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 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002

                                       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: 333-51240

                                HORIZON PCS, INC.
             (Exact name of Registrant as specified in its charter)

        DELAWARE                                        31-1707839
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


        68 EAST MAIN STREET
         CHILLICOTHE, OHIO                              45601-0480
(Address of principal executive offices)                (Zip Code)

                                 (740) 772-8200
              (Registrant's telephone number, including area code)


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

As of  October  31,  2002,  there  were  26,646  shares of class A common  stock
outstanding and 58,445,288 shares of class B common stock outstanding.



<PAGE>

                                HORIZON PCS, INC.
                                    FORM 10-Q
                              THIRD QUARTER REPORT

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

PART I FINANCIAL INFORMATION

   ITEM 1.  Financial Statements...............................................1

   ITEM 2.  Management's Discussion and Analysis of Financial Condition
            and Results of Operations.........................................14

   ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk........33

   ITEM 4.  Controls and Procedures...........................................33

PART II     OTHER INFORMATION

   ITEM 1.  Legal Proceedings.................................................34

   ITEM 2.  Changes in Securities and Use of Proceeds.........................34

   ITEM 3.  Defaults Upon Senior Securities...................................34

   ITEM 4.  Submission of Matters to a Vote of Security Holders...............34

   ITEM 5.  Other Information.................................................34

   ITEM 6.  Exhibits and Reports on Form 8-K..................................48

     Horizon PCS, Inc.  ("Horizon PCS"), is the issuer of 14.00% Senior Discount
Notes  ("discount  notes") due October 1, 2010, and 13.75% Senior Notes ("senior
notes") due June 15, 2011.  The discount notes and senior notes were the subject
of  exchange  offers  that were  registered  with the  Securities  and  Exchange
Commission ("SEC") (Registration No. 333-51238 and 333-85626, respectively). The
Co-Registrants  are Horizon Personal  Communications,  Inc. ("HPC"),  and Bright
Personal  Communications  Services,  LLC  ("Bright  PCS"),   collectively,   the
"Operating Companies," which are wholly-owned  subsidiaries of Horizon PCS. Each
of the Operating Companies has provided a full, unconditional, joint and several
guaranty  of  Horizon  PCS'  obligations  under the  notes.  Horizon  PCS has no
operations separate from its investment in the Operating Companies.  Pursuant to
Rule  12h-5 of the  Securities  Exchange  Act of  1934,  no  separate  financial
statements and other disclosures  concerning the Operating  Companies other than
narrative  disclosures  set  forth in the  Notes to the  Consolidated  Financial
Statements  have been  presented  herein.  Concurrent  with the  offering of the
discount notes discussed above,  Horizon PCS issued 295,000 warrants to purchase
up to 3,805,000  shares of Horizon PCS' class A common stock.  The warrants were
registered with the SEC (Registration No. 333-51240).  As used herein and except
as the  context  otherwise  may  require,  the  "Company,"  "we," "us," "our" or
"Horizon  PCS"  means,  collectively,  Horizon  PCS,  Inc.,  and  the  Operating
Companies.

                                      -i-

<PAGE>



                          PART I.  FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

HORIZON PCS, INC.

Consolidated Balance Sheets
As of September 30, 2002, and December 31, 2001
--------------------------------------------------------------------------------

                                                    September 30,   December 31,
                                                        2002             2001
                                                    -------------  -------------
                                                     (unaudited)
ASSETS
------
CURRENT ASSETS:
  Cash and cash equivalents (includes
   $71,000,000 on deposit in accordance with
   covenant amendment in 2002)................... $ 109,131,378   $ 123,775,562
  Restricted cash.................................    24,062,500      24,597,222
  Accounts receivable-- subscriber, less
   allowance for doubtful accounts of
   approximately $2,377,000 and $1,804,000 at
   September 30, 2002, and December 31, 2001,
   respectively...................................    22,118,741      14,293,771
  Receivable from affiliates......................       152,765         100,437
  Receivable from Parent..........................         2,105         483,785
  Equipment inventory.............................     2,653,004       3,845,433
  Prepaid expenses and other current assets.......     1,976,755         840,970
                                                  --------------   -------------
      Total current assets........................   160,097,248     167,937,180
                                                  --------------   -------------

OTHER ASSETS:
   Restricted cash................................    12,032,009      24,062,500
   Intangible asset -- Sprint PCS licenses,
    net of amortization...........................    40,996,035      42,840,534
   Goodwill.......................................     7,191,180       7,191,180
   Debt issuance costs, net of amortization.......    21,063,918      20,437,556
   Deferred activation expense and other assets...     5,706,252       4,001,436
                                                  --------------   -------------
      Total other assets..........................    86,989,394      98,533,206
                                                  --------------   -------------

PROPERTY AND EQUIPMENT, NET                          243,640,695     214,867,858
                                                  --------------   -------------

           Total assets...........................$  490,727,337   $ 481,338,244
                                                  ==============   =============


(Continued on next page)



                                       1
<PAGE>



HORIZON PCS, INC.

Consolidated Balance Sheets (continued)
As of September 30, 2002, and December 31, 2001
<TABLE>
<CAPTION>
<S>                                                 <C>             <C>
                                                    September 30,   December 31,
                                                        2002            2001
                                                    -------------   ------------
                                                     (unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
CURRENT LIABILITIES:
  Accounts payable................................ $  19,132,000   $  26,444,888
  Accrued liabilities.............................    13,852,759      10,583,505
  Payable to Sprint...............................    14,865,582      10,244,529
  Deferred service revenue........................     4,926,404       3,712,734
                                                   -------------   -------------
        Total current liabilities.................    52,776,745      50,985,656
                                                   -------------   -------------

LONG-TERM LIABILITIES:
  Long-term debt, net of discount.................   509,008,999     384,055,643
  Other long-term liabilities.....................     9,155,832       9,106,625
  Deferred activation revenue.....................     5,485,129       3,808,618
                                                   -------------   -------------
        Total long-term liabilities...............   523,649,960     396,970,886
                                                   -------------   -------------
          Total liabilities.......................   576,426,705     447,956,542
                                                   -------------   -------------

COMMITMENTS AND CONTINGENCIES (Note 6)

CONVERTIBLE PREFERRED STOCK.......................   154,067,678     145,349,043

STOCKHOLDERS' EQUITY (DEFICIT):
  Preferred stock, 10,000,000 shares
   authorized, none issued or outstanding,
   at $0.0001 par value...........................            --              --
  Common stock-- class A, 300,000,000 shares
   authorized, 26,646 issued and outstanding,
   at $0.0001 par value...........................             3               3
  Common stock-- class B, 75,000,000 shares
   authorized, 58,458,354 issued and 58,445,288
   outstanding....................................         5,846           5,846
  Treasury stock-- class B, 13,066 shares,
   at $8.50 per share.............................      (111,061)       (111,061)
  Accumulated other comprehensive income (loss)...      (697,123)       (837,851)
  Additional paid-in capital......................    91,852,117      91,852,117
  Deferred stock option compensation..............    (1,055,934)     (1,566,496)
  Retained deficit................................  (329,760,894)   (201,309,899)
                                                   -------------   -------------
          Total stockholders' equity (deficit)....  (239,767,046)   (111,967,341)
                                                   -------------   -------------
            Total liabilities and
            stockholders' equity (deficit)........ $ 490,727,337   $ 481,338,244
                                                   =============   =============
</TABLE>

                 The accompanying notes are an integral part of
                     these consolidated financial statements



                                       2
<PAGE>


HORIZON PCS, INC.

Consolidated Statements of Operations
For the Three and Nine Months Ended
September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>                                      <C>             <C>            <C>             <C>

                                         For the Three Months Ended     For the Nine Months Ended
                                                 September 30,                September 30,
                                         -----------------------------  -----------------------------
                                              2002           2001            2002           2001
                                         --------------  -------------  --------------  -------------
OPERATING REVENUES:
 Subscriber revenues.................... $   39,280,826  $  21,390,868  $  111,396,359  $  48,988,849
 Roaming revenue........................     14,993,078     11,792,956      38,928,318     25,645,305
 Equipment revenues.....................      1,787,076      2,020,282       5,760,004      4,595,019
                                         --------------  -------------  --------------  -------------
      Total operating revenues..........     56,060,980     35,204,106     156,084,681     79,229,173
                                         --------------  -------------  --------------  -------------

OPERATING EXPENSES:
 Cost of service (exclusive of
  items shown separately below).........     43,849,786     29,186,623     120,896,437     68,263,060
 Cost of equipment......................      3,973,789      4,125,835      12,635,078      8,628,244
 Selling and marketing..................     13,027,292     12,636,251      38,958,652     30,038,584
 General and administrative
  (exclusive of items shown
  separately below).....................     10,889,063      7,190,155      30,333,438     19,265,873
 Non-cash compensation .................        170,188        177,237         510,562      1,256,611
 Depreciation and amortization..........      9,302,721      5,158,645      30,232,128     12,980,231
                                         --------------  -------------  --------------  -------------
    Total operating expenses............     81,212,839     58,474,746     233,566,295    140,432,603
                                         --------------  -------------  --------------  -------------

OPERATING LOSS..........................    (25,151,859)   (23,270,640)    (77,481,614)   (61,203,430)

   Gain (Loss) on disposal of
     property and equipment                       9,961             --        (631,042)            --
   Loss on exchange of stock............             --             --              --       (399,673)
   Interest income and other, net.......        719,755        580,822       2,464,464      4,846,253
   Interest expense, net of amounts
     capitalized........................    (15,889,818)    (5,996,762)    (44,084,140)   (18,674,198)
                                         --------------  -------------  --------------  -------------

LOSS ON OPERATIONS BEFORE
 INCOME TAXES........................       (40,311,961)   (28,686,580)   (119,732,332)   (75,431,048)
                                         --------------  -------------  --------------  -------------

INCOME TAX EXPENSE...................                --             --              --             --
                                         --------------  -------------  --------------  -------------

NET LOSS.............................       (40,311,961)   (28,686,580)   (119,732,332)   (75,431,048)
                                         --------------  -------------  --------------  -------------

PREFERRED STOCK DIVIDENDS............        (3,005,897)    (2,816,053)     (8,718,663)    (8,169,630)
                                         --------------  -------------  --------------  -------------

NET LOSS AVAILABLE TO COMMON
 STOCKHOLDERS........................    $  (43,317,858) $ (31,502,633) $ (128,450,995) $ (83,600,678)
                                         ==============  =============  ==============  =============

Basic and diluted net loss
   per share available to common
   stockholders.....................     $        (0.74) $       (0.54) $        (2.20) $       (1.43)
                                         ==============  =============  ==============  =============
Basic and diluted weighted-average
   common shares outstanding.........        58,471,934     58,471,934      58,471,934     58,471,934
                                         ==============  =============  ==============  =============

</TABLE>


              The accompanying notes are an integral part of these
                        consolidated financial statements


                                       3
<PAGE>




HORIZON PCS, INC.

Consolidated Statements of Comprehensive Income (Loss)
For the Three and Nine Months Ended
September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>                                      <C>            <C>            <C>            <C>

                                         For the Three Months Ended     For the Nine Months Ended
                                                 September 30,                September 30,
                                         ---------------------------   ---------------------------
                                             2002           2001           2002           2001
                                         -------------  ------------   -------------  ------------

NET LOSS.............................    $(40,311,961)  $(28,686,580)  $(119,732,332) $ (75,431,048)
                                         =============  ============   ============== ==============

OTHER COMPREHENSIVE INCOME (LOSS):
  Net unrealized gain (loss)
  on hedging activities..............          20,686       (326,108)        140,728       (679,181)
                                         -------------  -------------  -------------- --------------

COMPREHENSIVE INCOME (LOSS)..........    $(40,291,275)  $(29,012,688)  $(119,591,604) $ (76,110,229)
                                         =============  =============  ============== ==============

</TABLE>


              The accompanying notes are an integral part of these
                        consolidated financial statements



                                       4
<PAGE>



HORIZON PCS, INC.

Consolidated Statements of Cash Flow
For the Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>                                                <C>             <C>
                                                    For the Nine Months Ended
                                                          September 30,
                                                   -----------------------------
                                                        2002           2001
                                                   -------------   -------------

CASH FLOWS FROM OPERATING ACTIVITIES:
     Net loss....................................  $ (119,732,332) $ (75,431,048)
                                                   --------------  -------------
 Adjustments to reconcile net loss to net
     cash used in operating activities:
     Depreciation and amortization...............      30,232,128     12,980,231
     Non-cash interest expense...................      20,222,946     13,804,012
     Non-cash compensation expense...............         510,562      1,256,611
     Loss on exchange of stock...................              --        399,673
     Loss on hedging activities..................          48,536         83,689
     Loss on disposal of property and equipment..         631,042             --
     Provision for doubtful accounts receivable..      11,939,941      3,780,912
     Change in:
       Accounts receivable.......................     (19,764,911)   (10,663,771)
       Equipment inventory.......................       1,192,429        280,913
       Prepaid expenses and other................      (1,135,785)     2,838,615
       Accounts payable..........................      (7,312,890)   (21,034,492)
       Accrued liabilities and deferred service
         revenue.................................      17,048,138      2,562,621
       Payable to Sprint.........................       4,621,053      3,783,467
       Change in receivable/payable from
         affiliates and Parent...................         429,352      1,278,441
       Change in other assets and liabilities, net        104,401       (405,671)
                                                     ------------  -------------
         Total adjustments.......................      58,766,942     10,945,251
                                                     ------------  -------------
         Net cash used in operating activities...     (60,965,390)    64,485,797)
                                                     ------------  -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures........................     (57,620,672)   (90,350,650)
     Dividends received..........................              --         (4,311)
     Proceeds from the sale of property and
       equipment.................................       1,563,970             --
     Proceeds from redemption of RTFC
       capital certificates......................              --      2,895,646
                                                     ------------  -------------
         Net cash used in investing activities...     (56,056,702)   (87,459,315)
                                                     ------------  -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Deferred financing fees.....................      (2,622,092)    (1,267,278)
     Borrowings on long-term debt................     105,000,000             --
                                                     ------------   ------------
         Net cash provided by financing activities    102,377,908     (1,267,278)
                                                     ------------   ------------
NET INCREASE (DECREASE) IN CASH AND CASH
 EQUIVALENTS.....................................     (14,644,184)  (153,212,390)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD...     123,775,562    191,417,394
                                                     ------------  -------------
CASH AND CASH EQUIVALENTS, END OF PERIOD.........    $109,131,378  $  38,205,004
                                                     ============  =============
</TABLE>


              The accompanying notes are an integral part of these
                        consolidated financial statements



                                       5
<PAGE>



HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 1 - GENERAL

     The  results  of  operations  for the  periods  shown  are not  necessarily
indicative  of the results to be expected for the fiscal year. In the opinion of
management,  the information contained herein reflects all adjustments necessary
to make a fair  statement  of the results for the  periods  presented.  All such
adjustments  are  of  a  normal  recurring  nature.  The  financial  information
presented  herein should be read in conjunction with the Company's Form 10-K for
the year ended December 31, 2001, which includes information and disclosures not
presented herein.

NOTE 2 - ORGANIZATION AND BUSINESS OPERATIONS

     On April 26, 2000,  Horizon Telcom,  Inc.  ("Parent" or "Horizon  Telcom"),
formed Horizon PCS, Inc. The Company provides wireless  personal  communications
services  ("PCS")  as a PCS  affiliate  of Sprint  Corporation  ("Sprint").  The
Company  entered into  management  agreements  with Sprint during 1998 and 1999.
These  agreements,  as amended,  provide the Company with the exclusive right to
build,  own, and manage a wireless  voice and data  services  network in markets
located  in  Ohio,  West  Virginia,  Kentucky,  Virginia,  Tennessee,  Maryland,
Pennsylvania,  New York, New Jersey,  Michigan, North Carolina and Indiana under
the Sprint PCS brand.  The  Company is required  to build the  wireless  network
according to Sprint's specifications. The term of the agreements is twenty years
with three successive ten-year renewal periods unless terminated by either party
under  provisions  outlined  in  the  management   agreements.   The  management
agreements  include  indemnification  clauses  between the Company and Sprint to
indemnify  each party  against  claims  arising from  violations  of laws or the
management  agreements,  other than  liabilities  resulting  from  negligence or
willful misconduct of the party seeking to be indemnified.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Note 3 in the Notes to Consolidated  Financial  Statements in the Company's
Annual Report on Form 10-K for the year ended  December 31, 2001,  describes the
Company's significant accounting policies in greater detail than the disclosures
presented herein.

BASIS OF PRESENTATION

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared  in  accordance  with the rules  and  regulations  of the SEC.  Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance  with  generally  accepted  accounting  principles in the
United  States  have  been  condensed  or  omitted  pursuant  to such  rules and
regulations.  The statements  herein include the accounts of the Company and its
wholly-owned  subsidiaries,  HPC  and  Bright  PCS.  All  material  intercompany
transactions and balances have been eliminated.

ESTIMATES

     The  preparation  of financial  statements  in  conformity  with  generally
accepted accounting  principles in the United States requires management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting  period.  Actual results could differ materially from those
estimates.  See  "Critical  Accounting  Policies"  under  "Item 2.  Management's
Discussion and Analysis of Financial  Results and  Operations" of this Form 10-Q
for further information regarding estimates.


                                       6
<PAGE>

HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

RESTRICTED CASH

     In connection with the Company's  December 2001 offering of $175,000,000 of
senior notes, the first four semi-annual  interest  payments due under the terms
of the notes were placed in escrow.  Amounts to be paid toward interest payments
due within twelve months of the balance sheet date have been classified as short
term. The first interest payment on the senior notes was made in June 2002.

PROPERTY AND EQUIPMENT

     Property and equipment,  including  improvements  that extend useful lives,
are stated at  original  cost,  while  maintenance  and  repairs  are charged to
operations as incurred.  Construction work in progress includes expenditures for
the  purchase  of  capital  equipment,  construction  and  items  such as direct
payroll-related  benefits  and interest  capitalized  during  construction.  The
Company  capitalizes  interest  pursuant to Statement  of  Financial  Accounting
Standards ("SFAS") No. 34, "Capitalization of Interest Cost."

     The  Company  accounts  for  long-lived   assets  in  accordance  with  the
provisions  SFAS  No.  144,  "Accounting  for  the  Impairment  or  Disposal  of
Long-Lived  Assets."  SFAS  No.  144  requires  long-lived  assets  and  certain
identifiable  intangibles be reviewed for impairment  whenever events or changes
in  circumstances   indicate  the  carrying  amount  of  an  asset  may  not  be
recoverable.  Recoverability  of  assets  to be held and used is  measured  by a
comparison of the carrying  amount of an asset to future  undiscounted  net cash
flows  expected  to be  generated  by the  asset.  If assets are  impaired,  the
impairment  to be  recognized  is measured  by the amount by which the  carrying
amount of the assets exceeds the fair value of the assets. Assets to be disposed
of are reported at the lower of the carrying amount or fair value, less costs to
sell.

DERIVATIVE FINANCIAL INSTRUMENTS

     The  Company  has  adopted  SFAS  No.  133,   "Accounting   for  Derivative
Instruments and Hedging Activities," as amended by SFAS No. 138, "Accounting for
Derivative Instruments and Certain Hedging Activities." These statements require
an entity  recognize  all  derivatives  and  hedging  activities  as an asset or
liability  measured  at  fair  value.  Depending  on  the  intended  use  of the
derivative,  changes in its fair value will be  reported in the period of change
as either a component of earnings or a component of other comprehensive  income.
The Company uses interest rate swaps,  designated as cash flow hedges, to manage
interest  rate risk.  The net amount paid or received on interest  rate swaps is
recognized as an adjustment to interest expense. Outstanding temporary gains and
losses are netted  together  and shown as either a component  of other assets or
other long-term liabilities.

REVENUE RECOGNITION

     The Company sells handsets and  accessories  which are recorded at the time
of the sale as  equipment  revenue.  After the handset has been  purchased,  the
subscriber purchases a service package which is recognized monthly as service is
provided  and is included as  subscriber  revenue.  The Company  defers  monthly
service  revenue billed in advance.  Roaming revenue is recorded when Sprint PCS
subscribers  not  based  in  the  Company's  network  area  and  non-Sprint  PCS
subscribers roam onto the Company's network. The roaming rate with Sprint PCS is
determined  between the Company and Sprint,  while the roaming  rate  charged to
other wireless carriers is negotiated by Sprint on the Company's behalf.

