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UNITEDSTATESSECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

|        |                                                                                                                              |
|--------|------------------------------------------------------------------------------------------------------------------------------|
|   | QUARTERLYREPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934for the quarterly period ended June 30, 2005 |

OR

|        |                                                                                                                                                                                                                                                                                                                                                                                                   |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | TRANSITION REPORTPURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934for the transition period from                      to                         |

COMMISSION FILE NUMBER: 333-123755

AIRGATE PCS, INC.

(Exactname of registrant as specified in its charter)

|                                                              |  |                                     |  |  |  |  |
|--------------------------------------------------------------|--|-------------------------------------|--|--|--|--|
| DELAWARE                                                     |  | 20-2156350                          |
| (State or other jurisdictionofincorporation or organization) |  | (I.R.S. EmployerIdentification No.) |
|                                                              |

5225 SOUTHLOOP 289, SUITE 120 LUBBOCK, TEXAS 79424

(Address of principal executive offices,including zip code)

(806) 722-1100

(Registrant's telephone number,including area code)

Indicate by check markwhether the registrant (1) has filed all reports required to be filedby Section 13 or 15(d) of the Securities Exchange Act of 1934 duringthe preceding 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days.

YES    NO 

Indicate by check markwhether the registrant is an accelerated filer (as defined in Rule12b-2 of the Exchange Act).

YES     NO

There is currently no public market for theregistrant's common stock.

As of August 8, 2005,1,000 shares of common stock, $0.01 par value per share, were issuedand outstanding.

The registrant meets the conditionsset forth in General Instructions H(1)(a) and (b) of Form 10-Q and istherefore filing this form with the reduced disclosureformat.

   

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AIRGATE PCS, INC.

TABLE OF CONTENTS

|                                                       |  |                                                                                                                                                                                                                                                       |        |        |        |        |        |        |  |  |
|-------------------------------------------------------|--|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--|--|
|                                                  |  |                                                                                                                                                                                                                                                  |        | PAGE   |        |   |
| **PARTI    FINANCIALINFORMATION** |  |                                                                                                                                                                                                                                                  |   |   |
| Item1.                                                |  | FinancialStatements                                                                                                                                                                                                                                   |        |   |   |   |
|                                                  |  | Consolidated BalanceSheets at June 30, 2005 and December 31, 2004(unaudited)                                                                                                                                                                          |        |   | 3      |   |
|                                                  |  | ConsolidatedStatements of Operations for the three months ended June 30, 2005 and2004, for the period from acquisition to June 30, 2005, for the periodfrom January 1, 2005 to February 15, 2005 and for the six months endedJune 30, 2004(unaudited) |        |   | 4      |   |
|                                                  |  | ConsolidatedStatements of Cash Flows for the period from acquisition to June 30,2005, for the period from January 1, 2005 to February 15, 2005 and forthe six months ended June 30, 2004(unaudited)                                                   |        |   | 5      |   |
|                                                  |  | Notes to theConsolidated Financial Statements                                                                                                                                                                                                         |        |   | 6      |   |
| Item2.                                                |  | Management's Discussion and Analysis of FinancialCondition and Results of Operations                                                                                                                                                                  |        |   | 25     |   |
| Item3.                                                |  | Quantitative and Qualitative Disclosures About MarketRisk                                                                                                                                                                                             |        |   | 35     |   |
| Item 4.                                               |  | Controls andProcedures                                                                                                                                                                                                                                |        |   | 35     |   |
| **PARTII    OTHER INFORMATION**   |  |                                                                                                                                                                                                                                                  |   |   |
| Item1.                                                |  | Legal Proceedings                                                                                                                                                                                                                                     |        |   | 35     |   |
| Item2.                                                |  | Unregistered Sales of Equity Securities and Use ofProceeds                                                                                                                                                                                            |        |   | 36     |   |
| Item 3.                                               |  | Defaults UponSenior Securities                                                                                                                                                                                                                        |        |   | 36     |   |
| Item4.                                                |  | Submission of Matters to a Vote of SecurityHolders                                                                                                                                                                                                    |        |   | 36     |   |
| Item 5.                                               |  | OtherInformation                                                                                                                                                                                                                                      |        |   | 36     |   |
| Item6.                                                |  | Exhibits                                                                                                                                                                                                                                              |        |   | 36     |   |
| **SIGNATURES**                                        |  |                                                                                                                                                                                                                                                  | 37     |   |        |   |   |   |
|                                                       |

