | $ | (3,131 | )       |  | $ | 1,198
|                                              |  |                        |         |                                 |   |        |         |  |   |      
|Interest expense                              |  |                        |         |                                 |   |        |         |  |   | 48   
|                                              |  |                        |         |                                 |   |        |         |  |   |      
|Net present value of future payments          |  |                        |         |                                 |   |        |         |  |   | 1,150
|Current portion of capital lease obligation   |  |                        |         |                                 |   |        |         |  |   | 286  
|                                              |  |                        |         |                                 |   |        |         |  |   |      
|Long-term portion of capital lease obligation |  |                        |         |                                 |   |        |         |  | $ | 864  
|                                              |  |                        |         |                                 |   |        |         |  |   |      

Rent expense under operating leases was $67.2 million, $54.8 million and $51.8 for the years ended
December 31, 2005, 2004 and 2003, respectively.

As of December 31, 2005, the Company had entered into contractual
commitments to purchase equipment and software as well as certain support related to its network and administrative systems. The total amount of these commitments as of December 31, 2005 was $23.8 million, of which $20.7 million and $3.1
million is committed for the years ended December 31, 2006 and 2007, respectively.

(b) Litigation

The Company has been involved in litigation relating to claims arising out of its operations in the normal course of business. The Company does not
believe that the outcome of any of these legal proceedings will have a material adverse effect on the Companys results of operations.



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SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



19. Termination Benefits and Other Related Charges

In January 2003, the Company completed a streamlining of its operations, which consolidated operations from a more decentralized structure and resulted in
the termination of 157 positions and the elimination of 13 unfilled positions, or 8% of the Companys workforce. In addition, 14 employees were relocated as a result of the streamlining. The workforce reduction resulted in $2.7 million of
expenses incurred during the year ended December 31, 2003, consisting of $1.7 million for one-time termination benefits and $1.0 million for relocation and other related workforce reduction expenses. As of December 31, 2003, the Company
had incurred all costs associated with this streamlining of operations.

20. Related party transactions

SunCom is a direct, wholly-owned subsidiary of SunCom Investment Company, and SunCom Investment Company is a direct, wholly-owned subsidiary of Holdings.
SunCom makes payments on behalf of SunCom Investment Company and Holdings for certain business activities, including, but not limited to, administrative expenses, tax payments and direct costs of business transactions. As of December 31, 2005
and 2004, the Company had recorded aggregate receivables from SunCom Investment Company and Holdings of $5.7 million and $7.3 million, respectively. These payments are due on demand. In addition, SunCom paid a $189.0 million dividend to SunCom
Investment Company in November 2004 for general and strategic corporate purposes.

21. Quarterly Results of Operations (Unaudited)

The following table summarizes the Companys quarterly financial data for the years ended December 31, 2005 and December 31, 2004. Unless
specifically noted, information related to the first three quarters of each year is derived from the Companys unaudited financial statements included in its Form 10-Q filings and includes, in managements opinion, only normal and
recurring adjustments that it considers necessary for a fair statement of the results for such periods. The information for the second quarter of 2005 was corrected during the fourth quarter to properly reflect the impact of the Companys
second quarter tower sale on the statement of operations. This correction was a result of previously excluding an income lease intangible asset associated with the disposed towers from the accounting for the calculation of the gain on the tower
sale. For the second quarter of 2005, this correction had the effect of increasing loss from operations and net loss by approximately $7.4 million. The Company has deemed this correction to be immaterial to its financial statements based upon its
quantitative and qualitative analysis. The operating results for any particular quarter are not necessarily indicative of results for that year or any future period.



|                              |                        |              |         |   |               |   |          |              |  |   |               |   |  |   |          |  
|----------------------------- | ---------------------- | ------------ | ------- | - | ------------- | - | -------- | ------------ |  | - | ------------- | - |  | - | -------- | -
|2005                          |                        | FirstQuarter |         |   | SecondQuarter |   |          | ThirdQuarter |  |   | FourthQuarter |  
|                              | (Dollars in thousands) |             
|Total revenue                 |                        | $            | 203,953 |   |               | $ | 212,880  |              |  | $ | 214,487       |   |  | $ | 194,838  |  
|Loss from operations          |                        |              | (32,244 | ) |               |   | (75,802  | )            |  |   | (80,210       | ) |  |   | (178,724 | )
|Net loss                      |                        |              | (70,866 | ) |               |   | (114,729 | )            |  |   | (118,670      | ) |  |   | (197,570 | )
|                              |                        |              |         |  
|2004                          |                        | FirstQuarter |         |   | SecondQuarter |   |          | ThirdQuarter |  |   | FourthQuarter |  
|                              | (Dollars in thousands) |             
|Total revenue                 |                        | $            | 197,960 |   |               | $ | 212,489  |              |  | $ | 212,243       |   |  | $ | 195,508  |  
|Income (loss) from operations |                        |              | (2,293  | ) |               |   | 6,284    |              |  |   | 12,655        |   |  |   | (2,474   | )
|Net income (loss)             |                        |              | (36,687 | ) |               |   | (27,866  | )            |  |   | (22,146       | ) |  |   | 648,775  |  



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



22. Supplemental Cash Flow Information



|                                                                       |  |                        |         |   |      |   |         |      |  |   |         |  
|---------------------------------------------------------------------- |  | ---------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                       |  | 2005                   |         |   | 2004 |   |         | 2003 | 
|                                                                       |  | (Dollars in thousands) |        
|Cash paid during the year for interest, net of amounts capitalized     |  | $                      | 144,445 |   |      | $ | 124,864 |      |  | $ | 116,915 |  
|Cash paid during the year for taxes                                    |  |                        | 152     |   |      |   | 6,906   |      |  |   | 1,560   |  
|Non-cash investing and financing activities:                           |  |                        |         |   |      |   |         |      |  |   |         |  
|Deferred stock compensation                                            |  |                        | 411     |   |      |   | (1,025  | )    |  |   | (10,964 | )
|Equipment acquired under capital lease obligation                      |  |                        | 1,000   |   |      |   | 438     |      |  |   | 1,551   |  
|Change in fair value of derivative instruments                         |  |                        |        |   |      |   | (846    | )    |  |   | (583    | )
|Change in capital expenditures included in accounts payable            |  |                        | (16,877 | ) |      |   | 19,573  |      |  |   | (5,375  | )
|FCC license acquisition through retirement of note receivable          |  |                        |        |   |      |   |        |      |  |   | 71,961  |  
|Change in accrued direct transaction costs                             |  |                        | (503    | ) |      |   | 503     |      |  |   |        |  
|Intangible assets acquired through the Triton PCS Agreement, net       |  |                        |        |   |      |   | 2,884   |      |  |   |        |  
|Intangible asset contribution from parent, net                         |  |                        |        |   |      |   | 18,958  |      |  |   |        |  
|Asset retirement obligation accruals for property, plant and equipment |  |                        | 103     |   |      |   | 613     |      |  |   | 1,187   |  
|Tangible assets acquired through the Exchange Agreement, net           |  |                        |        |   |      |   | 90,109  |      |  |   |        |  
|Intangible assets acquired through the Exchange Agreement, net         |  |                        |        |   |      |   | 463,071 |      |  |   |        |  
|Adjustment to goodwill related to the exchange agreement, net          |  |                        | (11,672 | ) |      |   |        |      |  |   |        |  

23. Guarantor Financial Information

The following tables set forth condensed consolidating financial information of SunCom (the Parent Company), for all of SunComs
subsidiaries other than Triton PCS License Company L.L.C. and Triton PCS Property Company L.L.C. (collectively, the Subsidiary Guarantors) and Triton PCS License Company L.L.C. and Triton PCS Property Company L.L.C. (together, the
Subsidiary Non-Guarantors). Set forth below are the balance sheets as of December 31, 2005 and 2004, the statements of operations for the twelve months ended December 31, 2005, 2004 and 2003 and the statements of cash flows for
the twelve months ended December 31, 2005, 2004 and 2003 for the Parent Company, the Subsidiary Guarantors and the Subsidiary Non-Guarantors. During the periods prior to June 13, 2003, both the Subsidiary Guarantors and Subsidiary
Non-Guarantors guaranteed the 11% Notes, the 93/8% Notes and the 83/4% Notes on a full and unconditional, joint and several basis.