     The Company  accounts  for the  recognition  of  activation  fee revenue in
accordance with the current  interpretations  of SEC Staff  Accounting  Bulletin
("SAB") No. 101,  "Revenue  Recognition in Financial  Statements."  Accordingly,
activation  fee revenue and direct  activation-related  expense are deferred and
will be recorded as subscriber  revenues and selling and marketing  expense over
the average life for those customers  assessed an activation  fee,  currently 30
months.


                                       7
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     The Company  records 100% of PCS  subscriber  revenues from our  customers,
roaming  revenues  from  Sprint PCS  subscribers  based  outside our markets and
non-Sprint  PCS roaming  revenues.  Sprint  retains 8% of all collected  service
revenue as a management fee.  Collected  service revenues include PCS subscriber
revenues and  non-Sprint  PCS roaming  revenues,  but exclude Sprint PCS roaming
revenues,  roaming charges billed to our customers for roaming onto a non-Sprint
PCS network and revenues from sales of equipment. The amounts retained by Sprint
are reported as general and administrative expense.

NET LOSS PER SHARE

     The Company  computes net loss per common share in accordance with SFAS No.
128,  "Earnings  per Share" and SAB No. 98. Basic and diluted net loss per share
available to common  stockholders  is computed by dividing net loss available to
common stockholders for each period by the  weighted-average  outstanding common
shares.  No  conversion  of common  stock  equivalents  has been  assumed in the
calculations since the effect would be antidilutive.  As a result, the number of
weighted-average outstanding common shares as well as the amount of net loss per
share is the same for basic and diluted net loss per share  calculations for all
periods  presented.  There are three items that could  potentially  dilute basic
earnings per share in the future.  These items  include  common  stock  options,
stock purchase  warrants and convertible  preferred  stock.  These items will be
included in the diluted earnings per share calculation when dilutive.

RECENT ACCOUNTING PRONOUNCEMENTS

     In June 2002 the Financial  Accounting Standards Board ("FASB") issued SFAS
No. 146,  "Accounting for Costs  Associated  with Exit or Disposal  Activities."
This Statement addresses financial accounting and reporting for costs associated
with exit or disposal  activities by requiring that expenses related to the exit
of an activity or disposal of  long-lived  assets will be recorded when they are
incurred and  measurable.  Prior to SFAS No. 146,  these charges were accrued at
the time of commitment to exit or dispose of an activity. The Company will adopt
SFAS 146 on January 1, 2003, and it is not expected to have a material effect on
the Company's financial position, results of operations or cash flows.

     In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No.  4,  44  and  64,   Amendment  of  FASB  Statement  No.  13,  and  Technical
Corrections."  SFAS No. 145 addresses the  accounting  for gains and losses from
the  extinguishment  of debt,  economic  effects  and  accounting  practices  of
sale-leaseback   transactions  and  makes  technical   corrections  to  existing
pronouncements. The Company adopted SFAS No. 145 on July 1, 2002, and it has not
had a material effect on the Company's financial position, results of operations
or cash flows.

     In  August  2001,  the  FASB  issued  SFAS  No.  144,  "Accounting  for the
Impairment or Disposal of Long-Lived  Assets." SFAS No. 144 addresses  financial
accounting and reporting for the impairment of long-lived  assets. The statement
supersedes SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and
for  Long-Lived  Assets to Be Disposed  Of," and the  accounting  and  reporting
provisions of APB Opinion No. 30. SFAS No. 144 removes  goodwill from its scope,
as goodwill is addressed in the impairment  test  described  under SFAS No. 142.
The Company  adopted SFAS No. 144 on January 1, 2002.  See Note 4 for discussion
on the impact of the adoption of this statement.

     In June  2001,  the  FASB  issued  SFAS  No.  143,  "Accounting  for  Asset
Retirement  Obligations."  This  statement  addresses  financial  accounting and
reporting for obligations associated with the retirements of tangible long-lived
assets  and  the  associated  asset  retirement   costs.  It  applies  to  legal
obligations  associated  with the  retirement  of long- lived assets that result
from the  acquisition,  construction,  development and the normal operation of a
long-lived  asset.  The Company will adopt this statement  effective  January 1,
2003,  and  it is not  expected  to  have a  material  effect  on the  Company's
financial position, results of operations or cash flows.



                                       8
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     The Company adopted SFAS No. 141, "Business Combinations" and SFAS No. 142,
"Goodwill  and Other  Intangible  Assets" on January 1, 2002. As a result of the
adoption,  goodwill amortization ceased as of December 31, 2001, and the Company
is required to complete an  impairment  test of its remaining  goodwill  balance
annually (or more frequently if impairment  indicators  arise).  As of September
30, 2002, the Company has goodwill of approximately  $7,191,000,  related to the
acquisition of Bright PCS. See Note 8 herein for additional information.

RECLASSIFICATIONS

     Certain prior year amounts have been  reclassified to conform with the 2002
presentation.  Management  believes  the  reclassifications  are  immaterial  to
previously reported financial statements.

NOTE 4 - PROPERTY AND EQUIPMENT

     Property and equipment consists of the following:

                                                  September 30,    December 31,
                                                      2002             2001
                                                  -------------   -------------
       Network assets...........................  $ 187,626,930    $134,257,788
       Switching equipment......................     67,151,493      35,253,986
       Furniture, vehicles and
         office equipment.......................      9,803,635      10,137,175
       Land.....................................        966,689         966,689
                                                  -------------   -------------
       Property and equipment in
         service, cost..........................    265,548,747     180,615,638
       Accumulated depreciation.................    (42,597,495)    (22,478,697)
                                                  -------------   -------------
       Property and equipment in service, net...    222,951,252     158,136,941
       Construction work in progress............     20,689,443      56,730,917
                                                  -------------   -------------
           Total property and equipment, net....  $ 243,640,695    $214,867,858
                                                  =============   =============

     The   Company   capitalized   interest   and   labor-related   expenses  of
approximately  $6,148,000 and $7,207,000 for the nine months ended September 30,
2002 and 2001, respectively.

     During 2002, the Company  launched  switches in Tennessee and  Pennsylvania
and  disconnected  some switching  equipment in Chillicothe,  Ohio. As a result,
approximately  $6.2 million of switching  equipment  is  considered  an impaired
asset as defined by SFAS No. 144.  Accordingly,  depreciation  and  amortization
expense for the nine months ended  September  30, 2002,  includes  approximately
$3.5 million  related to accelerated  depreciation  on the impaired  asset.  The
total amount of depreciation recorded to date on this equipment is approximately
$5.8 million. The residual book value of $400,000 approximates fair market value
at September 30, 2002, based on quoted market prices.


                                       9
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 5 - LONG-TERM DEBT

     The components of long-term debt outstanding are as follows:

                                 Interest Rate at   September 30,   December 31,
                                September 30, 2002      2002           2001
                                ------------------  -------------  -------------
Discount notes....................     14.00%       $295,000,000   $295,000,000
Senior notes......................     13.75%        175,000,000    175,000,000
Secured credit facility -
  term loan A.....................      5.80%        105,000,000             --
Secured credit facility -
  term loan B.....................      6.32%         50,000,000     50,000,000
                                                    -------------  -------------
Long-term debt, face value........                   625,000,000    520,000,000
Less: unaccreted interest
  portion of discount notes.......                  (115,991,001)  (135,944,357)
                                                    -------------  -------------
    Total long-term debt, net.....                 $ 509,008,999  $ 384,055,643
                                                    =============  =============

     As of September 30, 2002, Horizon PCS had $95.0 million committed under the
Company's  secured credit facility in the form of a line of credit at a variable
interest  rate equal to the London  Interbank  Offered Rate  ("LIBOR")  plus 400
basis points.

     Horizon PCS' secured credit facility includes financial covenants that must
be met each quarter.  The Company did not meet the covenant for earnings  before
interest,  taxes, depreciation and amortization ("EBITDA") for the first quarter
of 2002. As a result of higher than expected  gross and net additions to Horizon
PCS subscribers for that quarter,  the Company incurred  additional  expenses to
add those customers.  Although the Company ultimately benefits from the revenues
generated by new subscribers,  the Company incurs one-time  expenses  associated
with new subscribers, including commissions, handset subsidies, set up costs for
the network and marketing  expenses.  As a result,  these new  subscriber  costs
negatively  affect EBITDA in the short-term during the period of the addition of
new subscribers,  which led to  non-compliance  with the EBITDA covenant for the
first quarter of 2002.

     On June 27, 2002, the Company obtained a waiver of the non-compliance  with
the EBITDA  covenant for the first quarter of 2002 and entered into an amendment
of the secured credit facility.  The amended facility  primarily adjusts certain
financial  covenants  and  increases  the margin on the base interest rate by 25
basis points, while also providing for the payment of fees to the banking group,
an increase in post-default  interest rates, a new financial  covenant regarding
minimum available cash, additional prepayment requirements,  restrictions on the
Company's  borrowings  committed  under the remaining  $95.0  million  revolving
credit  facility  and  deposit  requirements  on the use of the  $105.0  million
borrowed under the secured credit facility in March 2002. This amendment and its
requirements  are  described  in detail in the Form 8-K filed by the  Company on
June 27,  2002  (See also  "Liquidity  and  Capital  Resources"  under  "ITEM 2.
Management's  Discussion  and  Analysis of  Financial  Condition  and Results or
Operations" included in this Form 10-Q).

NOTE 6 - COMMITMENTS AND CONTINGENCIES

SPRINT 3G DEVELOPMENT FEES

     Recently,  Sprint has sought to increase  service fees during the remainder
of 2002 and beyond in connection with its development of 3G-related  back-office
systems and platforms.  The Company,  along with other PCS affiliates of Sprint,
is currently  disputing the validity of Sprint's  right to pass through this fee
to the affiliates.  If this dispute is resolved unfavorably to the Company, then
Horizon PCS will incur additional expenses.


                                       10
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 6 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

OPERATING LEASES

     The  Company  leases  office  space and  various  equipment  under  several
operating leases. In addition, the Company has tower lease agreements with third
parties whereby the Company leases towers for substantially all of the Company's
cell sites.  The tower  leases are  operating  leases with a term of five to ten
years with three consecutive five-year renewal option periods.

     The Company also leases space for its retail stores. At September 30, 2002,
the  Company  leased  39 of  its  40  retail  stores  operating  throughout  its
territories.

     The following table summarizes the annual lease payments required under the
Company's existing lease agreements at September 30, 2002.

                                                        Period ending
         Year                                            December 31
         ----                                           -------------
         Fourth quarter of 2002........................ $  2,688,000
         2003...........................................  15,674,000
         2004...........................................  14,862,000
         2005...........................................  12,158,000
         2006...........................................   7,338,000
         April 2004.....................................  10,016,000
                                                        ------------
         Future operating lease obligation............. $ 62,736,000
                                                        ============

CONSTRUCTION EXPENDITURES

     Construction  expenditures  for the  year  ended  December  31,  2002,  are
estimated to be between approximately $60,000,000 and $70,000,000.  The majority
of the estimated expenditures are for the build-out and upgrade of the Company's
PCS network.

LEGAL MATTERS

     The  Company  is party to legal  claims  arising  in the  normal  course of
business.  Although the ultimate  outcome of the claims cannot be ascertained at
this time,  it is the opinion of  management  that none of these  matters,  when
resolved,  will have a  material  adverse  impact on the  Company's  results  of
operations, cash flows or financial condition.

GUARANTEES

     The discount  notes and the senior notes are  guaranteed  by the  Company's
existing  subsidiaries,  HPC and  Bright  PCS,  and  will be  guaranteed  by the
Company's  future  domestic   restricted   subsidiaries.   The  Company  has  no
independent assets or operations apart from its subsidiaries. The guarantees are
general  unsecured  obligations.   Each  guarantor  unconditionally  guarantees,
jointly and severally,  on a senior  subordinated  basis,  the full and punctual
payment of principal premium and liquidated damages, if any, and interest on the
discount  notes and senior  notes when due. If the  Company  creates or acquires
unrestricted   subsidiaries   and   foreign   restricted   subsidiaries,   these
subsidiaries need not be guarantors.


                                       11
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 6 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

ALLIANCES NETWORK AGREEMENT

     The Alliances are two independent PCS providers  offering service under the
NTELOS brand name. In August 1999, the Company  entered into a network  services
agreement  with  the  Alliances  for 13 of its  markets  in  Virginia  and  West
Virginia. The initial term is through June 8, 2008, with four automatic ten-year
renewals.  This  agreement was amended in the third  quarter of 2001.  Under the
amended  agreement,  Horizon PCS is obligated to pay fixed minimum  monthly fees
until December 2003, at a lower rate per minute than the prior agreement.  Usage
in excess of the monthly minute allowance is charged at a set rate per minute.

     The following  table  summarizes  the minimum  amounts  required to be paid
under the network services agreement.


                                                             Period ending
          Year                                                December 31
          ----                                               ------------
          Fourth quarter of 2002..........................   $  7,900,000
          2003............................................     38,600,000
                                                             ------------
          Future operating lease obligation...............   $ 46,500,000
                                                             ============

LONG-TERM DEBT COVENANTS

     As discussed in Note 5 above, the Company entered into a covenant amendment
under its  secured  credit  facility  in June 2002.  In  addition to a number of
changes to the secured credit  facility,  including an increase in the margin on
the base interest rate,  this  amendment  placed  restrictions  on the Company's
ability to draw on the $95.0 million line of credit and deposit  requirements on
the $105.0  million term loan A borrowed  under the secured  credit  facility in
March 2002. These amounts are summarized below.

     The following table details the maximum amount  available to be borrowed on
the line of credit for the period then ended:


                                                             Maximum amount
                                                            available to be
                                                                borrowed
                                                            ---------------
          September 30, 2002............................... $            --
          December 31, 2002................................              --
          March 31, 2003...................................              --
          June 30, 2003....................................      16,000,000
          September 30, 2003...............................      26,000,000
          December 31, 2003................................      33,000,000
          March 31, 2004...................................      52,000,000
          Thereafter.......................................      95,000,000

     The following table details the minimum balance requirements placed on cash
and cash equivalents under the amended terms of the secured credit facility:

                                                              Deposit balance
                                                                requirement
                                                              ---------------
At September 30, 2002................................. ....   $  71,000,000
October 1, 2002, through November 15, 2002.................      63,000,000
November 16, 2002, through December 31, 2002...............      55,000,000
January 1, 2003, through February 15, 2003.................      33,000,000
February 16, 2003, through March 31, 2003..................      11,000,000
April 1, 2003, through May 15, 2003........................       5,500,000


                                       12
<PAGE>


HORIZON PCS, INC.

Notes to Consolidated Financial Statements
As of September 30, 2002, and December 31, 2001,
And for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 7 - RELATED PARTIES

     The Company has non-interest-bearing  receivables from affiliated companies
(other  subsidiaries  of the Parent)  related to advances  made to and  services
received from these affiliated companies.  At December 31, 2001, the Company had
a receivable  from the Parent related to Federal income taxes.  The balances due
to and due from related parties as of September 30, 2002, and December 31, 2001,
are as follows:

                                                  September 30,   December 31,
                                                      2002            2001
                                                  -------------   ------------
Receivable from affiliates.......................   $ 152,765      $ 100,437
Receivable from Parent...........................       2,105        483,785

     During the nine months ended  September  30, 2002 and 2001, a subsidiary of
the  Parent  provided  the  Company  with   administrative   services  including
financial,  regulatory,  human  resource  and other  administrative  and support
services.  The cost of the  administrative  services  for the nine months  ended
September  30,  2002 and 2001,  was  approximately  $3,944,000  and  $4,735,000,
respectively.

NOTE 8 - GOODWILL AND INTANGIBLE ASSETS

     During 1999 the Company entered into a joint venture  agreement through the
purchase of 25.6% of Bright  PCS. On June 27,  2000,  the Company  acquired  the
remaining  74.4% of Bright  PCS.  The  total  purchase  price was  approximately
$49,300,000  and was treated as a purchase  method  acquisition  for  accounting
purposes.  The purchase  price  exceeded the fair market value of the net assets
acquired by approximately $7,778,000.  The resulting goodwill was amortized on a
straight-line  basis over 20 years until  December  31, 2001.  At September  30,
2002,  the  remaining   unamortized   balance  of  goodwill  was   approximately
$7,191,000.

     The  Company  adopted  SFAS No.  142 on  January 1, 2002 (See Note 3). As a
result of the adoption,  goodwill  amortization  ceased as of December 31, 2001,
and the Company was  required to complete an  impairment  test on its  remaining
goodwill  balance as of the date of adoption.  The Company  completed  the first
step required by SFAS No. 142 and determined  the goodwill  remaining at January
1, 2002, was not impaired.  The Company will complete an impairment  test of the
remaining goodwill balance annually, or more frequently if impairment indicators
arise.

     The following pro forma disclosure  reconciles net loss available to common
stockholders,  as  presented  on the  accompanying  consolidated  statements  of
operations, excluding the effect of goodwill amortization:

<TABLE>
<CAPTION>
<S>                               <C>               <C>             <C>              <C>

                                  Three Months Ended September 30,  Nine Months Ended September 30,
                                        2002              2001           2002              2001
                                  --------------    --------------   --------------   -------------
Reported net loss...............  $ (40,311,961)    $ (28,686,580)   $(119,732,332)   $(75,431,048)
Goodwill amortization...........             --            97,222               --         291,666
                                  --------------   ---------------   --------------   -------------
   Adjusted net loss............    (40,311,961)      (28,589,358)    (119,732,332)    (75,139,382)
Preferred stock dividend........     (3,005,897)       (2,816,053)      (8,718,663)     (8,169,630)
                                  --------------   ---------------   --------------   -------------
   Adjusted net loss available
     to common stockholders.....    (43,317,858)    $ (31,405,411)   $(128,450,995)   $(83,309,012)
                                  ==============   ===============   ==============   =============

Basic and diluted net loss per
   share available to
   common stockholders..........  $       (0.74)    $       (0.54)   $       (2.20)   $      (1.43)
Goodwill amortization...........             --                --               --              --
                                  --------------   ---------------   --------------   -------------
    Adjusted basic and diluted
      net loss per share
      available to common
      stockholders..............  $       (0.74)    $       (0.54)   $       (2.20)   $      (1.43)
                                  ==============   ===============   ==============   =============

</TABLE>


                                       13
<PAGE>


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

     The following  discussion and analysis  should be read in conjunction  with
the consolidated financial statements and the related notes.

                           FORWARD-LOOKING STATEMENTS

     This  quarterly  report on Form 10-Q  includes  forward-looking  statements
within the meaning of Section 27A of the Securities Act of 1933, as amended (the
Securities  Act),  and Section 21E of the  Securities  Exchange Act of 1934,  as
amended  (the   Exchange   Act),   which  can  be   identified  by  the  use  of
forward-looking   terminology  such  as:  "may,"  "might,"   "could,"   "would,"
"believe,"  "expect,"  "intend,"  "plan,"  "seek,"   "anticipate,"   "estimate,"
"project," or "continue," or the negative thereof or other variations thereon or
comparable terminology.  All statements other than statements of historical fact
included in this quarterly report on Form 10-Q,  including  without  limitation,
the statements under "ITEM 2. Management's  Discussion and Analysis of Financial
Condition and Results of Operations" and under "ITEM 5. Other  Information"  and
elsewhere   herein   regarding   our   financial   position  and  liquidity  are
forward-looking  statements.  These forward-looking statements also include, but
are not limited to:

     o    estimates of current and future population for our markets;

     o    forecasts of growth in the number of consumers  and  businesses  using
          personal communication services;

     o    estimates for churn and ARPU (defined below);

     o    statements  regarding  our plans for and costs of the build-out of our
          PCS network;

     o    statements  regarding  our  anticipated   revenues,   expense  levels,
          liquidity and capital resources and projections of when we will launch
          commercial PCS and achieve break-even or positive EBITDA and operating
          cash flow; and

     o    the anticipated impact of recent accounting pronouncements.

