##### Table of Contents

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549



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FORM 10-Q



(Mark
One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
|- | ----------------------------------------------------------------------------------------



For the quarterly period ended September 30, 2003



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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TRITON PCS, INC.

(Exact name of Registrant as specified in its charter)



|Delaware                                                      |  | 23-2930873                         
|------------------------------------------------------------- |  | -----------------------------------
|(State or other jurisdiction ofincorporation or organization) |  | (I.R.S. employeridentification no.)



1100 Cassatt Road

Berwyn, Pennsylvania 19312

(Address and zip code of principal executive offices)



(610) 651-5900

(Registrants telephone number, including area code)



---



Indicate by a 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  x    No ̈



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



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##### Table of Contents

TRITON PCS, INC.



THIRD QUARTER REPORT



Table of Contents



|        |  |                                                                                                                              |  | Page No.
|------- |  | ---------------------------------------------------------------------------------------------------------------------------- |  | --------
|        |  | PART I. Financial Information                                                                                                |  |         
|        |  |                                                                                                                             
|Item 1. |  | Financial Statements                                                                                                         |  |         
|        |  |                                                                                                                             
|        |  | Consolidated Balance Sheets at December 31, 2002 and September 30, 2003                                                      |  | 3       
|        |  |                                                                                                                             
|        |  | Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2002 and 2003 |  | 4       
|        |  |                                                                                                                             
|        |  | Consolidated Statements of Cash Flows for the nine months ended September 30, 2002 and 2003                                  |  | 5       
|        |  |                                                                                                                             
|        |  | Notes to the Financial Statements                                                                                            |  | 6       
|        |  |                                                                                                                             
|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                        |  | 16      
|        |  |                                                                                                                             
|Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk                                                                   |  | 26      
|        |  |                                                                                                                             
|Item 4. |  | Controls and Procedures                                                                                                      |  | 26      
|        |  |                                                                                                                             
|        |  | PART II. Other Information                                                                                                   |  |         
|        |  |                                                                                                                             
|Item 1. |  | Legal Proceedings                                                                                                            |  | 27      
|        |  |                                                                                                                             
|Item 2. |  | Changes in Securities and Use of Proceeds                                                                                    |  | 27      
|        |  |                                                                                                                             
|Item 3. |  | Defaults Upon Senior Securities                                                                                              |  | 27      
|        |  |                                                                                                                             
|Item 4. |  | Submission of Matters to a Vote of Security Holders                                                                          |  | 27      
|        |  |                                                                                                                             
|Item 5. |  | Other Information                                                                                                            |  | 27      
|        |  |                                                                                                                             
|Item 6. |  | Exhibits and Reports on Form 8-K                                                                                             |  | 27      



2



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##### Table of Contents

PART I. FINANCIAL INFORMATION



|ITEM 1. |  | FINANCIAL STATEMENTS
|------- |  | --------------------



TRITON PCS, INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)



|                                                                                                                                         |  | December 31, 2002 |           |   | September 30, 2003 |  
|---------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | --------- | - | ------------------ | -
|                                                                                                                                         |  | (unaudited)       |           |   | (unaudited)        |  
|                                                                                                                                         |  |                  
|ASSETS:                                                                                                                                  |  |                   |           |   |                    |  
|Current assets:                                                                                                                          |  |                   |           |   |                    |  
|Cash and cash equivalents                                                                                                                |  | $                 | 212,450   |   |                    | $
|Accounts receivable, net of allowance for doubtful accounts of $7,008 and $4,189, respectively                                           |  |                   | 68,213    |   |                    |  
|Accounts receivable  roaming partners                                                                                                   |  |                   | 23,037    |   |                    |  
|Inventory, net                                                                                                                           |  |                   | 28,510    |   |                    |  
|Prepaid expenses                                                                                                                         |  |                   | 8,767     |   |                    |  
|Other current assets                                                                                                                     |  |                   | 6,578     |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total current assets                                                                                                                     |  |                   | 347,555   |   |                    |  
|                                                                                                                                         |  |                  
|Property and equipment:                                                                                                                  |  |                   |           |   |                    |  
|Land                                                                                                                                     |  |                   | 377       |   |                    |  
|Network infrastructure and equipment                                                                                                     |  |                   | 1,004,323 |   |                    |  
|Furniture, fixtures and computer equipment                                                                                               |  |                   | 89,208    |   |                    |  
|Capital lease assets                                                                                                                     |  |                   | 8,454     |   |                    |  
|Construction in progress                                                                                                                 |  |                   | 37,647    |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|                                                                                                                                         |  |                   | 1,140,009 |   |                    |  
|Less accumulated depreciation                                                                                                            |  |                   | (343,506  | ) |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Net property and equipment                                                                                                               |  |                   | 796,503   |   |                    |  
|Intangible assets, net                                                                                                                   |  |                   | 395,249   |   |                    |  
|Investment in and advances to non-consolidated entities                                                                                  |  |                   | 72,019    |   |                    |  
|Other long-term assets                                                                                                                   |  |                   | 6,767     |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total assets                                                                                                                             |  | $                 | 1,618,093 |   |                    | $
|                                                                                                                                         |  |                   |           |   |                    |  
|                                                                                                                                         |  |                  
|LIABILITIES AND STOCKHOLDERS DEFICIT:                                                                                                   |  |                   |           |   |                    |  
|Current liabilities:                                                                                                                     |  |                   |           |   |                    |  
|Accounts payable                                                                                                                         |  | $                 | 57,758    |   |                    | $
|Bank overdraft liability                                                                                                                 |  |                   | 25,892    |   |                    |  
|Accrued payroll and related expenses                                                                                                     |  |                   | 16,282    |   |                    |  
|Accrued expenses                                                                                                                         |  |                   | 5,999     |   |                    |  
|Current portion of long term debt                                                                                                        |  |                   | 17,169    |   |                    |  
|Deferred revenue                                                                                                                         |  |                   | 19,548    |   |                    |  
|Deferred gain on sale of property and equipment                                                                                          |  |                   | 1,190     |   |                    |  
|Accrued interest                                                                                                                         |  |                   | 20,637    |   |                    |  
|Other current liabilities                                                                                                                |  |                   | 10,468    |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total current liabilities                                                                                                                |  |                   | 174,943   |   |                    |  
|                                                                                                                                         |  |                  
|Long-term debt:                                                                                                                          |  |                   |           |   |                    |  
|Capital lease obligations                                                                                                                |  |                   | 964       |   |                    |  
|Bank credit facility                                                                                                                     |  |                   | 192,579   |   |                    |  
|Senior notes                                                                                                                             |  |                   |          |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Senior long term debt                                                                                                                    |  |                   | 193,543   |   |                    |  
|Subordinated notes                                                                                                                       |  |                   | 1,219,720 |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total long-term debt                                                                                                                     |  |                   | 1,413,263 |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|                                                                                                                                         |  |                  
|Deferred income taxes                                                                                                                    |  |                   | 35,609    |   |                    |  
|Deferred revenue                                                                                                                         |  |                   | 3,051     |   |                    |  
|Fair value of derivative instruments                                                                                                     |  |                   | 23,819    |   |                    |  
|Asset retirement obligation                                                                                                              |  |                   |          |   |                    |  
|Deferred gain on sale of property and equipment                                                                                          |  |                   | 27,072    |   |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total liabilities                                                                                                                        |  |                   | 1,677,757 |   |                    |  
|                                                                                                                                         |  |                  
|Commitments and contingencies                                                                                                            |  |                   |          |   |                    |  
|                                                                                                                                         |  |                  
|Stockholders deficit:                                                                                                                   |  |                   |           |   |                    |  
|Common stock, $0.01 par value, 1,000 shares authorized; 100 shares issued and outstanding as of December 31, 2002 and September
30, 2003 |  |                   |          |   |                    |  
|Additional paid-in capital                                                                                                               |  |                   | 741,872   |   |                    |  
|Accumulated deficit                                                                                                                      |  |                   | (721,523  | ) |                    |  
|Accumulated other comprehensive loss                                                                                                     |  |                   | (5,459    | ) |                    |  
|Deferred compensation                                                                                                                    |  |                   | (74,554   | ) |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total stockholders deficit                                                                                                              |  |                   | (59,664   | ) |                    |  
|                                                                                                                                         |  |                   |           |   |                    |  
|Total liabilities and stockholders deficit                                                                                              |  | $                 | 1,618,093 |   |                    | $
|                                                                                                                                         |  |                   |           |   |                    |  



See accompanying notes
to financial statements.



3



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##### Table of Contents

TRITON PCS, INC.

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS

(Dollars in thousands)



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Three MonthsEnded September 30, |          |   | Nine MonthsEnded September 30, |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------- | -------- | - | ------------------------------ | -
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | 2002                            |          |   | 2003                           |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | (unaudited)                     |          |   | (unaudited)                    |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Revenues:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                 |          |   |                                |  
|Service                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | $                               | 133,545  |   |                                | $
|Roaming                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                 | 50,396   |   |                                |  
|Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                 | 9,303    |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|Total revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                 | 193,244  |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|Expenses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                 |          |   |                                |  
|Costs of service (excluding the below amortization, excluding depreciation of $30,309 and $36,228 for the three months ended
September 30, 2002 and 2003, respectively, and $84,348 and $97,874 for the nine months ended September 30, 2002 and 2003, respectively, and excluding noncash compensation of $911 and $856 for the three months ended September 30, 2002 and 2003,
respectively, and $2,736 and $2,607 for the nine months ended September 30, 2002 and 2003, respectively) |  |                                 | 56,547   |   |                                |  
|Cost of equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                 | 20,516   |   |                                |  
|Selling, general and administrative (excluding depreciation of $4,152 and $4,588 for the three months ended September 30, 2002 and
2003, respectively, and $12,207 and $13,240 for the nine months ended September 30, 2002 and 2003, respectively, and excluding noncash compensation of $4,519 and $5,273 for the three months ended September 30, 2002 and 2003, respectively, and
$13,302 and $21,028 for the nine months ended September 30, 2002 and 2003, respectively)            |  |                                 | 65,641   |   |                                |  
|Termination benefits and other related charges                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                 |         |   |                                |  
|Non-cash compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |                                 | 5,430    |   |                                |  
|Depreciation                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |                                 | 34,461   |   |                                |  
|Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |                                 | 1,243    |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Income from operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                 | 9,406    |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Interest expense, net of capitalized interest                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                 | (36,305  | ) |                                |  
|Other expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                 | (6,553   | ) |                                |  
|Debt extinguishment costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                 |         |   |                                |  
|Interest and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                 | 1,556    |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Loss before taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                 | (31,896  | ) |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Income tax expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                 | (2,469   | ) |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Net loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                                 | (34,365  | ) |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Other comprehensive income (loss), net of tax:                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                 |          |   |                                |  
|Unrealized gain (loss) on derivative instruments                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 | ($788    | ) |                                | $
|Plus: reclassification adjustment for previous unrealized losses                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |         |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |  
|Comprehensive loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                 | ($35,153 | ) |                                |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                 |          |   |                                |  



See accompanying notes
to financial statements.