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Balance Sheet as of December 31, 2005

(amounts in thousands)



|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|----------------------------------------------------------------------------------------------------------------- |  | ------------- | --------- | - | -------------------- | - | --------- | ------------------------- |  | - | ------------ | - |  | ------------ | ---------- | - |  | - | --------- | -
|                                                                                                                  |  |               |           |   |                     
|                                                                                                                  |  | ParentCompany |           |   | SubsidiaryGuarantors |   |           | Subsidiary Non-Guarantors |  |   | Eliminations |   |  | Consolidated |           
|ASSETS:                                                                                                           |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Current assets:                                                                                                   |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Cash and cash equivalents                                                                                         |  | $             | 12,729    |   |                      | $ | 3,071     |                           |  | $ |             |   |  | $            |           |   |  | $ | 15,800    |  
|Short-term investments                                                                                            |  |               | 139,050   |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | 139,050   |  
|Accounts receivable, net of allowance for doubtful accounts                                                       |  |               |          |   |                      |   | 82,628    |                           |  |   | 270          |   |  |              |           |   |  |   | 82,898    |  
|Accounts receivable  roaming partners                                                                            |  |               |          |   |                      |   | 18,188    |                           |  |   |             |   |  |              |           |   |  |   | 18,188    |  
|Due from related parties                                                                                          |  |               |          |   |                      |   | 5,703     |                           |  |   |             |   |  |              |           |   |  |   | 5,703     |  
|Inventory, net                                                                                                    |  |               |          |   |                      |   | 23,930    |                           |  |   |             |   |  |              |           |   |  |   | 23,930    |  
|Prepaid expenses                                                                                                  |  |               | 72        |   |                      |   | 6,225     |                           |  |   | 7,195        |   |  |              |           |   |  |   | 13,492    |  
|Intercompany receivable                                                                                           |  |               | 41,586    |   |                      |   | 266,590   |                           |  |   |             |   |  |              | (308,176   | ) |  |   |          |  
|Other current assets                                                                                              |  |               | 279       |   |                      |   | 11,743    |                           |  |   |             |   |  |              |           |   |  |   | 12,022    |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total current assets                                                                                              |  |               | 193,716   |   |                      |   | 418,078   |                           |  |   | 7,465        |   |  |              | (308,176   | ) |  |   | 311,083   |  
|                                                                                                                  |  |               |           |   |                     
|Long term assets:                                                                                                 |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Property and equipment, net                                                                                       |  |               |          |   |                      |   | 649,971   |                           |  |   | 313          |   |  |              |           |   |  |   | 650,284   |  
|Investments in subsidiaries                                                                                       |  |               | 1,254,878 |   |                      |   | 283,785   |                           |  |   |             |   |  |              | (1,538,663 | ) |  |   |          |  
|Intangible assets, net                                                                                            |  |               | 5,919     |   |                      |   | 107,401   |                           |  |   | 730,793      |   |  |              |           |   |  |   | 844,113   |  
|Other long-term assets                                                                                            |  |               |          |   |                      |   | 3,590     |                           |  |   | 734          |   |  |              |           |   |  |   | 4,324     |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total assets                                                                                                      |  | $             | 1,454,513 |   |                      | $ | 1,462,825 |                           |  | $ | 739,305      |   |  | $            | (1,846,839 | ) |  | $ | 1,809,804 |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT):                                                                   |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Current liabilities:                                                                                              |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Accounts payable                                                                                                  |  | $             |          |   |                      | $ | 80,814    |                           |  | $ | 16,541       |   |  | $            |           |   |  | $ | 97,355    |  
|Accrued liabilities                                                                                               |  |               | 23,587    |   |                      |   | 49,890    |                           |  |   |             |   |  |              |           |   |  |   | 73,477    |  
|Current portion of long-term debt                                                                                 |  |               | 2,500     |   |                      |   | 286       |                           |  |   |             |   |  |              |           |   |  |   | 2,786     |  
|Other current liabilities                                                                                         |  |               |          |   |                      |   | 23,271    |                           |  |   | 308,176      |   |  |              | (308,176   | ) |  |   | 23,271    |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total current liabilities                                                                                         |  |               | 26,087    |   |                      |   | 154,261   |                           |  |   | 324,717      |   |  |              | (308,176   | ) |  |   | 196,889   |  
|                                                                                                                  |  |               |           |   |                     
|Long-term debt:                                                                                                   |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Capital lease obligations                                                                                         |  |               |          |   |                      |   | 864       |                           |  |   |             |   |  |              |           |   |  |   | 864       |  
|Senior secured term loan                                                                                          |  |               | 245,000   |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | 245,000   |  
|Senior notes                                                                                                      |  |               | 713,148   |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | 713,148   |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Senior long-term debt                                                                                             |  |               | 958,148   |   |                      |   | 864       |                           |  |   |             |   |  |              |           |   |  |   | 959,012   |  
|                                                                                                                  |  |               |           |   |                     
|Subordinated notes                                                                                                |  |               | 730,339   |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | 730,339   |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total long-term debt                                                                                              |  |               | 1,688,487 |   |                      |   | 864       |                           |  |   |             |   |  |              |           |   |  |   | 1,689,351 |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Deferred income taxes, net                                                                                        |  |               |          |   |                      |   |          |                           |  |   | 130,803      |   |  |              |           |   |  |   | 130,803   |  
|Deferred revenue                                                                                                  |  |               |          |   |                      |   | 1,809     |                           |  |   |             |   |  |              |           |   |  |   | 1,809     |  
|Deferred gain on sale of property and equipment                                                                   |  |               |          |   |                      |   | 48,530    |                           |  |   |             |   |  |              |           |   |  |   | 48,530    |  
|Other                                                                                                             |  |               |          |   |                      |   | 2,483     |                           |  |   |             |   |  |              |           |   |  |   | 2,483     |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total liabilities                                                                                                 |  |               | 1,714,574 |   |                      |   | 207,947   |                           |  |   | 455,520      |   |  |              | (308,176   | ) |  |   | 2,069,865 |  
|                                                                                                                  |  |               |           |   |                     
|Commitments and contingencies                                                                                     |  |               |          |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   |          |  
|                                                                                                                  |  |               |           |   |                     
|Stockholders equity (deficit):                                                                                   |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Common Stock, $0.01 par value, 1,000 shares authorized; 100 shares issued and outstanding as of December 31, 2005 |  |               |          |   |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   |          |  
|Additional paid-in-capital                                                                                        |  |               | 561,396   |   |                      |   | 1,526,845 |                           |  |   | 495,456      |   |  |              | (2,022,301 | ) |  |   | 561,396   |  
|Accumulated deficit                                                                                               |  |               | (815,252  | ) |                      |   | (271,967  | )                         |  |   | (211,671     | ) |  |              | 483,638    |   |  |   | (815,252  | )
|SunCom Wireless Holdings, Inc common stock held in trust                                                          |  |               | (145      | ) |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | (145      | )
|Deferred compensation                                                                                             |  |               | (6,060    | ) |                      |   |          |                           |  |   |             |   |  |              |           |   |  |   | (6,060    | )
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total stockholders equity (deficit)                                                                              |  |               | (260,061  | ) |                      |   | 1,254,878 |                           |  |   | 283,785      |   |  |              | (1,538,663 | ) |  |   | (260,061  | )
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total liabilities and stockholders equity (deficit)                                                              |  | $             | 1,454,513 |   |                      | $ | 1,462,825 |                           |  | $ | 739,305      |   |  | $            | (1,846,839 | ) |  | $ | 1,809,804 |  
|                                                                                                                  |  |               |           |   |                      |   |           |                           |  |   |              |   |  |              |            |   |  |   |           |  



F - 33



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Statement of Operations for the Year Ended December 31, 2005

(amounts in thousands)



|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|-------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | --------- | ------------------------- |  | - | ------------ | - | ------------ | - | ------- |  | - | --------- | -
|                                                   |  | ParentCompany |          |   | SubsidiaryGuarantors |   |           | Subsidiary Non-Guarantors |  |   | Eliminations |   | Consolidated |  
|Revenues:                                          |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Service                                            |  | $             |         |   |                      | $ | 635,038   |                           |  | $ |             |   |              | $ |        |  | $ | 635,038   |  
|Roaming                                            |  |               |         |   |                      |   | 103,605   |                           |  |   |             |   |              |   |        |  |   | 103,605   |  
|Equipment                                          |  |               |         |   |                      |   | 87,515    |                           |  |   |             |   |              |   |        |  |   | 87,515    |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Total revenues                                     |  |               |         |   |                      |   | 826,158   |                           |  |   |             |   |              |   |        |  |   | 826,158   |  
|                                                   |  |               |          |   |                     
|Expenses:                                          |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Cost of service                                    |  |               |         |   |                      |   | 216,201   |                           |  |   | 53,916       |   |              |   |        |  |   | 270,117   |  
|Cost of equipment                                  |  |               |         |   |                      |   | 167,123   |                           |  |   |             |   |              |   |        |  |   | 167,123   |  
|Selling, general and administrative                |  |               | 94       |   |                      |   | 344,299   |                           |  |   | 13,267       |   |              |   |        |  |   | 357,660   |  
|Non-cash compensation                              |  |               |         |   |                      |   | 9,083     |                           |  |   |             |   |              |   |        |  |   | 9,083     |  
|Asset impairment                                   |  |               |         |   |                      |   |          |                           |  |   | 47,700       |   |              |   |        |  |   | 47,700    |  
|Depreciation and asset disposal                    |  |               |         |   |                      |   | 281,333   |                           |  |   | 673          |   |              |   |        |  |   | 282,006   |  
|Amortization                                       |  |               |         |   |                      |   | 59,449    |                           |  |   |             |   |              |   |        |  |   | 59,449    |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Total operating expenses                           |  |               | 94       |   |                      |   | 1,077,488 |                           |  |   | 115,556      |   |              |   |         |  |   | 1,193,138 |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Loss from operations                               |  |               | (94      | ) |                      |   | (251,330  | )                         |  |   | (115,556     | ) |              |   |        |  |   | (366,980  | )
|                                                   |  |               |          |   |                     
|Interest expense                                   |  |               | (148,556 | ) |                      |   | (315      | )                         |  |   |             |   |              |   |        |  |   | (148,871  | )
|Other expense                                      |  |               |         |   |                      |   | (157      | )                         |  |   |             |   |              |   |        |  |   | (157      | )
|Interest and other income                          |  |               | 8,403    |   |                      |   | 77        |                           |  |   |             |   |              |   |        |  |   | 8,480     |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Loss before taxes                                  |  |               | (140,247 | ) |                      |   | (251,725  | )                         |  |   | (115,556     | ) |              |   |        |  |   | (507,528  | )
|Income tax benefit (provision)                     |  |               |         |   |                      |   | (251      | )                         |  |   | 5,944        |   |              |   |        |  |   | 5,693     |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Net loss before equity in earnings of subsidiaries |  |               | (140,247 | ) |                      |   | (251,976  | )                         |  |   | (109,612     | ) |              |   |        |  |   | (501,835  | )
|Equity in earnings of subsidiaries                 |  |               | (361,588 | ) |                      |   | (109,612  | )                         |  |   |             |   |              |   | 471,200 |  |   |          |  
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  
|Net loss                                           |  | $             | (501,835 | ) |                      | $ | (361,588  | )                         |  | $ | (109,612     | ) |              | $ | 471,200 |  | $ | (501,835  | )
|                                                   |  |               |          |   |                      |   |           |                           |  |   |              |   |              |   |         |  |   |           |  