     Although  we believe the  expectations  reflected  in such  forward-looking
statements are reasonable, we can give no assurance such expectations will prove
to have been correct. Important factors with respect to any such forward-looking
statements,  including certain risks and  uncertainties  that could cause actual
results to differ materially from our expectations (Cautionary Statements),  are
disclosed in this quarterly report on Form 10-Q, including,  without limitation,
in conjunction with the  forward-looking  statements  included in this quarterly
report on Form 10-Q. Important factors that could cause actual results to differ
materially from those in the forward-looking statements included herein include,
but are not limited to:

     o    our potential need for additional  capital or the need for refinancing
          existing indebtedness;

     o    our  dependence on our  affiliation  with Sprint and our dependence on
          Sprint's back office services;

     o    our future compliance with debt covenants;

     o    the need to successfully  complete the build-out of our portion of the
          Sprint PCS network;

     o    changes or advances in technology and the acceptance of new technology
          in the marketplace;

     o    competition  in the  industry  and markets in which we operate and the
          creditworthiness of new customers;

     o    our lack of operating history and anticipation of future losses;

     o    potential fluctuations in our operating results;

     o    our potential inability to expand our services and related products in
          the event of a substantial  increase in demand for these  services and
          related products;


                                       14
<PAGE>


     o    our ability to attract and retain skilled personal;

     o    changes in government regulation; and

     o    general political, economic and business conditions.

     These   forward-looking   statements   involve  known  and  unknown  risks,
uncertainties and other factors which may cause our actual results,  performance
or achievements to be materially different from any future results,  performance
or achievements  expressed or implied by such  forward-looking  statements.  All
subsequent  written and oral  forward-looking  statements  attributable to us or
persons  acting on our behalf are expressly  qualified in their  entirety by the
Cautionary  Statements.  See "ITEM 5. Other Information" for further information
regarding several of these risks and uncertainties.

HISTORY AND BACKGROUND

     Under our  agreements  with  Sprint,  we manage  our  network  on  Sprint's
licensed  spectrum  and have the right to use the  Sprint  and  Sprint PCS brand
names. As of September 30, 2002, we had launched service covering  approximately
7.4 million  residents,  or  approximately  73% of the total  population  in our
territory, and served approximately 241,900 customers.

     Horizon  PCS is a  majority-owned  subsidiary  of Horizon  Telcom.  Horizon
Telcom is a holding  company which, in addition to its common stock ownership of
Horizon  PCS,  owns  100% of:  1) The  Chillicothe  Telephone  Company,  a local
telephone  company;  2)  Horizon  Services,  Inc.  ("Horizon  Services"),  which
provides  administrative  services  to  Horizon  PCS and  other  Horizon  Telcom
affiliates; and 3) Horizon Technology,  Inc. ("Horizon Technology"),  a separate
long distance and Internet services business.

    The following are key milestones in our business:

     In November  1996,  we acquired PCS licenses in the Federal  Communications
Commissions'  ("FCC")  C-Block auction giving us the right to provide service to
five markets in Ohio,  West  Virginia and Kentucky  with a total  population  of
approximately 1.0 million  residents.  In August 1997,  approximately ten months
after receiving our licenses,  we launched PCS service as an independent service
provider  operating under the "Horizon Personal  Communications"  brand name. We
were the third  C-Block  licensee to launch PCS service in the United States and
the first to use CDMA technology.

     In June 1998,  we returned all of our FCC licenses  except for a portion of
the  license  covering  our  Chillicothe,  Ohio,  market  in  exchange  for  the
forgiveness of our FCC debt. In connection  with the return of our FCC licenses,
we agreed to become one of five charter PCS  affiliates  of Sprint.  Our initial
grant of markets from Sprint  consisted of seven markets in Ohio,  West Virginia
and Kentucky with a total  population of  approximately  1.6 million  residents.
This grant included the five markets for which we originally  held licenses.  In
November 1998, we began offering PCS service under the Sprint licenses. However,
we continued to use "Horizon Personal  Communications"  as the primary brand for
marketing our PCS service.

     In August 1999, Sprint granted us 17 additional  markets in Virginia,  West
Virginia,  Tennessee,  Maryland,  Kentucky, North Carolina and Ohio with a total
population of  approximately  3.3 million  residents.  In conjunction  with this
second grant,  we also entered into a network  services  agreement with the West
Virginia  PCS  Alliance  and  Virginia  PCS  Alliance,  which we refer to as the
Alliances.  The Alliances are two related,  independent  PCS providers  offering
services under the NTELOS brand. Under this agreement,  we obtained the right to
use their  wireless  network to provide  Sprint PCS services to our customers in
most of these new  markets.  Within two months of receiving  our second  license
grant from Sprint,  we were offering PCS service in 16 of our markets  including
eleven markets served under this  agreement.  The  Alliances'  network  provides
coverage to 1.8 million residents, or 55% of the total population.

     In September 1999,  Horizon Telcom sold its interest in the towers it owned
to SBA Communications,  Corp. ("SBA"),  and invested the net proceeds in Horizon
PCS. Prior to the sale, we had been leasing the towers from Horizon  Telcom.  We


                                       15
<PAGE>

now lease those towers from SBA.  Concurrently  with the tower sale,  we entered
into a  build-to-suit  agreement with SBA for the  construction of new towers as
part of our network  build-out.  Under the terms of the  agreement,  we received
site  development  fees,  reduced lease rates,  and  construction  discounts for
specified towers constructed by SBA and leased to us as an anchor tenant.

     In September 1999, we became one of the founders of Bright PCS, receiving a
26% equity interest in exchange for an equity contribution of approximately $3.1
million.  Shortly  after our  investment,  Bright PCS became the  exclusive  PCS
affiliate of Sprint for 13 markets in Indiana,  Ohio and Michigan,  with a total
population of approximately 2.4 million residents. At that time, we also entered
into a  management  agreement  with  Bright PCS under  which we agreed to manage
Bright  PCS'  network   build-out  and  operations.   We  launched   service  in
substantially all of the Bright PCS markets in October 2000.

     In December  1999,  we completed a two-month  transition  from a co-branded
marketing  strategy to  marketing  and selling all of our  products and services
exclusively  under the  "Sprint  PCS" brand  name,  which gave us full access to
Sprint PCS' major national retailers. Since that transition, we have experienced
an accelerated growth in our customer base.

     In May 2000,  Sprint  granted us an additional 17 markets in  Pennsylvania,
New York,  Ohio and New Jersey  with a total  population  of  approximately  2.9
million residents.

     In June 2000,  we acquired the  remaining 74% of Bright PCS that we did not
already own to become a 100% owner. As consideration for the outstanding  Bright
PCS equity,  we exchanged 4.7 million shares of our class B common stock,  equal
to 8% of our outstanding  shares of all classes of our common stock prior to the
acquisition,  and 31,912 shares of Horizon  Telcom common stock,  equal to 8% of
the outstanding shares of Horizon Telcom, which we acquired in February 2000.

     On September 26, 2000, an investor group led by Apollo Management purchased
$126.5  million  of our  convertible  preferred  stock in a  private  placement.
Concurrently,  holders of a $14.1 million short-term convertible note (including
accrued  interest  of $1.1  million)  converted  it into  the  same  convertible
preferred  stock purchased by the investor  group.  The Company  received $149.7
million from the issuance of $295.0 million of 14% discount notes and negotiated
a $225.0 million secured credit  facility  (later  increased to a $250.0 million
facility)  with a bank group.  The  discount  notes were  subject to an exchange
offer filed with the SEC in late 2001.

     In December  2001, we received  $175.0  million from our offering of 13.75%
senior notes.  The senior notes were subject to an exchange offer filed with the
SEC in the second quarter of 2002 and completed in July 2002.

CRITICAL ACCOUNTING POLICIES

     Allowance  for Doubtful  Accounts.  Estimates are used in  determining  our
allowance for doubtful accounts  receivable,  which are based on a percentage of
our  accounts  receivables  by aging  category.  The  percentage  is  derived by
considering our historical  collections and write-off experience,  current aging
of our accounts receivable and credit quality trends, as well as Sprint's credit
policy. However, our historical write-off and receivables trends are limited due
to our strong subscriber growth and the recent launch of new markets.

     Under  Sprint's  service  plans,  customers who do not meet certain  credit
criteria  can select any plan  offered  subject  to an account  spending  limit,
referred to as ASL, to control credit risk  exposure.  Account  spending  limits
range from $125 to $200 depending on the credit  quality of the customer.  Prior
to May 2001,  all of these  customers were required to make a deposit that could
be credited  against future billings.  In May 2001, the deposit  requirement was
eliminated  on  certain,  but not  all,  credit  classes  ("No  Deposit  ASL" or
"NDASL").  As a  result,  a  significant  amount of our new  customer  additions
(approximately 59% between May 1, 2001, and March 31, 2002) were under the NDASL
program.

     This increase in sub-prime credit customers under the NDASL program has led
to higher  churn rates  (defined  below) and an increase in account  write-offs.
While the average  balance  written-off  for an NDASL customer is lower than the
average write-off balances of non-account  spending limit customers,  the number
of NDASL write-offs has caused an increase in the total amount  written-off each


                                       16
<PAGE>

quarter, resulting in the need for a higher allowance and provision for doubtful
accounts receivable.

     Beginning in November  2001, the NDASL program was replaced by "Clear Pay",
which had tightened credit  criteria.  In April 2002, we replaced Clear Pay with
"Clear  Pay II," which  re-instated  the  deposit  requirement  for most  credit
classes with account spending limits and featured increased back-office controls
with respect to credit qualification and account collections.  We anticipate the
implementation  of the Clear Pay II  program  will  reduce  our  future bad debt
exposure. If the deposit requirement is later removed or if these allowances for
doubtful  accounts  receivable  estimates are insufficient  for any reason,  our
operating income,  EBITDA and available cash could be reduced.  At September 30,
2002,  the  allowance for doubtful  accounts was  $2,377,000,  which  represents
approximately10% of accounts  receivable.  At September 30, 2002,  approximately
33% of the subscribers in our markets were account spending limit customers with
no deposit paid.

     Revenue Recognition. The Company sells handsets and accessories,  which are
recorded  at the time of the sale as  equipment  revenue.  After the handset has
been  purchased,  the subscriber  purchases a service package that is recognized
monthly as service is  provided  and is  included  as  subscriber  revenue.  The
Company  defers a  portion  of the  monthly  service  revenue  that is billed in
advance.

     Service revenues consist of PCS subscriber  revenues and roaming  revenues.
PCS  subscriber  revenues  consist  primarily of monthly  service fees and other
charges  billed to  customers  for Sprint PCS service in our  territory  under a
variety of service plans.  Roaming revenues consist of Sprint PCS and non-Sprint
PCS roaming.  We receive  Sprint PCS roaming  revenues at a per minute rate when
Sprint PCS  subscribers  based  outside of our  territory use our portion of the
Sprint PCS network.  Non-Sprint PCS roaming revenues include charges to wireless
service providers,  other than Sprint, when those providers' subscribers roam on
our network.  The Sprint PCS roaming rate is negotiated  between the Company and
Sprint. The roaming rate charged to other wireless carriers for their use of our
network is negotiated by Sprint with the carrier on our behalf.

     We record 100% of PCS subscriber  revenues from our  customers,  Sprint PCS
roaming revenues and non-Sprint PCS roaming  revenues.  Sprint retains 8% of all
collected  service  revenue as a  management  fee.  Collected  service  revenues
include PCS subscriber revenues and non-Sprint PCS roaming revenues, but exclude
Sprint PCS roaming revenues, roaming charges billed to our customers for roaming
onto a non-Sprint  PCS network and revenues from sales of  equipment.  We report
the amounts retained by Sprint as general and administrative expense.

     The Company's  accounting  policy for the  recognition  of  activation  fee
revenue is to record the  revenue  over the  periods  such  revenue is earned in
accordance with the current interpretations of SAB No. 101, "Revenue Recognition
in  Financial  Statements."  Accordingly,  activation  fee  revenue  and  direct
customer  activation  expense are deferred and will be recorded over the average
life for those customers, currently estimated to be 30 months, that are assessed
an activation  fee. Prior to January 1, 2002, we estimated the average life of a
customer to be 36 months. We reduced this estimate to 30 months in consideration
of an  increase  in churn  (defined  below)  resulting  from the  NDASL  program
discussed earlier.


                                       17
<PAGE>



RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED  SEPTEMBER 30, 2002 COMPARED TO
THREE MONTHS ENDED SEPTEMBER 30, 2001

OVERVIEW

     We have focused a significant  amount of our  operational  efforts over the
past twelve months on upgrading  our wireless  network to be able to provide the
first  level of third  generation  ("3G")  network  services  marketed by Sprint
nationally as "PCS Vision." In conjunction  with Sprint's  nationwide  launch of
PCS Vision,  we began  providing  3G services  across our network in  mid-August
2002.  This upgrade  provides users of 3G service a new experience with wireless
devices.  Subscribers  are now able to surf the  Internet  with their  handsets,
PDA's,  and laptops at speeds of up to 144  kilobits  per second  ("kbps").  The
average  user will  experience  peak rates of 75-80 kbps,  which is two to three
times  faster than  historical  dial-up  speeds.  We can now offer a host of new
products and services to our  subscribers  and we believe PCS Vision will entice
subscribers of other wireless carriers to move to our robust offerings.

     However,  the positive momentum generated by 3G was offset by a larger than
anticipated number of NDASL customers being involuntarily  disconnected.  During
the second  half of 2001 and first  half of 2002,  a  significant  number of our
customer  additions  were under the NDASL  program.  These lower credit  quality
customers  activated  under the NDASL  program led to higher  churn rates and an
increased  amount of bad debt during the third  quarter of 2002 as a significant
number of these customers were disconnected and written-off.

     Sprint has  discontinued  the NDASL program and replaced it with Clear Pay,
which  tightened  credit  restrictions,  and Clear Pay II,  which  re-instituted
deposit  requirements  for most lower credit  quality  customers and  introduces
additional controls on loss exposure.  In addition,  we've focused our marketing
efforts into recruiting higher quality customers. As a result, our percentage of
prime credit customers in our subscriber portfolio increased to 70% at September
30, 2002,  from 65% at March 31, 2002. We expect our churn rate to be consistent
to slightly  lower in the fourth quarter of 2002 than the 3.9% we experienced in
the third quarter.

     In response to  increased  competition  from other  carriers and to improve
focus on  penetrating  our  markets  with  PCS  Vision,  we took an  operational
reorganization on October 1, 2002. We realigned our internal  geographic markets
and added a vice president to oversee our marketing and retail operations teams.
We look forward to the benefits of this new organizational alignment and believe
it will result in higher gross additions and a better retention effort.

KEY METRICS

     The following  discussion  details key operating metrics and focuses on the
details of our financial  performance  over the last quarter and current  fiscal
year.

     Customer  Additions.  As  of  September  30,  2002,  we  provided  personal
communication service directly to approximately 241,900 customers. For the three
months ended September 30, 2002 and 2001, Horizon PCS net subscribers  increased
by approximately  6,800 and 40,300  customers,  respectively.  Gross activations
during the third quarter of 2002 were 21% lower than the same period in 2001 due
in  part  to  changes  in  deposit  requirements  for  new  low  credit  quality
subscribers.  Additionally,  an  increase  in the  churn of NDASL  and Clear Pay
subscribers  resulted  in overall  lower net  customer  additions  for the three
months ended  September 30, 2002,  compared to the three months ended  September
30, 2001.

     Cost Per Gross  Addition.  CPGA  summarizes the average cost to acquire new
customers  during the period.  CPGA is  computed by adding the income  statement
components  of selling and  marketing,  cost of equipment and  activation  costs
(which are included as a component of cost of service) and reducing  that amount
by the equipment revenue recorded.  That net amount is then divided by the total
new  customers  acquired  during the period.  CPGA was $365 for the three months
ended September 30, 2002,  compared to $307 for the three months ended September
30, 2001.  This increase is primarily the result of lower gross  activations  in
2002 compared to 2001.

    Churn.  Churn is the monthly rate of customer turnover that both voluntarily
and involuntarily  discontinued  service during the month.  Churn is computed by
dividing the number of customers that discontinued service during the month, net


                                       18
<PAGE>

of 30-day  returns,  by the beginning  customer  base for the period.  Quarterly
churn is an  average  of the three  months in the  quarter.  Churn for the three
months ended September 30, 2002, was 3.9 % compared to 2.1% for the three months
ended  September 30, 2001.  This increase in churn is a result of an increase in
the amount of sub-prime credit quality customers the Company added whose service
was involuntarily discontinued during the period.

     Average  Revenue Per Unit.  ARPU summarizes the average monthly revenue per
customer.  ARPU is computed by dividing service revenue and roaming revenues for
the period by the average subscribers for the period.

    The following summarizes ARPU for the three months ended September 30:

                                                        2002            2001
                                                    -------------   -----------
         Service revenues
            Recurring...........................    $          40   $        45
            Minute sensitive....................               12            14
            Features and other..................                3            (2)
                                                    -------------   -----------
              Total service revenues............               55            57
                                                    -------------   -----------

         Roaming revenues.......................               21            31
                                                    -------------   -----------
                ARPU............................    $          76   $        88
                                                    -------------   -----------

     Recurring service ARPU has declined as more customers activated or migrated
to  service  plans in the  $29.99  to $39.99  monthly  recurring  charge  range.
Additionally,  recent service plans are offering more minutes at a lower monthly
charge due to increased  competition in the wireless industry.  These additional
minutes have driven down the ARPU received when  customers use more minutes than
their plan allows.  We anticipate  this trend to continue on voice-only  service
plans,  but we  anticipate  higher  service  ARPU in the  future as  subscribers
activate on data and voice  plans,  which offer more  features,  but at a higher
monthly  charge.  ARPU from  features and other has increased as we are offering
fewer  promotional  credits and have charged more contract  termination  fees in
2002 as a result of higher deactivation and churn rates.

     On April 27, 2001,  Sprint and its  affiliates  announced an agreement on a
new Sprint PCS roaming rate; the  receivable and payable  roaming rate decreased
from $0.20 per minute to $0.15 per minute  effective June 1, 2001, and decreased
further to $0.12 per minute  effective  October 1, 2001.  The Sprint PCS roaming
rate changed to $0.10 per minute on January 1, 2002.  After 2002,  the rate will
be changed to "a fair and reasonable  return" which has not yet been determined.
However,  based  on  preliminary   discussions  with  Sprint,  we  anticipate  a
significant  additional  reduction in the rate.  The  decreases in the rate will
reduce our revenue and expense per minute, but we anticipate this rate reduction
will be offset by volume  increases from the continued  build-out of our network
and subscriber growth,  resulting in greater overall roaming revenue and expense
in the future.  Somewhat  offsetting  that rate  reduction in Sprint PCS roaming
revenue  was an  increase in  non-Sprint  PCS  revenue as a result of  expanding
roaming agreements with other wireless carriers.

     Earnings Before Interest, Taxes, Depreciation and Amortization. EBITDA is a
financial  metric used to estimate cash flow  available to service debt.  EBITDA
can be calculated from our income statement as follows:

                                                     Three Months Ended
                                                        September 30,
                                                -------------------------------
                                                       2002            2001
                                                ---------------   -------------
      Operating Loss.........................   $  (25,151,859)   $ (23,270,641)
      Plus:  Depreciation and amortization....       9,302,721        5,158,646
             Non-cash compensation............         170,188          177,237
                                                ---------------   -------------

             EBITDA.........................    $  (15,678,950)   $ (17,934,758)
                                                ===============   =============


                                       19
<PAGE>



     EBITDA is not a measure of financial  performance presented under generally
accepted accounting principals in the United States of America and should not be
considered an alternative to net income (loss) as a measure of performance or to
cash flow as a measure of  liquidity.  However,  the  Company's  secured  credit
facility  has  a  covenant  requiring  EBITDA  to  be  controlled  to a  certain
threshold.  During the third quarters of 2002, and 2001, the Company's  covenant
requirements,   as  they  pertain  to  EBITDA  losses,   were  ($21,400,00)  and
($25,135,000), respectively.

RESULTS OF OPERATIONS

     Revenues.  The  following  table sets forth a breakdown  of our revenues by
type for the three months ended September 30:

          (Dollars in thousands)           2002                 2001
                                    -------------------  -------------------
                                       Amount       %      Amount        %
                                    ----------  -------  ----------  -------
          Subscriber revenues       $   39,281      70%  $   21,391      61%
          Roaming revenues              14,993      27%      11,793      33%
          Equipment revenues             1,787       3%       2,020       6%
                                    ----------  -------  ----------  -------
          Total revenues            $   56,061     100%  $   35,204     100%
                                    ==========  =======  ==========  =======

     Subscriber  revenues for the three months ended  September  30, 2002,  were
approximately  $39.3 million,  compared to  approximately  $21.4 million for the
three  months  ended  September  30, 2001,  an increase of  approximately  $17.9
million. The growth in subscriber revenues is primarily the result of the growth
in our customer base. We managed  approximately  241,900  customers at September
30, 2002, compared to approximately  146,600 at September 30, 2001. Our customer
base has grown  because we have  launched  additional  markets and increased our
sales force.

