<PAGE>

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                         _____________________________

                                   FORM 10-Q

(Mark One)
     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934 (FEE REQUIRED)

          For the quarterly period ended September 30, 1999

                                      OR

     [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934 (NO FEE REQUIRED)


                       Commission file number: 333-60639

                         _____________________________

                         AMERICAN CELLULAR CORPORATION
             (Exact name of Registrant as specified in its charter)


               Delaware                              22-3043811
     (State or other jurisdiction of              (I.R.S. Employer
     incorporation or organization)               Identification No.)


                      1375 East Woodfield Road, Suite 700
                          Schaumburg, Illinois 60173
                   (Address of principal executive offices)

      Registrant's telephone number, including area code: (847) 995-8770

                         _____________________________
     Indicate by check mark whether the Company (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 Company
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [ ] No

     The number of shares of Class A Common Stock, par value $.01 per share, and
Class B Common Stock, par value $.01 per share, of the Company outstanding as of
November 15, 1999 was approximately 254,672 and 14,715, respectively. There is
no trading market for the Common Stock of the Company.

================================================================================
<PAGE>

                               TABLE OF CONTENTS

                        PART I.   FINANCIAL INFORMATION
<TABLE>
<CAPTION>

Item 1.   Financial Statements

          <S>                                                                                          <C>
          Condensed Consolidated Balance Sheets--September 30, 1999 and December 31, 1998............    1

          Condensed Consolidated Statements of Operations for the Three Months Ended September 30,
          1999 and 1998, and the Nine Months Ended September 30, 1999 and the Period from February
          26, 1998 (Date of Formation) to September 30, 1998.........................................    2


          Condensed Consolidated Statements of Cash Flows for the Nine Months Ended
          September 30, 1999 and the Period from February 26, 1998 (Date of Formation) to
          September 30, 1998.........................................................................    3

          Notes to Condensed Consolidated Financial Statements.......................................    4

Item 2.   Management's Discussion and Analysis of Financial Condition and Results of
          Operations.................................................................................    6


                              PART II.   OTHER INFORMATION

Item 1.   Legal Proceedings..........................................................................   14

Item 2.   Changes in Securities and Use of Proceeds..................................................   14

Item 3.   Defaults Upon Senior Securities............................................................   14

Item 4.   Submission of Matters to a Vote of Security Holders........................................   14

Item 5.   Other Information..........................................................................   14

Item 6.   Exhibits and Reports on Form 8-K...........................................................   14
</TABLE>
<PAGE>
                        PART 1.   FINANCIAL INFORMATION

Item 1.   FINANCIAL STATEMENTS



                American Cellular Corporation and Subsidiaries
                     Condensed Consolidated Balance Sheets
                 (Dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                      September 30
                                                                          1999              December 31
                                                                       (Unaudited)             1998
                                                                 -----------------------------------------
<S>                                                              <C>                        <C>
Assets
Current assets:
 Cash and cash equivalents                                                $    49,128          $    34,015
 Restricted short-term investments                                             27,729               26,550
 Accounts receivable, net of allowance for doubtful accounts of
  $1,062 in 1999 and $2,084 in 1998                                            39,367               26,494

 Inventories                                                                    4,117                2,005
 Prepaids and other current assets                                              2,128                1,569
                                                                 -----------------------------------------
Total current assets                                                          122,469               90,633
Cellular facilities, equipment, and other, net                                177,703              159,792
Other assets                                                                1,203,756            1,267,175
                                                                 -----------------------------------------
Total assets                                                              $ 1,503,928          $ 1,517,600

Liabilities and stockholders' equity
Current liabilities:
 Current portion of long-term debt                                        $     4,000          $     3,000
 Accounts payable                                                              11,255                6,022
 Interest payable                                                              28,359               22,061
 Accrued operating expenses                                                    12,407               16,620
 Income and other taxes payable                                                 7,679                3,398
 Deferred revenue                                                               5,926                6,170
 Other current liabilities                                                      1,307                  989
                                                                 -----------------------------------------
Total current liabilities                                                      70,933               58,260
Long-term debt                                                              1,193,134            1,195,971

Stockholders' equity:
 Series A cumulative redeemable preferred stock, $0.01 par
  value, $100 liquidation value, net of $2,000 notes receivable
  from stockholders; authorized 5,000,000 shares; 3,250,000
  shares issued and outstanding, including $53,862 in 1999 and
  $21,375 in 1998 of accrued dividends                                        376,862              344,375

 Common stock, $0.01 par:
  Class A:  Authorized 475,000 shares; issued and outstanding
   254,672 shares                                                                   3                    3

  Class B:  Authorized 25,000 shares; 15,315 shares issued and
   14,715 shares outstanding at September 30, 1999 and 19,687
   shares issued and 19,387 outstanding at December 31, 1998                        -                    -
  Additional paid-in capital                                                   25,191               25,191
  Accumulated deficit                                                        (162,195)            (106,200)
                                                                 -----------------------------------------
Total stockholders' equity                                                    239,861              263,369
                                                                 -----------------------------------------
Total liabilities and stockholders' equity                                $ 1,503,928          $ 1,517,600
                                                                 =========================================
</TABLE>

See notes to condensed consolidated financial statements.