4



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##### Table of Contents

TRITON PCS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)



|                                                                                |  | Nine Months EndedSeptember 30, |          
|------------------------------------------------------------------------------- |  | ------------------------------ | ---------
|                                                                                |  | 2002                           |          
|                                                                                |  | (unaudited)                    |          
|                                                                                |  |                               
|Cash flows from operating activities:                                           |  |                                |          
|Net loss                                                                        |  |                                | ($115,683
|Adjustments to reconcile net loss to net cash provided by operating activities: |  |                                |          
|Depreciation and amortization                                                   |  |                                | 100,340  
|Accretion of interest                                                           |  |                                | 39,560   
|Loss on equity investment                                                       |  |                                | 1,329    
|Bad debt expense                                                                |  |                                | 11,153   
|Non-cash compensation                                                           |  |                                | 16,038   
|Deferred income taxes                                                           |  |                                | 21,257   
|Loss on debt extinguishment                                                     |  |                                |         
|Loss on derivative instruments                                                  |  |                                | 5,341    
|                                                                                |  |                               
|Change in operating assets and liabilities:                                     |  |                                |          
|Accounts receivable                                                             |  |                                | (42,969  
|Inventory                                                                       |  |                                | 6,094    
|Prepaid expenses and other current assets                                       |  |                                | (4,444   
|Intangible and other assets                                                     |  |                                | 280      
|Accounts payable                                                                |  |                                | 4,324    
|Accrued payroll and liabilities                                                 |  |                                | 3,418    
|Deferred revenue                                                                |  |                                | 4,802    
|Accrued interest                                                                |  |                                | 655      
|Other liabilities                                                               |  |                                | (1,189   
|                                                                                |  |                                |          
|Net cash provided by operating activities                                       |  |                                | 50,306   
|                                                                                |  |                               
|Cash flows from investing activities:                                           |  |                                |          
|Capital expenditures                                                            |  |                                | (106,494 
|Investment in and advances to non-consolidated entity                           |  |                                | (14,477  
|Repayments from non-consolidated entity                                         |  |                                | 28,354   
|Proceeds from sale of property and equipment, net                               |  |                                | 150      
|Acquisition of FCC licenses                                                     |  |                                | (43,129  
|Other                                                                           |  |                                | (20      
|                                                                                |  |                                |          
|Net cash used in investing activities                                           |  |                                | (135,616 
|                                                                                |  |                               
|Cash flows from financing activities:                                           |  |                                |          
|Proceeds from issuance of senior debt, net of discount                          |  |                                |         
|Payments under credit facility                                                  |  |                                | (9,375   
|Payments of subordinated debt                                                   |  |                                |         
|Payment of debt extinguishment costs                                            |  |                                |         
|Change in bank overdraft                                                        |  |                                | 2,356    
|Capital contributions from parent                                               |  |                                | 770      
|Payment of deferred financing costs                                             |  |                                | (1,473   
|Advance to related party, net                                                   |  |                                | (120     
|Extinguishment of interest rate swaps                                           |  |                                |         
|Principal payments under capital lease obligations                              |  |                                | (1,615   
|                                                                                |  |                                |          
|Net cash used in financing activities                                           |  |                                | (9,457   
|                                                                                |  |                                |          
|                                                                                |  |                               
|Net decrease in cash and cash equivalents                                       |  |                                | (94,767  
|                                                                                |  |                               
|Cash and cash equivalents, beginning of period                                  |  |                                | 371,088  
|                                                                                |  |                                |          
|                                                                                |  |                               
|Cash and cash equivalents, end of period                                        |  | $                              | 276,321  
|                                                                                |  |                                |          
|                                                                                |  |                               
|Non-cash investing and financing activities:                                    |  |                                |          
|Change in capital expenditures included in accounts payable                     |  | $                              | 29,531   
|Deferred stock compensation                                                     |  |                                | 3,619    
|Change in fair value of derivative instruments acting as hedges                 |  |                                | 26       
|FCC license acquisition through retirement of note receivable                   |  |                                |         



See accompanying notes
to financial statements.



5



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##### Table of Contents

TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



|(1) | Basis of Presentation
|--- | ---------------------



The accompanying consolidated financial statements are unaudited and have been prepared by management. In the opinion of management, these consolidated financial
statements contain all of the adjustments, consisting of normal recurring adjustments, necessary to present fairly, in summarized form, the financial position and the results of operations of Triton PCS, Inc. (Triton). The results of
operations for the three and nine months ended September 30, 2003 may not be indicative of the results that may be expected for the year ending December 31, 2003. The financial information presented herein should be read in conjunction with the
consolidated financial statements for the year ended December 31, 2002, which include information and disclosures not included herein.



Triton is a wholly-owned subsidiary of Triton PCS Holdings, Inc. (Holdings); Triton PCS Operating Company L.L.C., Triton PCS Licenses Company L.L.C., Triton
PCS Equipment Company L.L.C., Triton PCS Property Company L.L.C., Triton PCS Holdings Company L.L.C., Triton Management Company, Inc., Triton PCS Investment Company L.L.C., and Triton PCS Finance Company Inc. are each wholly-owned subsidiaries of
Triton. Triton has no independent assets or operations, and all of Triton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
Tritons 8 1/2% senior notes due 2013 (the 8 1/2 % Notes), its 9 3/8% senior subordinated notes due 2011 (the 9 3/8 % Notes) and its 8 3/4% senior subordinated notes due 2011 (the 8 3/4% Notes). The 8 1/2%
Notes are effectively subordinated in right of payment to all of Tritons PCSs senior secured debt, including the current revolving credit facility (the Current Credit Facility). The 9 3/8% Notes and the 8 3/4% Notes constitute
unsecured obligations of Triton and rank subordinate in right of payment to all of Tritons existing and future senior debt, including the 8 1/2% Notes and the Current Credit Facility.



The consolidated accounts include Triton and its wholly-owned subsidiaries (collectively, the
Company). All significant intercompany accounts or balances have been eliminated in consolidation.



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



Stock Compensation



The Company accounts for stock compensation under the intrinsic value method of APB Opinion 25. Pro forma compensation expense is calculated for the fair value of the stock compensation using the Black-Scholes model
for stock issued under Holdings employee stock purchase plan. With regard to the pro forma net 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. The employee stock purchase plan was suspended in January 2003; therefore, there was no pro forma compensation expense calculated for the quarter ended September 30,
2003. Assumptions for the quarter ended September 30, 2002 included an expected life of three months, weighted average risk-free interest rate of 1.7%, dividend yield of 0.0% and expected volatility of 103%. For the nine months ended September 30,
2003, assumptions include an expected life of three months, weighted average risk-free interest rate of 1.2%, dividend yield of 0.0% and expected volatility of 150%. For the nine months ended September 30, 2002, assumptions included an expected life
of three months, weighted average risk-free interest rate between 1.7% - 1.8%, dividend yield of 0.0% and expected volatility between 42% - 107%. Had compensation expense for grants of stock-based compensation been determined consistent with
Statement of Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation, the pro forma net loss would have been:



|                                                                                                                                            |  | Three MonthsEnded September 30, |         |   | Nine MonthsEnded September 30, |  
|------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | -
|                                                                                                                                            |  | 2002                            |         |   | 2003                           |  
|                                                                                                                                            |  | (Dollars in thousands)          |        
|                                                                                                                                            |  |                                 |         |  
|Net loss as reported                                                                                                                        |  | $                               | (34,365 | ) |                                | $
|Add: stock-based employee compensation expense included in reported net loss, net of related tax effects                                    |  | $                               | 5,430   |   |                                | $
|Deduct: total stock-based employee compensation expense determined under fair value based method for all awards, net of related
tax effects |  | $                               | (5,499  | ) |                                | $
|Pro forma net loss                                                                                                                          |  | $                               | (34,434 | ) |                                | $



6



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##### Table of Contents

TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



|(2) | Stock Compensation
|--- | ------------------



Restricted Stock



During the nine
months ended September 30, 2003, Holdings granted 1,000,304 shares of restricted Class A common stock to its employees under Holdings 1999 Stock Incentive Plan (the Stock Incentive Plan). All of these shares are subject to
four-year vesting provisions. Deferred compensation of approximately $3.1 million was recorded based on the market value at each grant date.



During the nine months ended September 30, 2003, certain employees, who resigned their employment with the Company, forfeited approximately $12.7 million of deferred
compensation and in so doing returned 28,447 shares of Holdings restricted Class A common stock to a common stock trust established for grants of common stock to management, employees and independent directors. These employees forfeited
another 385,143 shares of Holdings restricted Class A common stock, which had been issued under the Stock Incentive Plan.



Employee Stock Purchase Plan



Holdings has an employee stock purchase plan, which is currently suspended, pursuant to which employees may purchase shares of Holdings Class A common stock.
Under the terms of the employee stock purchase plan, Holdings stock plan committee establishes offering periods during each calendar year in which employees can participate. The purchase price is determined at the discretion of the stock plan
committee, but shall not be less than the lesser of: (i) eighty-five percent (85%) of the fair market value of the Class A common stock on the first business day of each offering period; or (ii) eighty-five percent (85%) of the fair market value of
the Class A common stock on the last business day of the offering period. Holdings issued 36,504 shares of Class A common stock, at a per share price of $1.57 in January 2003. Following this issuance, Holdings has 440 shares available
under the employee stock purchase plan.



|(3) | Senior Notes
|--- | ------------



On June 13, 2003, Triton, completed the private sale of $725.0 million principal amount of its 8 1/2% Notes. The net proceeds of the offering (after estimated expenses of $14.5 million) were approximately $710.5
million. These net proceeds were used to retire the Companys previously existing bank credit facility (the Former Credit Facility) and to repurchase the Companys then outstanding $512.0 million aggregate principal amount of
11% Senior Subordinated Discount Notes due 2008 (the 11% Notes). See footnotes (4) and (5) for additional information regarding the Current Credit Facility, the Former Credit Facility and the 11% Notes.



|(4) | Credit Facility
|--- | ---------------



Triton and Holdings were parties to the Former Credit Facility. On June 13, 2003, the Company used a portion of the proceeds from the sale of its 8 1/2% Notes to retire the Former Credit Facility and Triton and
Holdings entered into the Current Credit Facility with a group of lenders pursuant to which such lenders agreed to provide the Company with up



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TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



to $100.0 million in revolving loans. All loans made under the Current Credit Facility will be due on June 30, 2008. As of September 29, 2003, the Company
entered in to a first amendment to the Current Credit Facility to clarify that the Company is permitted to enter into interest rate swap arrangements. As of September 30, 2003, the Company had no outstanding borrowings under the Current Credit
Facility. In connection with the retirement of the Former Credit Facility, the Company recognized deferred financing costs of approximately $3.7 million.



Due to the retirement of the Former Credit Facility, the Company was required to terminate its interest rate swaps. As a result, the Company extinguished all 13 of its
interest rate swaps in effect at that time, which had a total notional amount of $480.0 million, for aggregate cash consideration of $23.7 million, which amount included accrued and unpaid interest through the termination date.



|(5) | Repayment of Subordinated Notes
|--- | -------------------------------



On May 30, 2003, Triton commenced a tender offer to purchase any and all of its then outstanding $512.0 million aggregate principal amount of 11% Notes. On June 13, 2003,
the Company used a portion of the proceeds from the sale of its 8 1/2% 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. In accordance with the terms of the indenture governing the 11% Notes,
the Company redeemed the remaining $103.4 million aggregate principal amount of outstanding 11% Notes on July 14, 2003, the redemption date, for $111.4 million in the aggregate, which amount consisted of a redemption price of 105.5% of the 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, the Company incurred total costs of approximately $37.4 million for the nine
months ended September 30, 2003, which primarily included the tender offer premium, tender offer fees and the write-off of deferred financing costs related to the 11% Notes. The following table summarizes the Companys outstanding debt as of
September 30, 2003 and December 31, 2002, respectively:



|                                             |  | December 31,2002       |           | September 30,2003
|-------------------------------------------- |  | ---------------------- | --------- | -----------------
|                                             |  | (Dollars in thousands)
|                                             |  |                       
|Current portion of long-term debt            |  |                        |           |                  
|Current portion of capital lease obligations |  | $                      | 1,787     |                  
|Current portion of bank credit facility      |  |                        | 15,382    |                  
|Total current portion of long-term debt      |  |                        | 17,169    |                  
|                                             |  |                        |           |                  
|Long-term debt                               |  |                        |           |                  
|Capital lease obligations                    |  | $                      | 964       |                  
|Bank credit facility                         |  |                        | 192,579   |                  
|8 1/2% senior notes                          |  |                        |          |                  
|11% subordinated discount notes              |  |                        | 488,590   |                  
|9 3/8% subordinated notes                    |  |                        | 339,495   |                  
|8 3/4% subordinated notes                    |  |                        | 391,635   |                  
|Total long-term debt                         |  |                        | 1,413,263 |                  
|                                             |  |                        |           |                  
|Total debt                                   |  | $                      | 1,430,432 |                  
|                                             |  |                        |           |                  



|(6) | Termination Benefits and Other Related Charges
|--- | ----------------------------------------------



In January 2003, the Company completed a streamlining of its operations, which consolidated operations functionally from a more decentralized structure and resulted in
the termination of 157 positions and the elimination of 13 unfilled positions, or 8% of the 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 nine months ended September 30, 2003, consisting of $1.7 million for one-time termination benefits and $1.0 million for relocation and other related workforce reduction expenses.