2

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PART I – FINANCIALINFORMATION ITEM 1.    FINANCIAL STATEMENTS

AIRGATEPCS, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED)(dollars in thousands, except shareinformation)

|                                                                                                                                                   |  |              |         |                  |  |        |            |         |  |  |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--|--------------|---------|------------------|--|--------|------------|---------|--|--|
|                                                                                                                                              |  | Company      |         | OldAirGate       |
|                                                                                                                                              |  | June30, 2005 |         | December 31,2004 |
| ASSETS                                                                                                                                            |  |         |    |             |  |   |       |    |
| Currentassets:                                                                                                                                    |  |         |    |             |  |   |       |    |
| Cash andcashequivalents                                                                                                                           |  | $            | 4,366   |             |  | $      | 15,917     |    |
| Shortterminvestments                                                                                                                              |  |         | 39,549  |             |  |   | 94,059     |    |
| Customeraccounts receivable,net                                                                                                                   |  |         | 26,638  |             |  |   | 20,848     |    |
| Receivable fromSprint                                                                                                                             |  |         | 3,392   |             |  |   | 5,671      |    |
| Inventory                                                                                                                                         |  |         | 3,821   |             |  |   | 4,672      |    |
| Prepaidexpenses and otherassets                                                                                                                   |  |         | 7,019   |             |  |   | 3,991      |    |
| Deferred customeracquisitioncosts                                                                                                                 |  |         | 252     |             |  |   | —    |    |
| Deferred taxasset                                                                                                                                 |  |         | 7,611   |             |  |   | —    |    |
| Totalcurrentassets                                                                                                                                |  |         | 92,648  |             |  |   | 145,158    |    |
| Property andequipment, net                                                                                                                        |  |         | 90,644  |             |  |   | 130,809    |    |
| Debtissuance costs,net                                                                                                                            |  |         | — |             |  |   | 4,621      |    |
| Goodwill                                                                                                                                          |  |         | 255,305 |             |  |   | —    |    |
| Intangibleassets, net                                                                                                                             |  |         | 392,256 |             |  |   | —    |    |
| Othernoncurrentassets                                                                                                                             |  |         | 1,403   |             |  |   | 2,645      |    |
| Totalassets                                                                                                                                       |  | $            | 832,256 |             |  | $      | 283,233    |    |
| LIABILITIESAND STOCKHOLDERS' EQUITY(DEFICIT)                                                                                                      |  |         |    |             |  |   |       |    |
| Currentliabilities:                                                                                                                               |  |         |    |             |  |   |       |    |
| Accountspayable                                                                                                                                   |  | $            | 5,399   |             |  | $      | 1,275      |    |
| Accruedexpenses                                                                                                                                   |  |         | 14,787  |             |  |   | 17,245     |    |
| Payable toSprint                                                                                                                                  |  |         | 12,478  |             |  |   | 24,348     |    |
| Payable toParent                                                                                                                                  |  |         | 3,010   |             |  |   | —    |    |
| Interestpayable                                                                                                                                   |  |         | 2,512   |             |  |   | 9,388      |    |
| Deferredrevenue                                                                                                                                   |  |         | 5,954   |             |  |   | 9,567      |    |
| Totalcurrentliabilities                                                                                                                           |  |         | 44,140  |             |  |   | 61,823     |    |
| Longterm liabilities:                                                                                                                             |  |         |    |             |  |   |       |    |
| Other noncurrentliabilities                                                                                                                       |  |         | 1,070   |             |  |   | 3,363      |    |
| Deferred taxliability                                                                                                                             |  |         | 27,700  |             |  |   | —    |    |
| Seniornotes                                                                                                                                       |  |         | 346,949 |             |  |   | 312,478    |    |
| Totallong termliabilities                                                                                                                         |  |         | 375,719 |             |  |   | 315,841    |    |
| Totalliabilities                                                                                                                                  |  |         | 419,859 |             |  |   | 377,664    |    |
| Commitmentsand contingencies (see Note14)                                                                                                         |  |         | — |             |  |   | —    |    |
| Stockholders'equity (deficit):                                                                                                                    |  |         |    |             |  |   |       |    |
| Preferred stock,$.01 par value; 1,000,000 shares authorized; no sharesissued                                                                      |  |         | — |             |  |   | —    |    |
| Common stock,$.01 par value; 1,000 and 30,000,000 shares authorized,respectively; 1,000 and 11,827,483 shares issued and outstanding,respectively |  |         | — |             |  |   | 118        |    |
| Additionalpaid-incapital                                                                                                                          |  |         | 424,560 |             |  |   | 1,047,676  |    |
| Accumulateddeficit                                                                                                                                |  |         | (12,163 | )           |  |   | (1,142,225 | )  |
| Totalstockholders' equity(deficit)                                                                                                                |  |         | 412,397 |             |  |   | (94,431    | )  |
| Totalliabilities and stockholders' equity(deficit)                                                                                                |  | $            | 832,256 |             |  | $      | 283,233    |    |
|                                                                                                                                                   |

Theaccompanying notes are an integral part of the consolidated financialstatements.