                                       1
<PAGE>

                 American Cellular Corporation and Subsidiaries
          Condensed Consolidated Statements of Operations (Unaudited)
                                 (In thousands)


<TABLE>
<CAPTION>

                                              Three                  Three                   Nine           February 26, 1998
                                              Months                 Months                 Months         (date of formation)
                                              Ended                  Ended                  Ended                   to
                                           September 30           September 30           September 30          September 30
                                               1999                   1998                   1999                  1998
                                    ------------------------------------------------------------------------------------------
<S>                                 <C>                           <C>                    <C>               <C>
Revenues
 Subscriber revenues                      $ 31,658                 $ 27,828              $ 92,346              $ 27,828
 Roaming revenues                           34,480                   19,592                75,989                19,592
 Toll revenues                              13,494                   10,163                30,409                10,163
 Equipment sales                             2,725                    1,682                 7,087                 1,682
 Other                                       2,348                    1,840                 6,238                 1,840
                                    ------------------------------------------------------------------------------------------
Total revenues                              84,705                   61,105               212,069                61,105

Costs and expenses
 Cost of cellular service                    7,055                    4,922                18,154                 4,922
 Cost of equipment sold                      5,111                    3,246                13,128                 3,246
 General and administrative                 11,387                    8,974                32,565                 8,974
 Sales and marketing                         7,632                    7,410                21,972                 7,410
 Depreciation and amortization              24,696                   22,506                72,607                22,506
 Non-recurring charges                           -                       76                     -                 4,154
                                    ------------------------------------------------------------------------------------------
Total costs and expenses                    55,881                   47,134               158,426                51,212
                                    ------------------------------------------------------------------------------------------
Operating income                            28,824                   13,971                53,643                 9,893

Other income (expense)
 Interest expense                          (27,121)                 (29,875)              (80,620)              (33,864)
 Interest income                             1,121                    1,588                 3,454                 3,744
 Other income, net                              23                      250                    82                   250
                                    ------------------------------------------------------------------------------------------
                                           (25,977)                 (28,037)              (77,084)              (29,870)
                                    ------------------------------------------------------------------------------------------

Income (loss) before provision for
 income taxes                                2,847                  (14,066)              (23,441)              (19,977)
Provision for income taxes                     (11)                       -                   (67)                    -
                                    ------------------------------------------------------------------------------------------
Net income (loss)                         $  2,836                  (14,066)             $(23,508)             $(19,977)
                                    ==========================================================================================
</TABLE>

See notes to condensed consolidated financial statements.

                                      2
<PAGE>

                 American Cellular Corporation and Subsidiaries
          Condensed Consolidated Statements of Cash Flows (Unaudited)
                                 (In thousands)
<TABLE>
<CAPTION>

                                                                                              Nine         February 26, 1998
                                                                                             Months             (date of
                                                                                             Ended           formation) to
                                                                                           September 30        September 30
                                                                                              1999                1998
                                                                                     ---------------------------------------
<S>                                                                                  <C>                   <C>
Operating activities
Net loss                                                                                        $(23,508)        $   (20,352)
Adjustment to reconcile net loss to net cash provided by operating activities:
  Depreciation and amortization expense                                                           72,607              22,881
  Amortization of deferred financing costs                                                         3,307               2,264
  Accretion of discount on Senior Notes                                                              162                  88
  Amortization of premium on restricted investments                                                  229                 199
  Change in working capital components:
     Accounts receivable                                                                         (12,873)             (3,642)
     Inventories                                                                                  (2,112)               (492)
     Prepaids and other current assets                                                              (559)                 (1)
     Accounts payable                                                                              5,233              (1,351)
     Interest payable                                                                              6,298              28,175
     Accrued operating expenses                                                                   (4,213)              4,005
     Income and other taxes payable                                                                4,281                 298
     Deferred revenue                                                                               (244)              1,084
     Other current liabilities                                                                       318                 399
                                                                                     ---------------------------------------
Net cash provided by operating activities                                                         48,926              33,555

Investing activities
Acquisition of cellular operations, net of cash acquired                                               -          (1,418,272)
Purchase of fixed assets                                                                         (43,581)             (6,457)
Change in restricted investments, net                                                             12,187             (82,612)
                                                                                     ---------------------------------------
Net cash used in investing activities                                                            (31,394)         (1,507,341)

Financing activities
Proceeds from sale of preferred and common stock                                                       -             348,186
Proceeds from issuance of Senior Notes                                                                 -             282,834
Borrowings against (repayments of) credit facility                                                (2,000)            916,000
Deferred financing costs                                                                            (419)            (36,192)
                                                                                     ---------------------------------------
Net cash provided by (used in) financing activities                                               (2,419)          1,510,828
                                                                                     ---------------------------------------
Increase in cash and cash equivalents                                                             15,113              37,042
Cash and cash equivalents at beginning of period                                                  34,015                   -
                                                                                     ---------------------------------------
Cash and cash equivalents at end of period                                                      $ 49,128         $    37,042
                                                                                     =======================================
</TABLE>

See notes to condensed consolidated financial statements.

                                       3
<PAGE>

                 American Cellular Corporation and Subsidiaries

              Notes to Condensed Consolidated Financial Statements


1.   Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with rules and regulations of the Securities and Exchange
Commission for interim financial reporting.  In the opinion of management, the
accompanying condensed consolidated financial statements reflect all
adjustments, consisting only of normal recurring accruals, considered necessary
for a fair presentation of the results for the interim period.  The results of
operations for the interim period are not necessarily indicative of the results
for a full year.  These condensed consolidated financial statements should be
read in conjunction with the financial statements and notes thereto included in
the Company's 1998 Annual Report on Form 10-K.

2.   Reclassifications

Certain items have been reclassified in the December 31, 1998 consolidated
financial statements to conform to the current presentation.