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TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



|(7) | Lafayette Communications Company L.L.C.
|--- | ---------------------------------------



On June 20, 2003, the Company acquired 12 personal communication service licenses in two separate transactions from Lafayette Communications Company L.L.C.
(Lafayette) for an aggregate fair value of approximately $100.1 million. As a part of these transactions, Triton paid approximately $28.1 million to the Federal Communication Commission (FCC) to satisfy Lafayettes
outstanding obligations. In addition, all loans receivable from Lafayette to Triton were satisfied in connection with these transactions. These licenses cover populations totaling approximately 4.3 million people, including all of South Carolina and
parts of Virginia and Georgia. In a separate transaction, Lafayette acquired the Companys 39% ownership interest in Lafayette, and as a result, Triton no longer has an interest in or relationship with Lafayette. As of June 30, 2003, all loans
receivable from Lafayette to Triton had been satisfied.



|(8) | Asset Retirement Obligations
|--- | ----------------------------



In July of 2001, the Financial Accounting Standards Board (FASB) issued SFAS No. 143 Accounting for Asset Retirement Obligations. This statement
provides accounting and reporting standards for costs associated with the retirement of long-lived assets. This statement requires entities to record the fair value of a liability for an asset retirement obligation in the period in which it is
incurred. When the liability is initially recorded, the entity capitalizes a cost by increasing the carrying amount of the related long-lived asset. Over time, the liability is accreted to its present value each period, and the capitalized cost is
depreciated over the estimated useful life of the related asset. Triton is subject to asset retirement obligations associated with its cell site operating leases, which are subject to the provisions of SFAS No. 143. Cell site lease agreements 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. In the third quarter of 2003, Triton recorded an initial asset retirement obligation of $1.2 million, and capitalized the same amount by increasing the carrying cost of the related asset. Also during the third quarter,
$0.6 million of accretion expense was recorded to increase the asset retirement obligation to its present value, and the capitalized costs were depreciated $0.2 million. Upon settlement of the liability, an entity either settles the obligation for
its recorded amount or incurs a gain or loss upon settlement.



|(9) | Guarantor Financial Information
|--- | -------------------------------



The following tables set forth condensed consolidating financial information of Triton (the Parent Company), for all of Tritons subsidiaries other than
Triton PCS License Company L.L.C. and Triton PCS Property Company L.L.C. (collectively, the Guarantors) and of Triton PCS Licenses Company L.L.C. and Triton PCS Property Company L.L.C. (together, the Non-Guarantors) for the
balance sheet as of December 31, 2002 and September 30, 2003, the statement of operations for the three and nine months ended September 30, 2002 and 2003 and the statement of cash flows for the nine months ended September 30, 2002 and 2003. During
the periods prior to June 13, 2003, both the Guarantors and Non-Guarantors guaranteed the 11% Notes, the 9 3 /8% Notes and the 8 3/4% Notes on a full and unconditional, joint and several basis.



9



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TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Balance Sheet as of December 31, 2002

(amounts in thousands)



|                                                                                                                  |  | ParentCompany |           |   | SubsidiaryGuarantors |   |           | SubsidiaryNon-Guarantors |  |   | Eliminations |   |  | Consolidated |           
|----------------------------------------------------------------------------------------------------------------- |  | ------------- | --------- | - | -------------------- | - | --------- | ------------------------ |  | - | ------------ | - |  | ------------ | ----------
|ASSETS:                                                                                                           |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Current assets:                                                                                                   |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Cash and cash equivalents                                                                                         |  | $             | 212,411   |   |                      | $ | 39        |                          |  | $ |             |   |  | $            |          
|Accounts receivable, net of allowance for doubtful accounts                                                       |  |               |          |   |                      |   | 68,213    |                          |  |   |             |   |  |              |          
|Accounts receivable-roaming partners                                                                              |  |               |          |   |                      |   | 23,037    |                          |  |   |             |   |  |              |          
|Inventory, net                                                                                                    |  |               |          |   |                      |   | 28,510    |                          |  |   |             |   |  |              |          
|Prepaid expenses                                                                                                  |  |               |          |   |                      |   | 2,402     |                          |  |   | 6,365        |   |  |              |          
|Intercompany receivable                                                                                           |  |               | 345,532   |   |                      |   |          |                          |  |   |             |   |  |              | (345,532  
|Other current assets                                                                                              |  |               | 327       |   |                      |   | 6,251     |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total current assets                                                                                              |  |               | 558,270   |   |                      |   | 128,452   |                          |  |   | 6,365        |   |  |              | (345,532  
|Property and equipment:                                                                                           |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Land                                                                                                              |  |               |          |   |                      |   |          |                          |  |   | 377          |   |  |              |          
|Network infrastructure and equipment                                                                              |  |               |          |   |                      |   | 1,004,323 |                          |  |   |             |   |  |              |          
|Furniture, fixtures and computer equipment                                                                        |  |               |          |   |                      |   | 89,208    |                          |  |   |             |   |  |              |          
|Capital lease assets                                                                                              |  |               |          |   |                      |   | 8,454     |                          |  |   |             |   |  |              |          
|Construction in progress                                                                                          |  |               |          |   |                      |   | 37,647    |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|                                                                                                                  |  |               |          |   |                      |   | 1,139,632 |                          |  |   | 377          |   |  |              |          
|Less accumulated depreciation                                                                                     |  |               |          |   |                      |   | (343,506  | )                        |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Net property and equipment                                                                                        |  |               |          |   |                      |   | 796,126   |                          |  |   | 377          |   |  |              |          
|Investment in subsidiaries                                                                                        |  |               | 775,581   |   |                      |   | 191,456   |                          |  |   |             |   |  |              | (967,037  
|Intangible assets, net                                                                                            |  |               | 6,603     |   |                      |   | 18,132    |                          |  |   | 370,514      |   |  |              |          
|Investment in and advances to non-consolidated entities                                                           |  |               | 72,019    |   |                      |   |          |                          |  |   |             |   |  |              |          
|Other long-term assets                                                                                            |  |               |          |   |                      |   | 3,543     |                          |  |   | 3,224        |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total assets                                                                                                      |  | $             | 1,412,473 |   |                      | $ | 1,137,709 |                          |  | $ | 380,480      |   |  | $            | (1,312,569
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|LIABILITIES AND STOCKHOLDERS DEFICIT:                                                                            |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Current liabilities:                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Accounts payable                                                                                                  |  | $             |          |   |                      | $ | 47,301    |                          |  | $ | 10,457       |   |  | $            |          
|Bank overdraft liability                                                                                          |  |               |          |   |                      |   | 25,892    |                          |  |   |             |   |  |              |          
|Accrued payroll and related expenses                                                                              |  |               |          |   |                      |   | 16,282    |                          |  |   |             |   |  |              |          
|Accrued expenses                                                                                                  |  |               |          |   |                      |   | 5,999     |                          |  |   |             |   |  |              |          
|Current portion of long-term debt                                                                                 |  |               | 15,382    |   |                      |   | 1,787     |                          |  |   |             |   |  |              |          
|Deferred revenue                                                                                                  |  |               |          |   |                      |   | 19,548    |                          |  |   |             |   |  |              |          
|Deferred gain on sale of property and equipment                                                                   |  |               |          |   |                      |   | 1,190     |                          |  |   |             |   |  |              |          
|Accrued interest                                                                                                  |  |               | 20,637    |   |                      |   |          |                          |  |   |             |   |  |              |          
|Intercompany payable                                                                                              |  |               |          |   |                      |   | 202,574   |                          |  |   | 142,958      |   |  |              | (345,532  
|Other current liabilities                                                                                         |  |               |          |   |                      |   | 10,468    |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total current liabilities                                                                                         |  |               | 36,019    |   |                      |   | 331,041   |                          |  |   | 153,415      |   |  |              | (345,532  
|Long-term debt:                                                                                                   |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Bank credit facility                                                                                              |  |               | 192,579   |   |                      |   |          |                          |  |   |             |   |  |              |          
|Senior subordinated debt                                                                                          |  |               | 1,219,720 |   |                      |   |          |                          |  |   |             |   |  |              |          
|Capital lease obligations                                                                                         |  |               |          |   |                      |   | 964       |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total long-term debt                                                                                              |  |               | 1,412,299 |   |                      |   | 964       |                          |  |   |             |   |  |              |          
|Deferred income taxes                                                                                             |  |               |          |   |                      |   |          |                          |  |   | 35,609       |   |  |              |          
|Deferred revenue                                                                                                  |  |               |          |   |                      |   | 3,051     |                          |  |   |             |   |  |              |          
|Fair value of derivative instruments                                                                              |  |               | 23,819    |   |                      |   |          |                          |  |   |             |   |  |              |          
|Deferred gain on sale of property and equipment                                                                   |  |               |          |   |                      |   | 27,072    |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total liabilities                                                                                                 |  |               | 1,472,137 |   |                      |   | 362,128   |                          |  |   | 189,024      |   |  |              | (345,532  
|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, 2002 |  |               |          |   |                      |   |          |                          |  |   |             |   |  |              |          
|Additional paid-in capital                                                                                        |  |               | 741,872   |   |                      |   | 1,239,109 |                          |  |   | 392,922      |   |  |              | (1,632,031
|Accumulated deficit                                                                                               |  |               | (721,523  | ) |                      |   | (463,528  | )                        |  |   | (201,466     | ) |  |              | 664,994   
|Accumulated other comprehensive loss                                                                              |  |               | (5,459    | ) |                      |   |          |                          |  |   |             |   |  |              |          
|Deferred compensation                                                                                             |  |               | (74,554   | ) |                      |   |          |                          |  |   |             |   |  |              |          
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total stockholders equity (deficit)                                                                              |  |               | (59,664   | ) |                      |   | 775,581   |                          |  |   | 191,456      |   |  |              | (967,037  
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total liabilities and stockholders equity (deficit)                                                              |  | $             | 1,412,473 |   |                      | $ | 1,137,709 |                          |  | $ | 380,480      |   |  | $            | (1,312,569
|                                                                                                                  |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           



10



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TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Statement of Operations for the Three Months Ended September 30, 2002

(amounts in thousands)