F - 34



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Statement of Cash Flows for the Year Ended December 31, 2005

(amounts in thousands)



|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|--------------------------------------------------- |  | ------------- | ---------- | - | -------------------- | - | -------- | ------------------------ |  | - | ------------ | - |  | ------------ | ------- | - |  | - | ---------- | -
|                                                    |  | ParentCompany |            |   | SubsidiaryGuarantors |   |          | SubsidiaryNon-Guarantors |  |   | Eliminations |   |  | Consolidated |        
|Cash flows from operating activities:               |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Net cash provided by (used in) operating activities |  | $             | (135,946   | ) |                      | $ | 121,188  |                          |  | $ | (64,788      | ) |  | $            |        |   |  | $ | (79,546    | )
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Cash flows from investing activities:               |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Purchase of available for sale of securities        |  |               | (1,061,225 | ) |                      |   |         |                          |  |   |             |   |  |              |        |   |  |   | (1,061,225 | )
|Proceeds from sale of available for sale securities |  |               | 1,227,675  |   |                      |   |         |                          |  |   |             |   |  |              |        |   |  |   | 1,227,675  |  
|Capital expenditures                                |  |               |           |   |                      |   | (137,967 | )                        |  |   |             |   |  |              |        |   |  |   | (137,967   | )
|Proceeds from sale of assets                        |  |               |           |   |                      |   | 53,184   |                          |  |   | 30           |   |  |              |         |   |  |   | 53,214     |  
|Refund of FCC license deposit                       |  |               |           |   |                      |   |         |                          |  |   | 5,000        |   |  |              |         |   |  |   | 5,000      |  
|Payment of direct costs on business transactions    |  |               |           |   |                      |   | (1,280   | )                        |  |   |             |   |  |              |        |   |  |   | (1,280     | )
|Other                                               |  |               |           |   |                      |   | (99      | )                        |  |   |             |   |  |              |        |   |  |   | (99        | )
|Investment in subsidiaries                          |  |               | (63,368    | ) |                      |   |         |                          |  |   |             |   |  |              | 63,368  |   |  |   |           |  
|Dividends received                                  |  |               | 63,368     |   |                      |   |         |                          |  |   |             |   |  |              | (63,368 | ) |  |   |           |  
|Net intercompany loans                              |  |               | (25,366    | ) |                      |   | (34,392  | )                        |  |   |             |   |  |              | 59,758  |   |  |   |           |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Net cash provided by (used in) investing activities |  |               | 141,084    |   |                      |   | (120,554 | )                        |  |   | 5,030        |   |  |              | 59,758  |   |  |   | 85,318     |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Cash flows from financing activities:               |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Dividends paid                                      |  |               |           |   |                      |   | (63,368  | )                        |  |   |             |   |  |              | 63,368  |   |  |   |           |  
|Repayment of senior secured term loan               |  |               | (2,500     | ) |                      |   |         |                          |  |   |             |   |  |              |        |   |  |   | (2,500     | )
|Change in bank overdraft                            |  |               |           |   |                      |   | 3,663    |                          |  |   |             |   |  |              |        |   |  |   | 3,663      |  
|Payment of deferred financing costs                 |  |               | (28        | ) |                      |   |         |                          |  |   |             |   |  |              |        |   |  |   | (28        | )
|Principal payment under capital lease obligations   |  |               |           |   |                      |   | (1,104   | )                        |  |   |             |   |  |              |        |   |  |   | (1,104     | )
|Repayments from (advances to) related party         |  |               | 1,976      |   |                      |   | (330     | )                        |  |   |             |   |  |              |        |   |  |   | 1,646      |  
|Capital contribution from parent                    |  |               |           |   |                      |   | 63,368   |                          |  |   |             |   |  |              | (63,368 | ) |  |   |           |  
|Net intercompany loans                              |  |               |           |   |                      |   |         |                          |  |   | 59,758       |   |  |              | (59,758 | ) |  |   |           |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Net cash provided by (used in) financing activities |  |               | (552       | ) |                      |   | 2,229    |                          |  |   | 59,758       |   |  |              | (59,758 | ) |  |   | 1,677      |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Net increase in cash and cash equivalents           |  |               | 4,586      |   |                      |   | 2,863    |                          |  |   |             |   |  |              |        |   |  |   | 7,449      |  
|Cash and cash equivalents, beginning of period      |  |               | 8,143      |   |                      |   | 208      |                          |  |   |             |   |  |              |        |   |  |   | 8,351      |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  
|Cash and cash equivalents, end of period            |  | $             | 12,729     |   |                      | $ | 3,071    |                          |  | $ |             |   |  | $            |        |   |  | $ | 15,800     |  
|                                                    |  |               |            |   |                      |   |          |                          |  |   |              |   |  |              |         |   |  |   |            |  



F - 35



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Balance Sheet as of December 31, 2004

(amounts in thousands)