     Roaming  revenues  increased  from  approximately  $11.8 million during the
three months ended  September 30, 2001, to  approximately  $15.0 million for the
three  months  ended  September  30,  2002,  an increase of  approximately  $3.2
million.  This increase resulted from expanding roaming agreements with wireless
carriers and from  launching  additional  markets over the past year,  including
markets covering major interstate highways. This increase was offset somewhat by
the decrease in the Sprint PCS roaming rate discussed above.

     Equipment  revenues  for the three months ended  September  30, 2002,  were
approximately $1.8 million, compared to approximately $2.0 million for the three
months  ended  September  30,  2001,  representing  a decrease of  approximately
$200,000.  This decrease is  attributable to a decline in the sales price of the
handset as the average sales price,  net of discounts and rebates,  decreased to
$85 for the three months ended September 30, 2002, from $114 for the same period
in 2001.

     Cost of service.  Cost of service  includes costs associated with operating
our network,  including site rent,  utilities,  engineering  personnel and other
expenses  related to operations.  Cost of service also includes  interconnection
expenses,  customer  care,  Sprint back office and customer  care  charges,  and
roaming  fees.  We pay roaming fees to Sprint when our customers use Sprint PCS'
network  outside of our  territory.  We pay non-Sprint PCS roaming fees to other
wireless service providers when our customers use their networks.

     Also  included  in cost of service  are costs  incurred  under our  network
services agreement with the Alliances. In the third quarter of 2001, Horizon PCS
negotiated  an  amendment  to its  agreement  with the  Alliances  and a related
amendment to its Sprint agreements.  Under the Alliances amendment,  Horizon PCS
is obligated to pay a minimum monthly fee for a stated minimum  period.  Horizon
PCS expects to incur lower overall fees under this new  arrangement  at expected
usage  levels as  compared  to the  previous  agreement  that was based on a per
minute fee.  The  Alliances  are also  obligated  to upgrade  their  networks to
provide 3G technology.



                                       20
<PAGE>


     Sprint provides  back-office  and other services to the Company.  Recently,
Sprint has sought to  increase  service  fees during the  remainder  of 2002 and
beyond in connection with its development of 3G-related  back-office systems and
platforms.  The Company,  along with the other Sprint  affiliates,  is currently
disputing  the  validity  of  Sprint's  right  to pass  through  this fee to the
affiliates. If this dispute is resolved unfavorably to the Company, then Horizon
PCS will incur additional expenses which could have a material adverse impact on
our liquidity and financial results.

     Cost of  service  for the  three  months  ended  September  30,  2002,  was
approximately  $43.8 million,  compared to  approximately  $29.2 million for the
three  months  ended  September  30, 2001,  an increase of  approximately  $14.6
million. This increase reflects an increase in roaming expense and long distance
charges of  approximately  $3.7 million and the increase in costs incurred under
our network services agreement with the Alliances of approximately $3.8 million,
both as a result of our subscriber growth during 2001 and 2002. Additionally, at
September 30, 2002, our network covered  approximately 7.4 million people versus
approximately 6.6 million residents at September 30, 2001. As a result,  cost of
service in 2002 was higher than 2001 due to the  increase in network  operations
expense,  including tower lease expense,  circuit costs and payroll expense,  of
approximately  $5.2  million.  Growth in our customer base resulted in increased
customer care,  activations,  and billing expense of approximately  $1.7 million
and other variable  expenses,  including  interconnection  and national platform
expenses,  of  approximately  $200,000.  Overall,  the average cost of providing
service per the average  subscriber on our network decreased from $77 to $61 for
the three months ended  September  30, 2001 and 2002,  respectively,  as we have
increased our subscriber base.

     Cost of  equipment.  Cost of  equipment  includes  the cost of handsets and
accessories sold by our stores and direct sales force to our customers.  Cost of
equipment for the three months ended September 30, 2002, was approximately  $4.0
million,  compared to  approximately  $4.1  million for the three  months  ended
September 30, 2001, a decrease of  approximately  $100,000.  The decrease in the
cost of equipment  is the result of the lower growth in our wireless  customers.
For  competitive and marketing  reasons,  we have sold handsets to our customers
below our cost and expect to continue to sell handsets at a price below our cost
for the foreseeable future. Additionally,  we expect to incur additional expense
as existing  customers  upgrade their handsets to newer models to take advantage
of new  services  that may be  available  with  3G,  including  high-speed  data
applications.

     Selling and marketing  expenses.  Selling and marketing expenses consist of
costs  associated  with  operating  our  retail  stores,   including  marketing,
advertising,  payroll and sales commissions.  Selling and marketing expense also
includes  commissions  paid to  national  and  local  third  party  distribution
channels  and  subsidies on handsets  sold by third  parties for which we do not
record  revenue.  Selling and  marketing  expenses rose to  approximately  $13.0
million for the three months ended September 30, 2002, compared to approximately
$12.6  million for the three months  ended  September  30, 2001,  an increase of
approximately  $400,000.  This includes a decrease in commissions  paid to third
parties of approximately  $300,000,  a decrease in subsidies on handsets sold by
third  parties of  approximately  $1.2 million and an increase in marketing  and
advertising  in our sales  territory of  approximately  $1.9 million.  We expect
selling and  marketing  expense to increase  in the  aggregate  as we expand our
coverage, launch additional stores and add customers.

     General  and  administrative  expenses.  General and  administrative  costs
include the Sprint  management fee (which is 8% of "collected  revenues" defined
above),  a provision  for  doubtful  accounts  receivable  and costs  related to
corporate support functions  including costs associated with functions performed
for us by Horizon Services under our services agreement.  These services include
finance  and  accounting   functions,   computer   access  and   administration,
consulting, human resources and other administrative services. Horizon Services'
costs for these functions are charged to us using a standard FCC cost allocation
methodology.  Under  this  methodology,  all  costs  that  can  be  specifically
identified to us are directly charged to us, and all costs that are specifically
identified to other  subsidiaries  of Horizon Telcom are charged to them.  Costs
incurred by Horizon Services that cannot be specifically identified to a company
for which Horizon Services  provides  service are apportioned  among the Horizon
Telcom subsidiaries based on appropriate  measures.  Because of the economies of
scale  inherent  in a  centralized  service  company,  we believe we are able to
receive these  services less  expensively  through this  arrangement  than if we
provided them ourselves.

     General and  administrative  expenses for the three months ended  September
30, 2002,  were  approximately  $10.9  million  compared to  approximately  $7.2
million in 2001,  an  increase  of  approximately  $3.7  million.  The  increase
reflects an increase in the  provision  for doubtful  accounts of  approximately
$2.8 million,  primarily  due to the write-off of NDASL and ClearPay  customers,


                                       21
<PAGE>


and an increase in the Sprint management fee of approximately $1.4 million, as a
result of higher  subscriber  revenues  in 2002,  offset by a decrease  in other
general expenses of approximately $500,000.

     Non-cash  compensation  expense.  For both the three months ended September
30, 2002 and 2001, we recorded stock-based compensation expense of approximately
$200,000  and  $200,000,  respectively.  Stock-based  compensation  expense will
continue to be recognized through the conclusion of the vesting period for these
options  in 2005.  The  annual  non-cash  compensation  expense  expected  to be
recognized for these stock options is approximately  $681,000 in 2002,  $622,000
in 2003, $193,000 in 2004, and $71,000 in 2005.

     Depreciation  and  amortization  expense.   Depreciation  and  amortization
expenses  increased by  approximately  $4.1 million to a total of  approximately
$9.3  million  during the three months ended  September  30, 2002.  The increase
reflects the continuing  construction of our network as we funded  approximately
$57.6 million of capital expenditures during the nine months ended September 30,
2002.

     Since  our  acquisition  of  Bright  PCS was  accounted  for as a  purchase
transaction, we recorded purchase method goodwill and recorded intangible assets
related  to the  acquisition  of Bright  PCS'  license  agreement  with  Sprint.
Amortization  expense of the intangible asset was approximately  $400,000 during
the three months ended September 30, 2002 and 2001.  Goodwill  amortization  was
approximately  $100,000  during  the three  months  ended  September  30,  2001.
Goodwill  amortization ceased as of December 31, 2001, with the adoption of SFAS
No. 142.

     Amortization  expense also includes  amortization  of an  intangible  asset
recorded in  September  2000 related to the grant of new markets to us by Sprint
in  September  2000.  We agreed to grant  warrants to Sprint in exchange for the
right to provide  service in these  additional  markets.  The  warrants  will be
issued to Sprint at the earlier of an initial  public  offering of the Company's
common stock or July 31, 2003. The intangible  asset is being amortized over the
remaining term of the Sprint  management  agreement,  resulting in approximately
$800,000 of amortization  expense per year.  Accordingly,  amortization  expense
related to this intangible asset was approximately $200,000 for the three months
ended September 30, 2002 and 2001.

     Gain on sale of  property  and  equipment.  During the three  months  ended
September 30, 2002, we realized a gain of  approximately  $10,000 related to the
sale of miscellaneous  equipment. The sale resulted in proceeds of approximately
$20,000.

     Interest  income and other,  net.  Interest income and other income for the
three months ended September 30, 2002, was  approximately  $700,000  compared to
approximately $600,000 in 2001 and consisted primarily of interest income.

     Interest  expense,  net.  Interest  expense  for  the  three  months  ended
September 30, 2002, was approximately  $15.9 million,  compared to approximately
$6.0  million in 2001.  The  increase  in  interest  expense was a result of our
additional  indebtedness.  Interest  on the  outstanding  balance of our secured
credit facility accrues at LIBOR plus a specified  margin.  On June 29, 2001, we
agreed to several  changes in the secured credit  facility  including a 25 basis
point increase in the margin on the annual interest rate. At September 30, 2002,
the interest rate on the $105.0  million term loan A borrowed  under our secured
credit  facility was 5.80%,  while the interest  rate on the $50.0  million term
loan  B  was  6.32%.  Interest  expense  on  the  secured  credit  facility  was
approximately  $2.7  million  and $1.1  million  during the three  months  ended
September 30, 2002 and 2001, respectively.

     We accrue  interest  at a rate of 14.00%  annually  on our  discount  notes
issued in September 2000 and will begin paying  interest  semi-annually  in cash
beginning in October 2005. Unaccreted interest expense on the discount notes was
approximately  $116.0  million at September  30, 2002.  Interest  expense on the
discount notes was approximately  $6.8 million and $5.9 million during the three
months ended September 30, 2002 and 2001, respectively.

     On June 15, 2002,  we began  making  semi-annual  interest  payments on our
senior  notes  issued in December  2001,  at an annual rate of 13.75%.  Interest
expense  accrued on the senior notes was  approximately  $6.0 million during the
three months ended September 30, 2002. Under the terms of the senior notes, cash
to cover the first four  semi-annual  interest  payments was placed in an escrow
account.


                                       22
<PAGE>


     Interest expense also includes  approximately  $800,000 and $200,000 during
the  three  months  ended  September  30,  2002  and  2001,   respectively,   of
amortization  from the deferred  financing  fees  related to our secured  credit
facility, our discount notes and our senior notes. Additionally interest expense
includes,  approximately  $300,000 and $800,000 in  commitment  fees paid on the
unused  portion of our secured  credit  facility  during the three  months ended
September 30, 2002 and 2001, respectively.

     Capitalized interest reduced interest expense during the three months ended
September  30,  2002 and  2001,  by  approximately  $700,000  and $2.0  million,
respectively.  We expect our  interest  expense to  increase in the future as we
borrow  under our secured  credit  facility to fund our  network  build-out  and
operating losses.

     Income  taxes.   Until   September  26,  2000,  we  were  included  in  the
consolidated  Federal  income tax  return of Horizon  Telcom.  We  provided  for
Federal  income  taxes  on a pro  rata  basis,  consistent  with a  consolidated
tax-sharing  agreement.  As a result  of the sale of the  convertible  preferred
stock on September 26, 2000, we are not able to participate  in the  tax-sharing
agreement.  Additionally,  we are not able to recognize any net  operating  loss
benefits  until we  generate  taxable  income.  We did not record any income tax
benefit for the three months ended  September  30, 2002 or 2001,  because of the
uncertainty of generating  future  taxable income to be able to utilize  current
net operating loss carryforwards.

     Net loss.  Our net loss for the three months ended  September 30, 2002, was
approximately  $40.3  million  compared to  approximately  $28.7 million for the
three months ended  September  30, 2001.  The increase in our loss  reflects the
continued  expenses  related to launching  our markets and building our customer
base.  We  expect  to  incur  significant   operating  losses  and  to  generate
significant  negative cash flow from operating  activities  while we continue to
construct our network and increase our customer base.

     Preferred  stock  dividend.  Our  convertible  preferred stock pays a stock
dividend at the rate of 7.5% per annum, payable semi-annually, commencing May 1,
2001. The dividends are paid with  additional  shares of  convertible  preferred
stock. Through September 30, 2002, we have issued an additional 3,245,134 shares
of  convertible  preferred  stock in payment of dividends,  including  1,060,201
shares on May 1, 2002. An additional  1,099,958 were issued on November 1, 2002,
and are not included in the total above.

     Other  comprehensive  income  (loss).  During  2001,  we entered  into two,
two-year  interest rate swaps which effectively fix $50.0 million of term loan B
borrowed under the secured credit facility. We do not expect the effect of these
swaps to have a material  impact to interest  expense for the remainder of their
lives. We recorded an unrealized gain of $21,000 in other  comprehensive  income
during the second  quarter of 2002  related to the change in market value of the
derivate instrument.

RESULTS OF OPERATIONS  FOR THE NINE MONTHS ENDED  SEPTEMBER 30, 2002 COMPARED TO
NINE MONTHS ENDED SEPTEMBER 30, 2002

KEY METRICS

     Customer  Additions.  During the nine months ended  September  30, 2002 and
2001, Horizon PCS net subscribers  increased by approximately  47,800 and 80,200
customers,  respectively. Gross activations during the first nine months of 2002
and  2001  were  132,900  and  108,800,  respectively.  The  increase  in  gross
activations  was  offset  by an  increase  in the  churn of NDASL  and Clear Pay
subscribers during the first nine months of 2002 resulting in lower net customer
additions for the nine months ended  September  30, 2002,  compared to the prior
year period.

     Cost Per Gross Addition.  Cost per gross addition for the nine months ended
September  30,  2002,  was  $356,  compared  to $337 for the nine  months  ended
September 30, 2001.  This increase  reflects  slightly higher costs offset by an
increase in the number of activations.

     Churn.  Churn  for the nine  months  ended  September  30,  2002,  was 3.5%
compared to 2.1% for the nine months ended  September 30, 2001. This increase is
due to an increase in the churn of NDASL and Clear Pay customers.


                                       23
<PAGE>


     Average Revenue Per Unit. The following summarizes ARPU for the nine months
ended September 30:

                                                        2002           2001
                                                   ------------    ------------
        Service revenues
           Recurring............................   $         40    $         44
           Minute sensitive.....................             12              15
           Features and other*..................              4              (4)
                                                   ------------    ------------
             Total service revenues.............             56              55
                                                   ------------    ------------

        Roaming revenues........................             19              29
                                                   ------------    ------------
               ARPU.............................   $         75    $         84
                                                   ------------    ------------

     * Excludes impact of a non-recurring adjustment to access revenue

     Recurring service ARPU has declined as more customers activated or migrated
to  service  plans in the  $29.99  to $39.99  monthly  recurring  charge  range.
Additionally,  recent service plans are offering more minutes at a lower monthly
charge due to increased  competition in the wireless industry.  These additional
minutes have driven down the ARPU received when  customers use more minutes than
their plan allows.  We anticipate  this trend to continue on voice-only  service
plans,  but we  anticipate  higher  service  ARPU in the  future as  subscribers
activate on data and voice  plans,  which offer more  features,  but at a higher
monthly  charge.  ARPU from  features and other has increased as we are offering
fewer  promotional  credits and have charged more contract  termination  fees in
2002 as a result of higher deactivation and churn rates.

     On April 27, 2001,  Sprint and its  affiliates  announced an agreement on a
new Sprint PCS roaming rate; the  receivable and payable  roaming rate decreased
from $0.20 per minute to $0.15 per minute  effective June 1, 2001, and decreased
further to $0.12 per minute  effective  October 1, 2001.  The Sprint PCS roaming
rate changed to $0.10 per minute on January 1, 2002.  After 2002,  the rate will
be changed to "a fair and reasonable  return" which has not yet been determined.
However,  based  on  preliminary   discussions  with  Sprint,  we  anticipate  a
significant  additional  reduction in the rate.  The  decreases in the rate will
reduce our revenue and expense per minute, but we anticipate this rate reduction
will be offset by volume  increases from the continued  build-out of our network
and subscriber growth,  resulting in greater overall roaming revenue and expense
in the future.  Somewhat  offsetting  that rate  reduction in Sprint PCS roaming
revenue  was an  increase in  non-Sprint  PCS  revenue as a result of  expanding
roaming agreements with other wireless carriers.

     Earnings Before Interest, Taxes, Depreciation and Amortization. EBITDA is a
financial  metric used to estimate cash flow  available to service debt.  EBITDA
can be calculated from our income statement as follows:

                                                       Nine Months Ended
                                                          September 30,
                                                 -------------------------------
                                                     2002               2001
                                                 -------------   ---------------
     Operating Loss..........................    $(77,481,614)   $  (61,203,431)
     Less: Depreciation and amortization.....      30,232,128        12,980,232
           Non-cash compensation.............         510,562         1,256,611
                                                 -------------   --------------

             EBITDA.........................     $(46,738,924)   $  (46,966,588)
                                                 =============   ==============

     EBITDA is not a measure of financial  performance presented under generally
accepted accounting principals in the United States of America and should not be
considered an alternative to net income (loss) as a measure of performance or to
cash flow as a measure of  liquidity.  However,  the  Company's  secured  credit
facility  has  a  covenant  requiring  EBITDA  to  be  controlled  to a  certain
threshold.  During the third quarters of 2002, and 2001, the Company's  covenant
requirements,   as  they  pertain  to  EBITDA  losses,   were  ($21,400,00)  and
($25,135,000), respectively.


                                       24
<PAGE>



RESULTS OF OPERATIONS

Revenues. The following table sets forth a breakdown of our revenues by type:

        (Dollars in thousands)                 2002                 2001
                                        -------------------  ------------------
                                           Amount         %    Amount         %
                                        ----------  -------  ----------  ------
        Subscriber revenues             $  111,397      71%  $   48,989      62%
        Roaming revenues                    38,928      25%      25,645      32%
        Equipment revenues                   5,760       4%       4,595       6%
                                        ----------  -------  ----------  -------
        Total revenues                  $  156,085     100%  $   79,229     100%
                                        ==========  =======  ==========  =======

     Subscriber  revenues for the nine months  ended  September  30, 2002,  were
approximately  $111.4 million,  compared to approximately  $49.0 million for the
nine months  ended  September  30,  2001,  an increase  of  approximately  $62.4
million. The growth in subscriber revenues is primarily the result of the growth
in our customer base. We managed  approximately  241,900  customers at September
30, 2002, compared to approximately  146,600 at September 30, 2001. Our customer
base has grown  because we have  launched  additional  markets and increased our
sales force.

     Sprint  assesses  access charges to long distance  carriers on Horizon PCS'
behalf for the termination of landline-originated  calls in our markets.  Though
regulations  generally entitle a carrier that terminates a call on the behalf of
another to be compensated  for providing that service,  these  regulations  were
developed in a period where services of this nature were provided exclusively by
local exchange carriers.  Certain long distance  carriers,  including AT&T, have
disputed Sprint's  assessment of these charges as well as the corresponding rate
at which the charges were determined.  In July 2002, the FCC ruled that AT&T was
not  required  to pay  these  charges  unless  AT&T had  agreed  to do so in its
contract with Sprint and remanded the case to a U.S.  District Court for further
proceedings.  Because  the  case  is  still  pending  we  cannot  predict,  with
certainty,  the final  outcome  of this  action.  As a  result,  we  recorded  a
reduction in revenue in the second quarter of 2002 of approximately $1.3 million
representing  previously billed and recognized access revenue. The Company plans
to cease recognition of this type of revenue in future quarters, unless there is
ultimately a favorable ruling by the courts or the FCC on this issue. Sprint has
asserted  the right to recover from us amounts  previously  billed on our behalf
and remitted to us by Sprint.  We will  continue to assess the ability of Sprint
or other carriers to recover these charges. We are also continuing to review the
availability  of defenses we may have against  Sprint's  claim to recover  these
revenues from us.