3

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AIRGATE PCS, INC. CONSOLIDATEDSTATEMENTS OF OPERATIONS (UNAUDITED)(dollars inthousands, except per shareamounts)

|                                                                                                                                                                                                                                                                                                                                                                    |  |                                     |         |                                     |  |                                                         |            |                                                     |  |                                    |         |         |  |        |            |         |  |        |           |         |  |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|-------------------------------------|---------|-------------------------------------|--|---------------------------------------------------------|------------|-----------------------------------------------------|--|------------------------------------|---------|---------|--|--------|------------|---------|--|--------|-----------|---------|--|--|
|                                                                                                                                                                                                                                                                                                                                                               |  | Company                             |         | OldAirGate                          |  | Company                                                 |            | OldAirGate                                          |
|                                                                                                                                                                                                                                                                                                                                                               |  | Forthethreemonthsended June30, 2005 |         | Forthethreemonthsended June30, 2004 |  | Fortheperiod fromacquisition(see Note 4) toJune 30,2005 |            | For theperiod fromJanuary 1,2005 toFebruary 15,2005 |  | For the six monthsendedJune30,2004 |
| Revenues:                                                                                                                                                                                                                                                                                                                                                          |  |                                |    |                                |  |                                                    |       |                                                |  |                               |    |    |  |   |       |    |  |   |      |    |
| Subscriberrevenues                                                                                                                                                                                                                                                                                                                                                 |  | $                                   | 73,821  |                                |  | $                                                       | 65,037     |                                                |  | $                                  | 108,770 |    |  | $      | 34,680     |    |  | $      | 126,693   |    |
| Roamingand wholesalerevenues                                                                                                                                                                                                                                                                                                                                       |  |                                | 24,776  |                                |  |                                                    | 17,389     |                                                |  |                               | 32,916  |    |  |   | 10,972     |    |  |   | 30,887    |    |
| Servicerevenues                                                                                                                                                                                                                                                                                                                                                    |  |                                | 98,597  |                                |  |                                                    | 82,426     |                                                |  |                               | 141,686 |    |  |   | 45,652     |    |  |   | 157,580   |    |
| Productsales                                                                                                                                                                                                                                                                                                                                                       |  |                                | 3,005   |                                |  |                                                    | 3,612      |                                                |  |                               | 4,653   |    |  |   | 3,211      |    |  |   | 6,494     |    |
| Totalrevenue                                                                                                                                                                                                                                                                                                                                                       |  |                                | 101,602 |                                |  |                                                    | 86,038     |                                                |  |                               | 146,339 |    |  |   | 48,863     |    |  |   | 164,074   |    |
| Costsandexpenses:                                                                                                                                                                                                                                                                                                                                                  |  |                                |    |                                |  |                                                    |       |                                                |  |                               |    |    |  |   |       |    |  |   |      |    |
| Costof service and operations (excluding depreciation shown separatelybelow of $5,606 and $11,288 for the three months ended June 30, 2005and 2004, respectively, and $9,132, $7,594 and $22,385 for the periodfrom acquisition to June 30, 2005, for the period from January 1, 2005to February 15, 2005 and for the six months ended June 30, 2004,respectively) |  |                                | 53,079  |                                |  |                                                    | 43,278     |                                                |  |                               | 74,440  |    |  |   | 23,559     |    |  |   | 82,700    |    |
| Costof productssold                                                                                                                                                                                                                                                                                                                                                |  |                                | 7,698   |                                |  |                                                    | 6,670      |                                                |  |                               | 12,126  |    |  |   | 6,528      |    |  |   | 13,872    |    |
| Sellingandmarketing                                                                                                                                                                                                                                                                                                                                                |  |                                | 12,393  |                                |  |                                                    | 10,890     |                                                |  |                               | 21,150  |    |  |   | 9,293      |    |  |   | 22,806    |    |
| Generaland administrative expenses (excluding non-cash compensation of $550and $550 for the three months ended June 30, 2005 and for the periodfrom acquisition to June 30, 2005,respectively)                                                                                                                                                                     |  |                                | 5,373   |                                |  |                                                    | 4,970      |                                                |  |                               | 8,272   |    |  |   | 2,923      |    |  |   | 11,307    |    |
| Mergerrelatedexpenses                                                                                                                                                                                                                                                                                                                                              |  |                                | — |                                |  |                                                    | —    |                                                |  |                               | — |    |  |   | 23,748     |    |  |   | —   |    |