|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|----------------------------------------------------------------------------------------------------------------- |  | ------------- | --------- | - | -------------------- | - | ------------------------- |  | - | ------------ | - |  | ------------ | ---------- | - |  | - | --------- | -
|                                                                                                                  |  | ParentCompany |           |   | SubsidiaryGuarantors |   | Subsidiary Non-Guarantors |  |   | Eliminations |   |  | Consolidated |           
|ASSETS:                                                                                                           |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Current assets:                                                                                                   |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Cash and cash equivalents                                                                                         |  | $             | 8,143     |   |                      | $ | 208                       |  | $ |             |   |  | $            |           |   |  | $ | 8,351     |  
|Short-term investments                                                                                            |  |               | 305,500   |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   | 305,500   |  
|Accounts receivable, net of allowance for doubtful accounts                                                       |  |               | 13        |   |                      |   | 79,277                    |  |   |             |   |  |              |           |   |  |   | 79,290    |  
|Accounts receivable  roaming partners                                                                            |  |               |          |   |                      |   | 18,348                    |  |   |             |   |  |              |           |   |  |   | 18,348    |  
|Due from related parties                                                                                          |  |               | 1,976     |   |                      |   | 5,373                     |  |   |             |   |  |              |           |   |  |   | 7,349     |  
|Inventory, net                                                                                                    |  |               |          |   |                      |   | 18,216                    |  |   |             |   |  |              |           |   |  |   | 18,216    |  
|Prepaid expenses                                                                                                  |  |               | 71        |   |                      |   | 6,470                     |  |   | 5,070        |   |  |              |           |   |  |   | 11,611    |  
|Intercompany receivable                                                                                           |  |               | 7,119     |   |                      |   | 241,299                   |  |   |             |   |  |              | (248,418   | ) |  |   |          |  
|Other current assets                                                                                              |  |               | 316       |   |                      |   | 5,490                     |  |   | 5,000        |   |  |              |           |   |  |   | 10,806    |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total current assets                                                                                              |  |               | 323,138   |   |                      |   | 374,681                   |  |   | 10,070       |   |  |              | (248,418   | ) |  |   | 459,471   |  
|                                                                                                                  |  |               |           |   |                     
|Long term assets:                                                                                                 |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Property and equipment, net                                                                                       |  |               |          |   |                      |   | 813,814                   |  |   | 313          |   |  |              |           |   |  |   | 814,127   |  
|Investments in subsidiaries                                                                                       |  |               | 1,616,466 |   |                      |   | 393,397                   |  |   |             |   |  |              | (2,009,863 | ) |  |   |          |  
|Intangible assets, net                                                                                            |  |               | 7,210     |   |                      |   | 194,988                   |  |   | 781,854      |   |  |              |           |   |  |   | 984,052   |  
|Other long-term assets                                                                                            |  |               |          |   |                      |   | 4,405                     |  |   | 775          |   |  |              |           |   |  |   | 5,180     |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total assets                                                                                                      |  | $             | 1,946,814 |   |                      | $ | 1,781,285                 |  | $ | 793,012      |   |  | $            | (2,258,281 | ) |  | $ | 2,262,830 |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT):                                                                   |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Current liabilities:                                                                                              |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Accounts payable                                                                                                  |  | $             |          |   |                      | $ | 74,020                    |  | $ | 11,876       |   |  | $            |           |   |  | $ | 85,896    |  
|Accrued liabilities                                                                                               |  |               | 23,574    |   |                      |   | 43,791                    |  |   |             |   |  |              |           |   |  |   | 67,365    |  
|Current portion of long-term debt                                                                                 |  |               | 2,500     |   |                      |   | 984                       |  |   |             |   |  |              |           |   |  |   | 3,484     |  
|Other current liabilities                                                                                         |  |               |          |   |                      |   | 23,984                    |  |   | 248,418      |   |  |              | (248,418   | ) |  |   | 23,984    |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total current liabilities                                                                                         |  |               | 26,074    |   |                      |   | 142,779                   |  |   | 260,294      |   |  |              | (248,418   | ) |  |   | 180,729   |  
|                                                                                                                  |  |               |           |   |                     
|Long-term debt:                                                                                                   |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Capital lease obligations                                                                                         |  |               |          |   |                      |   | 269                       |  |   |             |   |  |              |           |   |  |   | 269       |  
|Senior secured term loan                                                                                          |  |               | 247,500   |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   | 247,500   |  
|Senior notes                                                                                                      |  |               | 712,055   |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   | 712,055   |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Senior long-term debt                                                                                             |  |               | 959,555   |   |                      |   | 269                       |  |   |             |   |  |              |           |   |  |   | 959,824   |  
|                                                                                                                  |  |               |           |   |                     
|Subordinated notes                                                                                                |  |               | 728,494   |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   | 728,494   |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total long-term debt                                                                                              |  |               | 1,688,049 |   |                      |   | 269                       |  |   |             |   |  |              |           |   |  |   | 1,688,318 |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Deferred income taxes, net                                                                                        |  |               |          |   |                      |   |                          |  |   | 139,321      |   |  |              |           |   |  |   | 139,321   |  
|Deferred revenue                                                                                                  |  |               |          |   |                      |   | 659                       |  |   |             |   |  |              |           |   |  |   | 659       |  
|Deferred gain on sale of property and equipment                                                                   |  |               |          |   |                      |   | 19,099                    |  |   |             |   |  |              |           |   |  |   | 19,099    |  
|Other                                                                                                             |  |               |          |   |                      |   | 2,013                     |  |   |             |   |  |              |           |   |  |   | 2,013     |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total liabilities                                                                                                 |  |               | 1,714,123 |   |                      |   | 164,819                   |  |   | 399,615      |   |  |              | (248,418   | ) |  |   | 2,030,139 |  
|                                                                                                                  |  |               |           |   |                     
|Commitments and contingencies                                                                                     |  |               |          |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   |          |  
|                                                                                                                  |  |               |           |   |                     
|Stockholders equity (deficit):                                                                                   |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Common Stock, $0.01 par value, 1,000 shares authorized; 100 shares issued and outstanding as of December 31, 2004 |  |               |          |   |                      |   |                          |  |   |             |   |  |              |           |   |  |   |          |  
|Additional paid-in-capital                                                                                        |  |               | 560,934   |   |                      |   | 1,463,477                 |  |   | 495,456      |   |  |              | (1,958,933 | ) |  |   | 560,934   |  
|Accumulated deficit                                                                                               |  |               | (313,417  | ) |                      |   | 152,989                   |  |   | (102,059     | ) |  |              | (50,930    | ) |  |   | (313,417  | )
|SunCom Wireless Holdings, Inc common stock held in trust                                                          |  |               | (94       | ) |                      |   |                          |  |   |             |   |  |              |           |   |  |   | (94       | )
|Deferred compensation                                                                                             |  |               | (14,732   | ) |                      |   |                          |  |   |             |   |  |              |           |   |  |   | (14,732   | )
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total stockholders equity (deficit)                                                                              |  |               | 232,691   |   |                      |   | 1,616,466                 |  |   | 393,397      |   |  |              | (2,009,863 | ) |  |   | 232,691   |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  
|Total liabilities and stockholders equity (deficit)                                                              |  | $             | 1,946,814 |   |                      | $ | 1,781,285                 |  | $ | 793,012      |   |  | $            | (2,258,281 | ) |  | $ | 2,262,830 |  
|                                                                                                                  |  |               |           |   |                      |   |                           |  |   |              |   |  |              |            |   |  |   |           |  



F - 36



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Statement of Operations for the Year Ended December 31, 2004

(amounts in thousands)



|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|----------------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | ------- | ------------------------- |  | - | ------------ | - |  | ------------ | -------- | - |  | - | -------- | -
|                                                            | 
|                                                            | 
|                                                            |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | Subsidiary Non-Guarantors |  |   | Eliminations |   |  | Consolidated |         
|Revenues:                                                   |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Service                                                     |  | $             |         |   |                      | $ | 603,242 |                           |  | $ |             |   |  | $            |         |   |  | $ | 603,242  |  
|Roaming                                                     |  |               |         |   |                      |   | 145,999 |                           |  |   |             |   |  |              |         |   |  |   | 145,999  |  
|Equipment                                                   |  |               |         |   |                      |   | 68,959  |                           |  |   |             |   |  |              |         |   |  |   | 68,959   |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Total revenues                                              |  |               |         |   |                      |   | 818,200 |                           |  |   |             |   |  |              |         |   |  |   | 818,200  |  
|                                                            |  |               |          |   |                     
|Expenses:                                                   |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cost of service                                             |  |               |         |   |                      |   | 203,081 |                           |  |   | 41,279       |   |  |              |         |   |  |   | 244,360  |  
|Cost of equipment                                           |  |               |         |   |                      |   | 122,880 |                           |  |   |             |   |  |              |         |   |  |   | 122,880  |  
|Selling, general and administrative                         |  |               | 71       |   |                      |   | 229,860 |                           |  |   | 12,522       |   |  |              |         |   |  |   | 242,453  |  
|Non-cash compensation                                       |  |               |         |   |                      |   | 19,965  |                           |  |   |             |   |  |              |         |   |  |   | 19,965   |  
|Depreciation and asset disposal                             |  |               |         |   |                      |   | 161,208 |                           |  |   |             |   |  |              |         |   |  |   | 161,208  |  
|Amortization                                                |  |               |         |   |                      |   | 13,162  |                           |  |   |             |   |  |              |         |   |  |   | 13,162   |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Income (loss) from operations                               |  |               | (71      | ) |                      |   | 68,044  |                           |  |   | (53,801      | ) |  |              |         |   |  |   | 14,172   |  
|                                                            |  |               |          |   |                     
|Interest expense                                            |  |               | (128,336 | ) |                      |   | (291    | )                         |  |   |             |   |  |              |         |   |  |   | (128,627 | )
|Other expense                                               |  |               | (3,092   | ) |                      |   |        |                           |  |   |             |   |  |              |         |   |  |   | (3,092   | )
|Interest and other income                                   |  |               | 2,545    |   |                      |   | 3       |                           |  |   |             |   |  |              |         |   |  |   | 2,548    |  
|Other gain                                                  |  |               |         |   |                      |   | 463,988 |                           |  |   | 215,527      |   |  |              |         |   |  |   | 679,515  |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Income (loss) before taxes                                  |  |               | (128,954 | ) |                      |   | 531,744 |                           |  |   | 161,726      |   |  |              |         |   |  |   | 564,516  |  
|Income tax provision                                        |  |               |         |   |                      |   | (1,256  | )                         |  |   | (1,184       | ) |  |              |         |   |  |   | (2,440   | )
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net income (loss) before equity in earnings of subsidiaries |  |               | (128,954 | ) |                      |   | 530,488 |                           |  |   | 160,542      |   |  |              |         |   |  |   | 562,076  |  
|Equity in earnings of subsidiaries                          |  |               | 691,030  |   |                      |   | 160,542 |                           |  |   |             |   |  |              | (851,572 | ) |  |   |         |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net income (loss)                                           |  | $             | 562,076  |   |                      | $ | 691,030 |                           |  | $ | 160,542      |   |  | $            | (851,572 | ) |  | $ | 562,076  |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |  |              |          |   |  |   |          |  



F - 37



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##### Table of Contents

Consolidating Statement of Cash Flows for the Year Ended December 31, 2004

(amounts in thousands)