|                                                                                                          |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | SubsidiaryNon-Guarantors |  |   | Eliminations |   | Consolidated |  
|--------------------------------------------------------------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | ------- | ------------------------ |  | - | ------------ | - | ------------ | -
|Revenues:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Service revenues                                                                                          |  | $             |         |   |                      | $ | 133,545 |                          |  | $ |             |   |              | $
|Roaming revenues                                                                                          |  |               |         |   |                      |   | 50,396  |                          |  |   |             |   |              |  
|Equipment revenues                                                                                        |  |               |         |   |                      |   | 9,303   |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Total revenue                                                                                             |  |               |         |   |                      |   | 193,244 |                          |  |   |             |   |              |  
|Expenses:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Cost of service                                                                                           |  |               |         |   |                      |   | 46,945  |                          |  |   | 9,602        |   |              |  
|Cost of equipment                                                                                         |  |               |         |   |                      |   | 20,516  |                          |  |   |             |   |              |  
|Selling, general and administrative                                                                       |  |               | 41       |   |                      |   | 62,678  |                          |  |   | 2,922        |   |              |  
|Non-cash compensation                                                                                     |  |               |         |   |                      |   | 5,430   |                          |  |   |             |   |              |  
|Depreciation                                                                                              |  |               |         |   |                      |   | 34,461  |                          |  |   |             |   |              |  
|Amortization                                                                                              |  |               |         |   |                      |   | 1,243   |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) from operations                                                                             |  |               | (41      | ) |                      |   | 21,971  |                          |  |   | (12,524      | ) |              |  
|Interest expense                                                                                          |  |               | (36,235  | ) |                      |   | (70     | )                        |  |   |             |   |              |  
|Other expense                                                                                             |  |               | (6,546   | ) |                      |   | (7      | )                        |  |   |             |   |              |  
|Interest and other income                                                                                 |  |               | 1,556    |   |                      |   |        |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) before taxes                                                                                |  |               | (41,266  | ) |                      |   | 21,894  |                          |  |   | (12,524      | ) |              |  
|Income tax provision                                                                                      |  |               |         |   |                      |   | (563    | )                        |  |   | (1,906       | ) |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss) before equity in earnings of subsidiaries                                               |  |               | (41,266  | ) |                      |   | 21,331  |                          |  |   | (14,430      | ) |              |  
|Equity in earnings of subsidiaries                                                                        |  |               | 6,901    |   |                      |   | (14,430 | )                        |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss)                                                                                         |  | $             | (34,365  | ) |                      | $ | 6,901   |                          |  | $ | (14,430      | ) |              | $
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|                                                                                                         
|Consolidating Statement of Operations for the Nine Months Ended September 30,
2002 (amounts in thousands)
|                                                                                                          |  |               |          |   |                     
|                                                                                                          |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | SubsidiaryNon-Guarantors |  |   | Eliminations |   | Consolidated |  
|Revenues:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Service revenues                                                                                          |  | $             |         |   |                      | $ | 377,304 |                          |  | $ |             |   |              | $
|Roaming revenues                                                                                          |  |               |         |   |                      |   | 131,030 |                          |  |   |             |   |              |  
|Equipment revenues                                                                                        |  |               |         |   |                      |   | 24,620  |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Total revenue                                                                                             |  |               |         |   |                      |   | 532,954 |                          |  |   |             |   |              |  
|Expenses:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Cost of service                                                                                           |  |               |         |   |                      |   | 128,663 |                          |  |   | 28,692       |   |              |  
|Cost of equipment                                                                                         |  |               |         |   |                      |   | 58,838  |                          |  |   |             |   |              |  
|Selling, general and administrative                                                                       |  |               | 126      |   |                      |   | 175,048 |                          |  |   | 9,339        |   |              |  
|Non-cash compensation                                                                                     |  |               |         |   |                      |   | 16,038  |                          |  |   |             |   |              |  
|Depreciation                                                                                              |  |               |         |   |                      |   | 96,555  |                          |  |   |             |   |              |  
|Amortization                                                                                              |  |               |         |   |                      |   | 3,785   |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) from operations                                                                             |  |               | (126     | ) |                      |   | 54,027  |                          |  |   | (38,031      | ) |              |  
|Interest expense                                                                                          |  |               | (107,260 | ) |                      |   | (361    | )                        |  |   |             |   |              |  
|Other expense                                                                                             |  |               | (6,670   | ) |                      |   | (23     | )                        |  |   |             |   |              |  
|Interest and other income                                                                                 |  |               | 4,986    |   |                      |   |        |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) before taxes                                                                                |  |               | (109,070 | ) |                      |   | 53,643  |                          |  |   | (38,031      | ) |              |  
|Income tax provision                                                                                      |  |               |         |   |                      |   | (968    | )                        |  |   | (21,257      | ) |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net loss before equity in earnings of subsidiaries                                                        |  |               | (109,070 | ) |                      |   | 52,675  |                          |  |   | (59,288      | ) |              |  
|Equity in earnings of subsidiaries                                                                        |  |               | (6,613   | ) |                      |   | (59,288 | )                        |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss)                                                                                         |  | $             | (115,683 | ) |                      | $ | (6,613  | )                        |  | $ | (59,288      | ) |              | $
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  



11



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##### Table of Contents

TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Statement of Cash Flows for the Nine Months Ended September 30, 2002

(amounts in thousands)



|                                                          |  | ParentCompany |         |   | SubsidiaryGuarantors |   |          | SubsidiaryNon-Guarantors |  |   | Eliminations |   |  | Consolidated |         
|--------------------------------------------------------- |  | ------------- | ------- | - | -------------------- | - | -------- | ------------------------ |  | - | ------------ | - |  | ------------ | --------
|Cash flows from operating activities:                     |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash provided by (used in) operating activities       |  | $             | (62,065 | ) |                      | $ | 148,869  |                          |  | $ | (36,498      | ) |  | $            |        
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash flows from investing activities:                     |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Capital expenditures                                      |  |               |        |   |                      |   | (106,494 | )                        |  |   |             |   |  |              |        
|Net investment in and advances to non-consolidated entity |  |               | (14,477 | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Repayments from non-consolidated entity                   |  |               | 28,354  |   |                      |   |         |                          |  |   |             |   |  |              |        
|Proceeds from sale of property and equipment, net         |  |               |        |   |                      |   | 150      |                          |  |   |             |   |  |              |        
|Acquisition of FCC licenses                               |  |               |        |   |                      |   |         |                          |  |   | (43,129      | ) |  |              |        
|Other                                                     |  |               |        |   |                      |   | (20      | )                        |  |   |             |   |  |              |        
|Investment in subsidiaries                                |  |               | (89,428 | ) |                      |   | (44,328  | )                        |  |   |             |   |  |              | 133,756 
|Dividends received                                        |  |               | 45,100  |   |                      |   |         |                          |  |   |             |   |  |              | (45,100 
|Net intercompany loans                                    |  |               |        |   |                      |   | (42,302  | )                        |  |   |             |   |  |              | 42,302  
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash provided by (used in) investing activities       |  |               | (30,451 | ) |                      |   | (192,994 | )                        |  |   | (43,129      | ) |  |              | 130,958 
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash flows from financing activities:                     |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Payments under credit facility                            |  |               | (9,375  | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Change in bank overdraft                                  |  |               |        |   |                      |   | 2,356    |                          |  |   |             |   |  |              |        
|Capital contributions from parent                         |  |               | 770     |   |                      |   | 89,428   |                          |  |   | 44,328       |   |  |              | (133,756
|Payment of deferred financing costs                       |  |               | (1,473  | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Repayments from (advances to) related party, net          |  |               |        |   |                      |   | (120     | )                        |  |   |             |   |  |              |        
|Dividends paid                                            |  |               |        |   |                      |   | (45,100  | )                        |  |   |             |   |  |              | 45,100  
|Principal payments under capital lease obligations        |  |               |        |   |                      |   | (1,615   | )                        |  |   |             |   |  |              |        
|Net intercompany loans                                    |  |               | 7,003   |   |                      |   |         |                          |  |   | 35,299       |   |  |              | (42,302 
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash used in financing activities                     |  |               | (3,075  | ) |                      |   | 44,949   |                          |  |   | 79,627       |   |  |              | (130,958
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net increase (decrease) in cash and cash equivalents      |  |               | (95,591 | ) |                      |   | 824      |                          |  |   |             |   |  |              |        
|Cash and cash equivalents, beginning of period            |  |               | 369,413 |   |                      |   | 1,675    |                          |  |   |             |   |  |              |        
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash and cash equivalents, end of period                  |  | $             | 273,822 |   |                      | $ | 2,499    |                          |  | $ |             |   |  | $            |        
|                                                          |  |               |         |   |                      |   |          |                          |  |   |              |   |  |              |         



12



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##### Table of Contents

TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Balance Sheet as of September 30, 2003

(amounts in thousands)



|                                                                                                              |  | ParentCompany |           |   | SubsidiaryGuarantors |   |           | SubsidiaryNon-Guarantors |  |   | Eliminations |   |  | Consolidated |           
|------------------------------------------------------------------------------------------------------------- |  | ------------- | --------- | - | -------------------- | - | --------- | ------------------------ |  | - | ------------ | - |  | ------------ | ----------
|ASSETS:                                                                                                       |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Current assets:                                                                                               |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Cash and cash equivalents                                                                                     |  | $             | 167,145   |   |                      | $ | 375       |                          |  | $ |             |   |  | $            |          
|Accounts receivable, net of allowance for doubtful accounts                                                   |  |               |          |   |                      |   | 62,056    |                          |  |   |             |   |  |              |          
|Accounts receivable - roaming partners                                                                        |  |               |          |   |                      |   | 24,824    |                          |  |   |             |   |  |              |          
|Inventory, net                                                                                                |  |               |          |   |                      |   | 19,050    |                          |  |   |             |   |  |              |          
|Prepaid expenses                                                                                              |  |               | 34        |   |                      |   | 5,980     |                          |  |   | 6,455        |   |  |              |          
|Intercompany receivable                                                                                       |  |               | 251,710   |   |                      |   |          |                          |  |   |             |   |  |              | (251,710  
|Other current assets                                                                                          |  |               | 79        |   |                      |   | 6,907     |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total current assets                                                                                          |  |               | 418,968   |   |                      |   | 119,192   |                          |  |   | 6,455        |   |  |              | (251,710  
|Property and equipment:                                                                                       |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Land                                                                                                          |  |               |          |   |                      |   |          |                          |  |   | 377          |   |  |              |          
|Network infrastructure and equipment                                                                          |  |               |          |   |                      |   | 1,086,288 |                          |  |   |             |   |  |              |          
|Furniture, fixtures and computer equipment                                                                    |  |               |          |   |                      |   | 89,008    |                          |  |   |             |   |  |              |          
|Capital lease assets                                                                                          |  |               |          |   |                      |   | 8,470     |                          |  |   |             |   |  |              |          
|Construction in progress                                                                                      |  |               |          |   |                      |   | 12,232    |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|                                                                                                              |  |               |          |   |                      |   | 1,195,998 |                          |  |   | 377          |   |  |              |          
|Less accumulated depreciation                                                                                 |  |               |          |   |                      |   | (445,964  | )                        |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Net property and equipment                                                                                    |  |               |          |   |                      |   | 750,034   |                          |  |   | 377          |   |  |              |          
|Investment in subsidiaries                                                                                    |  |               | 903,777   |   |                      |   | 245,129   |                          |  |   |             |   |  |              | (1,148,906
|Intangible assets, net                                                                                        |  |               | 3,966     |   |                      |   | 15,060    |                          |  |   | 470,887      |   |  |              |          
|Other long-term assets                                                                                        |  |               | 175       |   |                      |   | 6,907     |                          |  |   | 3,075        |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total assets                                                                                                  |  | $             | 1,326,886 |   |                      | $ | 1,136,322 |                          |  | $ | 480,794      |   |  | $            | (1,400,616
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|LIABILITIES AND STOCKHOLDERS DEFICIT:                                                                        |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Current liabilities:                                                                                          |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Accounts payable                                                                                              |  | $             |          |   |                      | $ | 55,872    |                          |  | $ | 12,314       |   |  |              |          
|Bank overdraft liability                                                                                      |  |               |          |   |                      |   | 11,091    |                          |  |   |             |   |  |              |          
|Accrued payroll and related expenses                                                                          |  |               |          |   |                      |   | 11,377    |                          |  |   |             |   |  |              |          
|Accrued expenses                                                                                              |  |               |          |   |                      |   | 11,397    |                          |  |   |             |   |  |              |          
|Current portion of long-term debt                                                                             |  |               |          |   |                      |   | 959       |                          |  |   |             |   |  |              |          
|Deferred revenue                                                                                              |  |               |          |   |                      |   | 21,695    |                          |  |   |             |   |  |              |          
|Deferred gain on sale of property and equipment                                                               |  |               |          |   |                      |   | 1,190     |                          |  |   |             |   |  |              |          
|Accrued interest                                                                                              |  |               | 37,083    |   |                      |   |          |                          |  |   |             |   |  |              |          
|Intercompany payable                                                                                          |  |               |          |   |                      |   | 72,437    |                          |  |   | 179,273      |   |  |              | (251,710  
|Other current liabilities                                                                                     |  |               |          |   |                      |   | 14,915    |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total current liabilities                                                                                     |  |               | 37,083    |   |                      |   | 200,933   |                          |  |   | 191,587      |   |  |              | (251,710  
|Long-term debt:                                                                                               |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Senior debt                                                                                                   |  |               | 710,813   |   |                      |   |          |                          |  |   |             |   |  |              |          
|Subordinated debt                                                                                             |  |               | 732,276   |   |                      |   |          |                          |  |   |             |   |  |              |          
|Capital lease obligations                                                                                     |  |               |          |   |                      |   | 295       |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total long-term debt                                                                                          |  |               | 1,443,089 |   |                      |   | 295       |                          |  |   |             |   |  |              |          
|Deferred income taxes                                                                                         |  |               |          |   |                      |   |          |                          |  |   | 44,078       |   |  |              |          
|Deferred revenue                                                                                              |  |               |          |   |                      |   | 3,342     |                          |  |   |             |   |  |              |          
|Asset Retirement Obligation                                                                                   |  |               |          |   |                      |   | 1,795     |                          |  |   |             |   |  |              |          
|Deferred gain on sale of property and equipment                                                               |  |               |          |   |                      |   | 26,180    |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total liabilities                                                                                             |  |               | 1,480,172 |   |                      |   | 232,545   |                          |  |   | 235,665      |   |  |              | (251,710  
|Commitments and contingencies                                                                                 |  |               |          |   |                      |   |          |                          |  |   |             |   |  |              |          
|Stockholders equity (deficit):                                                                               |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Common stock, $0.01 par value, 1,000 shares authorized; 100 shares issued and outstanding as of June 30, 2003 |  |               |          |   |                      |   |          |                          |  |   |             |   |  |              |          
|Additional paid-in capital                                                                                    |  |               | 732,315   |   |                      |   | 1,379,230 |                          |  |   | 493,295      |   |  |              | (1,872,525
|Accumulated deficit                                                                                           |  |               | (844,296  | ) |                      |   | (475,453  | )                        |  |   | (248,166     | ) |  |              | 723,619   
|Deferred compensation                                                                                         |  |               | (41,305   | ) |                      |   |          |                          |  |   |             |   |  |              |          
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total stockholders equity (deficit)                                                                          |  |               | (153,286  | ) |                      |   | 903,777   |                          |  |   | 245,129      |   |  |              | (1,148,906
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           
|Total liabilities and stockholders equity (deficit)                                                          |  | $             | 1,326,886 |   |                      | $ | 1,136,322 |                          |  | $ | 480,794      |   |  | $            | (1,400,616
|                                                                                                              |  |               |           |   |                      |   |           |                          |  |   |              |   |  |              |           