| Depreciationandamortization                                                                                                                                                                                                                                                                                                                                        |  |                                | 27,798  |                                |  |                                                    | 12,015     |                                                |  |                               | 42,103  |    |  |   | 7,914      |    |  |   | 23,907    |    |
| (Gain)loss on disposal of property andequipment                                                                                                                                                                                                                                                                                                                    |  |                                | — |                                |  |                                                    | (2         | )                                              |  |                               | — |    |  |   | 20         |    |  |   | (5        | )  |
| Non-cashcompensation                                                                                                                                                                                                                                                                                                                                               |  |                                | 550     |                                |  |                                                    | —    |                                                |  |                               | 550     |    |  |   | —    |    |  |   | —   |    |
| Totalcosts andexpenses                                                                                                                                                                                                                                                                                                                                             |  |                                | 106,891 |                                |  |                                                    | 77,821     |                                                |  |                               | 158,641 |    |  |   | 73,985     |    |  |   | 154,587   |    |
| Income(loss) fromoperations                                                                                                                                                                                                                                                                                                                                        |  |                                | (5,289  | )                              |  |                                                    | 8,217      |                                                |  |                               | (12,302 | )  |  |   | (25,122    | )  |  |   | 9,487     |    |
| Interestand otherincome                                                                                                                                                                                                                                                                                                                                            |  |                                | 706     |                                |  |                                                    | 188        |                                                |  |                               | 1,025   |    |  |   | 346        |    |  |   | 353       |    |
| Interestexpense                                                                                                                                                                                                                                                                                                                                                    |  |                                | (5,729  | )                              |  |                                                    | (6,230     | )                                              |  |                               | (8,497  | )  |  |   | (4,111     | )  |  |   | (17,541   | )  |
| Income(loss) before income taxbenefit                                                                                                                                                                                                                                                                                                                              |  |                                | (10,312 | )                              |  |                                                    | 2,175      |                                                |  |                               | (19,774 | )  |  |   | (28,887    | )  |  |   | (7,701    | )  |
| Incometaxbenefit                                                                                                                                                                                                                                                                                                                                                   |  |                                | 3,966   |                                |  |                                                    | —    |                                                |  |                               | 7,611   |    |  |   | —    |    |  |   | —   |    |
| Netincome(loss)                                                                                                                                                                                                                                                                                                                                                    |  | $                                   | (6,346  | )                              |  | $                                                       | 2,175      |                                                |  | $                                  | (12,163 | )  |  | $      | (28,887    | )  |  | $      | (7,701    | )  |
| Netincome (loss) per commonshare                                                                                                                                                                                                                                                                                                                                   |  |                                |    |                                |  |                                                    |       |                                                |  |                               |    |    |  |   |       |    |  |   |      |    |
| Basic                                                                                                                                                                                                                                                                                                                                                              |  |                                |    |                                |  | $                                                       | 0.18       |                                                |  |                               |    |    |  | $      | (2.44      | )  |  | $      | (0.77     | )  |
| Diluted                                                                                                                                                                                                                                                                                                                                                            |  |                                |    |                                |  | $                                                       | 0.18       |                                                |  |                               |    |    |  | $      | (2.44      | )  |  | $      | (0.77     | )  |
| Weightedaverage common sharesoutstanding                                                                                                                                                                                                                                                                                                                           |  |                                |    |                                |  |                                                    |       |                                                |  |                               |    |    |  |   |       |    |  |   |      |    |
| Basic                                                                                                                                                                                                                                                                                                                                                              |  |                                |    |                                |  |                                                    | 11,769,976 |                                                |  |                               |    |    |  |   | 11,831,973 |    |  |   | 9,961,069 |    |
| Diluted                                                                                                                                                                                                                                                                                                                                                            |  |                                |    |                                |  |                                                    | 11,857,479 |                                                |  |                               |    |    |  |   | 11,831,973 |    |  |   | 9,961,069 |    |
|                                                                                                                                                                                                                                                                                                                                                                    |