|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|---------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | -------- | ------------------------- |  | - | ------------ | - |  | ------------ | -------- | - |  | - | -------- | -
|                                                     |  | ParentCompany |          |   | SubsidiaryGuarantors |   |          | Subsidiary Non-Guarantors |  |   | Eliminations |   |  | Consolidated |         
|Cash flows from operating activities:                |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) operating activities  |  | $             | (122,391 | ) |                      | $ | 265,878  |                           |  | $ | (55,856      | ) |  | $            |         |   |  | $ | 87,631   |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash flows from investing activities:                |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Purchase of available for sale of securities         |  |               | (652,500 | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (652,500 | )
|Proceeds from sale of available for sale securities  |  |               | 449,600  |   |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | 449,600  |  
|Capital expenditures                                 |  |               |         |   |                      |   | (77,795  | )                         |  |   |             |   |  |              |         |   |  |   | (77,795  | )
|Proceeds from exchange of FCC licenses               |  |               |         |   |                      |   |         |                           |  |   | 4,698        |   |  |              |         |   |  |   | 4,698    |  
|Deposits on FCC licenses                             |  |               |         |   |                      |   |         |                           |  |   | (5,000       | ) |  |              |          |   |  |   | (5,000   | )
|Acquisition of FCC licenses                          |  |               |         |   |                      |   |         |                           |  |   | (2,161       | ) |  |              |         |   |  |   | (2,161   | )
|Proceeds from asset exchange                         |  |               |         |   |                      |   | 176,000  |                           |  |   |             |   |  |              |         |   |  |   | 176,000  |  
|Payment of direct costs on business transactions     |  |               |         |   |                      |   | (5,539   | )                         |  |   | (1,118       | ) |  |              |         |   |  |   | (6,657   | )
|Other                                                |  |               |         |   |                      |   | 136      |                           |  |   |             |   |  |              |         |   |  |   | 136      |  
|Investment in subsidiaries                           |  |               | (52,589  | ) |                      |   | (2,161   | )                         |  |   |             |   |  |              | 54,750   |   |  |   |         |  
|Dividends received                                   |  |               | 50,428   |   |                      |   |         |                           |  |   |             |   |  |              | (50,428  | ) |  |   |         |  
|Net intercompany loans                               |  |               |         |   |                      |   | (343,445 | )                         |  |   |             |   |  |              | 343,445  |   |  |   |         |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) investing activities  |  |               | (205,061 | ) |                      |   | (252,804 | )                         |  |   | (3,581       | ) |  |              | 347,767  |   |  |   | (113,679 | )
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash flows from financing activities:                |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Dividends paid                                       |  |               | (189,000 | ) |                      |   | (50,428  | )                         |  |   |             |   |  |              | 50,428   |   |  |   | (189,000 | )
|Borrowings under senior secured term loan            |  |               | 250,000  |   |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | 250,000  |  
|Payments of subordinated debt                        |  |               | (4,463   | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (4,463   | )
|Payment of debt extinguishment costs                 |  |               | (10      | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (10      | )
|Change in bank overdraft                             |  |               |         |   |                      |   | (9,212   | )                         |  |   |             |   |  |              |         |   |  |   | (9,212   | )
|Payment of deferred financing costs                  |  |               | (4,947   | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (4,947   | )
|Extinguishment of interest rate swaps                |  |               | (3,092   | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (3,092   | )
|Principal payment under capital lease obligations    |  |               |         |   |                      |   | (1,536   | )                         |  |   |             |   |  |              |         |   |  |   | (1,536   | )
|Advances to related party                            |  |               | (1,976   | ) |                      |   | (4,731   | )                         |  |   |             |   |  |              |         |   |  |   | (6,707   | )
|Capital contribution from parent                     |  |               |         |   |                      |   | 52,589   |                           |  |   | 2,161        |   |  |              | (54,750  | ) |  |   |         |  
|Net intercompany loans                               |  |               | 286,169  |   |                      |   |         |                           |  |   | 57,276       |   |  |              | (343,445 | ) |  |   |         |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) financing activities  |  |               | 332,681  |   |                      |   | (13,318  | )                         |  |   | 59,437       |   |  |              | (347,767 | ) |  |   | 31,033   |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net increase (decrease) in cash and cash equivalents |  |               | 5,229    |   |                      |   | (244     | )                         |  |   |             |   |  |              |         |   |  |   | 4,985    |  
|Cash and cash equivalents, beginning of period       |  |               | 2,914    |   |                      |   | 452      |                           |  |   |             |   |  |              |         |   |  |   | 3,366    |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash and cash equivalents, end of period             |  | $             | 8,143    |   |                      | $ | 208      |                           |  | $ |             |   |  | $            |         |   |  | $ | 8,351    |  
|                                                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  



F - 38



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Statement of Operations for the Year Ended December 31, 2003

(amounts in thousands)



|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|----------------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | ------- | ------------------------- |  | - | ------------ | - | ------------ | - | ------ |  | - | -------- | -
|                                                            |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | Subsidiary Non-Guarantors |  |   | Eliminations |   | Consolidated |  
|Revenues:                                                   |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Service                                                     |  | $             |         |   |                      | $ | 576,359 |                           |  | $ |             |   |              | $ |       |  | $ | 576,359  |  
|Roaming                                                     |  |               |         |   |                      |   | 180,314 |                           |  |   |             |   |              |   |       |  |   | 180,314  |  
|Equipment                                                   |  |               |         |   |                      |   | 53,426  |                           |  |   |             |   |              |   |       |  |   | 53,426   |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Total revenues                                              |  |               |         |   |                      |   | 810,099 |                           |  |   |             |   |              |   |       |  |   | 810,099  |  
|                                                            |  |               |          |   |                     
|Expenses:                                                   |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Cost of service                                             |  |               |         |   |                      |   | 204,574 |                           |  |   | 39,652       |   |              |   |       |  |   | 244,226  |  
|Cost of equipment                                           |  |               |         |   |                      |   | 104,630 |                           |  |   |             |   |              |   |       |  |   | 104,630  |  
|Selling, general and administrative                         |  |               | 135      |   |                      |   | 224,406 |                           |  |   | 11,136       |   |              |   |       |  |   | 235,677  |  
|Termination benefits and other related charges              |  |               |         |   |                      |   | 2,731   |                           |  |   |             |   |              |   |       |  |   | 2,731    |  
|Non-cash compensation                                       |  |               |         |   |                      |   | 28,810  |                           |  |   |             |   |              |   |       |  |   | 28,810   |  
|Depreciation and asset disposal                             |  |               |         |   |                      |   | 148,794 |                           |  |   |             |   |              |   |       |  |   | 148,794  |  
|Amortization                                                |  |               |         |   |                      |   | 4,300   |                           |  |   |             |   |              |   |       |  |   | 4,300    |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Income (loss) from operations                               |  |               | (135     | ) |                      |   | 91,854  |                           |  |   | (50,788      | ) |              |   |       |  |   | 40,931   |  
|                                                            |  |               |          |   |                     
|Interest expense                                            |  |               | (140,414 | ) |                      |   | (796    | )                         |  |   |             |   |              |   |       |  |   | (141,210 | )
|Other expense                                               |  |               | (2,898   | ) |                      |   |        |                           |  |   |             |   |              |   |       |  |   | (2,898   | )
|Debt extinguishment costs                                   |  |               | (41,171  | ) |                      |   |        |                           |  |   |             |   |              |   |       |  |   | (41,171  | )
|Interest and other income                                   |  |               | 2,285    |   |                      |   |        |                           |  |   |             |   |              |   |       |  |   | 2,285    |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Income (loss) before taxes                                  |  |               | (182,333 | ) |                      |   | 91,058  |                           |  |   | (50,788      | ) |              |   |       |  |   | (142,063 | )
|Income tax provision                                        |  |               |         |   |                      |   | (1,560  | )                         |  |   | (10,347      | ) |              |   |       |  |   | (11,907  | )
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Net income (loss) before equity in earnings of subsidiaries |  |               | (182,333 | ) |                      |   | 89,498  |                           |  |   | (61,135      | ) |              |   |       |  |   | (153,970 | )
|Equity in earnings of subsidiaries                          |  |               | 28,363   |   |                      |   | (61,135 | )                         |  |   |             |   |              |   | 32,772 |  |   |         |  
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  
|Net income (loss)                                           |  | $             | (153,970 | ) |                      | $ | 28,363  |                           |  | $ | (61,135      | ) |              | $ | 32,772 |  | $ | (153,970 | )
|                                                            |  |               |          |   |                      |   |         |                           |  |   |              |   |              |   |        |  |   |          |  



F - 39



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



Consolidating Statement of Cash Flows for the Year Ended December 31, 2003

(amounts in thousands)



|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|--------------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | -------- | ------------------------- |  | - | ------------ | - |  | ------------ | -------- | - |  | - | -------- | -
|                                                          |  | ParentCompany |          |   | SubsidiaryGuarantors |   |          | Subsidiary Non-Guarantors |  |   | Eliminations |   |  | Consolidated |         
|Cash flows from operating activities:                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) operating activities       |  | $             | (115,074 | ) |                      | $ | 300,177  |                           |  | $ | (48,184      | ) |  | $            |         |   |  | $ | 136,919  |  
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash flows from investing activities:                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Purchase of available for sale securities                 |  |               | (675,200 | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (675,200 | )
|Proceeds from sales of available for sale securities      |  |               | 770,917  |   |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | 770,917  |  
|Capital expenditures                                      |  |               |         |   |                      |   | (145,874 | )                         |  |   |             |   |  |              |         |   |  |   | (145,874 | )
|Net investment in and advances to non-consolidated entity |  |               | (875     | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (875     | )
|Repayments from non-consolidated entity                   |  |               | 58       |   |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | 58       |  
|Acquisition of FCC licenses                               |  |               |         |   |                      |   |         |                           |  |   | (28,413      | ) |  |              |         |   |  |   | (28,413  | )
|Other                                                     |  |               |         |   |                      |   | 738      |                           |  |   |             |   |  |              |         |   |  |   | 738      |  
|Investment in subsidiaries                                |  |               | (80,860  | ) |                      |   | (28,413  | )                         |  |   |             |   |  |              | 109,273  |   |  |   |         |  
|Dividends received                                        |  |               | 52,448   |   |                      |   |         |                           |  |   |             |   |  |              | (52,448  | ) |  |   |         |  
|Net intercompany loans                                    |  |               |         |   |                      |   | (149,388 | )                         |  |   |             |   |  |              | 149,388  |   |  |   |         |  
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) investing activities       |  |               | 66,488   |   |                      |   | (322,937 | )                         |  |   | (28,413      | ) |  |              | 206,213  |   |  |   | (78,649  | )
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash flows from financing activities:                     |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Dividends paid                                            |  |               |         |   |                      |   | (52,448  | )                         |  |   |             |   |  |              | 52,448   |   |  |   |         |  
|Proceeds from issuance of debt, net of discount           |  |               | 710,500  |   |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | 710,500  |  
|Payments under senior secured credit facility             |  |               | (207,961 | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (207,961 | )
|Payment of subordinated debt                              |  |               | (511,989 | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (511,989 | )
|Payment of debt extinguishment costs                      |  |               | (31,342  | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (31,342  | )
|Change in bank overdraft                                  |  |               |         |   |                      |   | (3,171   | )                         |  |   |             |   |  |              |         |   |  |   | (3,171   | )
|Payment of deferred financing costs                       |  |               | (2,680   | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (2,680   | )
|Extinguishment of interest rate swaps                     |  |               | (20,383  | ) |                      |   |         |                           |  |   |             |   |  |              |         |   |  |   | (20,383  | )
|Principal payments under capital lease obligations        |  |               |         |   |                      |   | (1,948   | )                         |  |   |             |   |  |              |         |   |  |   | (1,948   | )
|Advances to related party                                 |  |               |         |   |                      |   | (120     | )                         |  |   |             |   |  |              |         |   |  |   | (120     | )
|Capital contributions from parent                         |  |               | 57       |   |                      |   | 80,860   |                           |  |   | 28,413       |   |  |              | (109,273 | ) |  |   | 57       |  
|Net intercompany loans                                    |  |               | 101,204  |   |                      |   |         |                           |  |   | 48,184       |   |  |              | (149,388 | ) |  |   |         |  
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Net cash provided by (used in) financing activities       |  |               | 37,406   |   |                      |   | 23,173   |                           |  |   | 76,597       |   |  |              | (206,213 | ) |  |   | (69,037  | )
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|                                                          |  |               |          |   |                     
|Net increase (decrease) in cash and cash equivalents      |  |               | (11,180  | ) |                      |   | 413      |                           |  |   |             |   |  |              |         |   |  |   | (10,767  | )
|Cash and cash equivalents, beginning of period            |  |               | 14,094   |   |                      |   | 39       |                           |  |   |             |   |  |              |         |   |  |   | 14,133   |  
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  
|Cash and cash equivalents, end of period                  |  | $             | 2,914    |   |                      | $ | 452      |                           |  | $ |             |   |  | $            |         |   |  | $ | 3,366    |  
|                                                          |  |               |          |   |                      |   |          |                           |  |   |              |   |  |              |          |   |  |   |          |  