13



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##### Table of Contents

TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Statement of Operations for the Three Months Ended September 30, 2003

(amounts in thousands)



|                                                                                                          |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | SubsidiaryNon-Guarantors |  |   | Eliminations |   | Consolidated |  
|--------------------------------------------------------------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | ------- | ------------------------ |  | - | ------------ | - | ------------ | -
|Revenues:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Service revenues                                                                                          |  | $             |         |   |                      | $ | 149,825 |                          |  | $ |             |   |              | $
|Roaming revenues                                                                                          |  |               |         |   |                      |   | 49,728  |                          |  |   |             |   |              |  
|Equipment revenues                                                                                        |  |               |         |   |                      |   | 14,115  |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Total revenue                                                                                             |  |               |         |   |                      |   | 213,668 |                          |  |   |             |   |              |  
|Expenses:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Cost of service                                                                                           |  |               |         |   |                      |   | 53,769  |                          |  |   | 9,943        |   |              |  
|Cost of equipment                                                                                         |  |               |         |   |                      |   | 25,783  |                          |  |   |             |   |              |  
|Selling, general and administrative                                                                       |  |               | 33       |   |                      |   | 55,181  |                          |  |   | 2,804        |   |              |  
|Termination benefits and other related charges                                                            |  |               |         |   |                      |   | 321     |                          |  |   |             |   |              |  
|Non-cash compensation                                                                                     |  |               |         |   |                      |   | 6,129   |                          |  |   |             |   |              |  
|Depreciation                                                                                              |  |               |         |   |                      |   | 40,816  |                          |  |   |             |   |              |  
|Amortization                                                                                              |  |               |         |   |                      |   | 1,161   |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) from operations                                                                             |  |               | (33      | ) |                      |   | 30,508  |                          |  |   | (12,747      | ) |              |  
|Interest expense                                                                                          |  |               | (33,441  | ) |                      |   | (647    | )                        |  |   |             |   |              |  
|Other expense                                                                                             |  |               |         |   |                      |   |        |                          |  |   |             |   |              |  
|Debt extinguishment costs                                                                                 |  |               | (7,038   | ) |                      |   |        |                          |  |   |             |   |              |  
|Interest and other income                                                                                 |  |               | 500      |   |                      |   |        |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) before taxes                                                                                |  |               | (40,012  | ) |                      |   | 29,861  |                          |  |   | (12,747      | ) |              |  
|Income tax provision                                                                                      |  |               |         |   |                      |   | (350    | )                        |  |   | (3,386       | ) |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss) before equity in earnings of subsidiaries                                               |  |               | (40,012  | ) |                      |   | 29,511  |                          |  |   | (16,133      | ) |              |  
|Equity in earnings of subsidiaries                                                                        |  |               | 13,378   |   |                      |   | (16,133 | )                        |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss)                                                                                         |  | $             | (26,634  | ) |                      | $ | 13,378  |                          |  | $ | (16,133      | ) |              | $
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|                                                                                                         
|Consolidating Statement of Operations for the Nine Months Ended September 30,
2003 (amounts in thousands)
|                                                                                                          |  |               |          |   |                     
|                                                                                                          |  | ParentCompany |          |   | SubsidiaryGuarantors |   |         | SubsidiaryNon-Guarantors |  |   | Eliminations |   | Consolidated |  
|Revenues:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Service revenues                                                                                          |  | $             |         |   |                      | $ | 429,171 |                          |  | $ |             |   |              | $
|Roaming revenues                                                                                          |  |               |         |   |                      |   | 141,822 |                          |  |   |             |   |              |  
|Equipment revenues                                                                                        |  |               |         |   |                      |   | 37,606  |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Total revenue                                                                                             |  |               |         |   |                      |   | 608,599 |                          |  |   |             |   |              |  
|Expenses:                                                                                                 |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Cost of service                                                                                           |  |               |         |   |                      |   | 153,197 |                          |  |   | 29,948       |   |              |  
|Cost of equipment                                                                                         |  |               |         |   |                      |   | 72,681  |                          |  |   |             |   |              |  
|Selling, general and administrative                                                                       |  |               | 102      |   |                      |   | 165,520 |                          |  |   | 8,282        |   |              |  
|Termination benefits and other related charges                                                            |  |               |         |   |                      |   | 2,671   |                          |  |   |             |   |              |  
|Non-cash compensation                                                                                     |  |               |         |   |                      |   | 23,635  |                          |  |   |             |   |              |  
|Depreciation                                                                                              |  |               |         |   |                      |   | 111,114 |                          |  |   |             |   |              |  
|Amortization                                                                                              |  |               |         |   |                      |   | 3,231   |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) from operations                                                                             |  |               | (102     | ) |                      |   | 76,550  |                          |  |   | (38,230      | ) |              |  
|Interest expense                                                                                          |  |               | (108,270 | ) |                      |   | (743    | )                        |  |   |             |   |              |  
|Other expense                                                                                             |  |               | (2,898   | ) |                      |   |        |                          |  |   |             |   |              |  
|Debt extinguishment costs                                                                                 |  |               | (41,118  | ) |                      |   |        |                          |  |   |             |   |              |  
|Interest and other income                                                                                 |  |               | 1,792    |   |                      |   |        |                          |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Income (loss) before taxes                                                                                |  |               | (150,596 | ) |                      |   | 75,807  |                          |  |   | (38,230      | ) |              |  
|Income tax provision                                                                                      |  |               |         |   |                      |   | (1,284  | )                        |  |   | (8,470       | ) |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss) before equity in earnings of subsidiaries                                               |  |               | (150,596 | ) |                      |   | 74,523  |                          |  |   | (46,700      | ) |              |  
|Equity in earnings of subsidiaries                                                                        |  |               | 27,823   |   |                      |   | (46,700 | )                        |  |   |             |   |              |  
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  
|Net income (loss)                                                                                         |  | $             | (122,773 | ) |                      | $ | 27,823  |                          |  | $ | (46,700      | ) |              | $
|                                                                                                          |  |               |          |   |                      |   |         |                          |  |   |              |   |              |  



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TRITON PCS, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2003



Consolidating Statement of Cash Flows for the Nine Months Ended September 30, 2003

(amounts in thousands)



|                                                      |  | ParentCompany |          |   | SubsidiaryGuarantors |   |          | SubsidiaryNon-Guarantors |  |   | Eliminations |   |  | Consolidated |         
|----------------------------------------------------- |  | ------------- | -------- | - | -------------------- | - | -------- | ------------------------ |  | - | ------------ | - |  | ------------ | --------
|Cash flows from operating activities:                 |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash provided by (used in) operating activities   |  | $             | (69,840  | ) |                      | $ | 234,211  |                          |  | $ | (36,315      | ) |  | $            |        
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash flows from investing activities:                 |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Capital expenditures                                  |  |               |         |   |                      |   | (64,308  | )                        |  |   |             |   |  |              |        
|Investment in and advances to non-consolidated entity |  |               | (875     | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Repayments from non-consolidated entity               |  |               | 58       |   |                      |   |         |                          |  |   |             |   |  |              |        
|Proceeds from sale of property and equipment, net     |  |               |         |   |                      |   | 732      |                          |  |   |             |   |  |              |        
|Acquisition of FCC licenses                           |  |               |         |   |                      |   |         |                          |  |   | (28,412      | ) |  |              |        
|Investment in subsidiaries                            |  |               | (68,160  | ) |                      |   | (28,412  | )                        |  |   |             |   |  |              | 96,572  
|Dividends received                                    |  |               | 39,748   |   |                      |   |         |                          |  |   |             |   |  |              | (39,748 
|Net intercompany loans                                |  |               |         |   |                      |   | (153,895 | )                        |  |   |             |   |  |              | 153,895 
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash provided by (used in) investing activities   |  |               | (29,229  | ) |                      |   | (245,883 | )                        |  |   | (28,412      | ) |  |              | 210,719 
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash flows from financing activities:                 |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Proceeds from senior debt                             |  |               | 710,500  |   |                      |   |         |                          |  |   |             |   |  |              |        
|Payments under credit facility                        |  |               | (207,961 | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Payment of subordinated debt                          |  |               | (511,989 | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Payment of debt extinguishment costs                  |  |               | (31,289  | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Change in bank overdraft                              |  |               |         |   |                      |   | (14,801  | )                        |  |   |             |   |  |              |        
|Capital contributions from parent                     |  |               | 57       |   |                      |   | 68,160   |                          |  |   | 28,412       |   |  |              | (96,572 
|Repayments from (advances to) related party, net      |  |               |         |   |                      |   | (90      | )                        |  |   |             |   |  |              |        
|Payment of deferred financing costs                   |  |               | (2,712   | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Extinguishment of interest rate swaps                 |  |               | (20,383  | ) |                      |   |         |                          |  |   |             |   |  |              |        
|Dividends paid                                        |  |               |         |   |                      |   | (39,748  | )                        |  |   |             |   |  |              | 39,748  
|Principal payments under capital lease obligations    |  |               |         |   |                      |   | (1,513   | )                        |  |   |             |   |  |              |        
|Net intercompany loans                                |  |               | 117,580  |   |                      |   |         |                          |  |   | 36,315       |   |  |              | (153,895
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net cash provided by (used in) financing activities   |  |               | 53,803   |   |                      |   | 12,008   |                          |  |   | 64,727       |   |  |              | (210,719
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Net increase (decrease) in cash and cash equivalents  |  |               | (45,266  | ) |                      |   | 336      |                          |  |   |             |   |  |              |        
|Cash and cash equivalents, beginning of period        |  |               | 212,411  |   |                      |   | 39       |                          |  |   |             |   |  |              |        
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         
|Cash and cash equivalents, end of period              |  | $             | 167,145  |   |                      | $ | 375      |                          |  | $ |             |   |  | $            |        
|                                                      |  |               |          |   |                      |   |          |                          |  |   |              |   |  |              |         



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|ITEM 2. |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- |  | -------------------------------------------------------------------------------------



General



In this section, the terms Triton, we, our and similar terms refer collectively to Triton PCS, Inc. and its consolidated subsidiaries
and Holdings refers to our parent corporation, Triton PCS Holdings, Inc. The following discussion and analysis is based upon our 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 financial statements and the related notes contained elsewhere in this report.