Theaccompanying notes are an integral part of the consolidated financialstatements.

4

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AIRGATE PCS, INC. CONSOLIDATEDSTATEMENTS OF CASH FLOWS (UNAUDITED)(dollars inthousands)

|                                                                                         |  |                                                             |          |                                                         |  |                                       |         |         |  |        |          |         |  |  |
|-----------------------------------------------------------------------------------------|--|-------------------------------------------------------------|----------|---------------------------------------------------------|--|---------------------------------------|---------|---------|--|--------|----------|---------|--|--|
|                                                                                    |  | Company                                                     |          | OldAirGate                                              |
|                                                                                    |  | For theperiod from acquisition (see Note 4) to June 30,2005 |          | For the period from January 1, 2005 toFebruary 15, 2005 |  | For the six months ended June 30,2004 |
| Cash flows from operatingactivities:                                                    |  |                                                        |     |                                                    |  |                                  |    |    |  |
| Netloss                                                                                 |  | $                                                           | (12,163  | )                                                  |  | $                                     | (28,887 | )  |  | $      | (7,701   | )  |
| Adjustmentsto reconcile net loss to net cash provided by (used in) operatingactivities: |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Non-cashcompensation expense(benefit)                                                   |  |                                                        | 550      |                                                    |  |                                  | (823    | )  |  |   | 379      |    |
| Non-cashaccretion of asset retirementobligations                                        |  |                                                        | 29       |                                                    |  |                                  | 56      |    |  |   | —  |    |
| Provisionfor baddebts                                                                   |  |                                                        | 1,310    |                                                    |  |                                  | (955    | )  |  |   | (958     | )  |
| Depreciationand amortization of property andequipment                                   |  |                                                        | 9,358    |                                                    |  |                                  | 7,914   |    |  |   | 23,907   |    |
| Amortizationof intangibleassets                                                         |  |                                                        | 32,745   |                                                    |  |                                  | — |    |  |   | —  |    |
| Amortizationof financing costs included in interestexpense                              |  |                                                        | —  |                                                    |  |                                  | 457     |    |  |   | 507      |    |
| Amortizationof debtpremium                                                              |  |                                                        | (1,442   | )                                                  |  |                                  | — |    |  |   | —  |    |
| Deferredincometaxes                                                                     |  |                                                        | (7,611   | )                                                  |  |                                  | — |    |  |   | —  |    |
| Interestaccreted on discountnotes                                                       |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | 6,092    |    |
| (Gain)loss on disposal of property andequipment                                         |  |                                                        | —  |                                                    |  |                                  | 20      |    |  |   | (5       | )  |
| (Increase)decreasein:                                                                   |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Receivablefrom/payable toParent                                                         |  |                                                        | 2,460    |                                                    |  |                                  | — |    |  |   | —  |    |
| Receivables                                                                             |  |                                                        | 9,441    |                                                    |  |                                  | (2,892  | )  |  |   | (2,907   | )  |
| Inventory                                                                               |  |                                                        | 510      |                                                    |  |                                  | 341     |    |  |   | (103     | )  |
| Prepaidexpenses and otherassets                                                         |  |                                                        | (3,003   | )                                                  |  |                                  | (2,279  | )  |  |   | 3,074    |    |
| Increase(decrease)in:                                                                   |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Accountspayable and accruedexpenses                                                     |  |                                                        | (36,144  | )                                                  |  |                                  | 8,430   |    |  |   | 11,768   |    |
| Netcash provided by (used in) operatingactivities                                       |  |                                                        | (3,960   | )                                                  |  |                                  | (18,618 | )  |  |   | 34,053   |    |
| Cashflows from investingactivities:                                                     |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Purchasesof property andequipment                                                       |  |                                                        | (18,062  | )                                                  |  |                                  | (8,611  | )  |  |   | (10,204  | )  |
| Acquisitionof business, net of cashpaid                                                 |  |                                                        | 36,314   |                                                    |  |                                  | — |    |  |   | —  |    |
| Changein short terminvestments                                                          |  |                                                        | 5,074    |                                                    |  |                                  | 49,435  |    |  |   | —  |    |
| Netcash provided by (used in) investingactivities                                       |  |                                                        | 23,326   |                                                    |  |                                  | 40,824  |    |  |   | (10,204  | )  |
| Cashflows from financingactivities:                                                     |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Repaymentsof borrowings under senior secureddebt                                        |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | (16,513  | )  |
| Debtissuancecosts                                                                       |  |                                                        | —  |                                                    |  |                                  | (1,629  | )  |  |   | (693     | )  |
| Capitaldistribution toParent                                                            |  |                                                        | (15,000  | )                                                  |  |                                  | — |    |  |   | —  |    |
| Stockoptionsexercised                                                                   |  |                                                        | —  |                                                    |  |                                  | 12      |    |  |   | 35       |    |
| Equityissuancecosts                                                                     |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | (4,759   | )  |
| Netcash used in financingactivities                                                     |  |                                                        | (15,000  | )                                                  |  |                                  | (1,617  | )  |  |   | (21,930  | )  |
| Netincrease in cash and cashequivalents                                                 |  |                                                        | 4,366    |                                                    |  |                                  | 20,589  |    |  |   | 1,919    |    |
| Cashand cash equivalents at beginning ofperiod                                          |  |                                                        | —  |                                                    |  |                                  | 15,917  |    |  |   | 60,043   |    |
| Cashand cash equivalents at end ofperiod                                                |  | $                                                           | 4,366    |                                                    |  | $                                     | 36,506  |    |  | $      | 61,962   |    |
| Supplementaldisclosure of non-cash financing and investingactivities:                   |  |                                                        |     |                                                    |  |                                  |    |    |  |   |     |    |
| Capitalinfusion in businesscombination                                                  |  | $                                                           | 333,416  |                                                    |  | $                                     | — |    |  | $      | —  |    |
| Fairvalue of assets recorded in businesscombination                                     |  |                                                        | 888,920  |                                                    |  |                                  | — |    |  |   | —  |    |
| Fairvalue of liabilities recorded in businesscombination                                |  |                                                        | (449,552 | )                                                  |  |                                  | — |    |  |   | —  |    |
| Assetretirement obligationscapitalized                                                  |  |                                                        | 28       |                                                    |  |                                  | — |    |  |   | —  |    |
| Changein accounts payable for purchases of property andequipment                        |  |                                                        | 4,827    |                                                    |  |                                  | — |    |  |   | —  |    |
| Capitalizedinterest                                                                     |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | 82       |    |
| Netcarrying value of notesexchanged                                                     |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | (264,888 | )  |
| Unamortizedfinancing costs of old notesexchanged                                        |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | 3,755    |    |
| Issuanceof newnotes                                                                     |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | 159,035  |    |
| Carryingvalue difference on newnotes                                                    |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | (24,686  | )  |
| Commonstock issued in exchange of oldnotes                                              |  |                                                        | —  |                                                    |  |                                  | — |    |  |   | 126,784  |    |
|                                                                                         |