F - 40



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##### Table of Contents

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

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Controls and Procedures.The Chief Executive
Officer and the Chief Financial Officer of SunCom (its principal executive officer and principal financial officer, respectively), as well as the Controller have concluded, based on their evaluation as of December 31, 2005, that SunComs
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended): are effective to ensure that information required to be disclosed by SunCom in the reports filed or submitted by
it under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms; and include controls and procedures designed to ensure that information
required to be disclosed by SunCom in such reports is accumulated and communicated to the Companys management, including the Chief Executive Officer, Chief Financial Officer and the Controller, as appropriate to allow timely decisions
regarding required disclosure.

Changes in Internal Controls. There were no changes in SunComs internal controls over
financial reporting that occurred during the year ended December 31, 2005 that have materially affected, or are reasonably likely to materially affect, SunComs internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

On December 20, 2005, David Clark, SunCom Wireless Holdings, Inc. and
SunCom Wireless Management Company, Inc. mutually agreed not to renew Mr. Clarks employment agreement after its expiration on February 3, 2006, and Mr. Clark resigned his role as Executive Vice President, Chief Financial Officer
and Secretary, effective as of December 20, 2005. Mr. Clark remained with SunCom until February 3, 2006 to assist with the transition to a successor executive. Mr. Clarks departure was not related to any dispute with
SunCom, nor was it related to any accounting or financial reporting issue. In connection with this matter, Mr. Clark and SunCom entered into a Separation Agreement, or the Separation Agreement, effective as of December 20, 2005, or
the Separation Date. Pursuant to the terms of the Separation Agreement, Mr. Clark will receive a bonus earned in 2005 in an amount equal to one years base salary as well as payments equal to one years base salary commencing
August 3, 2006. In addition, the vested portion of Mr. Clarks Holdings restricted stock will be determined as if Mr. Clark had continued his employment through and including May 1, 2006, and Mr. Clark will become
vested in 92,500 additional shares of Holdings restricted common stock as of May 1, 2006. In consideration of his benefits under the Separation Agreement, Mr. Clark has agreed to a comprehensive release of claims against SunCom and
agreed not to solicit SunCom employees or customers for two years following the Separation Date.

On December 20, 2005, SunCom
Wireless Holdings, Inc. appointed Eric Haskell as its interim Executive Vice President and Chief Financial Officer to serve while SunCom searches for Mr. Clarks replacement. Mr. Haskell has served on Holdings Board of Directors
since November 2003 and will remain a director of Holdings while serving as SunComs interim Executive Vice President and Chief Financial Officer. However, Mr. Haskell has stepped down from his position on Holdings Audit Committee
and its Nominating/Corporate Governance Committee. Mr. Haskell, 59, was formally Executive Senior Vice President and Chief Financial Officer of Systems & Computer Technology Corporation, or SCT, a publicly-held global technology
solutions provider, from 1989 until it was sold to SunGard Data Systems in February 2004. Mr. Haskell also served on SCTs board of directors. Prior to joining SCT in 1989, Mr. Haskell served as senior financial executive with
Williams Holdings, Inc. and Transamerica Delaval. Mr. Haskell began his career with Ernst & Young.

On January 12, 2006,
David Watson submitted his resignation from Holdings Board of Directors, effective as of January 13, 2006. Mr. Watson has served as a director of Holdings since January 2004 and was a member of Holdings Audit Committee and
Compensation Committee. Mr. Watsons departure was not related to any dispute with SunCom, nor was it related to any accounting or financial reporting issue.



44



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##### Table of Contents

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Omitted pursuant to General Instruction I(2)
of Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION

Omitted pursuant to General Instruction I(2) of Form 10-K.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Omitted pursuant to General
Instruction I(2) of Form 10-K.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Omitted pursuant to General Instruction I(2) of
Form 10-K.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Omitted pursuant to General Instruction I(2) of Form
10-K.



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##### Table of Contents

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES



|(a) | (1) Financial Statements and Financial Statement Schedules
|--- | ----------------------------------------------------------

The following financial statements have been included as part of this report:



|                                                                      |  |    
|--------------------------------------------------------------------- |  | ---
|Report of Independent Registered Public Accounting Firm               |  | F-2
|Consolidated Balance Sheets                                           |  | F-3
|Consolidated Statements of Operations and Comprehensive Income (Loss) |  | F-4
|Consolidated Statements of Stockholders Equity (Deficit)             |  | F-5
|Consolidated Statements of Cash Flows                                 |  | F-6
|Notes to Consolidated Financial Statements                            |  | F-7
|                                                                      | 
|Schedule I  Valuation and Qualifying Accounts                        |  | 47 



46



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##### Table of Contents

SUNCOM WIRELESS, INC.

NOTES TO FINANCIAL STATEMENTS

SUNCOM WIRELESS, INC.

SCHEDULE I - VALUATION AND QUALIFYING ACCOUNTS

(in thousands)



|                                             |  |                            |         |                                     |   |                                        |  |                               |         |  |                      |        |   |  |   |        
|-------------------------------------------- |  | -------------------------- | ------- | ----------------------------------- | - | -------------------------------------- |  | ----------------------------- | ------- |  | -------------------- | ------ | - |  | - | -------
|                                             |  | Balance atBeginningof Year |         | AdditionsCharged toCost andExpenses |   | DeductionsCredited toCosts andExpenses |  | PurchaseAccountingAdjustments |         |  | Balanceat Endof Year
|Allowance for doubtful accounts:             |  |                            |         |                                     |   |                                        |  |                               |         |  |                      |        |   |  |   |        
|Year ended December 31, 2003                 |  | $                          | 7,008   |                                     | $ | 8,530                                  |  | $                             | 11,699  |  | $                    |       |   |  | $ | 3,839  
|Year ended December 31, 2004                 |  |                            | 3,839   |                                     |   | 7,761                                  |  |                               | 7,876   |  |                      | 3,861  |   |  |   | 7,585  
|Year ended December 31, 2005                 |  |                            | 7,585   |                                     |   | 16,145                                 |  |                               | 13,717  |  |                      | 2,339  |   |  |   | 12,352 
|                                             |  |                            |         |                                     |  
|Inventory Obsolescence Reserve:              |  |                            |         |                                     |   |                                        |  |                               |         |  |                      |        |   |  |   |        
|Year ended December 31, 2003                 |  | $                          | 646     |                                     | $ | 3,092                                  |  | $                             | 3,049   |  | $                    |       |   |  | $ | 689    
|Year ended December 31, 2004                 |  |                            | 689     |                                     |   | 1,335                                  |  |                               | 1,526   |  |                      |       |   |  |   | 498    
|Year ended December 31, 2005                 |  |                            | 498     |                                     |   | 1,774                                  |  |                               | 1,725   |  |                      |       |   |  |   | 547    
|                                             |  |                            |         |                                     |  
|Valuation Allowance for Deferred Tax Assets: |  |                            |         |                                     |   |                                        |  |                               |         |  |                      |        |   |  |   |        
|Year ended December 31, 2003                 |  | $                          | 315,129 |                                     | $ | 36,502                                 |  | $                             |        |  | $                    |       |   |  | $ | 351,631
|Year ended December 31, 2004                 |  |                            | 351,631 |                                     |   |                                       |  |                               | 171,962 |  |                      | (9,328 | ) |  |   | 170,341
|Year ended December 31, 2005                 |  |                            | 170,341 |                                     |   | 163,154                                |  |                               |        |  |                      | (2,890 | ) |  |   | 330,605

All other schedules for which provision is made in the applicable accounting regulations of the SEC are not
required under the related instructions or are inapplicable and, therefore, have been omitted.