3.   Sale of Business

On October 5, 1999, American Cellular Corporation (the "Company") entered into
an Agreement and Plan of Merger, (the "Merger Agreement") pursuant to which a
newly-formed joint venture of Dobson Communications Corporation and AT&T
Wireless Systems, Inc. will, subject to the terms and conditions set forth in
the Merger Agreement, acquire the Company by merging a wholly-owned subsidiary
of the joint venture with and into the Company (the "Merger"). Pursuant to the
Merger Agreement, each share of Class A common stock, par value $.01 per share,
of the Company will, at the effective time of the Merger (the "Effective Time"),
be converted into the right to receive $3,244.24 per share in cash, plus
interest thereon for the period commencing January 1, 2000 through and including
the closing date at a rate of 8% per annum (the "Common Stock Purchase Price").
As provided in the Merger Agreement, the Common Stock Purchase Price is subject
to adjustment in the event any shares of common stock are repurchased by the
Company pursuant to stock repurchase rights prior to the Effective Time.

The Merger Agreement further provides that each share of non-voting Class B
common stock, par value $.01 per share, of the Company issued and outstanding
immediately prior to the Effective Time will become fully vested and will
automatically be converted into one share of Class A common stock at the
Effective Time in accordance with the terms of the grant thereof and, as such,
will thereupon be subject to conversion into the right to receive the Common
Stock Purchase Price. In addition, each share of non-voting Series A Preferred
Stock, par value $.01 per share, of the Company issued and outstanding
immediately prior to the Effective Time will, consistent with the terms of such
preferred stock designated in the Company's certificate of incorporation, be
converted at the Effective Time into the right to receive $100 per share in cash
plus all accrued but unpaid dividends thereon to and including the Effective
Time.

Concurrent with the execution of the Merger Agreement, certain stockholders of
the Company executed a Stockholder Voting Agreement, dated as of October 5,
1999, pursuant to which, among other things, such stockholders agreed to vote
all shares beneficially owned by such persons in favor of the Merger and each of
the other transactions contemplated by the Merger Agreement at any meeting of
the Company's stockholders in connection with the Merger (or otherwise to
consent in writing thereto, as the case may be).  A majority of the stockholders
of the Company voted to approve the Merger Agreement and the transactions
contemplated thereby, including the Merger, at a meeting of the stockholders
held on October 5, 1999.

The completion of the Merger, which is expected to close in the first quarter of
2000, is subject to certain conditions, including the expiration or earlier
termination of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the approval of the Federal
Communications Commission.

                                       4
<PAGE>

4.  Other Assets

Other assets consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                  September 30         December 31
                                                                      1999                 1998
                                                             ----------------------------------------
<S>                                                          <C>                       <C>
        Goodwill/cellular licenses                                     $1,175,479          $1,175,479
        Investments in cellular operations                                 35,531              35,531
        Deferred financing costs                                           35,982              35,563
        Restricted investments                                             29,377              42,972
        Subscriber lists                                                   11,233              11,233
        Accumulated amortization                                          (83,846)            (33,603)
                                                             ----------------------------------------
                                                                       $1,203,756          $1,267,175
                                                             ========================================
</TABLE>

Goodwill/cellular licenses represent the excess of purchase price over the fair
market value assigned to the net tangible and identifiable intangible assets of
the business acquired.

                                       5
<PAGE>

Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

General

     The following is a discussion and analysis of the historical results of
operations and financial condition of American Cellular Corporation ("American
Cellular" or the "Company") and factors affecting the Company's financial
resources. This discussion should be read in conjunction with the Company's
financial statements, including the notes thereto, included in this Quarterly
Report on Form 10-Q (the "Report").

     On June 25, 1998, American Cellular acquired PriCellular Corporation
("PriCellular") pursuant to an Agreement and Plan of Merger dated March 6, 1998
(the "PriCellular Merger Agreement") for approximately $1.5 billion (the
"PriCellular Merger"). The acquisition was recorded in accordance with the
purchase method of accounting. The cost of the acquisition was allocated to the
tangible and intangible assets and liabilities assumed based on their respective
fair values. PriCellular had been partially owned (6.39%) by a group of
investors, which also own 27.2% of American Cellular (the 6.39% is considered
the continuing ownership interest). The cost to acquire the continuing ownership
interest in the net assets of PriCellular in excess of the predecessor basis
($44.4 million) has been reflected as a reduction of stockholders' equity of
American Cellular pursuant to generally accepted accounting principles.

     American Cellular accounted for the PriCellular Merger using purchase
accounting. Accordingly, the PriCellular and American Cellular financial
statements reflect different bases of accounting and capitalization which can
significantly impact depreciation, amortization, interest and related tax
expenses. However, for purposes of the following discussion regarding 1999 and
1998 activity, the pre-and post-acquisition financial information has been
combined to provide the reader with an indication of the trend of results.
Specifically, the results of operations of American Cellular for the nine months
ended September 30, 1999 will be compared with the results of operations of
American Cellular and PriCellular on a combined basis for the nine months ended
September 30, 1998.


Results of Operations of American Cellular

 General

     The results for the current three month period ending September 30, 1999
reflect the continuation of the growth of the Company's operations and
subscriber additions. Net subscriber additions from internally generated sales
were approximately 23,200 for the three months and 63,400 for the nine months
ended September 30, 1999 compared to 19,100 and 49,900 for the same periods of
the prior year. The Company ended the current period with approximately 397,900
subscribers resulting in penetration of 8.13% compared to 305,100 and
penetration of 6.24% for the same period of the prior year.