     Roaming revenues  increased from  approximately  $25.6 million for the nine
months ended  September  30, 2001, to  approximately  $38.9 million for the nine
months ended  September 30, 2002, an increase of  approximately  $13.3  million.
This increase  resulted from expanding  roaming  agreements  with other wireless
carriers and from  launching  additional  markets over the past year,  including
markets covering major interstate highways. This increase was offset somewhat by
the decrease in the Sprint PCS roaming rate discussed above.

     Equipment  revenues for the nine months  ended  September  30,  2002,  were
approximately $5.8 million,  compared to approximately $4.6 million for the nine
months ended September 30, 2001, an increase of approximately $1.2 million.  The
increase  in  equipment  revenues  is the result of an increase in the number of
handsets  sold,  offset by a decline  in the sales  price of the  handset as the
average sales price, net of discounts and rebates, decreased to $99 for the nine
months ended September 30, 2002, from $119 for the same period in 2001.

     Cost of service.  Cost of service for the nine months ended  September  30,
2002, was approximately $120.9 million,  compared to approximately $68.3 million
for the nine months ended September 30, 2001, an increase of approximately $52.6
million.  This  increase  reflects  the  increase  in roaming  expense  and long
distance charges, of approximately $15.4 million; the increase in costs incurred
under our network services  agreement with the Alliances of  approximately  $9.8
million;  the increase in network  operations,  including  tower lease  expense,
circuit costs and payroll  expense,  of approximately  $16.7 million;  increased
customer care,  activations,  and billing expense of approximately $8.9 million;
and the  increase in other  variable  expenses,  including  interconnection  and
national platform expenses, of approximately $1.8 million.  Overall, the average
cost of providing  service per the average  subscriber on our network  decreased
from  $77 to $60  for the  nine  months  ended  September  30,  2001  and  2002,
respectively, as we have increased our subscriber base.


                                       25
<PAGE>


     Cost of equipment.  Cost of equipment  for the nine months ended  September
30, 2002,  was  approximately  $12.6  million,  compared to  approximately  $8.6
million  for  the  nine  months  ended   September  30,  2001,  an  increase  of
approximately $4.0 million.  The increase in the cost of equipment is the result
of the growth in our wireless customers, partially offset by the decreasing unit
cost of the  handsets.  For  competitive  and  marketing  reasons,  we have sold
handsets to our customers below our cost and expect to continue to sell handsets
at a price below our cost for the foreseeable future. Additionally, we expect to
incur additional  expense as existing  customers upgrade their handsets to newer
models and to take  advantage  of new services  that may be  available  with 3G,
including high-speed data applications.

     Selling and  marketing  expenses.  Selling and  marketing  expenses rose to
approximately  $39.0  million  for the nine months  ended  September  30,  2002,
compared to approximately $30.0 million for the same period in 2001, an increase
of approximately $9.0 million.  This increase reflects the increase in the costs
of operating our 40 retail stores,  including  marketing and  advertising in our
sales  territory,  of approximately  $6.6 million,  the increase in subsidies on
handsets sold by third parties of  approximately  $900,000,  and the increase in
commissions paid to third parties of approximately $1.5 million.

     General and administrative  expenses.  General and administrative  expenses
for the nine months ended  September 30, 2002 were  approximately  $30.3 million
compared to  approximately  $19.3 million in 2001, an increase of  approximately
$11.0 million.  The increase  reflects an increase in the provision for doubtful
accounts of approximately  $8.2 million  primarily due to the write off of NDASL
and  Clear  Pay  customers  and an  increase  in the  Sprint  management  fee of
approximately  $4.6 million as a result of higher  subscriber  revenues in 2002,
offset by a decrease in other general  expenses of  approximately  $1.8 million.
During the nine months ended  September 30, 2001,  we  recognized  approximately
$1.3 million of legal and  consulting  expenses  related to the  exploration  of
strategic business alternatives.

     Non-cash compensation expense. For the nine months ended September 30, 2002
and 2001, we recorded stock-based compensation expense of approximately $500,000
and  $1.3  million   respectively.   The  expense   recorded  in  2001  includes
approximately  $700,000  related to the  distribution of 7,249 shares of Horizon
Telcom stock to employees  of Horizon PCS and  approximately  $600,000 for stock
options granted.

     Depreciation  and  amortization  expense.   Depreciation  and  amortization
expenses  increased by  approximately  $17.2 million to a total of approximately
$30.2 million in 2002. The increase reflects the continuing  construction of our
network as we funded  approximately $57.6 million of capital expenditures during
the nine months ended September 30, 2002.

     During 2002, the Company  launched  switches in Tennessee and  Pennsylvania
and  disconnected  some switching  equipment in Chillicothe,  Ohio. As a result,
approximately  $6.2 million of switching  equipment  is  considered  an impaired
asset as defined by SFAS No. 144.  Accordingly,  depreciation  and  amortization
expense for the nine months ended  September  30, 2002,  includes  approximately
$3.5  million of expense  related to  accelerated  depreciation  on the impaired
assets.

     Amortization  expense of the  intangible  asset  related to the Bright PCS'
acquisition  was  approximately  $1.3  million  during  the  nine  months  ended
September 30, 2002 and 2001.  Goodwill  amortization was approximately  $300,000
during the nine months ended September 30, 2001. Goodwill amortization ceased as
of December 31, 2001, with the adoption of SFAS No. 142.

     Amortization  expense also includes  amortization  of an  intangible  asset
recorded in  September  2000 related to the grant of new markets to us by Sprint
in September 2000.  Amortization  expense  related to this intangible  asset was
approximately $600,000 for the nine months ended September 30, 2002 and 2001.

     Loss on sale of  property  and  equipment.  During  the nine  months  ended
September 30, 2002, we incurred a loss of approximately  $600,000 related to the
sale of network  equipment and  corporate-owned  vehicles.  The sale resulted in
proceeds of approximately  $1.5 million.  The vehicles were subsequently  leased
back from the purchaser.

     Loss on exchange of stock. On April 2, 2001, the Company  distributed 7,249
shares of Horizon Telcom stock to employees of Horizon PCS. In conjunction  with
this transaction,  the Company  recognized a non-operating loss of approximately


                                       26
<PAGE>

$400,000  representing the reduced fair market value of the stock at the time of
the transaction compared to the original holding value of the investment

     Interest  income and other,  net.  Interest income and other income for the
nine months ended September 30, 2002, was approximately $2.5 million compared to
approximately  $4.8 million in 2001 and consisted  primarily of interest income.
This decrease was due primarily to a lower average  balance of cash  investments
during  2002,  as  compared  to the  same  period  in  2001  and  due to a lower
short-term interest rate environment in 2002.

     Interest expense, net. Interest expense for the nine months ended September
30, 2002, was  approximately  $44.1  million,  compared to  approximately  $18.7
million in 2001. The increase in interest expense was a result of our additional
indebtedness. Interest on the outstanding balance of our secured credit facility
accrues at LIBOR plus a specified margin. On June 29, 2001, we agreed to several
changes in the secured  credit  facility  including a 25 basis point increase in
the margin on the annual interest rate. At September 30, 2002, the interest rate
on the $105.0 million term loan A borrowed under our secured credit facility was
5.80%,  while the  interest  rate on the $50.0  million  term loan B was  6.32%.
Interest  expense on the  secured  credit  facility  was $6.6  million  and $3.6
million during the nine months ended September 30, 2002 and 2001, respectively.

     We accrue  interest  at a rate of 14.00%  annually  on our  discount  notes
issued in September 2000 and will pay interest  semi-annually  in cash beginning
in  October  2005.  Unaccreted  interest  expense  on  the  discount  notes  was
approximately  $116.0  million at September  30, 2002.  Interest  expense on the
discount notes was approximately $20.0 million and $17.4 million during the nine
months ended September 30, 2002 and 2001, respectively.

     On June 15, 2002,  we began  making  semi-annual  interest  payments on our
senior  notes  issued in  December  2001 at an annual  rate of 13.75%.  Interest
expense accrued on the senior notes was  approximately  $18.0 million during the
nine months ended September 30, 2002. Under the terms of the senior notes,  cash
to cover the first four  semi-annual  interest  payments was placed in an escrow
account.

     Interest  expense  also  includes  approximately  $2.0 million and $600,000
during the nine  months  ended  September  30, 2002 and 2001,  respectively,  of
amortization  from the deferred  financing  fees  related to our secured  credit
facility, our discount notes and our senior notes. Also contributing to interest
expense was  approximately  $1.3 million and 2.2 million  during the nine months
ended  September  2002 and 2001,  respectively,  in commitment  fees paid on the
unused portion of our secured credit facility.

     Capitalized  interest  during the nine months ended  September 30, 2002 and
2001, was approximately $3.8 million and 5.1 million, respectively.

     Income  taxes.   Until   September  26,  2000,  we  were  included  in  the
consolidated  federal  income tax  return of Horizon  Telcom.  We  provided  for
federal  income  taxes  on a  pro-rata  basis,  consistent  with a  consolidated
tax-sharing  agreement.  As a result  of the sale of the  convertible  preferred
stock on  September  26,  2000,  we will not be able to  participate  in the tax
sharing agreement nor will we be able to utilize any net operating loss benefits
until we start to  generate  taxable  income.  We did not  record any income tax
benefit for the nine months ended  September 30, 2002 because of the uncertainty
of  generating  future  taxable  income  to be able  to  recognize  current  net
operating losses.

     Net loss.  Our net loss for the nine months ended  September 30, 2002,  was
approximately  $119.7 million  compared to  approximately  $75.4 million for the
nine months  ended  September  30, 2001.  The increase in our loss  reflects the
continued  expenses  related to launching  our markets and building our customer
base.  We  expect  to  incur  significant   operating  losses  and  to  generate
significant  negative cash flow from operating  activities  while we continue to
construct our network and increase our customer base.

     Preferred  stock  dividend.  Our  convertible  preferred stock pays a stock
dividend at the rate of 7.5% per annum, payable semi-annually  commencing May 1,
2001. The dividends are paid with  additional  shares of  convertible  preferred
stock. Through September 30, 2002, we have issued an additional 3,245,134 shares
of  convertible  preferred  stock in payment of dividends,  including  1,060,201
shares on May 1, 2002. An additional  1,099,958 were issued on November 1, 2002,
and are not included in the total above.

                                       27
<PAGE>


     Other  comprehensive  income  (loss).  During  2001,  we  entered  into two
two-year interest rate swaps,  effectively fixing $50.0 million of the term loan
B borrowed  under the secured  credit  facility.  We do not expect the effect of
these swaps to have a material  impact to interest  expense for the remainder of
their lives. We recovered approximately $141,000 of previously unrealized losses
in other comprehensive income during the first nine months of 2002.

LIQUIDITY AND CAPITAL RESOURCES

     Through  September  26, 2000,  we financed our  operations  through  equity
contributions  from Horizon  Telcom and through debt  financing  provided by the
Rural Telephone Finance  Cooperative  (RTFC). On September 26, 2000, an investor
group led by Apollo  Management  purchased  $126.5  million  of our  convertible
preferred stock in a private placement.  Concurrent with the closing, holders of
our $14.1 million  short-term  convertible  note (including  accrued interest of
$1.1 million)  converted it into the same convertible  preferred stock purchased
by the investor group.

     Also on September 26, 2000,  the Company  received  $149.7 million from the
issuance of $295.0  million of discount  notes.  The discount  notes  accrete in
value at a rate of 14% compounded  semi-annually.  The Company will begin making
semi-annual cash interest payments on the discount notes on October 1, 2005. The
discount  notes were subject to an exchange offer that was completed in 2001. At
September 30, 2002,  the discount notes were rated by Standard and Poors ("S&P")
as "B-", which means a company's  obligation is vulnerable to non-payment  under
adverse business,  financial or economic conditions, but the obligor of an issue
currently has the capacity to meet its financial  commitment on its  obligation.
On October 29, 2002,  S&P  downgraded our corporate debt rating to "CCC+" with a
negative  outlook,  which  means  an  obligation  "is  currently  vulnerable  to
nonpayment  and is dependent upon favorable  business,  financial,  and economic
conditions for the obligor to meet its financial  commitment on the  obligation.
In the event of adverse business, financial, or economic conditions, the obligor
is not  likely to have the  capacity  to meet its  financial  commitment  on the
obligation." At September 30, 2002, Moody's Investors Services ("Moody's") rated
the notes as "Caa1",  which means an issue is in "poor standing." On October 28,
2002,  Moody's  downgraded  it's rating on our  discount  notes to "C," which is
Moody's lowest bond rating. The CUSIP on the discount notes is 44043UAC4.

     Also on September 26, 2000, we negotiated a $225.0  million  secured credit
facility led by Wachovia (formerly First Union National Bank). The amount of the
secured  credit  facility was increased to $250.0  million in November  2000. We
drew a $50.0 million term loan under the facility on September  26, 2000,  and a
$105.0  million  term loan on March 22,  2002.  A $95.0  million  line of credit
remains  committed  to us  under  the  facility  at  September  30,  2002,  with
restrictions.

     Horizon PCS' secured credit facility includes financial covenants that must
be met each  quarter.  The Company did not meet the  covenant for EBITDA for the
first  quarter  of 2002.  As a result  of  higher  than  expected  gross and net
additions to Horizon PCS  subscribers  for that  quarter,  the Company  incurred
additional  expenses to add those  customers.  Although  the Company  ultimately
benefits  from the revenues  generated by new  subscribers,  the Company  incurs
one-time  expenses  associated  with  new  subscribers,  including  commissions,
handset  subsidies,  set up costs for the network and marketing  expenses.  As a
result,  these new subscriber costs  negatively  affect EBITDA in the short-term
during  the  period  of  the   addition  of  new   subscribers,   which  led  to
non-compliance with the EBITDA covenant for the first quarter of 2002.

     On June 27,  2002,  the  Company  entered  into a fourth  amendment  to its
secured credit  agreement  with the bank group.  The amendment  adjusts  certain
financial  covenants  and  increases  the margin on the base interest rate by 25
basis points to LIBOR plus 400 to 450 basis points, while also providing for the
payment of fees to the  banking  group,  an increase  in  post-default  interest
rates, a new financial  covenant  regarding minimum  available cash,  additional
prepayment  requirements,  restrictions  on Horizon  PCS'  borrowings  under the
remaining  $95.0 million line of credit and deposit  requirements  on the $105.0
million we  borrowed  under the  secured  credit  facility  in March  2002.  The
amendment, and details on the requirements and restrictions,  was filed with the
Company's Form 8-K on June 27, 2002.


                                       28
<PAGE>


    The following  table details the maximum amount  available to be borrowed on
the line of credit for the period then ended:
                                                                Maximum amount
                                                               available to be
                                                                   borrowed
                                                               ---------------
         September 30, 2002................................    $         --
         December 31, 2002.................................              --
         March 31, 2003....................................              --
         June 30, 2003.....................................      16,000,000
         September 30, 2003................................      26,000,000
         December 31, 2003.................................      33,000,000
         March 31, 2004....................................      52,000,000
         Thereafter........................................      95,000,000

     The following table details the minimum balance requirements placed on cash
and cash equivalents under the amended terms of the secured credit facility:

                                                              Deposit balance
                                                                requirement
                                                             -----------------
        At September 30, 2002...............................    $ 71,000,000
        October 1, 2002, through November 15, 2002..........      63,000,000
        November 16, 2002, through December 31, 2002........      55,000,000
        January 1, 2003, through February 15, 2003..........      33,000,000
        February 16, 2003, through March 31, 2003...........      11,000,000
        April 1, 2003, through May 15, 2003.................       5,500,000

     As of September  30,  2002,  the Company is in  compliance  with all of the
applicable covenants, as amended.

     On December 7, 2001, the Company  received $175.0 million from the issuance
of unsecured senior notes.  Cash interest  payments on the senior notes are made
semi-annually  at an annual rate of 13.75%.  A portion of the offering  proceeds
was  placed in an escrow  account to fund the first  four  semi-annual  interest
payments and is classified as restricted  cash. The first  interest  payment was
made on June 15, 2002.  The senior notes were subject to an exchange  offer that
was completed in 2002. At September 30, 2002, the senior notes were rated by S&P
as "B-." On October 29, 2002, S&P downgraded our corporate debt rating to "CCC+"
with a negative  outlook.  Moody's rated the senior notes as "Caa1",  which is a
bond in "poor standing." On October 28, 2002,  Moody's  downgraded its rating on
our senior notes to "C," which is Moody's  lowest bond rating.  The CUSIP on the
senior notes is 44043UAH3.

    The following  table  summarizes  our  long-term  debt  principal  repayment
requirements for the next five years:
<TABLE>
<CAPTION>
<S>                            <C>        <C>      <C>        <C>      <C>       <C>

(Dollars in millions)                               Years Ending December 31,
                               ------------------------------------------------------------
                                  2002     2003      2004       2005      2006   Thereafter
                               --------- --------- ---------  -------  --------  ----------
Secured credit facility,
  due 2008..................... $ 155.0   $ 155.0   $146.5    $126.5   $  99.7    $ 99.7
     Variable interest rate (1)    5.97%      5.97%    5.97%     5.97%     5.97%     5.97%
     Principal payments........ $   --    $   --    $  8.3    $ 20.2   $  26.8    $ 99.7
Discount notes, due 2010 (2)... $ 186.3   $ 217.5   $253.1    $283.7   $ 286.1    $295.0
     Fixed interest rate.......    14.00%    14.00%   14.00%    14.00%    14.00%    14.00%
     Principal payments........ $   --    $   --    $  --     $  --    $   --     $295.0
Senior notes, due 2011......... $ 175.0   $ 175.0   $175.0    $175.0   $ 175.0    $175.0
     Fixed interest rate.......    13.75%    13.75%   13.75%    13.75%    13.75%    13.75%
     Principal payments........ $   --    $  --     $  --     $  --    $   --     $175.0

</TABLE>

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

(1)  Interest  rate on the secured  credit  facility  equals LIBOR plus a margin
     that varies from 400 to 450 basis  points.  At September  30,  2002,  $50.0
     million was  effectively  fixed at 8.53%  through two  interest  rate swaps
     discussed in "ITEM 3. Quantitative and Qualitative Disclosures About Market
     Risk".  The nominal interest rate is assumed to equal 5.97% for all periods
     ($50.0 million at 6.32% and $105.0 million at 5.80%).


                                       29
<PAGE>


(2)  Face value of the discount  notes is $295.0  million.  End of year balances
     presented  herein  are net of the  discount  and  assume  accretion  of the
     discount as interest expense at an annual rate of 14.00%.

     At September 30, 2002, we had cash and cash  equivalents  of  approximately
$109.1 million and working capital of approximately  $107.3 million. At December
31, 2001, we had cash and cash equivalents of  approximately  $123.8 million and
working capital of approximately  $117.0 million.  The decrease in cash and cash
equivalents  of  approximately  $14.7 million is primarily  attributable  to the
funding of our loss from continuing  operations of approximately  $119.7 million
(this  loss  includes  certain   non-cash   charges)  and  funding  our  capital
expenditures  of  approximately  $57.6  million  during the first nine months of
2002, offset by the $105.0 million draw on the secured credit facility.

     The Company was also required to escrow funds sufficient to cover the first
four  interest  payments  on the senior  notes.  These  funds are  presented  as
restricted cash on the  consolidated  balance sheet.  Net cash used in operating
activities for the nine months ended September 30, 2002, was approximately $61.0
million.  This reflects the  continuing  use of cash for our operations to build
our customer base, including but not limited to providing service in our markets
and the costs of acquiring new customers.  The net loss of approximately  $119.7
million was partially offset by increases to depreciation,  increases in accrued
liabilities,  including  the payable to Sprint,  offset by increases to accounts
receivable.

     Net cash used in investing  activities for the nine months ended  September
30, 2002, was  approximately  $56.1 million.  Our capital  expenditures for that
period were approximately $57.6 million, reflecting the continuing build-out and
upgrade of our network.  At September  30, 2002, we operated  approximately  791
cell sites in our network  (an  additional  507 cell sites were  operated by the
Alliances in our territories).  This represents an addition of approximately 187
sites during the nine months ended September 30, 2002. In addition to the sites,
we have  increased  the number of switching  stations in our  territory and have
increased  our  number  of  retail  stores  from  38 at the end of 2001 to 40 at
September 30, 2002. We will incur additional capital expenditures as we complete
the build-out of our network,  including the launch of additional retail stores,
completing  additional cell sites for 3G compatibility and expanding capacity at
our  switches as needed,  but  anticipate  future  expenditures  to be less than
historical levels.