Theaccompanying notes are an integral part of the consolidated financialstatements.

5

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS (UNAUDITED)(dollars in thousands,except asnoted)

|          |                                                                |
|----------|----------------------------------------------------------------|
| 1.  | BASISOF PRESENTATION OF UNAUDITED INTERIM FINANCIALINFORMATION |

On December 7, 2004, AirGate PCS, Inc. ("OldAirGate") entered into an Agreement and Plan of Mergerwith Alamosa Holdings, Inc. ("AlamosaHoldings") and A-Co. Merger Sub, Inc.("A-Co."), a direct wholly-owned subsidiaryof Alamosa Holdings. Pursuant to the merger agreement, Old AirGatemerged with and into A-Co. on February 15, 2005 with A-Co. survivingthe merger. Immediately after the closing of the transaction, A-Co. wasrenamed AirGate PCS, Inc. ("AirGate") andremains a wholly-owned subsidiary of Alamosa Holdings. In connectionwith the acquisition of Old AirGate, the purchase price was allocatedto the assets and liabilities of AirGate based on fair value resultingin a new basis of accounting. AirGate is referred to in theseconsolidated financial statements as the"Company," "we,""us" or "our."

The unaudited consolidated balance sheets at June 30, 2005 andDecember 31, 2004, the unaudited consolidated statements of operationsfor the three months ended June 30, 2005 and 2004, for the period fromacquisition to June 30, 2005, for the period from January 1, 2005 toFebruary 15, 2005 and for the six months ended June 30, 2004, theunaudited consolidated statements of cash flows for the period fromacquisition to June 30, 2005, for the period from January 1, 2005 toFebruary 15, 2005 and for the six months ended June 30, 2004 andrelated footnotes have been prepared in accordance with accountingprinciples generally accepted in the United States of America forinterim financial information and Article 10 of Regulation S-X.Accordingly, they do not include all of the information and footnotesrequired annually by accounting principles generally accepted in theUnited States of America. In the opinion of management, the interimdata includes all adjustments (consisting of only normally recurringadjustments) necessary for a fair statement of the results for theinterim periods. Operating results for the period ended June 30, 2005are not necessarily indicative of results that may be expected for theyear ending December 31, 2005.

Old AirGate basic and diluted netloss per share of common stock for the six months ended June 30, 2004and for the period from January 1, 2005 to February 15, 2005 iscomputed by dividing net loss attributable to common stockholders foreach period by the weighted-average outstanding number of commonshares. No conversion of common stock equivalents has been assumed inthe calculations for these periods since the effect would beantidilutive. As a result, the number of weighted-average outstandingcommon shares as well as the amount of net loss per share are the samefor basic and diluted net loss per share calculations. For the threemonths ended June 30, 2004, the diluted weighted average number ofcommon shares outstanding include 87,503 shares related to stockoptions and warrants with exercise prices below the weighted averagefair value of Old AirGate stock during the period using the treasurystock method. Common stock equivalents excluded from diluted net lossper share calculations for the six months ended June 30, 2004 and forthe period from January 1, 2005 to February 15, 2005 includedoutstanding options and warrants to purchase 53,841 and 0 shares ofcommon stock, respectively. All outstanding options were terminated onFebruary 15, 2005.

Company basic and diluted net loss per sharefor the period from acquisition to June 30, 2005 is not presented asthe Company is now a wholly-owned subsidiary of Alamosa Holdings.