     Earnings before interest, taxes, depreciation and amortization ("EBITDA"),
which excludes non-recurring charges and gain (loss) on sale of investments in
cellular operations, amounted to $53.5 million for the third quarter of 1999
compared to $36.8 million for the same period in 1998. For the current nine
month period EBITDA amounted to $126.3 million compared to $90.5 million for the
same period in 1998. Although the Company has experienced positive results when
measured by EBITDA, it expects to incur net accounting losses for the
foreseeable future. EBITDA is utilized as a measurement of performance within
the industry, although it should not be regarded as an alternative to either
operating income or net income as an indicator of operating performance or to
cash flows as a measure of liquidity. Further, EBITDA is not a GAAP-based
financial measure, and it should not be considered as an alternative to GAAP-
based measures of financial performance.

                                       6
<PAGE>

<TABLE>
<CAPTION>
                                                                                      American
                                                                                      Cellular
                                                                                       Period
                                                                                        from
                                      American        American        American        February
                                      Cellular        Cellular        Cellular        26, 1998      PriCellular     Combined
                                        Three           Three           Nine          (Date of          Six           Nine
                                       Months          Months          Months        Formation)       Months         Months
                                        Ended           Ended           Ended          through         Ended          Ended
                                    September 30,   September 30,   September 30,   September 30,    June 30,     September 30,
                                         1999            1998            1999            1998          1998            1998
                                         ----            ----            ----            ----          ----            ----
<S>                                 <C>             <C>             <C>             <C>             <C>           <C>
Revenues..........................  $      84,705   $      61,105   $     212,069   $      61,105   $    97,530   $     158,635
Cost of cellular service..........         (7,055)         (4,922)        (18,154)         (4,922)       (9,771)        (14,693)
Cost of equipment sold............         (5,111)         (3,246)        (13,128)        ( 3,246)       (5,365)         (8,611)
General and administrative........        (11,387)         (8,974)        (32,565)         (8,974)      (18,010)        (26,984)
Sales and marketing...............         (7,632)         (7,410)        (21,972)         (7,410)      (12,220)        (19,630)
Depreciation and amortization.....        (24,696)        (22,506)        (72,607)        (22,506)      (17,553)        (40,059)
Non-recurring charges.............             --             (76)             --          (4,154)       (4,889)         (9,043)
                                    -------------   -------------   -------------   -------------   -----------   -------------
Operating income..................         28,824          13,971          53,643           9,893        29,722          39,615
Interest income (expense), net....        (26,000)        (28,287)        (77,166)        (30,120)      (37,385)        (67,505)
Gain (loss) on sale of assets.....             --              --              --              --          (133)           (133)
Other income......................             23             250              82             250         1,510           1,760
Provision for income taxes........            (11)             --             (67)             --            --              --
                                    -------------   -------------   -------------   -------------   -----------   -------------
Net income (loss).................  $       2,836   $     (14,066)  $     (23,508)  $     (19,977)  $    (6,286)  $     (26,263)
                                    =============   =============   =============   =============   ===========   =============
</TABLE>

Note: Certain reclassifications have been made to the PriCellular Corporation
financial statements for the six months ended June 30, 1998 to conform with the
American Cellular Corporation classification and disclosure for comparability
purposes.

 Three Months Ended September 30, 1999 Compared with the Three Months Ended
 September 30, 1998

     Revenues increased from $61.1 million in 1998 (consisting of $27.8 million
for subscriber revenue, $19.6 million for roaming revenue, $10.2 million for
toll revenue, $1.7 million for equipment sales and $1.8 million for other
revenue) to $84.7 million in 1999 (consisting of $31.7 million for subscriber
revenue, $34.5 million for roaming revenue, $13.5 million for toll revenue, $2.7
million for equipment sales and $2.3 million for other revenue). The increase
represents the continuing growth in the cellular industry impacting both
subscriber and roaming revenues, and the effect of improved coverage in the
Company's markets as a result of the increase in the number of cell sites in its
systems.

     Total costs and expenses increased from $47.1 million in 1998 (consisting
of $4.9 million for cost of cellular service, $3.2 million for cost of equipment
sales, $9.0 million for general and administrative expense, $7.4 million for
sales and marketing expense, $22.5 million for depreciation and amortization
expense and $0.1 million for non-recurring charges) to $55.9 million in 1999
(consisting of $7.1 million cost of cellular service, $5.1 million for cost of
equipment sales, $11.4 million for general and administrative expense, $7.6
million for sales and marketing expense and $24.7 million for depreciation and
amortization expense). The primary factor contributing to the increase in
expenses is the growth in the subscriber base and the increase in cellular
service minutes provided. Cost of cellular service represents 8.9% of cellular
service, roaming and toll revenue in 1999 compared to 8.5% for the same period
in 1998. Operating expenses consisting of the cost of cellular service, cost of
equipment sold, general and administrative expense and sales and marketing
expense decreased as a percent of total revenues from 40.2% for the three months
ended September 30, 1998 to 36.8% for the current three month period. This
reduction represents cost efficiencies the Company has realized while achieving
a 21% increase in growth in net subscriber additions over the same period in
1998 and leveraging of various fixed costs over increased revenues. Depreciation
and amortization expense reflects the acquisition of PriCellular by the Company.

     The decrease in net interest expense from $28.3 million for the three
months ended September 30, 1998 to $26.0 million for the same period in 1999 is
primarily the result of the decrease in marginal interest rates charged by

                                       7
<PAGE>

the banks on the Company's credit facility. Other income decreased from $250,000
to $23,000 principally due to amortization of a covenant not to compete that was
fully amortized in 1998.

     The provision for income taxes in 1999 relates to current state income tax
requirements.