Forward-Looking Statements



When used in this Form 10-Q and in future filings by us with the Securities and Exchange Commission, in our press releases and in oral statements made with the approval
of an authorized executive officer of Triton, statements concerning possible or assumed future results of operations of Triton and those preceded by, followed by or that include the words may, will, should,
expects, plans, anticipates, believes, estimates, predicts, potential or continue or the negative of such terms and other comparable terminology
(including confirmations by an authorized executive officer of Triton or any such expressions made by a third party with respect to Triton) are intended to identify forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on any such forward-looking statements, each of which speaks only as of the date made. Such statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical earnings and those presently anticipated or projected. For a discussion of certain risks and uncertainties that could affect our results of operations, liquidity and capital resources, see the
Risk Factors section of the Triton PCS, Inc. exchange offer prospectus dated July 28, 2003, as filed with the Securities and Exchange Commission on that date. We have no obligation to release publicly the result of any revisions which
may be made to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements.



Overview



We are a leading provider of wireless communications services in the southeastern United States. Our wireless communications licenses cover approximately 13.6 million potential customers in a contiguous geographic
area encompassing portions of Virginia, North Carolina, South Carolina, Tennessee, Georgia and Kentucky. In February 1998, we entered into a joint venture with AT&T Wireless. As part of this agreement, AT&T Wireless contributed personal
communications services licenses for 20 MHz of authorized frequencies covering 11.3 million potential customers within defined areas of our region in exchange for an equity position in Holdings. Since that time, we have expanded our coverage area to
include an additional 2.3 million potential customers through acquisitions and license exchanges with AT&T Wireless. As part of the 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 within our region. We believe our markets are strategically attractive because of their proximity to AT&T Wireless systems in the Washington, D.C., Charlotte, North Carolina and Atlanta, Georgia
markets, which collectively cover a population of more than 28.5 million individuals. In addition, we are the preferred provider of wireless mobility services to AT&T Wireless digital wireless customers who roam into our markets. Our
strategy is to provide our customers with simple, easy-to-use wireless services with coast-to-coast service, superior call quality, personalized customer care and competitive pricing and to benefit from roaming revenues generated by AT&T
Wireless and other carriers wireless customers who roam into our covered area.



Our 37 markets have attractive demographic characteristics for wireless communications services and include 10 of the top 100 markets in the country with population densities that are 80% greater than the national
average. Since we began offering services in these 37 markets, our subscriber base and the number of minutes generated by non-Triton subscribers roaming onto our network have grown significantly.



Three Months Ended September 30, 2003 Compared to the Three Months Ended September 30,
2002



Subscribers



Net subscriber additions were 3,567 for the three months ended September 30, 2003, bringing
our total subscribers to 884,252 as of September 30, 2003, an increase of 11.0% over our subscriber total as of September 30, 2002. Our strategy of shifting channel mix to more cost-effective, company-owned retail locations and strategically-aligned
agents adversely impacted new subscriber additions as several inefficient agent relationships were terminated. This was further



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exacerbated by the bankruptcy of Tritons largest independent agent during the quarter. This independent agent historically had contributed
approximately 8-10% of our monthly gross subscriber additions. Collectively, the loss of these agents resulted in the gross subscriber additions shortfall as compared to the year-earlier period. Additionally, several of our markets were particularly
hard hit by Hurricane Isabel in September. During the three months ended September 30, 2003, all of our gross subscriber additions were postpay on a one or two year service contract.



Churn



Subscriber churn was 2.46% and 2.24% for the three months ended September 30, 2003 and 2002, respectively. Subscriber churn is calculated by
dividing subscriber deactivations by our average subscriber base for the respective period. We believe that our churn rate remains consistently low compared to the industry average due to our high-quality system performance, our commitment to
quality customer service and our focused retention efforts.



The Federal
Communications Commission has mandated that wireless carriers provide for local number portability by November 24, 2003. This would allow subscribers to keep their wireless phone number when switching to a different service provider. We anticipate
that number portability may increase churn.



Average Revenue Per User



Average revenue per user, or ARPU, was $57.29 and $58.02 for the three
months ended September 30, 2003 and 2002, respectively. ARPU reflects the average amount billed to subscribers based on rate plan offerings. ARPU excludes service revenue credits made to retain existing subscribers of $0.69 and $0.95 for the
three months ended September 30, 2003 and 2002, respectively. ARPU is calculated by dividing service revenue, excluding service revenue credits made to existing 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.



We continue to focus on attracting new customers with rate plans that provide more value to the customer at a higher average customer bill. The ARPU decrease of $0.73, or 1.3% from year to year, was primarily the
result of a change in our rate plan mix, as many existing high-ARPU subscribers migrated to our UnPlan service offering to take advantage of that plans unlimited minutes for calls from the subscribers local calling area at a lower
monthly cost. We believe that most high-ARPU subscribers who will migrate to the UnPlan have done so.



Revenues



Total revenues increased
10.6% to $213.7 million for the three months ended September 30, 2003 from $193.2 million for the three months ended September 30, 2002. Service revenue for the three months ended September 30, 2003 was $149.8 million, an increase of $16.3 million,
or 12.2%, compared to $133.5 million for the three months ended September 30, 2002. The increase in service revenue was due primarily to growth in the number of subscribers. We expect subscriber growth to continue, and hence, we expect service
revenue to continue to increase. Roaming revenue was $49.7 million for the three months ended September 30, 2003, a decrease of $0.7 million, or 1.4%, compared to $50.4 million for the three months ended September 30, 2002. The net decrease in
roaming revenue was the result of reductions in roaming rates contractually agreed to with other carriers, offset partially by increased roaming minutes of use due to the expansion of our network, the implementation of new roaming agreements with
carriers such as Cingular wireless and the overall growth in the wireless industry. Roaming minutes for the third quarter of 2003 were 297.1 million, which represents a 9.6% increase over the third quarter of 2002. We expect the growth of the
wireless industry to continue, and as a result, we expect roaming minutes to continue to increase, which will be offset by contractual rate decreases that occurred during the quarter ended September 30, 2003. As a result, we expect roaming revenue
to remain relatively flat in the foreseeable future. Equipment revenue was $14.1 million for the three months ended September 30, 2003, an increase of $4.8 million, or 51.6%, compared to $9.3 million for the three months ended September 30, 2002.
Equipment revenue includes the revenue earned in the sale of a handset or handset accessories to new and existing subscribers. In addition, equipment revenue includes the fair value of handsets received from a subscriber in a handset upgrade or
exchange transaction. The equipment revenue increase was due primarily to an increase in the sale of excess subscriber returned handsets to third party wholesalers and resellers.



Cost of Service



Cost of service was $63.7 million for the three months ended September 30, 2003, an increase of $7.2 million, or 12.7%, compared to $56.5 million for the three months
ended September 30, 2002. The increase was related to a higher volume of traffic on our network driven by rate plan offerings and subscriber growth as well as higher roaming minutes of use. 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 anticipated subscriber growth. Cost of service as a percentage of revenue, excluding equipment revenue, was 31.9% and 30.7% for the three months ended September 30,
2003 and 2002, respectively. The



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increase of 1.2% was primarily attributable to increased costs to operate our Global System for Mobile Communications and Global Packet Radio Service, or
GSM/GPRS, network and the expansion and maintenance of our wireless network to support an increased number of minutes of use on our Time Division Multiple Access, or TDMA, network. Cost of service as a percentage of revenue, excluding equipment
revenue, may decline in the future as we continue to leverage our fixed costs of service against increased revenue.



Cost of Equipment



Cost of equipment was $25.8 million for the three months ended September 30, 2003, an increase of $5.3 million, or 25.9%, compared to $20.5 million for the three months ended September 30, 2002. Cost of equipment
includes the cost associated with the sale or exchange of a handset or handset accessories to new and existing subscribers. The cost of equipment increase was due primarily to an increase in the sale of excess subscriber returned handsets to third
party wholesalers and resellers.



Selling, General and Administrative
Expense



Selling, general and administrative expense was $58.0 million for
the three months ended September 30, 2003, a decrease of $7.6 million, or 11.6%, compared to $65.6 million for the three months ended September 30, 2002. Selling expenses decreased by $4.7 million, or 16.6%, primarily due to decreased advertising
and promotion spending as well as decreased commissions resulting from lower gross subscriber additions. General and administrative expense decreased by $2.9 million, or 7.8%, primarily due to decreased bad debt expense, which was $2.2 million and
$5.3 million for the three months ended September 30, 2003 and 2002, respectively. 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 expense may increase in conjunction with anticipated subscriber growth. General and administrative expense as a percentage of revenue, excluding equipment revenue, was 17.2% and 20.3% for the three months ended September 30, 2003 and
2002, respectively. The decrease of 3.1% is primarily attributable to increased customer care efficiency, focused collection efforts which controlled bad debt expense and increased leverage of other fixed costs. General and administrative expense as
a percentage of revenue, excluding equipment revenue, may continue to decline in the future as we continue to further leverage our fixed general and administrative costs, such as headcount and rent expense, against increased revenue.



Cost Per Gross Addition



Cost per gross addition, or CPGA, was $451 and $418 for the three months ended September 30, 2003 and 2002, respectively. The CPGA increase
of $33, or 7.9%, was primarily the result of decreased leverage on fixed acquisition costs, such as retail store rent expense and sales and marketing headcount costs, as the result of lower gross subscriber additions. 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 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.



Termination Benefits and Other Related Costs



Termination benefits and other related costs were $0.3 million for the three months ended September 30, 2003. These expenses, which consisted primarily of relocation
costs, resulted from the streamlining of our operations during January 2003. There were no termination benefits and other related costs for the three months ended September 30, 2002. We expect that the termination benefits will result in
approximately $5.4 million of net operational savings for the year ended December 31, 2003 and represent $10.0 million of savings in each subsequent fiscal year.



Non-cash Compensation Expense



Non-cash compensation expense was $6.1 million for the three months ended September 30, 2003, an increase of $0.7 million, or 13.0%, compared to $5.4 million for the
three months ended September 30, 2002. The increase is attributable to the vesting of an increased number of restricted shares of Holdings Class A common stock awarded to management in prior periods.



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Depreciation and Amortization Expense



Depreciation and amortization expense was $42.0 million for the three months ended September 30, 2003, an increase of $6.3 million, or
17.6%, compared to $35.7 million for the three months ended September 30, 2002. The increase relates primarily to increased depreciation expense due to the growth in the depreciable asset base resulting from capital expenditures. In addition, we
recognized a $4.4 million loss in connection with the disposal of certain cell site equipment deemed to be obsolete during the quarter ended September 30, 2003. For the quarter ended September 30, 2002, there was a $2.6 million loss recognized in
connection with managements decision not to complete the construction of certain cell sites. Depreciation expense will continue to increase as we overlay and upgrade our network with GSM/GPRS technology.



Interest Expense



Interest expense was $34.1 million, net of capitalized interest of $0.3 million, for the three months ended September 30, 2003. Interest
expense was $36.3 million, net of capitalized interest of $1.0 million, for the three months ended September 30, 2002. The decrease of $2.2 million, or 6.1%, relates primarily to a decrease of $6.6 million of interest expense on our former bank
credit facility, which was extinguished in June 2003, a decrease of $12.2 million of interest expense on our 11% subordinated notes, which were repurchased in July 2003, offset partially by an increase of $15.4 million of interest expense related to
our June 2003 private placement of $725.0 million aggregate principal amount 8 1/2% senior notes, a decrease of $0.7 million in capitalized interest for the three months ended September 30, 2003 and $0.6 million of accreted interest expense related
to an asset retirement obligation for our leased facilities recorded in accordance with Statement of Financial Accounting Standards No. 143 Accounting for Obligations Associated with the Retirement of Long-Lived Assets.



We had a weighted average interest rate of 8.77% for the three months ended September 30,
2003 on our average borrowings under our current bank credit facility and our average obligation for our senior and subordinated debt, as compared with the 9.70% weighted average interest rate for the three months ended September 30, 2002.



Other Expense



There was no expense for the three months ended September 30, 2003. Other expense was $6.6
million for the three months ended September 30, 2002. This expense consisted primarily of loss on our interest rate swap derivative instruments, which were extinguished in June 2003.



Debt Extinguishment Costs



Debt extinguishment costs were $7.0 million for the three months ended September 30, 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 the remaining $103.4 million aggregate principal amount of our 11% subordinated notes
in July 2003. There were no debt extinguishment costs for the three months ended September 30, 2002.