47



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|(a) | (3) Exhibits
|--- | ------------



|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|2.1           |  | Exchange Agreement among Triton PCS Holdings, Inc., the entities defined therein as Triton Contributing Entities, AT&T Wireless Services, Inc., the entities defined therein as AWS
Contributing Entities and Cingular Wireless LLC. (incorporated by reference to Exhibit 2.1 to the Form 10-Q of Triton PCS Holdings, Inc. filed August 9, 2004).                                                                                                                                                                             
|              | 
|3.1           |  | Certificate of Incorporation of Triton PCS, Inc. (incorporated by reference to Exhibit 3.1 to the Form S-4/A, Amendment No. 1, Registration Statement of Triton PCS, Inc., File No.
333-57715).                                                                                                                                                                                                                                                                                                                                 
|              | 
|3.2           |  | Amendments to Certificate of Incorporation of Triton PCS, Inc. changing the corporate name to SunCom Wireless, Inc. (incorporated by reference to Exhibit 3.2 to the Form 10-K of SunCom Wireless,
Inc. for the year ended December 31, 2004).                                                                                                                                                                                                                                                                                  
|              | 
|3.3           |  | Bylaws of Triton PCS, Inc. (incorporated by reference to Exhibit 3.2 to the Form S-4/A Registration Statement, Amendment No. 1, of Triton PCS, Inc., File No. 333-57715).                                                                                                                                                                                                                                                                                                                                                       
|              | 
|4.1           |  | Indenture, dated as of January 19, 2001, among Triton PCS, Inc., the Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.5 to Amendment No. 2 to
the Form S-3 Registration Statement of Triton PCS Holdings, Inc., File No. 333-49974).                                                                                                                                                                                                                                       
|              | 
|4.2           |  | Supplemental Indenture, dated as of November 18, 2004, by and among Triton PCS, Inc., Affiliate License Co., L.L.C. and The Bank of New York, to the Indenture, dated as of January 19, 2001,
among Triton PCS, Inc., the Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.3 to the Form 10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).                                                                                                          
|              | 
|4.3           |  | Supplemental Indenture, dated as of January 27, 2005, by and among Triton PCS, Inc., AWS Network Newco, LLC, SunCom Wireless International, LLC, SunCom Wireless Puerto Rico Operating Company,
LLC, Triton Network Newco, LLC and The Bank of New York to the Indenture, dated as of January 19, 2001, among Triton PCS, Inc., the Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.4 to the Form
10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).
|              | 
|4.4           |  | Indenture, dated as of November 14, 2001, among Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 to the Form 8-K/A of
Triton PCS Holdings, Inc. filed November 15, 2001).                                                                                                                                                                                                                                                                                
|              | 
|4.5           |  | Supplemental Indenture, dated as of November 18, 2004, by and among Triton PCS, Inc., Affiliate License Co., L.L.C. and The Bank of New York to the Indenture, dated as of November 14, 2001,
among Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.6 to the Form 10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).                                                                                                                
|              | 
|4.6           |  | Supplemental Indenture, dated as of January 27, 2005, by and among Triton PCS, Inc., AWS Network Newco, LLC, SunCom Wireless International, LLC, SunCom Wireless Puerto Rico Operating Company,
LLC, Triton Network Newco, LLC and The Bank of New York to the Indenture, dated as of November 14, 2001, among Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.7 to the Form 10-K
of Triton PCS Holdings, Inc. for the year ended December 31, 2004).     
|              | 
|4.7           |  | Indenture, dated as of June 13, 2003, among Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 to the Form 8-K/A of Triton
PCS Holdings, Inc. filed June 16, 2003).                                                                                                                                                                                                                                                                                        
|              | 
|4.8           |  | Supplemental Indenture, dated as of November 18, 2004, by and among Triton PCS, Inc., Affiliate License Co., L.L.C. and The Bank of New York, to the Indenture, dated as of June 13, 2003, among
Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.9 to the Form 10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).                                                                                                                   
|              | 
|4.9           |  | Supplemental Indenture, dated as of January 27, 2005, by and among Triton PCS, Inc., AWS Network Newco, LLC, SunCom Wireless International, LLC, SunCom Wireless Puerto Rico Operating Company,
LLC, Triton Network Newco, LLC and The Bank of New York, to the Indenture, dated as of June 13, 2003, among Triton PCS, Inc., the Guarantors thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.10 to the Form 10-K of
Triton PCS Holdings, Inc. for the year ended December 31, 2004).       



48



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|      |  |                                                                                                                                                                                                                                                                                                                                                               
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      | 
|10.1  |  | Term Loan Agreement, dated as of November 18, 2004, among Triton PCS, Inc., the lenders party thereto, Lehman Commercial Paper Inc., as Administrative Agent, and Merrill Lynch, Pierce,
Fenner & Smith Incorporated, as Syndication Agent (incorporated by reference to Exhibit 10.1 to the Form 8-K of Triton PCS Holdings, Inc. filed November 23, 2004).  
|      | 
|10.2  |  | Pledge Agreement, dated as of November 18, 2004, among Triton PCS, Inc., each Subsidiary of the Borrower party thereto, SunCom Wireless Investment Company LLC and Lehman Commercial Paper Inc.,
as Collateral Agent for the Secured Parties (incorporated by reference to Exhibit 10.2 to the Form 8-K of Triton PCS Holdings, Inc. filed November 23, 2004).
|      | 
|10.3  |  | Security Agreement, dated as of November 18, 2004, among Triton PCS, Inc., each Subsidiary of the Borrower party thereto and Lehman Commercial Paper Inc., as Collateral Agent for the Secured
Parties (incorporated by reference to Exhibit 10.3 to the Form 8-K of Triton PCS Holdings, Inc. filed November 23, 2004).                                      
|      | 
|10.4  |  | Guarantee Agreement, dated as of November 18, 2004, among each Subsidiary of Triton PCS, Inc. party thereto and Lehman Commercial Paper Inc., as Collateral Agent for the Secured Parties
(incorporated by reference to Exhibit 10.4 to the Form 8-K of Triton PCS Holdings, Inc. filed November 23, 2004).                                                   
|      | 
|10.5  |  | Indemnity, Subrogation and Contribution Agreement, dated as of November 18, 2004, among Triton PCS, Inc., each Subsidiary of the Borrower party thereto and Lehman Commercial Paper Inc., as
Collateral Agent for the Secured Parties (incorporated by reference to Exhibit 10.5 to the Form 8-K of Triton PCS Holdings, Inc. filed November 23, 2004).       
|      | 
|10.6  |  | Ericsson Acquisition Agreement, dated as of March 11, 1998, between Triton Equipment Company L.L.C. and Ericsson, Inc. (incorporated by reference to Exhibit 10.15 to Amendment No. 2 to the Form
S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).**                                                                 
|      | 
|10.7  |  | First Addendum to Acquisition Agreement, dated as of May 24, 1999, between Triton PCS Equipment Company L.L.C. and Ericsson, Inc. (incorporated by reference to Exhibit 10.27 to Amendment No. 3
to the Form S-1 Registration Statement of Triton PCS Holdings, Inc., File No. 333-85149).**                                                                  
|      | 
|10.8  |  | Second Addendum to Acquisition Agreement, dated as of September 22, 1999, between Triton PCS Equipment Company L.L.C. and Ericsson, Inc. (incorporated by reference to Exhibit 10.13 to the Form
10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2000).**                                                                                   
|      | 
|10.9  |  | Third Addendum to Acquisition Agreement, dated as of June 20, 2000, between Triton PCS Equipment Company L.L.C. and Ericsson, Inc. (incorporated by reference to Exhibit 10.14 to the Form 10-K of
Triton PCS Holdings, Inc. for the year ended December 31, 2000).**                                                                                         
|      | 
|10.10 |  | Fourth Addendum to Acquisition Agreement, effective as of September 21, 2001, between Triton PCS Equipment Company L.L.C. and Ericsson Inc. (incorporated by reference to Exhibit 10.3 to the Form
10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2002).**                                                                                  
|      | 
|10.11 |  | Employment Agreement, dated as of February 4, 1998, among Triton Management Company, Inc., Triton PCS Holdings, Inc. and Michael E. Kalogris (incorporated by reference to Exhibit 10.16 to the
Form S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).*                                                               
|      | 
|10.12 |  | Amendment No. 1 to Employment Agreement, dated as of June 29, 1998, among Triton Management Company, Inc., Triton PCS Holdings, Inc., and Michael E. Kalogris (incorporated by reference to
Exhibit 10.16.1 to Amendment No. 1 to the Form S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).*                         
|      | 
|10.13 |  | Amendment No. 2 to Employment Agreement by and among Triton Management Company, Inc., Triton PCS Holdings, Inc. and Michael E. Kalogris, dated December, 1998 (incorporated by reference to
Exhibit 10.39 to Post-Effective Amendment No. 2 to the Form S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).*            
|      | 
|10.14 |  | Amendment No. 3 to Employment Agreement by and among Triton Management Company, Inc., Triton PCS Holdings, Inc. and Michael E. Kalogris, dated June 8, 1999 (incorporated by reference to Exhibit
10.40 to Post-Effective Amendment No. 2 to the Form S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).*              
|      | 
|10.15 |  | Letter Agreement, dated as of May 6, 2003, by and among Triton PCS Holdings, Inc., Triton Management Company, Inc. and Michael E. Kalogris (incorporated by reference to Exhibit 10.2 to the Form
10-Q/A, Amendment No.1, of Triton PCS Holdings, Inc. for the quarter ended March 31, 2003).*                                                                
|      | 
|10.16 |  | Letter Agreement, dated as of December 2, 2005, by and among SunCom Wireless Holdings, Inc., SunCom Wireless Management Company, Inc. and Michael E. Kalogris (incorporated by reference to
Exhibit 10.16 to the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*                                                          
|      | 
|10.17 |  | Amendment No. 4 to Employment Agreement by and among SunCom Wireless Management Company, Inc., SunCom Wireless Holdings, Inc. and Michael E. Kalogris, dated December 20, 2005 (incorporated by
reference to Exhibit 10.17 to the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*                                         