  Nine Months Ended September 30, 1999 Compared with the Combined Nine Months
  Ended September 30, 1998

     Revenues increased from $158.6 million in 1998 (consisting of $80.0 million
for subscriber revenue, $44.7 million for roaming revenue, $22.4 million for
toll revenue, $4.6 million for equipment sales and $6.9 million for other
revenue) to $212.1 million in 1999 (consisting of $92.4 million for subscriber
revenue, $76.0 million for roaming revenue, $30.4 million for toll revenue, $7.1
million for equipment sales and $6.2 million for other revenue). The increase
represents the continuing growth in the cellular industry impacting both
subscriber and roaming revenues, and the effect of improved coverage in the
Company's markets as a result of the increase in the number of cell sites in its
systems.

     Total costs and expenses increased from $119.0 million in 1998 (consisting
of $14.7 million for cost of cellular service, $8.6 million for cost of
equipment sales, $27.0 million for general and administrative expense, $19.6
million for sales and marketing expense, $40.1 million for depreciation and
amortization expense and $9.0 million for non-recurring charges) to $158.4
million in 1999 (consisting of $18.1 million cost of cellular service, $13.1
million for cost of equipment sales, $32.6 million for general and
administrative expense, $22.0 million for sales and marketing expense and $72.6
million for depreciation and amortization expense). The primary factor
contributing to the increase in expenses is the growth in the subscriber base
and the increase in cellular service minutes provided. Cost of cellular service
represents 9.1% of cellular service, roaming and toll revenue in 1999 compared
to 10.0% for the same period in 1998. Operating expenses consisting of the cost
of cellular service, cost of equipment, general and administrative expense and
sales and marketing expense decreased as a percent of total revenues from 44.1%
for the nine months ended September 30, 1998 to 40.5% for the current nine month
period. This reduction represents cost efficiencies the Company has realized
while achieving a 27% increase in growth in net subscriber additions over the
same period in 1998 and leveraging of various fixed costs over increased
revenues. Depreciation and amortization expense reflects the acquisition of
PriCellular by the Company.

     The increase in net interest expense from $67.5 million for the nine months
ended September 30, 1998 to $77.2 million in 1999 is primarily the result of the
acquisition of PriCellular by the Company and the related financing. Other
income decreased from $1.8 million to $0.1 million principally due to
amortization of a covenant not to compete that was fully amortized in 1998.

     The provision for income taxes in 1999 relates to current state income tax
requirements.


Liquidity and Capital Resources

 Cash Flows

     As of September 30, 1999, the Company had approximately $49.1 million of
cash and cash equivalents and approximately $51.5 million of working capital.
Net cash generated by operations was approximately $48.9 million. Cash used in
investing activities was approximately $31.4 million, consisting of fixed asset
additions of $43.6 million less $12.2 million of net proceeds from the maturity
of restricted investments. Cash used in financing activities was approximately
$2.4 million consisting of $2.0 million for scheduled repayment of debt and $0.4
million of deferred financing costs.

     Earnings before interest, taxes, depreciation and amortization ("EBITDA"),
which excludes non-recurring charges and gain (loss) on sale of investments in
cellular operations, amounted to $53.5 million for the three months ended
September 30, 1999 compared to $36.8 million for 1998 or an increase of 45%.
Management believes that EBITDA is an effective measure of operating performance
because it is industry practice to use a multiple of

                                       8
<PAGE>

EBITDA as one method of evaluating cellular properties. EBITDA does not
represent cash flow from operations as defined by GAAP, and is not necessarily
indicative of cash available to fund all cash flow needs and should not be
considered as an alternative to net income. The Company expects to incur net
accounting losses for the foreseeable future due to interest and non-cash
charges such as depreciation and amortization.


 Liquidity and Capital Requirements

     The Company has long-term debt aggregating approximately $1.2 billion.
Substantially all such indebtedness was incurred to pay the consideration to the
PriCellular stockholders in the PriCellular Merger, repay the indebtedness of
PriCellular, pay the related fees and expenses and purchase the restricted
securities.

     The Company has $914 million outstanding under a bank syndicated Credit
Facility. The Credit Facility provides the Company up to $1 billion in four
tranches ($450 million on Tranche A, $200 million for each Tranche B and C, and
up to $150 million on the Revolver Loan). Interest is payable quarterly at the
adjusted prime rate plus the applicable margin for each tranche (0.625% for the
Revolver and Tranche A, 1.5% for Tranche B and 1.75% for Tranche C) or LIBOR
plus the applicable margin for each tranche (1.625% for the Revolver and Tranche
A, 2.750% for Tranche B and 2.750% for Tranche C), based on the Company's
consolidated leverage ratio. As of September 30, 1999, the interest rates
applicable on the tranches of the Credit Facility ranged from approximately
7.225% to 8.35%, yielding a weighted average rate of 7.76%. The Credit Facility
contains several financial covenants related to Company's leverage and debt
service ratios. The Company is in compliance with the terms of those covenants.
Other covenants also contain restrictions on the incurrence of additional debt,
the payment of dividends, the incurrence of liens, and payments and transfer of
net assets.

     As part of its interest rate management program, the Company utilizes
interest swap and collar agreements to hedge variable interest rate risk under
the Credit Facility. At September 30, 1999, the Company had interest rate
collars with an aggregate notional amount of $656.3 million, effectively fixing
the LIBOR rate between 5.38% and 6.00%, expiring in 2001. At September 30, 1999,
the Company had an interest rate swap with a notional amount of $98.3 million,
effectively fixing the LIBOR rate to 5.84%, expiring in 2001. The fair value of
the Company's interest rate agreements is $2.7 million at September 30, 1999
based on the current underlying spot rates.