Interest and Other Income



Interest and
other income was $0.5 million for the three months ended September 30, 2003, a decrease of $1.1 million, or 68.8%, compared to $1.6 million for the three months ended September 30, 2002. The decrease was due primarily to the combination of lower
average interest rates on lower average cash balances.



Income Tax Expense



Income tax expense was $3.7 million for the three months ended September
30, 2003, an increase of $1.2 million, or 48.0%, compared to $2.5 million for the three months ended September 30, 2002. The increase was due primarily to increased non-cash tax adjustments resulting from additional FCC licenses purchased in the
second quarter of 2003. As we are no longer able to reasonably estimate the period of reversal, if any, for deferred tax liabilities related to licensing costs as the result of the adoption of SFAS No. 142, we recorded additional non-cash income tax
expense to establish a valuation allowance against our deferred tax assets, which resulted from the newly acquired FCC licenses.



Net Loss



Net loss was $26.6 million and $34.4 million for the three months ended September 30, 2003 and 2002, respectively. The net loss decrease of $7.8 million resulted primarily from the items discussed above.



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Nine Months Ended September 30, 2003 Compared to the Nine Months Ended September 30, 2002



Subscribers



Net subscriber additions were 54,093 for the nine months ended September 30, 2003, bringing our total subscribers to 884,252 as of September
30, 2003, an increase of 11.0% over our subscriber total as of September 30, 2002. During the nine months ended September 30, 2003, all of our gross subscriber additions were postpay on a one or two year service contract.



Churn



Subscriber churn was 2.22% and 2.05% for the nine months ended September 30, 2003 and 2002, respectively. Subscriber churn is calculated by
dividing subscriber deactivations by our average subscriber base for the respective period. We believe that our churn rate remains consistently low compared to the industry average due to our high-quality system performance, our commitment to
quality customer service and our focused retention efforts.



The Federal
Communications Commission has mandated that wireless carriers provide for local number portability by November 24, 2003. This would allow subscribers to keep their wireless phone number when switching to a different service provider. We anticipate
that number portability may increase churn.



Average Revenue Per User



Average revenue per user, or ARPU, was $55.80 and $57.36 for the nine
months ended September 30, 2003 and 2002, respectively. ARPU reflects the average amount billed to subscribers based on rate plan offerings. ARPU excludes service revenue credits made to retain existing subscribers of $0.77 and $0.81 for the nine
months ended September 30, 2003 and 2002, respectively. ARPU is calculated by dividing service revenue, excluding service revenue credits made to existing 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.



We continue to focus on attracting new customers with rate plans that provide more value to the customer at a higher average customer bill. The ARPU decrease of $1.56, or 2.7%, was primarily the result of a change in
our rate plan mix, as many existing high-ARPU subscribers migrated to the UnPlan to take advantage of that plans unlimited minutes for calls from the subscribers local calling area at a lower monthly cost. We believe that most high-ARPU
subscribers who will migrate to the UnPlan have done so.



Revenues



Total revenues increased 14.2% to $608.6 million for the nine months
ended September 30, 2003 from $533.0 million for the nine months ended September 30, 2002. Service revenue for the nine months ended September 30, 2003 was $429.2 million, an increase of $51.9 million, or 13.8%, compared to $377.3 million for the
nine months ended September 30, 2002. The increase in service revenue was due primarily to growth in the number of subscribers. We expect subscriber growth to continue, and hence, we expect service revenue to continue to increase. Roaming revenue
was $141.8 million for the nine months ended September 30, 2003, an increase of $10.8 million, or 8.2%, compared to $131.0 million for the nine months ended September 30, 2002. The net increase in roaming revenue was the result of increased roaming
minutes of use due to the expansion of our network, the implementation of new roaming agreements with carriers such as Cingular Wireless and the overall growth in the wireless industry, partially offset by any reductions in roaming rates
contractually agreed to with other carriers. Roaming minutes for the nine months ended September 30, 2003 were 815.8 million, which represents a 20.1% increase over the nine months ended September 30, 2002. We expect the growth of the wireless
industry to continue, and as a result, we expect roaming minutes to continue to increase, which will be offset by contractual rate decreases that occurred during the quarter ended September 30, 2003. As a result we expect roaming revenue to remain
relatively flat in the foreseeable future. Equipment revenue was $37.6 million for the nine months ended September 30, 2003, an increase of $13.0 million, or 52.8%, compared to $24.6 million for the nine months ended September 30, 2002. Equipment
revenue includes the revenue earned in the sale of a handset or handset accessories to new and existing subscribers. In addition, equipment revenue includes the fair value of handsets received from a subscriber in a handset upgrade or exchange
transaction. The equipment revenue increase was due primarily to an increase in the sale of excess subscriber returned handsets to third party wholesalers and resellers.



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Cost of Service



Cost of service was $183.1 million for the nine months ended September 30, 2003, an increase of $25.7 million, or 16.3%, compared to $157.4 million for the nine months
ended September 30, 2002. The increase was related to a higher volume of traffic on our network driven by rate plan offerings and subscriber growth as well as higher roaming minutes of use. 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 anticipated subscriber growth. Cost of service as a percentage of revenue, excluding equipment revenue, was 32.1% and 31.0% for the nine months ended September 30,
2003 and 2002, respectively. The increase of 1.1% was primarily attributable to increased costs to operate our GSM/GPRS network and expand and maintain our wireless network to support an increased number of minutes of use on our TDMA network. Cost
of service as a percentage of revenue, excluding equipment revenue, may decline in the future as we continue to leverage our fixed cost of service against increased revenue.



Cost of Equipment



Cost of equipment was $72.7 million for the nine months ended September 30, 2003, an increase of $13.9 million, or 23.6%, compared to $58.8 million for the nine months
ended September 30, 2002. Cost of equipment includes the cost associated with the sale or exchange of a handset or handset accessories to new and existing subscribers. The cost of equipment increase was due primarily to an increase in the
sale of excess subscriber returned handsets to third party wholesalers and resellers.



Selling, General and Administrative Expense



Selling, general
and administrative expense was $173.9 million for the nine months ended September 30, 2003, a decrease of $10.6 million, or 5.7%, compared to $184.5 million for the nine months ended September 30, 2002. Selling expenses decreased by $5.2 million, or
6.6%, primarily due to lower fixed costs resulting from the streamlining of our operations during the first half of the year as well as decreased spending on advertising and promotions during the nine months ended September 30, 2003. General and
administrative expenses decreased by $5.4 million, or 5.1%, primarily due to decreased bad debt expense, which was $6.5 million and $11.2 million for the nine months ended September 30, 2003 and 2002. 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 expense may increase in conjunction with anticipated subscriber growth. General and administrative expense as a
percentage of revenue, excluding equipment revenue, was 17.6% and 20.9% for the nine months ended September 30, 2003 and 2002, respectively. The decrease of 3.3% is primarily attributable to increased customer care efficiency, focused collection
efforts, which controlled bad debt expense and increased leverage of other fixed costs. General and administrative expense as a percentage of revenue, excluding equipment revenue, may decline in the future as we continue to further leverage our
fixed general and administrative costs, such as headcount and rent expense, against increased revenue.



Cost Per Gross Addition



CPGA was $431
and $427 for the nine months ended September 30, 2003 and 2002, respectively. The CPGA increase of $4, or 0.9%, was primarily the result of decreased leverage on fixed acquisition costs such as store rent expense and sales and marketing overhead
costs, as the result of lower gross subscriber additions, partially offset by the streamlining of our operations in the first quarter of 2003. 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 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.



Termination Benefits and Other Related Costs



Termination
benefits and other related costs were $2.7 million for the nine months ended September 30, 2003. These expenses, which consisted primarily of severance and relocation costs, resulted from the streamlining of our operations during January 2003. There
were no termination benefits and other related costs for the nine months ended September 30, 2002. We expect that the termination benefits will result in approximately $5.4 million of net operational savings for the year ended December 31, 2003 and
represent $10.0 million of savings in each subsequent fiscal year.



Non-cash Compensation Expense



Non-cash compensation expense
was $23.6 million for the nine months ended September 30, 2003, an increase of $7.6 million, or 47.5%, compared to $16.0 million for the nine months ended September 30, 2002. The increase is



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attributable to the vesting of an increased number of restricted shares of Holdings Class A common stock awarded to management in prior periods. The
increase in the number of vested restricted shares was primarily the result of the acceleration of a portion of our retired Chief Operating Officers restricted shares in accordance with his retirement agreement.



Depreciation and Amortization Expense



Depreciation and amortization expense was $114.3 million for the nine months ended September
30, 2003, an increase of $14.0 million, or 14.0%, compared to $100.3 million for the nine months ended September 30, 2002. The increase relates primarily to increased depreciation expense due to the growth in the depreciable asset base resulting
from capital expenditures. In addition, we recognized a $4.4 million loss in connection with the disposal of certain cell site equipment deemed to be obsolete during the nine months ended September 30, 2003. For the nine months ended September 30,
2002, there was a $2.6 million loss recognized in connection with managements decision not to complete the construction of certain cell sites. Depreciation expense will continue to increase as we overlay and upgrade our network with GSM/GPRS
technology.



Interest Expense



Interest expense was $109.0 million, net of capitalized interest of $1.4 million, for the
nine months ended September 30, 2003. Interest expense was $107.6 million, net of capitalized interest of $3.2 million, for the nine months ended September 30, 2002. The increase of $1.4 million, or 1.3%, relates primarily to an increase of $18.5
million of interest expense related to our June 2003 private placement of $725.0 million aggregate principal amount of 8 1/2% senior notes, a decrease of $1.8 million in capitalized interest for the nine months ended September 30, 2003 and $0.6
million of accreted interest expense related to an asset retirement obligation for our leased facilities recorded in accordance with Statement of Financial Accounting Standards No. 143 Accounting for Obligations Associated with the Retirement
of Long-Lived Assets, offset partially by a decrease of $11.7 million of interest expense on our 11% subordinated notes, which were repurchased in July 2003 and a decrease of $7.6 million of interest expense on our bank credit facility, which
was extinguished in June 2003.



We had a weighted average interest rate of
9.26% for the nine months ended September 30, 2003 on our average borrowings under our former and current bank credit facility and our average obligation for our senior and subordinated debt, as compared with the 9.68% weighted average interest rate
for the nine months ended September 30, 2002.



Other Expense



Other expense was $2.9 million for the nine months ended September 30, 2003, a decrease
of $3.8 million, or 56.7%, compared to $6.7 million for the nine months ended September 30, 2002. The decrease was primarily attributable to a decrease in the loss on our interest rate swap derivative instruments, which were extinguished in June of
2003. Loss on derivatives was $2.0 million and $5.3 million for the nine months ended September 30, 2003, and 2002, respectively.



Debt Extinguishment Costs



Debt extinguishment costs were $41.1 million for the nine months ended September 30, 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. There
were no debt extinguishment costs for the nine months ended September 30, 2002.



Interest and Other Income



Interest and other income was $1.8
million for the nine months ended September 30, 2003, a decrease of $3.2 million, or 64.0%, compared to $5.0 million for the nine months ended September 30, 2002. The decrease was due primarily to the combination of lower average interest rates on
lower average cash balances.



Income Tax Expense



Income tax expense was $9.8 million for the nine months ended September 30, 2003, a decrease
of $12.4 million, or 55.9%, compared to $22.2 million for the nine months ended September 30, 2002. This decrease was due primarily to a non-cash tax adjustment in the first quarter of 2002 to establish a valuation allowance against our deferred tax
assets, as we were no longer able to reasonably estimate the period of reversal, if any, for deferred tax liabilities related to licensing costs as the result of the adoption of the SFAS No. 142.



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Net Loss



Net loss was $122.8 million and $115.7 million for the nine months ended September 30, 2003 and 2002, respectively. The net loss increase of $7.1 million resulted
primarily from the items discussed above.



Liquidity and
Capital Resources



As of September 30, 2003, we had $167.5 million in cash
and cash equivalents, compared to $212.5 million in cash and cash equivalents at December 31, 2002. Net working capital was $115.0 million as of September 30, 2003 and $172.6 million as of December 31, 2002.