     Net  cash  provided  by  financing  activities  for the nine  months  ended
September 30, 2002, was $102.4 million  consisting mostly of the March 2002 draw
on the term loan A required under our secured credit facility of $105.0 million.
We incurred $2.6 million of deferred  financing fees related to the amendment of
our covenants under the secured credit facility discussed above.

     At September  30,  2002,  we had a $95.0  million line of credit  committed
under our secured credit facility. We believe the available borrowings under our
secured  credit  facility  will be  adequate  to  fund  our  network  build-out,
anticipated  operating losses and working capital  requirements until we achieve
positive  EBITDA,  which we expect to occur during 2004. We believe the increase
in churn and subsequent  write-offs of involuntary NDASL deactivations  combined
with a slow down in activation  growth  during the second and third  quarters of
2002 has extended the time it will take to reach positive EBITDA.

     Income from  ongoing  operations  and EBITDA are not  measures of financial
performance  under generally  accepted  accounting  principles and should not be
considered  alternatives  to net income (loss) as measures of  performance or to
cash flows as a measure of liquidity.

     For the year ended  December 31, 2002, we anticipate our funding needs will
be between  $150.0  million and $160.0  million,  of which  approximately  $60.0
million  to  $70.0  million  will be used  for  capital  expenditures  with  the
remainder  utilized to fund working  capital and  operating  losses.  The actual
funds  required to  build-out  and  upgrade  our  network and to fund  operating
losses,  working  capital needs and other capital needs may vary materially from
these  estimates  and  additional  funds may be required  because of  unforeseen
delays, cost overruns,  unanticipated expenses,  regulatory changes, engineering
design  changes and  required  technological  upgrades  and other  technological
risks. Additionally,  Sprint is planning to continually upgrade their nationwide
network  to  deploy  higher  data  rate  speeds  that may  require  us to outlay
additional capital expenditures in future years that have not been determined at
this point.  Should the Company be required to upgrade its network to provide 3G
services  that  meet  Sprint's  standards,  we may  need  to  obtain  additional
financing to fund those capital expenditures.


                                       30
<PAGE>


     Other  future  cash  expenditures  that may require  additional  borrowings
include:

     o    expanding  the  coverage  within  our  existing  operating  markets or
          improving call quality with fill-in coverage;

     o    opening  additional  retail  stores,  beyond  our  current  plan of 50
          stores;

     o    mergers or  acquisitions  of other PCS  affiliates  of Sprint or other
          compatible PCS carriers;

     o    the grant to us by  Sprint  of  additional  markets  under our  Sprint
          agreements; and/or

     o    expanding our network, if economically justifiable,  by exercising our
          right to build our own network in our markets which are covered by our
          network services  agreement with the Alliances under the terms of that
          amended agreement.

     If we are  unable to obtain any  necessary  additional  financing  or if we
incur further restrictions on the availability of our current funding and we are
unable to  complete  our  network  upgrades  and  build-out  as  required by the
management agreements, Sprint may terminate our agreements; we will no longer be
able to offer  Sprint PCS  products  and  services.  In this  event,  Sprint may
purchase  our  operating  assets or capital  stock  under  terms  defined in our
agreements  with  Sprint.  Also,  any  delays  in our  build-out  may  result in
penalties under our Sprint agreements, as amended.

     Other risk factors that may impact liquidity are:

     o    We may not be able to sustain our growth or obtain sufficient  revenue
          to  achieve  and  sustain   positive  cash  flow  from  operations  or
          profitability;

     o    We may  experience  a higher  churn rate,  which could result in lower
          revenue;

     o    New  customers  may be of lower  credit  quality,  which may require a
          higher provision for doubtful accounts;

     o    Increased competition causing declines in ARPU;

     o    Our  failure to comply  with  restrictive  financial  and  operational
          covenants under the secured credit facility; and

     o    Our upgrade to 3G services,  due to which we have incurred significant
          capital expenditures, may not be successful in the marketplace and may
          not result in incremental revenue.

SEASONALITY

     Our business is subject to  seasonality  because the wireless  industry has
historically  been heavily  dependent on calendar fourth quarter results.  Among
other things, the industry relies on significantly higher customer additions and
handset  sales in the  calendar  fourth  quarter as  compared to the other three
calendar quarters. A number of factors contribute to this trend, including:

     o    the  increasing  use of retail  distribution,  which is more dependent
          upon the year-end holiday shopping season;

     o    the timing of new product and service announcements and introductions;

     o    competitive pricing pressures; and

     o    aggressive marketing and promotions.


                                       31
<PAGE>

INFLATION

     We believe  that  inflation  has not had a material  adverse  effect on our
results of operation.

RECENT ACCOUNTING PRONOUNCEMENTS

     In June 2002 the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." This Statement addresses financial accounting
and reporting for costs associated with exit or disposal activities by requiring
that  expenses  related to the exit of an activity  or  disposal  of  long-lived
assets will be recorded when they are incurred and measurable. Prior to SFAS No.
146,  these charges were accrued at the time of commitment to exit or dispose of
an activity.  The Company will adopt SFAS 146 on January 1, 2003,  and it is not
expected to have a material effect on the Company's financial position,  results
of operations or cash flows.

     In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements
No.  4,  44  and  64,   Amendment  of  FASB  Statement  No.  13,  and  Technical
Corrections."  SFAS No. 145 addresses the  accounting  for gains and losses from
the  extinguishment  of debt,  economic  effects  and  accounting  practices  of
sale-leaseback   transactions  and  makes  technical   corrections  to  existing
pronouncements. The Company adopted SFAS No. 145 on July 1, 2002, and it has not
had a material effect on the Company's financial position, results of operations
or cash flows.

     In  August  2001,  the  FASB  issued  SFAS  No.  144,  "Accounting  for the
Impairment or Disposal of Long-Lived  Assets." SFAS No. 144 addresses  financial
accounting and reporting for the impairment of long-lived  assets. The statement
supersedes SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and
for  Long-Lived  Assets to Be Disposed  Of," and the  accounting  and  reporting
provisions of APB Opinion No. 30. SFAS No. 144 removes  goodwill from its scope,
as goodwill is addressed in the impairment  test described  above under SFAS No.
142.  The  Company  adopted  SFAS No. 144 on January 1, 2002.  See Note 4 in the
"Notes to  Consolidated  Financial  State" for  discussion  on the impact of the
adoption of this statement.

     In June  2001,  the  FASB  issued  SFAS  No.  143,  "Accounting  for  Asset
Retirement  Obligations."  This  statement  addresses  financial  accounting and
reporting for obligations associated with the retirements of tangible long-lived
assets  and  the  associated  asset  retirement   costs.  It  applies  to  legal
obligations  associated  with the  retirement  of long- lived assets that result
from the  acquisition,  construction,  development and the normal operation of a
long-lived  asset.  The Company will adopt this statement  effective  January 1,
2003,  and  it is not  expected  to  have a  material  effect  on the  Company's
financial position, results of operations or cash flows.

     The Company adopted SFAS No. 141, "Business Combinations" and SFAS No. 142,
"Goodwill  and Other  Intangible  Assets" on January 1, 2002. As a result of the
adoption,  goodwill amortization ceased as of December 31, 2001, and the Company
is required to complete an  impairment  test of its remaining  goodwill  balance
annually (or more frequently if impairment  indicators  arise).  As of September
30,  2002,  the  Company  has  goodwill  of  approximately  $7,191,000,  net  of
accumulated  amortization,  related to the acquisition of Bright PCS. See Note 8
in the "Notes to Consolidated Financial Statements." .


                                       32
<PAGE>



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     We do not engage in commodity  futures trading  activities and do not enter
into derivative financial  instruments for speculative trading purposes. We also
do not engage in  transactions  in foreign  currencies  that would  expose us to
additional  market  risk.  We manage the interest  rate risk on our  outstanding
long-term debt through the use of fixed and variable-rate debt and interest rate
swaps.

     In the normal course of business,  our  operations  are exposed to interest
rate  risk.  Our  primary  interest  rate  risk  exposure  relates  to  (i)  the
variable-rate  secured  credit  facility,  (ii) our  ability  to  refinance  our
fixed-rate  discount and senior notes at maturity at market rates, and (iii) the
impact of  interest  rate  movements  on our  ability to meet  interest  expense
requirements and meet financial covenants under our debt instruments.

     In the first  quarter of 2001,  we entered  into a two-year  interest  rate
swap, effectively fixing $25.0 million of term loan B borrowed under the secured
credit facility.  In the third quarter of 2001, we entered into another two-year
interest rate swap,  effectively fixing the remaining $25.0 million of term loan
B. The table below compares  current market rates on the balances subject to the
swap agreements:

           (Dollars in millions)                 At September 30, 2002
                                           -----------------------------------
                                           Balance     Market rate   Swap rate
           Swap 1.....................      $25.0         6.32%        9.40%
           Swap 2.....................      $25.0         6.32%        7.65%

     Since  our swap  interest  rates  are  currently  greater  than the  market
interest rates on our underlying  debt,  our results from  operations  currently
reflect a higher  interest  expense than had we not hedged our  position.  Since
inception  and through  September  30, 2002,  we have  recognized  approximately
$200,000 in losses due to the ineffectiveness of these swaps in the consolidated
statement  of  operations.   At  September  30,  2002,  the  Company  recognized
approximately $700,000 in other comprehensive losses on the balance sheet.

     While we cannot predict our ability to refinance existing debt, we continue
to evaluate our interest rate risk on an ongoing  basis.  If we do not renew our
swaps,  or, if we do not hedge  incremental  variable-rate  borrowings under our
secured credit  facility,  we will increase our interest rate risk,  which could
have a  material  impact on our  future  earnings.  As of  September  30,  2002,
approximately  83% of our long-term  debt is fixed rate or is variable rate that
has been swapped under fixed-rate hedges, thus reducing our exposure to interest
rate risk.  Currently,  a 100 basis  point  increase  in  interest  rates  would
increase our interest expense approximately $1.1 million.

ITEM 4. CONTROLS AND PROCEDURES

     With the participation of management, the Company's chief executive officer
and chief  financial  officer  evaluated the Company's  disclosure  controls and
procedures  within  the 90 days  preceding  the  filing  date of this  quarterly
report.  Based  upon this  evaluation,  the chief  executive  officer  and chief
financial  officer  concluded  that  the  Company's   disclosure   controls  and
procedures  are effective in ensuring that material  information  required to be
disclosed  is  included  in the reports  that it files with the  Securities  and
Exchange Commission.

     There were no significant changes in the Company's internal controls or, to
the  knowledge of the  management  of the Company,  in other  factors that could
significantly affect these controls subsequent to the evaluation date.


                                       33
<PAGE>



                           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 VOTE OF SECURITY HOLDERS

     None.

ITEM 5. OTHER INFORMATION

                                  RISK FACTORS

WE HAVE NOT HAD ANY  PROFITABLE  YEARS IN THE PAST  FIVE  YEARS,  AND WE MAY NOT
ACHIEVE OR SUSTAIN OPERATING  PROFITABILITY OR POSITIVE CASH FLOW FROM OPERATING
ACTIVITIES.

     We expect to incur significant operating losses and to generate significant
negative  cash flow from  operating  activities  until 2004 while we continue to
construct our network and grow our customer  base.  Our operating  profitability
will depend upon many  factors,  including  our ability to market our  services,
achieve our projected market  penetration and manage customer turnover rates. If
we do not achieve and maintain  operating  profitability  and positive cash flow
from operating activities on a timely basis, we may not be able to meet our debt
service requirements.

IF WE FAIL TO COMPLETE THE  BUILD-OUT OF OUR NETWORK,  SPRINT MAY  TERMINATE THE
SPRINT  PCS  AGREEMENTS  AND WE WOULD NO  LONGER  BE ABLE TO  OFFER  SPRINT  PCS
PRODUCTS AND SERVICES FROM WHICH WE GENERATE SUBSTANTIALLY ALL OUR REVENUES.

     Our long-term affiliation  agreements with Sprint, which we refer to as the
Sprint PCS agreements, require us to build and operate the portion of the Sprint
PCS network  located in our  territory in  accordance  with  Sprint's  technical
specifications  and coverage  requirements.  The  agreements  also require us to
provide  minimum network  coverage to the population  within each of the markets
that make up our territory by specified dates.

     Under our original Sprint PCS agreements,  we were required to complete the
build-out in several of our markets in Pennsylvania and New York by December 31,
2000. Sprint and HPC agreed to an amendment of the build-out requirements, which
extended the dates by which we were to launch coverage in several  markets.  The
amended Sprint PCS agreement provides for monetary penalties to be paid by us if
coverage is not launched by these extended  contract  dates.  The amounts of the
penalties  depends on the  market  and  length of delay in  launch,  and in some
cases,  whether  the  shortfall  relates to an  initial  launch in the market or
completion of the remaining build-out. The penalties must be paid in cash or, if
both Horizon PCS and Sprint agree, in shares of Horizon PCS stock.

     Under the amended Sprint PCS agreement,  portions of the New York, Sunbury,
Williamsport,  Oil City, Dubois,  Erie,  Meadville,  Sharon,  Olean,  Jamestown,
Scranton,  State College,  Stroudsburg,  Allentown and  Pottsville  markets were
required to be completed and launched by October 31, 2001.  Although we launched
service in portions of each of these  markets,  we did not  complete  all of the
build-out requirements.  We notified Sprint PCS in November 2001 that it was our
position that the reasons for the delay constitutes events of "force majeure" as
described  in the Sprint PCS  agreements  and that,  consequently,  no  monetary
penalties or other remedies were applicable.  The delay was primarily caused due
to delays in  obtaining  the  required  backhaul  services  from local  exchange
carriers  and zoning  and other  approvals  from  governmental  authorities.  On


                                       34
<PAGE>

January 30, 2002,  Sprint  notified us that,  as a result of these force majeure
events,  it does not consider our  build-out  delay to be a breach of the Sprint
PCS agreement.  We agreed to use commercially reasonable efforts to complete the
build-out by June 30, 2002.  We have not been able to complete some of the sites
in some markets due to continuing force majeure issues.

     We will  require  additional  expenditures  of  significant  funds  for the
continued development,  construction,  testing,  deployment and operation of our
network.  These  activities  are  expected to place  significant  demands on our
managerial, operational and financial resources. A failure to meet our build-out
requirements for any of our markets, or to meet Sprint's technical requirements,
would  constitute a breach of the Sprint PCS agreements that could lead to their
termination if not cured.  If Sprint  terminates  these  agreements,  we will no
longer be able to offer Sprint PCS products and services.

OUR SUBSTANTIAL  INDEBTEDNESS  COULD ADVERSELY  AFFECT OUR FINANCIAL  HEALTH AND
PREVENT US FROM FULFILLING OUR LONG-TERM DEBT OBLIGATIONS.

     As of September 30, 2002, our total debt  outstanding  was $625.0  million,
comprised of $155.0 million borrowed under our secured credit  facility,  $175.0
million due under our senior  notes issued in December  2001 and $295.0  million
represented  by our discount  notes (which are reported on our balance  sheet at
September 30, 2002, net of a discount of approximately $116.0 million).

     Our  substantial  debt  will  have  a  number  of  important  consequences,
including the following:

     o    we may not have sufficient funds to pay interest on, and principal of,
          our debt;

     o    we have to dedicate a  substantial  portion of any positive  cash flow
          from  operations  to the payment of interest on, and principal of, our
          debt, which will reduce funds available for other purposes;

     o    we may  not be able  to  obtain  additional  financing  for  currently
          unanticipated  capital  requirements,  capital  expenditures,  working
          capital requirements and other corporate purposes;

     o    some  borrowings  likely will be at variable rates of interest,  which
          will result in higher  interest  expense in the event of  increases in
          market interest rates;

     o    due to the liens on substantially all of our assets and the pledges of
          equity  ownership of our  subsidiaries  that secure our secured credit
          facility, our lenders may control our assets upon a default;

     o    our debt increases our  vulnerability  to general adverse economic and
          industry conditions;

     o    our debt  limits our  flexibility  in planning  for,  or reacting  to,
          changes in our business and the industry in which we operate; and

     o    our debt  places  us at a  competitive  disadvantage  compared  to our
          competitors that have less debt.

TO SERVICE OUR INDEBTEDNESS,  WE WILL REQUIRE A SIGNIFICANT  AMOUNT OF CASH. OUR
ABILITY TO GENERATE CASH DEPENDS ON MANY FACTORS BEYOND OUR CONTROL.

     Our ability to make payments on and to refinance our  indebtedness,  and to
fund our network  build-out,  anticipated  operating  losses and working capital
requirements will depend on our ability to generate cash in the future. This, to
a certain  extent,  is  subject  to general  economic,  financial,  competitive,
legislative, regulatory and other factors that are beyond our control.

     We cannot be certain that our business will generate  sufficient  cash flow
from  operations  or that future  borrowings  will be  available to us under our
secured  credit  facility  in an  amount  sufficient  to  enable  us to pay  our
indebtedness or to fund our other liquidity  needs. We may need to refinance all
or a portion of our indebtedness, including the notes, on or before maturity. We
may not be able to refinance any of our indebtedness on commercially  reasonable
terms, or at all.


                                       35
<PAGE>


IF WE FAIL TO PAY OUR DEBT,  OUR  LENDERS  MAY SELL OUR  LOANS TO SPRINT  GIVING
SPRINT THE RIGHTS OF A CREDITOR TO FORECLOSE ON OUR ASSETS.

     If the  lenders  accelerate  the  amounts  due  under  our  secured  credit
facility,  Sprint has the right to purchase our obligations  under that facility
and become a senior lender.  To the extent Sprint  purchases these  obligations,
Sprint's interests as a creditor could conflict with ours.  Sprint's rights as a
senior lender would enable it to exercise  rights with respect to our assets and
Sprint's  continuing  relationship in a manner not otherwise permitted under the
Sprint PCS agreements.

IF SPRINT TERMINATES THE SPRINT PCS AGREEMENTS,  THE BUY-OUT PROVISIONS OF THOSE
AGREEMENTS MAY DIMINISH THE VALUATION OF OUR COMPANY.

     Provisions  of the Sprint PCS  agreements  could affect our  valuation  and
decrease our ability to raise  additional  capital.  If Sprint  terminates these
agreements, Sprint may purchase our operating assets or capital stock for 80% of
the "Entire  Business Value" as defined by the agreement.  If the termination is
due to our breach of the Sprint PCS  agreements,  the  percent is reduced to 72%
instead of 80%. Under our Sprint PCS  agreements,  the Entire  Business Value is
generally  the fair  market  value of our  wireless  business  valued on a going
concern basis as determined by an independent  appraiser and assumes that we own
the FCC licenses in our territory.  In addition,  Sprint must approve any change
of control of our  ownership  and  consent to any  assignment  of the Sprint PCS
agreements.  Sprint  also has a right of first  refusal if we decide to sell our
operating  assets in our Bright PCS markets.  We are also subject to a number of
restrictions on the transfer of our business  including a prohibition on selling
our  company or our  operating  assets to a number of  identified  and yet to be
identified competitors of Sprint. These and other restrictions in the Sprint PCS
agreements  may limit the  marketability  of and reduce the price a buyer may be
willing to pay for the  Company  and may  operate to reduce the Entire  Business
Value of the Company.

THE TERMINATION OF OUR STRATEGIC  AFFILIATION WITH SPRINT OR SPRINT'S FAILURE TO
PERFORM ITS OBLIGATIONS  UNDER THE SPRINT PCS AGREEMENTS WOULD SEVERELY RESTRICT
OUR ABILITY TO CONDUCT OUR BUSINESS.

     Because  Sprint owns the FCC  licenses  that we use in our  territory,  our
ability to offer Sprint PCS products and services on our network is dependent on
the Sprint PCS agreements  remaining in effect and not being terminated.  Sprint
may terminate the Sprint PCS agreements for breach by us of any material  terms.
We also depend on Sprint's  ability to perform its obligations  under the Sprint
PCS  agreements.  The termination of the Sprint PCS agreements or the failure of
Sprint to perform its obligations under the Sprint PCS agreements would severely
restrict our ability to conduct our wireless digital communications business.

IF SPRINT DOES NOT COMPLETE THE  CONSTRUCTION OF ITS NATIONWIDE PCS NETWORK,  WE
MAY NOT BE ABLE TO ATTRACT AND RETAIN  CUSTOMERS,  WHICH WOULD ADVERSELY  AFFECT
OUR REVENUES.