     As a result of the PriCellular Merger, the Company has significant cash
requirements for debt service and expansion and operation of its cellular
systems. To meet its liquidity needs, the Company will rely on internally
generated funds, borrowings under the Revolver Loan of the Credit Facility, and
restricted securities. At September 30, 1999, the Company had $84 million
available under the Revolver Loan of the Credit Facility. A portion of the
Company's debt bears interest floating rates; therefore, its financial condition
is and will continue to be affected by changes in prevailing interest rates.

     For fiscal 1999, the Company intends to fund its interest obligations,
capital expenditures and working capital requirements with cash flows from
operations, borrowings under the Revolver Loan of the Credit Facility and the
restricted securities.  If the sale of the Company is not consummated, the
Company may need to raise additional capital to fund the acquisition and
integration of additional cellular systems, in future periods. The Company may
raise such funds through bank financings or public or private offerings of its
securities. There can be no assurance that the Company will be able to secure
such funding, if necessary, or on favorable terms. If the Company is not
successful in securing such funding, the Company's ability to pursue its
business strategy may be impaired and results of operations of future periods
may be adversely affected.

     The Company plans to continue to expand its marketing efforts which will
include, but are not limited to, an increase in funds for advertising, cellular
telephone inventory purchases and other expenditures relating to subscriber
growth. During the 1999 calendar year, American Cellular anticipates that it
will spend an aggregate of approximately $53 million in capital expenditures.
However, actual capital requirements may change. The ability of the Company to
meet its debt service obligations and reduce its total debt will be dependent on
the future performance of the Company, which in turn, will be subject to general
economic conditions and to financial, business and other factors, including
factors beyond the Company's control.

                                       9
<PAGE>

Year 2000 Issues

     The term "Year 2000 problem" is a general term used to describe the various
problems that may result from the improper processing of dates and time-
sensitive calculations by computers and other machinery as the year 2000 is
reached. These problems generally arise from the fact that most of the world's
computer hardware and software has historically used only two digits to identify
the year component of a date. This will often result in a computer reading a
date of "00" as meaning, 1900, and not 2000. Problems may also arise from other
sources, including the use of special codes and conventions in software that
make use of a date field.

     The Company's Year 2000 issue is primarily the result of the Company's
reliance on third party vendors for the major systems integral to its
operations. These systems include all hardware and software directly related to
the Company's cellular networks, interconnect systems which provide for the
delivery of data and voice messaging between the Company's networks and networks
of other carriers, information management systems that provide customer support
and billing functionality, and other administrative systems that support the
operations. The Company is also reliant upon third party manufacturers that
provide cellular telephone equipment and accessories that are sold to the
Company's subscribers. The Company is working with its vendors to ensure Year
2000 compliance of these systems. However, if required modifications to these
systems are not completed, the Year 2000 issue could have a material impact on
the operations of the Company.


 Status of Becoming Year 2000 Compliant

     The Company's Year 2000 readiness program involves the following four
phases: system assessment, remediation, testing and implementation. To date, the
Company has substantially completed its assessment of all systems that could be
significantly affected by the Year 2000 issue. The assessment indicated all of
the systems could be affected because of the heavy reliance on information
technology products and services. The assessment also indicated that hardware
and software used in administrative operations are also at risk. The Company has
been gathering information about the Year 2000 compliance status of its vendors
that support these systems. The Company's vendors are at various stages in their
Year 2000 compliance programs, and there is no assurance that each vendor will
achieve its goals. Additionally, the Company has identified all carriers that
provide direct interconnect services for local or long distance telephone
services and requested certification as to Year 2000 compliance. However, there
is no assurance that the Company will be able to test these systems beyond the
representations of these carriers.

     While management considers that the assessment phase of the Company's Year
2000 program is substantially completed, the Company will continue to review all
areas of operations to identify any other potential Year 2000 issues. In
addition, any new system that may be implemented during the remainder of the
year will be evaluated for Year 2000 compliance prior to the deployment of the
system.

     In the remediation phase, the Company is determining the Year 2000
compliance status of each component of each system identified as a risk during
the assessment phase. This process includes contacting each vendor and obtaining
representations regarding the Year 2000 compliance of that vendor's products as
it impacts the Company's systems. In the event that a product is determined to
be non-compliant, the Company is requesting information as to the vendor's
procedures to bring the product into compliance. The Company's vendors are at
various stages in their Year 2000 compliance programs, and there is no assurance
that each vendor will achieve its goals. This phase is approximately 98.8%
completed overall and is expected to be 100% completed by November, 1999.

     In the testing phase, the Company is performing its own evaluation of Year
2000 compliance and, to the extent possible, testing each system or component in
a forward date environment to insure compliance of the system. Although the
Company can verify Year 2000 compliance of its systems in this fashion, the
complexity and variability of systems to which the Company interconnects
prohibits the testing of the telecommunications network

                                       10
<PAGE>

as a whole. For example, the failure of a local power grid or local exchange
carrier as a result of a Year 2000 event will adversely affect the performance
of the Company's cellular network. This phase is approximately 98.8% completed
overall and is expected to be 100% completed by November, 1999.

     The implementation phase involves the deployment of Year 2000 compliant
software upgrades and patches into the operating systems, the development of
contingency plans and work around procedures for those systems found to be non-
compliant and the replacement of non-compliant hardware and software used in
administrative support functions. This phase is approximately 98.8% completed
overall and is expected to be 100% completed by November, 1999.

     No systems that are considered to be material to the operations and that
are not expected to be Year 2000 compliant have been identified. Set forth below
is a table of the various systems of the Company and the level of completion of
each of the phases of the Company's Year 2000 readiness program with respect to
such systems.