Net Cash Provided by Operating Activities



The $128.1 million of cash provided by operating activities during the nine-month period
ended September 30, 2003 was the result of our net loss of $122.8 million, offset by $33.0 million of cash provided by changes in working capital and other long-term assets and $217.9 million of depreciation and amortization, accretion of interest,
loss in equity investment, non-cash compensation, bad debt expense, deferred income taxes, loss on debt extinguishment and loss on non-hedging interest rate swap derivative instruments.



Net Cash Used in Investing Activities



The $92.8 million of cash used by investing activities during the nine-month period ended September 30, 2003 was primarily related to FCC license acquisitions totaling
$28.4 million and capital expenditures of $64.3 million associated with the overlay of our wireless network with GSM/GPRS technology. We will continue to upgrade our network capacity and service quality to support our anticipated subscriber growth
and satisfy competitive requirements.



Net Cash Used in
Financing Activities



The $80.2 million of cash used in financing
activities during the nine-month period ended September 30, 2003 was primarily related to payments of $512.0 million for the repurchase and redemption of our 11% subordinated notes, $208.0 million to retire our former credit facility, $31.3 million
for debt extinguishment costs, $20.4 million for the extinguishment of our interest rate swaps and a change in our bank overdraft liability of $14.8 million, offset primarily by the proceeds from the issuance of 8 1/2% senior notes for net proceeds
of $710.5 million.



Liquidity



We believe that cash on hand and available credit facility borrowings will be sufficient to
meet our projected capital requirements through 2004, at which time we expect to be free cash flow positive. However, it is possible that we may need additional financing. On June 13, 2003, we entered into our current credit facility that will
permit us, subject to various terms and conditions, including compliance with specified leverage ratios, to borrow up to $100.0 million to finance working capital requirements, capital expenditures and other corporate needs. Our borrowings under the
current facility are subject to customary terms and conditions. As of September 30, 2003, we were in compliance with all such covenants. As of September 29, 2003, we entered into a first amendment to the current facility to clarify that we are
permitted to enter into interest rate swap arrangements. As of September 30, 2003, we had no outstanding borrowings under the current credit facility.



Reconciliation of Non-GAAP Financial Measures



We utilize certain financial measures that are not calculated in accordance with accounting principles generally accepted in the United States, or 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, other than cash cost per user, 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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|                                |  | Three Months EndedSeptember 30,     |         | Nine Months EndedSeptember 30,
|------------------------------- |  | ----------------------------------- | ------- | ------------------------------
|Average revenue per user (ARPU) |  | 2002                                |         | 2003                          
|                                |  | (Dollars in thousands, except ARPU)
|                                |  |                                     |         |                               
|Service revenue                 |  | $                                   | 133,545 |                               
|Subscriber retention credits    |  |                                     | 2,222   |                               
|                                |  |                                     |         |                               
|Adjusted service revenue        |  | $                                   | 135,767 |                               
|                                |  |                                     |         |                               
|Average subscribers             |  |                                     | 780,006 |                               
|ARPU                            |  | $                                   | 58.02   |                               



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 excludes service revenue credits made to retain
existing subscribers, as these 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. ARPU is calculated by dividing service revenue, excluding service revenue credits made to existing subscribers, by our average subscriber base for the respective period.



|ARPU, plus roaming revenue less subscriber retention costs   |      | Three Months EndedSeptember 30,     |         | Nine Months EndedSeptember 30,
|------------------------------------------------------------ | ---- | ----------------------------------- | ------- | ------------------------------
|                                                             | 2002 |                                     | 2003    |                               
|                                                             |      | (Dollars in thousands, except ARPU)
|                                                             |      |                                     |         |                               
|Service revenue                                              |      | $                                   | 133,545 |                               
|Roaming revenue                                              |      |                                     | 50,396  |                               
|                                                             |      |                                     |         |                               
|Service and roaming revenue                                  |      |                                     | 183,941 |                               
|                                                             |      |                                     |         |                               
|Average subscribers                                          |      |                                     | 780,006 |                               
|ARPU, plus roaming revenue less subscriber retention credits |      | $                                   | 78.61   |                               



We believe ARPU, plus roaming revenue
less subscriber retention credits, which calculates the average service and roaming revenue per subscriber provides a gauge to compare our service and roaming revenue to that of other wireless communications providers that may have significantly
more or less subscribers and, therefore, more or less revenue on an aggregate basis. In addition, this metric minus cash costs per user, or CCPU, is an indicator of net cash flows generated on a per subscriber basis.



|                                                                 |  | Three Months EndedSeptember 30,              |         | Nine Months EndedSeptember 30,
|---------------------------------------------------------------- |  | -------------------------------------------- | ------- | ------------------------------
|CCPU and CPGA                                                    |  | 2002                                         |         | 2003                          
|                                                                 |  | (Dollars in thousands, except CCPU and CPGA)
|                                                                 |  |                                              |         |                               
|Cost of service                                                  |  | $                                            | 56,547  |                               
|General and administrative expense                               |  |                                              | 37,320  |                               
|Total cost of equipment - transactions with existing subscribers |  |                                              | 4,585   |                               
|                                                                 |  |                                              |         |                               
|CCPU operating expenses                                          |  |                                              | 98,452  |                               
|                                                                 |  |                                              |         |                               
|Selling expense(1)                                               |  |                                              | 28,321  |                               
|Total cost of equipment - transactions with new subscribers(1)   |  |                                              | 15,931  |                               
|                                                                 |  |                                              |         |                               
|CPGA operating expenses                                          |  |                                              | 44,252  |                               
|                                                                 |  |                                              |         |                               
|Termination benefits and other related expenses                  |  |                                              |        |                               
|Non-cash compensation                                            |  |                                              | 5,430   |                               
|Depreciation                                                     |  |                                              | 34,461  |                               
|Amortization                                                     |  |                                              | 1,243   |                               
|                                                                 |  |                                              |         |                               
|Total operating expenses                                         |  | $                                            | 183,838 |                               



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|                                                           |  | Three Months EndedSeptember 30,              |         |   | Nine Months EndedSeptember 30, |  
|---------------------------------------------------------- |  | -------------------------------------------- | ------- | - | ------------------------------ | -
|CCPU and CPGA (continued)                                  |  | 2002                                         |         |   | 2003                           |  
|                                                           |  | (Dollars in thousands, except CCPU and CPGA) |        
|                                                           |  |                                              |         |  
|CCPU operating expenses (from above)                       |  | $                                            | 98,452  |   |                                | $
|Equipment revenue - transactions with existing subscribers |  |                                              | (782    | ) |                                |  
|                                                           |  |                                              |         |   |                                |  
|CCPU costs, net                                            |  | $                                            | 97,670  |   |                                | $
|                                                           |  |                                              |         |  
|Average subscribers                                        |  |                                              | 780,006 |   |                                |  
|CCPU                                                       |  | $                                            | 42      |   |                                | $
|                                                           |  |                                              |         |  
|CPGA operating expenses (from above)                       |  | $                                            | 44,252  |   |                                | $
|Equipment revenue - transactions with new subscribers      |  |                                              | (8,521  | ) |                                |  
|                                                           |  |                                              |         |   |                                |  
|CPGA costs, net                                            |  | $                                            | 35,731  |   |                                | $
|                                                           |  |                                              |         |  
|Gross subscriber additions                                 |  |                                              | 85,397  |   |                                |  
|CPGA                                                       |  | $                                            | 418     |   |                                | $



We believe CCPU, which calculates the
cash cost to operate our business on a per subscriber basis, is a useful measure to compare our subscriber costs to that of other wireless communications providers. In addition to our subscriber costs, CCPU includes the costs of other carriers
subscribers roaming on our network. CCPU is calculated as the total of GAAP operating expenses reported on our consolidated statements of operations, less equipment revenue related to transactions with existing subscribers, depreciation,
amortization, non-cash compensation, termination benefits and related charges and operating costs incurred to acquire new subscribers (as described above under Cost Per Gross Addition and denoted by (1) in the above table), divided by
our average subscribers for the period. For quarterly periods, average subscribers is calculated by adding subscribers at the beginning of the quarter to subscribers at the end of the end of the quarter and dividing by two; for year-to-date periods,
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.



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 communications providers.



Inflation



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



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##### Table of Contents

|ITEM 3. |  | 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 September 30, 2003, our outstanding debt can be categorized as follows (dollars in thousands):



|Fixed interest rates:                  |  |   |        
|-------------------------------------- |  | - | -------
|Senior notes                           |  | $ | 710,813
|Subordinated notes                     |  | $ | 732,276
|Subject to interest rate fluctuations: |  |   |        
|Bank credit facility                   |  | $ |       



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. Historically, we have selectively entered into interest rate swaps to manage our interest
rate exposure only. Due to the repayment of our former credit facility on June 13, 2003, we terminated all 13 of our previously existing interest rate swaps for aggregate cash consideration of $23.7 million, which included accrued and unpaid
interest through the date of termination. We were not a party to any interest rate swaps as of September 30, 2003. During October of 2003, we entered into two interest rate swap agreements for an aggregate notional amount of $80.0 million.



Our cash and cash equivalents consist of short-term assets having initial
maturities of three months 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.



|ITEM 4. |  | CONTROLS AND PROCEDURES
|------- |  | -----------------------



The Chief Executive Officer and the Chief Financial Officer of Triton (its principal executive officer and principal financial officer respectively), as well as the
Senior Vice President of Operations and Controller have concluded, based on their evaluation as of September 30, 2003, that Tritons disclosure controls and procedures are: effective to ensure that information required to be disclosed by Triton
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 Triton in such reports is accumulated and communicated to the companys management, including the Chief Executive Officer, Chief Financial Officer and Senior Vice President of
Operations and Controller, as appropriate to allow timely decisions regarding required disclosure.



There were no changes in Tritons internal control over financial reporting that occurred during the quarter ended September 30, 2003 that have materially affected, or are reasonably likely to materially affect,
Tritons internal control over financial reporting.



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PART II. OTHER INFORMATION



|ITEM 1. |  | LEGAL PROCEEDINGS
|------- |  | -----------------



None.



|ITEM 2. |  | CHANGES IN SECURITIES AND USE OF PROCEEDS
|------- |  | -----------------------------------------



None.



|ITEM 3. |  | DEFAULTS UPON SENIOR SECURITIES
|------- |  | -------------------------------



None.



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



None.



|ITEM 5. |  | OTHER INFORMATION
|------- |  | -----------------



None.



|ITEM 6. |  | EXHIBITS AND REPORTS ON FORM 8-K
|------- |  | --------------------------------



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



|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                                                                                                                                                              
|------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|              | 
|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           |  | 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 (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           |  | 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).                                                                                                                                                                         
|              | 
|4.3           |  | 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, Inc. filed June 16, 2003).                                                                                                                                                                                          
|              | 
|4.4           |  | First Amended and Restated Stockholders Agreement, dated as of October 27, 1999, among AT&T Wireless PCS, L.L.C., Triton PCS Holdings, Inc., the cash equity investor
party thereto, the management stockholders party thereto and the independent directors party thereto (incorporated by reference to Exhibit 10.47 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended September 30,
1999).         
|              | 
|4.5           |  | Amendment No. 1 to First Amended and Restated Stockholders Agreement, dated as of April 4, 2002, among AT&T Wireless PCS, L.L.C., Triton PCS Holdings, Inc., the cash
equity investor party thereto, the management stockholders party thereto and the independent directors party thereto (incorporated by reference to Exhibit 4.9 to the Form 10-Q of Triton PCS Holdings, Inc. for the quarter ended June 30,
2002).



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|     | 
|---- | 
|4.6  | 
|     | 
|4.7  | 
|     | 
|10.1 | 
|     | 
|10.2 | 
|     | 
|31.1 | 
|     | 
|31.2 | 
|     | 
|31.3 | 
|     | 
|32.1 | 
|     | 
|32.2 | 



| | (b) | Reports on Form 8-K
| | --- | -------------------



None.



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SIGNATURES



Pursuant to the requirements 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.



|                        |  |  |  | TRITON PCS, INC.
|----------------------- |  |  |  | ----------------
|                        |  |  | 
|Date: November 10, 2003 |  |  |  | By:             
|                        |  |  |  |                 
|                        |  |  |  |                 



|                        |  |  |  |    
|----------------------- |  |  |  | ---
|                        |  |  | 
|Date: November 10, 2003 |  |  |  | By:
|                        |  |  |  |    
|                        |  |  |  |