     Sprint's PCS network may not provide nationwide coverage to the same extent
as its  competitors'  networks,  which  could  adversely  affect our  ability to
attract  and retain  customers.  Sprint is  creating a  nationwide  PCS  network
through its own construction efforts and those of its affiliates. Today, neither
Sprint  nor any other PCS  provider  offers  service in every area of the United
States.  Sprint has entered  into  affiliation  agreements  similar to ours with
companies  in  other  territories  pursuant  to  its  nationwide  PCS  build-out
strategy. Our business and results of operations depend on Sprint's national PCS
network and, to a lesser extent, on the networks of its other affiliates. Sprint
and its  affiliate  program are subject,  in varying  degrees,  to the economic,
administrative,  logistical,  regulatory  and  other  risks  described  in  this
document.  Sprint's  and  its  other  affiliates'  PCS  operations  may  not  be
successful,  which in turn  could  adversely  affect  our  ability  to  generate
revenues.


                                       36
<PAGE>



WE ARE DEPENDENT UPON SPRINT'S BACK OFFICE SERVICES AND ITS THIRD-PARTY VENDORS'
BACK OFFICE  SYSTEMS.  PROBLEMS  WITH THESE  SYSTEMS,  OR  TERMINATION  OF THESE
ARRANGEMENTS, COULD DISRUPT OUR BUSINESS AND POSSIBLY INCREASE OUR COSTS.

     Because Sprint  provides our back office systems such as billing,  customer
care and  collections,  our operations could be disrupted if Sprint is unable to
maintain and expand its back office services,  or to efficiently outsource those
services  and  systems  through  third-party  vendors.  The rapid  expansion  of
Sprint's business will continue to pose a significant  challenge to its internal
support systems.  Additionally,  Sprint has relied on third-party  vendors for a
significant number of important functions and components of its internal support
systems and may  continue to rely on these  vendors in the future.  We depend on
Sprint's  willingness  to continue to offer these  services to us and to provide
these services at  competitive  costs.  The Sprint PCS agreements  provide that,
upon nine months'  prior  written  notice,  Sprint may elect to terminate any of
these services. If Sprint terminates a service for which we have not developed a
cost-effective  alternative,   our  operating  costs  may  increase  beyond  our
expectations and restrict our ability to operate successfully.

WE DEPEND ON OTHER  TELECOMMUNICATIONS  COMPANIES  FOR SOME  SERVICES  THAT,  IF
DELAYED,  COULD  DELAY OUR  PLANNED  NETWORK  BUILD-OUT  AND DELAY OUR  EXPECTED
INCREASES IN CUSTOMERS AND REVENUES.

     We depend on other  telecommunications  companies to provide facilities and
transport  to  interconnect  portions  of our network and to connect our network
with the landline telephone system.  American Electric Power,  Ameritech,  AT&T,
Verizon and Sprint (long  distance) are our primary  suppliers of facilities and
transport. Without these services, we could not offer Sprint PCS services to our
customers  in some  areas.  From  time to time,  we have  experienced  delays in
obtaining  facilities  and  transport  from  some  of  these  companies,  and in
obtaining local telephone numbers for use by our customers,  which are sometimes
in short supply,  and we may continue to experience  delays and interruptions in
the  future.  Delays in  obtaining  facilities  and  transport  could  delay our
build-out  and capacity  plans and our  business  may suffer.  Delays could also
result in a breach of our Sprint PCS agreements,  subjecting these agreements to
potential termination by Sprint.

IF WE DO NOT MEET ALL OF THE CONDITIONS  UNDER OUR SECURED CREDIT  FACILITY,  WE
MAY NOT BE ABLE TO DRAW  DOWN ALL OF THE  FUNDS  UNDER THE  FACILITY  AND,  AS A
RESULT,  WE MAY NOT BE ABLE TO COMPLETE THE BUILD-OUT OF OUR NETWORK,  WHICH MAY
RESULT IN THE TERMINATION OF THE SPRINT PCS AGREEMENTS.

     Our secured  credit  facility  provides for aggregate  borrowings of $250.0
million  of  which  $155.0  million  was  borrowed  as of  September  30,  2002.
Availability of future borrowings will be subject to customary credit conditions
at each funding date, including the following:

     o    the absence of any default or event of default;

     o    the continuing accuracy of all representations and warranties; and

     o    no material adverse change.

     If we do not meet  these  conditions  at each  funding  date,  our  secured
lenders may choose not to lend any or all of the remaining amounts, and if other
sources of funds are not available,  we may not be in a position to complete the
build-out of our  network.  If we do not have  sufficient  funds to complete our
network  build-out,  we may be in breach of the  Sprint  PCS  agreements  and in
default under our senior secured credit facility.

     Horizon PCS' secured credit facility includes financial covenants that must
be met each  quarter.  We did not meet the  covenant  for  EBITDA  for the first
quarter of 2002. As a result of higher than expected  gross and net additions to
Horizon PCS subscribers for the quarter,  we incurred additional expenses to add
those customers.  Although we ultimately  benefit from the revenues generated by
new  subscribers,  we incur one-time  expenses  associated with new subscribers,
including  commissions,  handset  subsidies,  set up costs for the  network  and
marketing  expenses.  As a result,  these new subscriber costs negatively affect
EBITDA in the  short-term  during the period of the addition of new  subscribers
which led to  non-compliance  with the EBITDA  covenant for the first quarter of
2002.


                                       37
<PAGE>



     On June 27, 2002, Horizon PCS obtained a waiver of the non-compliance  with
the EBITDA  covenant for the first quarter of 2002 and entered into an amendment
of the secured credit facility.  The amended facility  primarily adjusts certain
financial  covenants  and  increases the margin on the base interest by 25 basis
points,  while also providing for the payment of fees to the banking  group,  an
increase in  post-default  interest  rates, a new financial  covenant  regarding
minimum  available cash,  additional  prepayment  requirements,  restrictions on
Horizon PCS'  borrowings  under the  remaining  $95.0 million  revolving  credit
facility  and deposit  requirements  on the $105.0  million  borrowed  under the
secured credit facility in March 2002.

     Although under its most recent forecast,  Horizon PCS currently  expects to
remain in compliance  with the  covenants as amended,  there can be no assurance
that its financial  results will not be lower than expected in future  quarters,
causing another  non-compliance  to occur,  which could have a material  adverse
effect on Horizon PCS' financial condition and results of operations.

MATERIAL  RESTRICTIONS  IN OUR DEBT  INSTRUMENTS MAY MAKE IT DIFFICULT TO OBTAIN
ADDITIONAL  FINANCING OR TAKE OTHER NECESSARY ACTIONS TO REACT TO CHANGES IN OUR
BUSINESS.

     The indenture  governing the senior notes contains  various  covenants that
limit our  ability  to engage in a variety of  transactions.  In  addition,  the
indenture  governing our discount  notes and the secured  credit  agreement both
impose  additional  material  operating and financial  restrictions on us. These
restrictions,  subject to  ordinary  course of  business  exceptions,  limit our
ability to engage in some transactions, including the following:

     o    designated types of mergers or consolidations;

     o    paying dividends or other distributions to our stockholders;

     o    making investments;

     o    selling assets;

     o    repurchasing our common stock;

     o    changing lines of business;

     o    borrowing additional money; and

     o    transactions with affiliates.

     In addition,  our secured credit facility  requires us to maintain  certain
ratios, including:

     o    leverage ratios;

     o    an interest coverage ratio; and

     o    a fixed charges ratio,

     and to satisfy certain tests, including tests relating to:

     o    minimum covered population;

     o    minimum number of PCS subscribers in our territory;

     o    minimum total revenues; and

     o    minimum EBITDA.



                                       38
<PAGE>


     These  restrictions  could  limit our  ability  to obtain  debt  financing,
repurchase  stock,  refinance or pay  principal  or interest on our  outstanding
debt,  consummate  acquisitions  for  cash or debt or react  to  changes  in our
operating environment. An event of default under the secured credit facility may
prevent the  Company and the  guarantors  of the senior  notes and the  discount
notes from paying those notes or the guarantees of those notes.

THE TERMS OF THE CONVERTIBLE PREFERRED STOCK MAY AFFECT OUR FINANCIAL RESULTS.

     The  terms of the  convertible  preferred  stock  give the  holders  of the
preferred stock the following principal rights:

     o    to initially designate two members of our board of directors,  subject
          to reduction based on future percentage ownership;

     o    to  approve  or   disapprove   fundamental   corporate   actions   and
          transactions;

     o    to  receive  dividends  in  the  form  of  additional  shares  of  our
          convertible  preferred stock, which may increase and accelerate upon a
          change in control; and

     o    to require us to redeem the convertible preferred stock in 2005.

     If we  become  subject  to  the  repurchase  right  or  change  of  control
redemption  requirements under the convertible preferred stock while our secured
credit facility, our discount notes or the senior notes are outstanding, we will
be  required  to seek the  consent  of the  lenders  under  our  secured  credit
facility,  the holders of the discount notes and the holders of the senior notes
to repurchase or redeem the convertible preferred stock, or attempt to refinance
the secured credit facility, the discount notes and the senior notes. If we fail
to obtain  these  consents,  there will be an event of  default  under the terms
governing our secured credit facility.  In addition,  if we do not repurchase or
redeem  the  convertible  preferred  stock and the  holders  of the  convertible
preferred  stock  obtain a judgment  against us, any  judgment in excess of $5.0
million would constitute an event of default under the indentures  governing the
discount notes and the senior notes.

IF WE  BREACH  OUR  AGREEMENT  WITH  SBA  COMMUNICATIONS  CORP.  ("SBA"),  OR IT
OTHERWISE  TERMINATES  ITS  AGREEMENT  WITH US,  OUR RIGHT TO  PROVIDE  WIRELESS
SERVICE FROM MOST OF OUR CELL SITES WILL BE LOST.

     We lease cell sites from SBA. We rely on our  contract  with SBA to provide
us with  access to most of our cell  sites and to the  towers  located  on these
sites. If SBA were to lose its underlying  rights to these sites, our ability to
provide  wireless  service  from these sites would end,  subject to our right to
cure defaults by SBA. If SBA terminates our agreement as a result of our breach,
we will lose our right to provide wireless services from most of our cell sites.

WE MAY HAVE DIFFICULTY OBTAINING  INFRASTRUCTURE  EQUIPMENT AND HANDSETS,  WHICH
COULD RESULT IN DELAYS IN OUR NETWORK  BUILD-OUT,  DISRUPTION OF SERVICE OR LOSS
OF CUSTOMERS.

     If we cannot acquire the equipment required to build or upgrade our network
in a timely manner, we may be unable to provide wireless communications services
comparable to those of our competitors or to meet the requirements of the Sprint
PCS agreements.  Manufacturers  of this equipment could have  substantial  order
backlogs.  Accordingly,  the lead-time for the delivery of this equipment may be
longer than  anticipated.  In  addition,  the  manufacturers  of specific  types
handsets may have to  distribute  their limited  supply of products  among their
numerous  customers.  Some  of our  competitors  purchase  large  quantities  of
communications  equipment  and  may  have  established  relationships  with  the
manufacturers of this equipment.  Consequently, they may receive priority in the
delivery  of this  equipment.  If we do not obtain  equipment  or  handsets in a
timely  manner,  we  could  suffer  delays  in the  build-out  of  our  network,
disruptions in service and a reduction in customers.


                                       39
<PAGE>



IF THE WEST  VIRGINIA PCS  ALLIANCE  AND  VIRGINIA PCS ALLIANCE  FAIL TO PROVIDE
THEIR NETWORK TO US IN THEIR MARKETS,  OR IF OUR NETWORK SERVICES AGREEMENT WITH
THE  ALLIANCES  IS  OTHERWISE  TERMINATED,  WE WILL LOSE THE  ABILITY TO USE THE
ALLIANCES' NETWORKS.

     West Virginia PCS Alliance and Virginia PCS Alliance,  which we refer to as
the  Alliances,  are two related,  independent  PCS  providers  whose network is
managed by NTELOS.  Under our network services agreement,  the Alliances provide
us with the use of and access to key  components of their network in most of our
markets in Virginia and West Virginia. We directly compete with the Alliances in
the markets where we use their  network.  If the Alliances  fail to maintain the
standards for their network as set forth in our network services  agreement with
them or  otherwise  fail to provide  their  network for our use,  our ability to
provide wireless services in these markets may be adversely affected, and we may
not be able to provide  seamless  service  for our  customers.  If we breach our
obligations  to the  Alliances,  or if the  Alliances  otherwise  terminate  the
network services agreement, we will lose our right to use the Alliances' network
to provide service in these markets. In that event, it is likely that we will be
required  to build our own network in those  markets  and incur the  substantial
costs associated with doing so.

SPRINT'S  VENDOR  DISCOUNTS  MAY  BE  DISCONTINUED,  WHICH  COULD  INCREASE  OUR
EQUIPMENT  COSTS AND REQUIRE MORE CAPITAL THAN WE HAD  PROJECTED TO BUILD-OUT OR
UPGRADE OUR NETWORK.

     We intend to  continue  to  purchase  our  infrastructure  equipment  under
Sprint's vendor agreements that include significant volume discounts.  If Sprint
were unable to continue to obtain vendor discounts for its affiliates,  the loss
of  vendor  discounts  could  increase  our  equipment  costs  for  our  network
build-out.

CONFLICTS WITH SPRINT MAY NOT BE RESOLVED IN OUR FAVOR, WHICH COULD RESTRICT OUR
ABILITY TO MANAGE OUR  BUSINESS AND PROVIDE  SPRINT PCS  PRODUCTS AND  SERVICES,
ADVERSELY AFFECTING OUR RELATIONSHIPS WITH OUR CUSTOMERS,  INCREASE OUR EXPENSES
OR DECREASE OUR REVENUES.

     Under the Sprint PCS agreements, Sprint has a substantial amount of control
over the conduct of our business.  Conflicts between us may arise, and as Sprint
owes us no duties  except  as set  forth in the  Sprint  PCS  agreements,  these
conflicts may not be resolved in our favor.  The conflicts and their  resolution
may harm our business. For example:

     o    Sprint may price its national  plans based on its own  objectives  and
          may set price  levels and  customer  credit  policies  that may not be
          economically sufficient for our business;

     o    Sprint may  increase  the prices we pay for our back office  services;
          and

     o    Sprint may make decisions that adversely  affect our use of the Sprint
          and Sprint PCS brand names, products or services.

WE MAY NOT BE ABLE TO COMPETE WITH LARGER,  MORE ESTABLISHED  WIRELESS PROVIDERS
WHO HAVE RESOURCES TO  COMPETITIVELY  PRICE THEIR  PRODUCTS AND SERVICES,  WHICH
COULD IMPAIR OUR ABILITY TO ATTRACT AND RETAIN CUSTOMERS.

     Our ability to compete will depend in part on our ability to anticipate and
respond  to  various  competitive   factors  affecting  the   telecommunications
industry,  including  new services that may be  introduced,  changes in consumer
preferences,  demographic  trends,  economic  conditions  and  discount  pricing
strategies by competitors. In each market, we compete with at least two cellular
providers that have had their  infrastructure in place and have been operational
for a number  of  years.  They  may have  significantly  greater  financial  and
technical  resources than we do, they could offer attractive pricing options and
they may have a wider variety of handset  options.  We expect existing  cellular
providers  will continue to upgrade their systems and provide  expanded  digital
services to compete with the Sprint PCS products and services we offer.  Many of
these  wireless  providers  generally  require  their  customers  to enter  into
long-term  contracts,  which  may  make  it  more  difficult  for us to  attract
customers away from them.

     We will  also  compete  with  several  PCS  providers  and  other  existing
communications  companies in our markets and expect to compete with new entrants
as the FCC licenses additional  spectrum to mobile services providers.  A number
of our cellular, PCS and other wireless competitors have access to more licensed
spectrum  than the  amount  licensed  to  Sprint  in most of our  territory  and
therefore will be able to provide  greater network call volume capacity than our


                                       40
<PAGE>

network to the extent that network  usage begins to reach or exceed the capacity
of our licensed spectrum.  Our inability to accommodate increases in call volume
could result in more dropped or disconnected calls. In addition, any competitive
difficulties that Sprint may experience could also harm our competitive position
and success.

     We anticipate  that market prices for two-way  wireless  voice services and
products   generally   will  continue  to  decline  as  a  result  of  increased
competition.  Consequently we may be forced to increase spending for advertising
and promotions.  Increased  competition also may lead to continued  increases in
customer churn. Those trends could cause further delays in our expected dates to
achieve positive EBITDA.

WE MAY NOT BE ABLE TO OFFER COMPETITIVE ROAMING  CAPABILITY,  WHICH COULD IMPAIR
OUR ABILITY TO ATTRACT AND RETAIN CUSTOMERS.

     We rely  on  agreements  with  competitors  to  provide  automatic  roaming
capability  to our PCS  customers in many of the areas of the United  States not
covered by the Sprint PCS network,  which primarily serves  metropolitan  areas.
Some competitors may be able to offer coverage in areas not served by the Sprint
PCS  network  or may be able to offer  roaming  rates  that are lower than those
offered by Sprint and its  affiliates.  Some of our  competitors  are seeking to
reduce access to their networks through actions pending with the FCC.  Moreover,
the engineering standard for the dominant air interface upon which PCS customers
roam is  currently  being  considered  for  elimination  by the FCC as part of a
streamlining  proceeding.  If the FCC eliminates  this standard,  our Sprint PCS
customers may have difficulty roaming in some markets.

THERE IS NO UNIFORM SIGNAL TRANSMISSION TECHNOLOGY AND IF WE DECIDE TO USE OTHER
TECHNOLOGIES  IN THE FUTURE,  THIS  DECISION  COULD  SUBSTANTIALLY  INCREASE OUR
EQUIPMENT EXPENDITURES TO REPLACE THE TECHNOLOGY USED ON OUR NETWORK.

     The wireless  telecommunications industry is experiencing evolving industry
standards.  We have employed code division  multiple  access (CDMA)  technology,
which is the digital wireless  communications  technology selected by Sprint for
its network.  CDMA may not provide the advantages  expected by us and by Sprint.
In  addition  to  CDMA,  there  are  two  other  principal  signal  transmission
technologies,  time division  multiple  access,  or TDMA, and global systems for
mobile communications,  or GSM. These three signal transmission technologies are
not  compatible  with  each  other.  If one of  these  technologies  or  another
technology becomes the preferred  industry standard,  we may be at a competitive
disadvantage and competitive  pressures may require Sprint to change its digital
technology  which,  in turn,  may  require us to make  changes at  substantially
increased costs.

WE MAY NOT RECEIVE AS MUCH SPRINT PCS ROAMING  REVENUE AS WE ANTICIPATE  AND OUR
NON-SPRINT PCS ROAMING REVENUE IS LIKELY TO BE LOW.

     We are paid a fee from Sprint or a Sprint PCS  affiliate  for every  minute
that a Sprint PCS  subscriber  based outside of our territory  uses our network.
Similarly, we pay a fee to Sprint PCS or a Sprint PCS affiliate for every minute
that our  customers  use the Sprint  PCS  network  outside  our  territory.  Our
customers may use the Sprint PCS network  outside our territory more  frequently
than we anticipate,  and Sprint PCS subscribers  based outside our territory may
use our network less frequently than we anticipate.  The fee for each Sprint PCS
roaming  minute used was decreased from $0.20 per minute before June 1, 2001, to
$0.15 per minute  effective  June 1, 2001,  and further  decreased  to $0.12 per
minute  effective  October 1, 2001.  The Sprint PCS roaming  rate was changed to
$0.10 per minute in 2002.  After  2002,  the rate will be changed to "a fair and
reasonable  return,"  which  has not yet  been  determined.  However,  based  on
preliminary  discussions  with Sprint,  we anticipate a  significant  additional
reduction  in the rate.  As a result,  we may  receive  less  Sprint PCS roaming
revenue in the aggregate,  than we previously  anticipated or we may have to pay
more Sprint PCS roaming fees in the aggregate than we  anticipate.  Furthermore,
we do not expect to receive substantial non-Sprint PCS roaming revenue.

                                       41
<PAGE>


IF SPRINT PCS CUSTOMERS ARE NOT ABLE TO ROAM INSTANTANEOUSLY OR EFFICIENTLY ONTO
OTHER WIRELESS NETWORKS, WE MAY SUFFER A REDUCTION IN OUR REVENUES AND NUMBER OF
CUSTOMERS.