                            COMPLIANCE PROGRAM PHASE

<TABLE>
<CAPTION>
       Systems                Assessment             Remediation               Testing          Implementation
       -------                ----------             -----------               -------          --------------
<S>                     <C>                     <C>                     <C>                     <C>
Cellular
Networks.............   100% Completed          96.8% Completed         96.8% Completed         96.8% Completed

                                                Expected                Expected                Expected
                                                Completion Date         Completion Date         Completion Date
                                                November, 1999          November, 1999          November, 1999

Interconnect
Systems..............   100% Completed          99.1% Completed         0% Completed            99.1% Completed

                                                Expected                Expected                Expected
                                                Completion Date         Completion Date         Completion Date
                                                November, 1999          Not Applicable          November, 1999

Information
Management
Systems..............   100% Completed          99.3% Completed         99.3% Completed         99.3% Completed

                                                Expected                Expected                Expected
                                                Completion Date         Completion Date         Completion Date
                                                November, 1999          November, 1999          November, 1999
Other
Administrative
Systems..............   100% Completed          99.9% Completed         99.9% Completed         99.9% Completed

                                                Expected                Expected                Expected
                                                Completion Date         Completion Date         Completion Date
                                                November, 1999          November, 1999          November, 1999
</TABLE>


 Costs Related to Year 2000 Compliance

     The Company will utilize internal resources in completing its Year 2000
readiness plan. Company personnel are assigned specific tasks relating to Year
2000 compliance on the basis of technical skill and availability. The Company
does not account for the time spent on Year 2000 compliance as a separate item
as these costs are not incremental to the operations. The Company has budgeted
for software upgrade costs relating to

                                       11
<PAGE>

vendor software of approximately $100,000. The Company also anticipates an
additional $100,000 required to replace administrative hardware and software
that are not Year 2000 compliant. As of October 31, 1999, actual expenditures
for these items were approximately $75,000.


 Risks Associated with Year 2000 Issues

     Management believes that it has an effective program in place to resolve
those Year 2000 issues in which it can exert significant influence. As noted in
the table above, the program is not yet completed. In the event the Company does
not complete the additional phases of the program, the Company would be unable
to provide cellular telephone service, invoice customers or collect payments.
Disruption of cellular service would also negatively impact customer
satisfaction, which may impact future sales and growth of the operations. In
addition, disruptions in the economy generally resulting from Year 2000 issues
could materially adversely affect the Company. The amount of potential liability
or lost revenue to the Company cannot be reasonably estimated at this time.


 Year 2000 Contingency Plans

     The Company is in the process of developing contingency plans with its
primary vendors for cellular network operations and information management
services. These plans include detail recovery plans, vendor contacts and work
around procedures upon the occurrence of a Year 2000 event. The Company will
continue to evaluate the necessity and adequacy of its contingency plans as
additional information relating to the Year 2000 readiness of its vendors
becomes available.


 Year 2000 Forward-Looking Statements

     The foregoing Year 2000 discussions contain "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements, including without limitation, anticipated costs and dates by which
the Company expects to complete certain actions, are based on management's best
current estimates, which are derived utilizing numerous assumptions about future
events, including continued availability of certain resources, representations
derived from third parties and other factors. However, there can be no guarantee
that these estimates will be achieved, and the actual results could differ
materially from those anticipated. Specific factors that might cause such
material differences include, but are not limited to, the ability to identify
and remediate all relevant information technology and non-information technology
systems, results of Year 2000 testing, adequate resolution of Year 2000 issues
by business and other third parties who are service providers, suppliers or
customers of the Company, unanticipated system costs, the adequacy of and the
ability to develop and implement contingency plans and similar uncertainties.
The "forward-looking statements" made in the foregoing Year 2000 discussion
speak only as to the date such statements are made, and the Company undertakes
no obligation to update any forward-looking statement to reflect events or
circumstances after the date on which such statement is made or to reflect the
occurrence of unanticipated events. The foregoing information constitutes a Year
2000 readiness disclosure under the Year 2000 Information and Readiness
Disclosure Act.


Uncertainties Associated with Forward Looking Statements

     American Cellular has made in this Report, and from time to time may
otherwise make, statements which constitute forward looking statements. These
statements include statements regarding the intent, belief, plans or current
expectations of the Company, its directors or its officers primarily with
respect to the Company's operations and financial performance. Investors are
cautioned that any such forward looking statements are not guarantees of future
performance and involve risks and uncertainties, and that actual results may
differ materially from those in the forward looking statements as a result of
various factors. Some of these factors may include: (i) the Company's high
degree of leverage and the requirement for significant and sustained growth in
the Company's cash flow to meet its debt service requirements; (ii) the
Company's limited operating history, the Company's history of net losses

                                       12
<PAGE>

and the expectation of future losses; (iii) the Company's prospects in the event
of a general economic downturn; (iv) that the Company will be managed by a new
team of senior management; (v) that members of the Company's management have
other commitments; (vi) competition from the other cellular operator in the
Company's clusters or from other technologies; (vii) that new Systems and
Systems recently acquired may not perform as expected; (viii) that the
telecommunications industry is subject to rapid and significant changes in
technology; (ix) that the Company relies upon the registered service mark
CELLULAR ONE(R) to market the services of its non-wireline systems; (x) that
there is potential for adverse regulatory change and the need for renewal of
cellular licenses; (xi) fluctuations in market value of licenses; (xii)
equipment failure or natural disaster; (xiii) concerns about RF emissions; (xiv)
the costs associated with the unauthorized use of the Company's network; (xv)
that the Indenture governing the Notes imposes significant operating and
financial restrictions on the Company; (xvi) the potential effect of the pending
acquisition of the Company or the failure of such acquisition to occur; and
(xvii) the potential effect of Year 2000 computer issues.