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|      |  |                                                                                                                                                                                                                                                                                                        
|----- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      | 
|10.18 |  | Employment Agreement, dated May 24, 2001, to be effective as of January 1, 2001, by and between Triton Management Company, Inc. and David D. Clark (incorporated by reference to Exhibit
10.1 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2001).*                     
|      | 
|10.19 |  | Letter Agreement, dated as of May 6, 2003, by and among Triton PCS Holdings, Inc., Triton Management Company, Inc. and David D. Clark (incorporated by reference to Exhibit 10.3 to the Form
10-Q/A, Amendment No.1, of Triton PCS Holdings, Inc. for the quarter ended March 31, 2003).*              
|      | 
|10.20 |  | Letter Agreement, dated as of December 2, 2005, by and among SunCom Wireless Holdings, Inc., SunCom Wireless Management Company, Inc. and David D. Clark (incorporated by reference to Exhibit
10.20 to the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*        
|      | 
|10.21 |  | Separation Agreement, dated as of December 20, 2005, by and among SunCom Wireless Holdings, Inc., SunCom Wireless Management Company, Inc. and David D. Clark (incorporated by reference to
Exhibit 10.21 to the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*   
|      | 
|10.22 |  | Employment Agreement, dated as of March 7, 2005, by and between SunCom Wireless Management Company, Inc. and William A. Robinson (incorporated by reference to Exhibit 10.1 to the Form 8-K of
Triton PCS Holdings, Inc. filed March 11, 2005).*                                                       
|      | 
|10.23 |  | Amendment No. 1 to Employment Agreement by and between SunCom Wireless Management Company, Inc. and William A. Robinson, dated December 14, 2005 (incorporated by reference to Exhibit 10.23 to
the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*                
|      | 
|10.24 |  | Employment Agreement, dated as of December 14, 2005, by and among SunCom Wireless Management Company, Inc., SunCom Wireless Holdings, Inc. and Daniel E. Hopkins (incorporated by reference to
Exhibit 10.24 to the Form 10-K of SunCom Wireless Holdings, Inc. for the year ended December 31, 2005).*
|      | 
|10.25 |  | Amended and Restated Common Stock Trust Agreement for Management Employees and Independent Directors, dated as of June 26, 1998 (incorporated by reference to Exhibit 10.19 to Amendment No. 1 to
the Form S-4 Registration Statement of Triton PCS, Inc. and its subsidiaries, File No. 333-57715).*  
|      | 
|10.26 |  | Form of Stockholders Letter Agreement for Management Employees (incorporated by reference to Exhibit 10.43 to Post-Effective Amendment No. 2 to the Form S-4 Registration Statement of Triton PCS,
Inc. and its subsidiaries, File No. 333-57715).*                                                    
|      | 
|10.27 |  | Triton PCS Holdings, Inc. Directors Stock and Incentive Plan (incorporated by reference to Exhibit 10.5 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended March 31,
2004).*                                                                                                         
|      | 
|10.28 |  | Form of Directors Stock Award Agreement (incorporated by reference to Exhibit 10.22 to the Form 10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).*                                                                                                                              
|      | 
|10.29 |  | Form of 2002 Director Stock Award Agreement, as amended (incorporated by reference to Exhibit 10.9 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30,
2002).*                                                                                                                
|      | 
|10.30 |  | Triton PCS Holdings, Inc. Amended and Restated Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended March 31,
2004).*                                                                                               
|      | 
|10.31 |  | Form of Notification of Restricted Stock Award (incorporated by reference to Exhibit 10.25 to the Form 10-K of Triton PCS Holdings, Inc. for the year ended December 31, 2004).*                                                                                                                       
|      | 
|10.32 |  | Triton PCS Holdings, Inc. Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.46 to Amendment no. 1 to the Form S-1 Registration Statement of Triton PCS Holdings, Inc., File
No. 333-85149).*                                                                                       
|      | 
|10.33 |  | Triton PCS Holdings, Inc. Nonqualified Deferred Compensation Plan (incorporated by reference to Exhibit 10.3 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended March 31,
2004).*                                                                                                     
|      | 
|10.34 |  | Form of Executive Bonus Program Agreement (incorporated by reference to Exhibit 10.5 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2003).*                                                                                                                              
|      | 
|10.35 |  | Master Purchase Agreement, effective as of September 21, 2001, between Ericsson Inc. and Triton PCS Equipment Company L.L.C. (incorporated by reference to Exhibit 10.4 to the Form 10-Q of Triton
PCS Holdings, Inc. for the quarter ended June 30, 2002). **                                         
|      | 
|10.36 |  | Statement of Work No. 1, effective as of September 21, 2001, between Triton PCS Equipment Company L.L.C. and Ericsson Inc. (incorporated by reference to Exhibit 10.1 to the Form 10-Q of Triton
PCS Holdings, Inc. for the quarter ended June 30, 2002). **                                           



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|      |  |                                                                                                                                                                                                                                                                                                                                                                      
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      | 
|10.37 |  | Statement of Work No. 2, effective as of April 10, 2002, between Triton PCS Equipment Company L.L.C. and Ericsson Inc. (incorporated by reference to Exhibit 10.6 to the Form 10-Q of Triton
PCS Holdings, Inc. for the quarter ended June 30, 2002). **                                                                                                             
|      | 
|10.38 |  | Purchase and License Agreement, effective as of May 16, 2002, between Triton PCS Equipment Company L.L.C. and Nortel Networks Inc. (incorporated by reference to Exhibit 10.7 to the Form 10-Q of
Triton PCS Holdings, Inc. for the quarter ended June 30, 2002). **                                                                                                 
|      | 
|10.39 |  | GSM/GPRS Supplement to the Purchase and License Agreement, effective as of May 16, 2002, between Triton PCS Equipment Company L.L.C. and Nortel Networks Inc. (incorporated by reference to
Exhibit 10.8 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2002). **                                                                      
|      | 
|10.40 |  | Agreement, dated the July 7, 2004, by and among Triton PCS Holdings, Inc., AT&T Wireless Services, Inc., AT&T Wireless PCS LLC, and Cingular Wireless LLC (incorporated by reference
to Exhibit 10.3 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2004).                                                                             
|      | 
|10.41 |  | Agreement, dated the July 7, 2004, by and among Triton PCS, Inc., AT&T Wireless Services, Inc., AT&T Wireless PCS LLC, and Cingular Wireless LLC (incorporated by reference to
Exhibit 10.4 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2004).                                                                                      
|      | 
|10.42 |  | License Exchange Agreement, dated July 7, 2004, by and among Triton PCS, Inc., Triton PCS License Company L.L.C., a Delaware limited liability company AT&T Wireless Services, Inc.,
AT&T Wireless PCS LLC, and Cingular Wireless LLC. (incorporated by reference to Exhibit 10.5 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30, 2004).
|      | 
|21.1  |  | Subsidiaries of SunCom Wireless, Inc.                                                                                                                                                                                                                                                                                                                                
|      | 
|24.1  |  | Power of Attorney (set forth on the signature page of this report).                                                                                                                                                                                                                                                                                                  
|      | 
|31.1  |  | Certification of Chief Executive Officer pursuant to Rule 13a-14a under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                                                                                             
|      | 
|31.2  |  | Certification of Chief Financial Officer pursuant to Rule 13a-14a under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                                                                                             
|      | 
|31.3  |  | Certification of Controller pursuant to Rule 13a-14a under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                                                                                                          
|      | 
|32.1  |  | Certification of Chief Executive Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                                                                                           
|      | 
|32.2  |  | Certification of Chief Financial Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                                                                                           

---

|* | Management contract or compensatory plan.
|- | -----------------------------------------

|** | Portions of this exhibit have been omitted under a Securities and Exchange Commission order granting confidential treatment.
|-- | ----------------------------------------------------------------------------------------------------------------------------



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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Berwyn, State of Pennsylvania on March 16, 2006.



|                     |  |                       |  |                                          
|-------------------- |  | --------------------- |  | -----------------------------------------
|                     |  | SunCom Wireless, Inc.
|                     |  |                      
|Date: March 16, 2006 |  | By:                   |  | /s/ Michael E. Kalogris                  
|                     |  |                       |  | Michael E. Kalogris                      
|                     |  |                       |  | Chief Executive Officer and Sole Director
|                     |  |                       |  | (Principal Executive Officer)            
|                     |  |                      
|Date: March 16, 2006 |  | By :                  |  | /s/ Eric Haskell                         
|                     |  |                       |  | Eric Haskell                             
|                     |  |                       |  | Interim Executive Vice President and     
|                     |  |                       |  | Chief Financial Officer                  
|                     |  |                       |  | (Principal Financial Officer)