     The Sprint PCS network  operates at a different  frequency  and uses or may
use a different  signal  transmission  technology  than many analog cellular and
other digital systems. To access another provider's analog cellular, TDMA or GSM
digital  system when outside the territory  served by the Sprint PCS network,  a
Sprint  PCS  customer  is  required  to  utilize a  dual-band/dual-mode  handset
compatible with that provider's system. Generally,  because  dual-band/dual-mode
handsets incorporate two radios rather than one, they are more expensive, larger
and heavier than  single-band/single-mode  handsets. The Sprint PCS network does
not allow for call hand-off  between the Sprint PCS network and another wireless
network, so a customer must end a call in progress on the Sprint PCS network and
initiate a new call when outside the territory served by the Sprint PCS network.
In addition,  the quality of the service provided by a network provider during a
roaming call may not approximate  the quality of the service  provided by Sprint
PCS.  The price of a roaming  call may not be  competitive  with prices of other
wireless  companies for roaming calls,  and Sprint  customers may not be able to
use Sprint PCS advanced features, such as voicemail notification, while roaming.
These  roaming  issues may cause us to suffer a reduction  in our  revenues  and
number of customers.

PARTS OF OUR TERRITORIES  HAVE LIMITED  LICENSED  SPECTRUM,  WHICH MAY ADVERSELY
AFFECT THE QUALITY OF OUR SERVICE.

     In the majority of our markets,  Sprint has licenses  covering 20 MHz or 30
MHz of spectrum.  However,  Sprint has licenses covering only 10 MHz in parts of
our  territory  covering  approximately  3.8  million  residents  out of a total
population of over 10.2 million  residents.  In the future,  as our customers in
those areas increase in number,  this limited licensed  spectrum may not be able
to accommodate  increases in call volume and may lead to increased dropped calls
and may limit our ability to offer enhanced services.

NON-RENEWAL  OR  REVOCATION  BY  THE  FCC  OF  THE  SPRINT  PCS  LICENSES  WOULD
SIGNIFICANTLY  HARM OUR  BUSINESS  BECAUSE WE WOULD NO LONGER  HAVE THE RIGHT TO
OFFER WIRELESS SERVICE THROUGH OUR NETWORK.

     We are dependent on Sprint's PCS licenses, which are subject to renewal and
revocation  by the FCC.  Sprint's PCS licenses in many of our  territories  will
expire as early as 2005 but may be renewed for additional  ten-year terms. There
may be opposition to renewal of Sprint's PCS licenses upon their  expiration and
the  Sprint  PCS  licenses  may not be  renewed.  The FCC has  adopted  specific
standards  to apply to PCS license  renewals.  For  example,  if Sprint does not
demonstrate  to  the  FCC  that  Sprint  has  met  the  five-year   construction
requirements for each of its PCS licenses,  it can lose those licenses.  Failure
to comply with these  standards in our territory  could cause the  imposition of
fines on Sprint by the FCC or the  revocation  or  forfeiture  of the Sprint PCS
licenses for our territory,  which would  prohibit us from providing  service in
our markets.

IF THE SPRINT PCS  AGREEMENTS  DO NOT COMPLY WITH FCC  REQUIREMENTS,  SPRINT MAY
TERMINATE  THE SPRINT PCS  AGREEMENTS,  WHICH COULD  RESULT IN OUR  INABILITY TO
PROVIDE SERVICE.

     The FCC  requires  that  licensees  like Sprint  maintain  control of their
licensed spectrum and not delegate control to third-party  operators or managers
like us.  Although the Sprint PCS  agreements  reflect an  arrangement  that the
parties  believe  meets the FCC  requirements  for licensee  control of licensed
spectrum, we cannot be certain the FCC will agree with us. If the FCC determines
that the Sprint PCS  agreements  need to be modified  to  increase  the level of
licensee  control,  we have agreed with Sprint to use our best efforts to modify
the Sprint PCS agreements to comply with applicable law. If we cannot agree with
Sprint to modify the  Sprint  PCS  agreements,  they may be  terminated.  If the
Sprint PCS agreements are terminated, we would no longer be a part of the Sprint
PCS network and we would have extreme difficulty in conducting our business.


                                       42
<PAGE>



WE MAY NEED MORE CAPITAL THAN WE CURRENTLY  ANTICIPATE TO COMPLETE THE BUILD-OUT
AND UPGRADE OF OUR NETWORK,  AND A DELAY OR FAILURE TO OBTAIN ADDITIONAL CAPITAL
COULD DECREASE OUR REVENUES.

     The completion of our network build-out will require  substantial  capital.
Additional funds would be required in the event of:

     o    significant departures from our current business plan;

     o    unforeseen delays, cost overruns, unanticipated expenses; or

     o    regulatory, engineering design and other technological changes.

     For example,  it is possible that we will need substantial funds if we find
it necessary or desirable to overbuild the territory  currently  served  through
our  arrangements  with  the  Alliances.  Due to our  highly  leveraged  capital
structure,  additional financing may not be available or, if available,  may not
be obtained on a timely basis or on terms acceptable to us or within limitations
permitted  under our  existing  debt  covenants.  Failure  to obtain  additional
financing,  should  the  need  for it  develop,  could  result  in the  delay or
abandonment of our development and expansion plans, and we may be unable to fund
our ongoing operations.

BECAUSE SPRINT HAS RECENTLY REQUIRED US TO UPGRADE OUR NETWORK TO PROVIDE "THIRD
GENERATION" TECHNOLOGY, WE WILL FACE ADDITIONAL CAPITAL EXPENSES.

     The wireless  industry is seeking to implement new "third  generations," or
"3G", technology. Sprint has selected a version of 3G technology (1XRTT) for its
own networks and required us to upgrade our network to provide  those  services.
We currently  estimate the network upgrade to 1XRTT will cost  approximately $35
million, but actual costs could exceed this estimate. Sprint launched the new 3G
technology  in August  2002.  We  participated  in that launch  along with other
Sprint PCS affiliates. We still have additional expenditures pending to complete
the full  implementation of 3G in all of our markets. If other wireless carriers
implement  their  3G  upgrades  on a more  rapid  timetable,  or on a more  cost
efficient basis, or on a more advanced  technology  basis, we will likely suffer
competitive  disadvantages in our markets.  While there are potential advantages
with  3G  technology,   such  as  increased   network  capacity  and  additional
capabilities for wireless data applications,  the technology has not been proven
in  the  marketplace   and  has  the  risks  inherent  in  other   technological
innovations.

     Recently,  Sprint has sought to increase  service fees during the remainder
of 2002 and beyond in connection with its development of 3G-related  back-office
systems and platforms.  The Company,  along with other PCS affiliates of Sprint,
is currently  disputing the validity of Sprint's  right to pass through this fee
to the affiliates.  If this dispute is resolved unfavorably to the Company, then
Horizon PCS will incur significant additional expenses.

UNAUTHORIZED  USE OF OUR  NETWORK  AND OTHER  TYPES OF FRAUD  COULD  DISRUPT OUR
BUSINESS AND INCREASE OUR COSTS.

     We will likely  incur costs  associated  with the  unauthorized  use of our
network,  including  administrative and capital costs associated with detecting,
monitoring  and reducing the incidence of fraud.  Fraud impacts  interconnection
costs, capacity costs, administrative costs, fraud prevention costs and payments
to other carriers for unbillable  fraudulent  roaming.  Although we believe that
Sprint has  implemented  appropriate  controls to  minimize  the effect to us of
fraudulent usage, our efforts may not be successful.

EXPANDING OUR TERRITORY MAY HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS.

     As part of our business  strategy,  we may expand our territory through the
grant of additional markets from Sprint or through  acquisitions of other Sprint
PCS  affiliates.   We  will  evaluate   strategic   acquisitions  and  alliances
principally  relating to our current operations.  These transactions may require
the approval of Sprint and commonly involve a number of risks, including:

     o    difficulty assimilating acquired operations and personnel;

     o    diversion of management attention;


                                       43
<PAGE>


     o    disruption of ongoing business;

     o    inability to retain key personnel;

     o    inability to successfully  incorporate acquired assets and rights into
          our service offerings;

     o    inability to maintain  uniform  standards,  controls,  procedures  and
          policies; and

     o    impairment of relationships with employees, customers or vendors.

     Failure to overcome these risks or any other problems  encountered in these
transactions could have a material adverse effect on our business. In connection
with these  transactions,  we may also issue  additional  equity  securities and
incur additional debt.

THE SPRINT PCS AGREEMENTS AND OUR RESTATED CERTIFICATE OF INCORPORATION  INCLUDE
PROVISIONS  THAT MAY  DISCOURAGE,  DELAY OR RESTRICT  ANY SALE OF OUR  OPERATING
ASSETS OR COMMON STOCK TO THE POSSIBLE DETRIMENT OF OUR NOTEHOLDERS.

     The Sprint PCS agreements restrict our ability to sell our operating assets
and common  stock.  Generally,  Sprint  must  approve a change of control of our
ownership and consent to any assignment of the Sprint PCS agreements. The Sprint
PCS  agreements  also give Sprint a right of first  refusal if we decide to sell
the  operating  assets of our Bright PCS markets to a third party.  In addition,
provisions of our restated  certificate of  incorporation  could also operate to
discourage, delay or make more difficult a change in control of our company. For
example, our restated certificate of incorporation provides for:

     o    two classes of common stock,  with our class B common stock having ten
          votes per share;

     o    the issuance of preferred stock without stockholder approval; and

     o    a classified board, with each board member serving a three-year term.

     The  restrictions  in the Sprint PCS  agreements  and the provisions of our
restated certificate of incorporation could discourage any sale of our operating
assets or common stock.

HORIZON  TELCOM  WILL BE ABLE TO  CONTROL  THE  OUTCOME OF  SIGNIFICANT  MATTERS
PRESENTED TO  STOCKHOLDERS  AS A RESULT OF ITS OWNERSHIP  POSITION,  WHICH COULD
POTENTIALLY IMPAIR OUR ATTRACTIVENESS AS A TAKEOVER TARGET.

     Horizon Telcom  beneficially  owns  approximately  54.7% of our outstanding
common stock on fully diluted  basis as of September 30, 2002. In addition,  the
shares  held by  Horizon  Telcom  are class B shares,  which  have ten votes per
share.  The class A shares  have only one vote per share.  As a result,  Horizon
Telcom holds approximately 81.2% of the voting power on a fully diluted basis at
September  30,  2002.  Horizon  Telcom will have the voting power to control the
election of our board of directors  and it will be able to cause  amendments  to
our restated certificate of incorporation or our restated bylaws. Horizon Telcom
also may be able to cause changes in our business  without  seeking the approval
of any other party.  These changes may not be to the advantage of our company or
in the best interest of our other  stockholders or the holders of our notes. For
example,  Horizon Telcom will have the power to prevent, delay or cause a change
in control of our company and could take other  actions  that might be favorable
to Horizon Telcom, but not necessarily to other stockholders.  This may have the
effect of  delaying or  preventing  a change in control.  In  addition,  Horizon
Telcom is  controlled  by members of the McKell  family,  who  collectively  own
approximately  60.6% of the voting interests of Horizon Telcom.  Therefore,  the
McKell family,  acting as a group, may be able to exercise indirect control over
us.


                                       44
<PAGE>


WE MAY FACE  CONFLICTS  OF  INTEREST  WITH  HORIZON  TELCOM,  WHICH MAY HARM OUR
BUSINESS.

     Conflicts of interest may arise between Horizon Telcom, and us or its other
affiliates,  in  areas  relating  to past,  ongoing  and  future  relationships,
including:

     o    corporate opportunities;

     o    tax and intellectual property matters;

     o    potential acquisitions;

     o    financing transactions,  sales or other dispositions by Horizon Telcom
          of shares of our common stock held by it; and

     o    the  exercise  by  Horizon  Telcom  of  its  ability  to  control  our
          management and affairs.

     Horizon  Telcom  controls  approximately  81.2% of the voting  power of our
shares on a fully diluted basis. Horizon Telcom is engaged in a diverse range of
telecommunications-related  businesses,  such as local  telephone  services  and
Internet  services,  and these  businesses  may have  interests that conflict or
compete in some manner with our business.  Horizon Telcom is under no obligation
to share any  future  business  opportunities  available  to it with us,  unless
Delaware law requires it to do so. Any  conflicts  that may arise between us and
Horizon Telcom or any of its affiliates or any loss of corporate  opportunity to
Horizon  Telcom that may  otherwise be available to us may impact our  financial
condition or results of operations because these conflicts of interest or losses
of corporate  opportunities  could result in a loss of customers and, therefore,
business.  Because  Horizon  Telcom  will be able to control the outcome of most
conflicts upon which stockholders could vote and because it will have the voting
power to control our board of  directors,  conflicts  may not be resolved in our
favor.

PRESENT AND FUTURE TRANSACTIONS WITH HORIZON TELCOM MAY BE ON TERMS THAT ARE NOT
AS FAVORABLE AS COULD BE OBTAINED FROM THIRD PARTIES.

     In the  past,  we  have  entered  into  transactions  with  Horizon  Telcom
including  the leasing of towers by Horizon  Telcom to us and the  advancing  of
cash  to  us to  finance  our  operations.  In  addition,  Horizon  Services,  a
subsidiary of Horizon Telcom  provides  administrative  services to us including
finance and accounting services,  computer access and human resources.  Although
these  transactions  were on terms that we  believe  are fair,  because  Horizon
Telcom  currently owns 54.7% of our outstanding  common stock on a fully diluted
basis,  third  parties  with  whom we  wish  to  enter  into  agreements  or the
marketplace in general may not perceive these  transactions  with Horizon Telcom
to be fair.  In addition,  because  Horizon  Telcom has the power to control our
board  of  directors,  we may not be able to  renew  these  agreements  on terms
favorable to us.

WE MAY  EXPERIENCE A HIGH RATE OF CUSTOMER  TURNOVER,  WHICH WOULD  INCREASE OUR
COSTS OF OPERATIONS AND REDUCE OUR REVENUE AND POTENTIALLY  CAUSE A VIOLATION OF
OUR COVENANTS UNDER OUR SECURED CREDIT FACILITY.

     Our strategy to minimize  customer  turnover,  commonly known as churn, may
not be  successful.  As a result  of  customer  turnover,  we lose  the  revenue
attributable  to these  customers  and  increase the costs of  establishing  and
growing our customer  base.  The PCS industry has  experienced  a higher rate of
customer turnover as compared to cellular industry averages. We have experienced
an increase in churn during 2002, primarily caused by NDASL customers' inability
to pay for services  billed.  Current and future  strategies to reduce  customer
churn may not be successful.

     The rate of customer turnover is affected by the following factors, several
of which are not within our ability to address:

     o    credit worthiness of customers;

     o    extent of network coverage;


                                       45
<PAGE>


     o    reliability  issues such as blocked  calls,  dropped calls and handset
          problems;

     o    non-use of phones;

     o    change of employment;

     o    a lack of affordability;

     o    price competition;

     o    Sprint PCS' customer credit policies;

     o    customer care concerns; and

     o    other competitive factors.

     A high rate of customer  turnover could  adversely  affect our  competitive
position,  results  of  operations  and our costs of,  or  losses  incurred  in,
obtaining new customers, especially because we subsidize some of the cost of the
handsets purchased by our customers.

OUR ALLOWANCE FOR DOUBTFUL ACCOUNTS MAY NOT BE SUFFICIENT TO COVER UNCOLLECTIBLE
ACCOUNTS.

     On an ongoing basis, we estimate the amount of customer receivables that we
may not collect to reflect  the  expected  loss on such  accounts in the current
period.  However,  our allowance for doubtful accounts may underestimate  actual
unpaid receivables for various reasons, including:

     o    adverse changes in our churn rate exceeding our estimates;

     o    adverse changes in the economy  generally  exceeding our expectations;
          or

     o    unanticipated changes in Sprint PCS' products and services.

     If our allowance for doubtful  accounts is  insufficient to cover losses on
our receivables, our business, financial position or results of operations could
be materially adversely affected.

BECAUSE THE WIRELESS  INDUSTRY HAS  EXPERIENCED  HIGHER  CUSTOMER  ADDITIONS AND
HANDSET  SALES IN THE FOURTH  CALENDAR  QUARTER AS  COMPARED  TO THE OTHER THREE
CALENDAR  QUARTERS,  A FAILURE BY US TO ACQUIRE  SIGNIFICANTLY MORE CUSTOMERS IN
THE FOURTH QUARTER COULD HAVE A DISPROPORTIONATE  NEGATIVE EFFECT ON OUR RESULTS
OF OPERATIONS.

     The wireless industry is historically  dependent on fourth calendar quarter
results. Our overall results of operations could be significantly  reduced if we
have a worse than expected fourth calendar quarter for any reason, including the
following:

     o    our inability to match or beat pricing plans offered by competitors;

     o    our failure to adequately  promote Sprint PCS' products,  services and
          pricing plans;

     o    our inability to obtain an adequate supply or selection of handsets;

     o    a  downturn  in the  economy  of  some  or all of the  markets  in our
          territory; or

     o    a generally poor holiday shopping season.


                                       46
<PAGE>



REGULATION BY GOVERNMENT AGENCIES MAY INCREASE OUR COSTS OF PROVIDING SERVICE OR
REQUIRE US TO CHANGE OUR SERVICES, WHICH COULD IMPAIR OUR FINANCIAL PERFORMANCE.

     The  licensing,  construction,  use,  operation,  sale and  interconnection
arrangements  of wireless  telecommunications  systems are  regulated to varying
degrees by the FCC, the Federal Aviation  Administration  and,  depending on the
jurisdiction,  state and  local  regulatory  agencies  and  legislative  bodies.
Adverse  decisions  regarding these  regulatory  requirements  could  negatively
impact our operations and our cost of doing business.

USE OF HAND-HELD  PHONES MAY POSE HEALTH RISKS,  REAL OR PERCEIVED,  WHICH COULD
RESULT IN THE  REDUCED USE OF OUR  SERVICES OR  LIABILITY  FOR  PERSONAL  INJURY
CLAIMS.

     Media reports have suggested that radio  frequency  emissions from wireless
handsets may be linked to various health  problems,  including  cancer,  and may
interfere with various  electronic  medical devices,  including hearing aids and
pacemakers.  Concerns  over radio  frequency  emissions  may  discourage  use of
wireless handsets or expose us to potential  litigation.  Any resulting decrease
in demand for our services,  or costs of  litigation  and damage  awards,  could
impair our ability to profitably operate our business


                                       47
<PAGE>


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(A)  EXHIBITS

Exhibit Number Description
-------------- -----------
3.1*           Amended and Restated Certificate of Incorporation of Horizon PCS.

3.2*           Bylaws of Horizon PCS.

*    Incorporated  by reference  to the exhibit with the same number  previously
     filed by the Registrant on Form S-4 (Reg. No. 333-51238).
+    The Registrant has requested confidential treatment for certain portions of
     this exhibit pursuant to Rule 24b-2 of the Securities Exchange Act of 1934.

(B) REPORTS ON FORM 8-K

          1.   On August 14,  2002,  we filed a Current  Report on Form 8-K with
               the SEC that  provided  information  under "ITEM 5 - Other Event"
               disclosing  we issued a press  release  announcing  our financial
               results for the second quarter of the fiscal year ending December
               31, 2002.



                                       48
<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
undersign thereunto duly authorized

                                             HORIZON PCS, INC.
                                             -----------------------------------
                                             Registrant


    Date: November 12, 2002                  By: /s  William A. McKell
         ------------------                      -------------------------------
                                                     William A. McKell
                                                     Chief Executive Officer


    Date: November 12, 2002                  By: /s  Peter M. Holland
          -----------------                      -------------------------------
                                                     Peter M. Holland
                                                     Chief Financial Officer
                                                     (Principal Financial and
                                                      Chief Accounting Officer)


                                       49
<PAGE>



       Horizon PCS, Inc., Certification for Quarterly Report on Form 10-Q
       ------------------------------------------------------------------


I, William A. McKell, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Horizon PCS, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrants  other  certifying  officers  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:    November 12, 2002
      ------------------------------
                                             /s/  William A McKell
                                             -----------------------------------
                                             William A. McKell
                                             Chairman  of the  Board,  President
                                             and Chief Executive Officer



<PAGE>



       Horizon PCS, Inc., Certification for Quarterly Report on Form 10-Q
       ------------------------------------------------------------------


I, Peter M. Holland, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Horizon PCS, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrants  other  certifying  officers  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

Date:  November 12, 2002
       ------------------------------
                                             /s/  Peter M. Holland
                                             -----------------------------------
                                             Peter M. Holland
                                             Chief Financial Officer




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