Fluctuations in Quarterly Results

     Traditionally, subscriber revenues fluctuate from quarter to quarter and
are influenced by such factors as weather, holiday periods and typical vacation
periods. Additionally, losses are generally higher in the fourth quarter due to
the lower revenues coupled with higher sales and marketing costs incurred during
the holiday sales season.

                                       13
<PAGE>

                          PART II. OTHER INFORMATION

Item 1.   LEGAL PROCEEDINGS

          The Company is not currently involved in any pending legal proceedings
that individually, or in the aggregate, are material to the Company.


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

          The Company held a special meeting of stockholders on October 5, 1999
(the "Special Meeting"). At such Special Meeting, the following matters were
submitted to the stockholders for approval: (1) the acquisition of the Company
by a newly-formed joint venture of Dobson Communications Corporation and AT&T
Wireless Systems, Inc. pursuant to an Agreement and the Plan of Merger, dated as
of October 5, 1999 (the "Merger Agreement"), and the transactions contemplated
thereby, and (2) the payments and benefits, including the acceleration of the
timing of such payments, to executive officers and other employees holding
shares of Class B common stock of the Company to be made or which could be made
in connection with the transactions contemplated by the Merger Agreement in
accordance with Section 280G of the Internal Revenue Code of 1986, as amended
(the "Executive Payments"). With respect to the approval of proposed acquisition
of the Company pursuant to the Merger Agreement and the transactions
contemplated by the Merger Agreement, 250,386 shares were in favor, 357 shares
abstained and 3,929 shares were absent. With respect to the approval of the
Executive Payments, 243,214 shares were in favor, 7,529 shares abstained and
3,929 shares were absent.


Item 5.   OTHER INFORMATION

          On October 5, 1999, the Company entered into the Merger Agreement
pursuant to which a newly-formed joint venture of Dobson Communications
Corporation and AT&T Wireless Systems, Inc. will, subject to the terms and
conditions set forth in the Merger Agreement, acquire the Company by merging a
wholly-owned subsidiary of the joint venture with and into the Company (the
"Merger"). Pursuant to the Merger Agreement, each share of Class A common
stock, par value $.01 per share, of the Company will, at the effective time of
the Merger (the "Effective Time"), be converted into the right to receive
$3,244.24 per share in cash, plus interest thereon for the period commencing
January 1, 2000 through and including the closing date at a rate of 8% per
annum (the "Common Stock Purchase Price"). As provided in the Merger
Agreement, the Common Stock Purchase Price is subject to adjustment in the
event any shares of common stock are repurchased by the Company pursuant to
stock repurchase rights prior to the Effective Time.

          The Merger Agreement further provides that each share of non-voting
Class B common stock, par value $.01 per share, of the Company issued and
outstanding immediately prior to the Effective Time will become fully vested and
will automatically be converted into one share of Class A common stock at the
Effective Time in accordance with the terms of the grant thereof and, as such,
will thereupon be subject to conversion into the right to receive the Common
Stock Purchase Price. In addition, each share of non-voting Series A Preferred
Stock, par value $.01 per share, of the Company issued and outstanding
immediately prior to the Effective Time will, consistent with the terms of such
preferred stock designated in the Company's certificate of incorporation, be
converted at the Effective Time into the right to receive $100 per share in cash
plus all accrued but unpaid dividends thereon to and including the Effective
Time.

          Concurrent with the execution of the Merger Agreement, certain
stockholders of the Company executed a Stockholder Voting Agreement, dated as of
October 5, 1999, pursuant to which, among other things, such stockholders agreed
to vote all shares beneficially owned by such persons in favor of the Merger and
each of the other transactions contemplated by the Merger Agreement at any
meeting of the Company's stockholders in connection with the Merger (or
otherwise to consent in writing thereto, as the case may be). A majority of the
stockholders of the Company voted to approve the Merger Agreement and the
transactions contemplated thereby, including the Merger, at the Special Meeting.

          The completion of the Merger, which is expected to close in the first
quarter of 2000, is subject to certain conditions, including the expiration or
earlier termination of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the approval of the Federal
Communications Commission.  There can be no assurance that the Merger will be
consummated.


Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a) Exhibits:

          The exhibits to this Report are listed on the Exhibit Index included
          elsewhere herein.

          (b) Reports on Form 8-K:

          None.

                                       14
<PAGE>

                                  SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                        AMERICAN CELLULAR CORPORATION
                                        Registrant




                                        By:   /s/ John Fujii
                                            --------------------------------
                                                  John Fujii
                                            Chief Executive Officer


                                        By:   /s/ James J. Walter, Jr
                                            --------------------------------
                                                  James J. Walter, Jr.
                                            Vice President of Finance,
                                            Chief Financial Officer
                                                  and Secretary


Dated: November 15, 1999

                                       15
<PAGE>

                                 EXHIBIT INDEX


    Exhibit
      No.                                      Description
    -------                                    -----------

      9.1         Form of Stockholder Voting Agreement dated as of October 5,
                  1999 by and among American Cellular Corporation, ACC
                  Acquisition LLC, ACC Acquisition Co. and the stockholders
                  party thereto.

     10.1         Agreement and Plan of Merger dated as of October 5, 1999 among
                  ACC Acquisition LLC, ACC Acquisition Co. and American Cellular
                  Corporation.

     10.2         Form of Termination Agreement dated as of October 5, 1999 by
                  and among American Cellular Corporation and the stockholders
                  party thereto.

     27.1         Financial Data Schedule for the nine months ended September
                  30, 1999.