Certain reclassifications have been made to Old AirGate balances toconform to Company presentation.

|          |                                     |
|----------|-------------------------------------|
| 2.  | ORGANIZATION AND BUSINESSOPERATIONS |

AirGate is a wholly-owned subsidiary of AlamosaHoldings and a PCS Affiliate of Sprint with the exclusive right toprovide wireless personal communications services under the Sprintbrand name in a territory encompassing approximately 7.4 millionresidents. The Company was formed 

6

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

in December 2004 as A-Co. Merger Sub, Inc. inanticipation of the acquisition of Old AirGate on February 15, 2005, asdiscussed in Note 4. Subsequent to the closing of the transaction,A-Co. changed its name to AirGate PCS, Inc. The Company provideswireless personal communications services, commonly referred to as PCS,in the southeastern United States. The accompanying consolidatedfinancial statements include the accounts of AirGate and itswholly-owned restricted subsidiaries, AGW Leasing Company, Inc.,AirGate Service Company, Inc. and AirGate Network Services,LLC.

See Note 17 for recent developments in the Company'srelationship with Sprint.

|          |                                |
|----------|--------------------------------|
| 3.  | LIQUIDITY ANDCAPITAL RESOURCES |

Old AirGate financed its operations throughdebt financing and through proceeds generated from public offerings ofOld AirGate common stock and cash provided by operations. The proceedsfrom these transactions and cash provided by operations have been usedto fund the build-out of the Company's portion of the PCS networkof Sprint, subscriber acquisition costs and working capital.

Asof June 30, 2005, the Company had $4 million in cash and cashequivalents as well as $40 million in short-term investments, which theCompany believes will be sufficient to fund expected capitalexpenditures and to cover its working capital and debt servicerequirements for at least the next 12 months.

TheCompany's future liquidity will be dependent on a number offactors influencing its projections of operating cash flows, includingthose related to subscriber growth, average revenue per user, averagemonthly churn and cost per gross addition. Should actual results differsignificantly from these assumptions, the Company's liquidityposition could be adversely affected and it could be in a position thatwould require it to raise additional capital which may or may not beavailable on terms acceptable to the Company, if at all, and could havea material adverse effect on the Company's ability to achieve itsintended business objectives.

|          |                         |
|----------|-------------------------|
| 4.  | MERGERS ANDACQUISITIONS |

As discussed in Note 1, Old AirGate was acquiredby Alamosa Holdings on February 15, 2005. The transaction was accountedfor under the purchase method of accounting and the results of theCompany are included in the consolidated financial statements ofAlamosa Holdings from the date of acquisition.

The mergerconsideration consisted of 26.1 million shares of Alamosa Holdingscommon stock valued at $12.66 per share, representing the averageclosing price of Alamosa Holdings common stock from February 10, 2005to February 15, 2005, and approximately $100.0 million in cash plusdirect transaction costs of approximately $6.3 million. AlamosaHoldings also assumed the debt of Old AirGate in the transaction, whichhad a fair value of approximately $348.4 million as of February 15,2005.

7

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

The Company obtained an independentvaluation to allocate the purchase price. The result of the allocationis asfollows:

|                                                    |  |        |         |        |  |  |
|----------------------------------------------------|--|--------|---------|--------|--|--|
| Consideration:                                     |  |   |    |   |
| AlamosaHoldings common stock issued                |  | $      | 330,848 |   |
| Commonstock warrants assumed by AlamosaHoldings    |  |   | 383     |   |
| Cashconsideration                                  |  |   | 100,001 |   |
| Totalconsideration                                 |  |   | 431,232 |   |
|                                               |  |   |    |   |
| Directtransaction costs                            |  |   | 6,334   |   |
| Long-term debtassumed (at fair value)              |  |   | 348,391 |   |
| Otherliabilities assumed (including deferredtaxes) |  |   | 103,345 |   |
| Total purchaseprice                                |  |   | 889,302 |   |
|                                               |  |   |    |   |
| Allocatedto:                                       |  |   |    |   |
| Currentassets                                      |  |   | 130,946 |   |
| Property andequipment                              |  |   | 77,085  |   |
| Other tangible non-currentassets                   |  |   | 966     |   |
| Intangible assets (other thangoodwill)             |  |   | 425,000 |   |
| Goodwill                                           |  | $      | 255,305 |   |
|                                                    |

Asa result of the acquisition of Old AirGate by Alamosa Holdings, theCompany implemented a plan to terminate certain employees of OldAirGate as well as to close certain locations. In connection with thisplan, the Company established reserves for severance and related costssuch as payments in connection with cancellation of employee stockoptions and restricted stock units as well as reserves for future leasepayments associated with an operating lease on a facility to be closed(net of estimated sub-lease income) in May 2005. Activity with respectto these reservesfollows:

|                              |  |                                         |         |                                                 |  |                                                        |         |         |  |        |         |         |  |  |
|------------------------------|--|-----------------------------------------|---------|-------------------------------------------------|--|--------------------------------------------------------|---------|---------|--|--------|---------|---------|--|--|
|                         |  | Company                                 |         | OldAirGate                                      |
|                         |  | For thethree months ended June 30, 2005 |         | For the periodfrom acquisition to June 30, 2005 |  | For the period fromJanuary 1, 2005 to February 15,2005 |
| Severance and relatedcosts:  |  |                                    |    |                                            |  |                                                   |    |    |  |   |    |    |
|                         |  |                                    |    |                                            |  |                                                   |    |    |  |   |    |    |
| Balanceat beginning ofperiod |  | $                                       | 629     |                                            |  | $                                                      | 2,184   |    |  | $      | — |    |
| Netcharges(benefit)          |  |                                    | — |                                            |  |                                                   | — |    |  |   | 16,778  |    |
| Payments                     |  |                                    | (621    | )                                          |  |                                                   | (2,176  | )  |  |   | (14,594 | )  |
| Balanceat end ofperiod       |  | $                                       | 8       |                                            |  | $                                                      | 8       |    |  | $      | 2,184   |    |
|                         |  |                                    |    |                                            |  |                                                   |    |    |  |   |    |    |
| Futurelease payments,net:    |  |                                    |    |                                            |  |                                                   |    |    |  |   |    |    |
| Balance at beginningofperiod |  | $                                       | 1,474   |                                            |  | $                                                      | 1,474   |    |  | $      | — |    |
| Netcharges(benefit)          |  |                                    | — |                                            |  |                                                   | — |    |  |   | 1,474   |    |
| Payments                     |  |                                    | (84     | )                                          |  |                                                   | (84     | )  |  |   | — |    |
| Balanceat end ofperiod       |  | $                                       | 1,390   |                                            |  | $                                                      | 1,390   |    |  | $      | 1,474   |    |
|                              |

8

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

|          |                         |
|----------|-------------------------|
| 5.  | STOCK-BASEDCOMPENSATION |

The Company and Old AirGate have elected to followAccounting Principles Board ("APB") OpinionNo. 25, "Accounting for Stock Issued toEmployees" and related interpretations in accounting forits employee stock options. The non-cash compensation benefit includedin Old AirGate's consolidated statements of operations for theperiod from January 1, 2005 to February 15, 2005 of $823 represents thereversal of previously recorded variable non-cash compensation expenseassociated with restricted stock unit awards that were cancelled andsettled in cash on February 15, 2005 by Old AirGate immediately priorto the merger with Alamosa Holdings. Non-cash compensation expense inthe three month and six month periods ended June 30, 2004 is related tothe vesting of employee stock options that had been issued with anexercise price less than the market price on the date of grant. Nostock-based compensation expense was recorded in the period fromacquisition to June 30, 2005. The following table illustrates theeffect on Old AirGate net loss and Old AirGate net loss per share ifOld AirGate had applied the fair value recognition provisions ofStatement of Financial Accounting Standards("SFAS") No. 123, "Accountingfor Stock-Based Compensation," to stock-based employeecompensation:

|                                                                                                                              |  |                                                        |         |                                         |  |                                       |        |         |  |        |         |         |  |  |
|------------------------------------------------------------------------------------------------------------------------------|--|--------------------------------------------------------|---------|-----------------------------------------|--|---------------------------------------|--------|---------|--|--------|---------|---------|--|--|
|                                                                                                                         |  | OldAirGate                                             |
|                                                                                                                         |  | For theperiod from January 1, 2005 to February 15,2005 |         | For the three months ended June 30,2004 |  | For the six months ended June 30,2004 |
| Net income (loss) – asreported                                                                                         |  | $                                                      | (28,887 | )                                  |  | $                                     | 2,175  |    |  | $      | (7,701  | )  |
| Add:stock-based employee compensation included in reported net loss, net ofrelatedtax                                        |  |                                                   | 9,870   |                                    |  |                                  | 183    |    |  |   | 379     |    |
| Deduct:stock-based employee compensation expense determined under fair valuemethod for all awards, net of related taxeffects |  |                                                   | (9,870  | )                                  |  |                                  | (1,651 | )  |  |   | (3,048  | )  |
| Netincome (loss) – proforma                                                                                            |  | $                                                      | (28,887 | )                                  |  | $                                     | 707    |    |  | $      | (10,370 | )  |
| Netincome (loss) per share – asreported                                                                                |  |
| Basic                                                                                                                        |  | $                                                      | (2.44   | )                                  |  | $                                     | 0.18   |    |  | $      | (0.77   | )  |
| Diluted                                                                                                                      |  | $                                                      | (2.44   | )                                  |  | $                                     | 0.18   |    |  | $      | (0.77   | )  |
| Netincome (loss) per share – proforma                                                                                  |  |
| Basic                                                                                                                        |  | $                                                      | (2.44   | )                                  |  | $                                     | 0.06   |    |  | $      | (1.04   | )  |
| Diluted                                                                                                                      |  | $                                                      | (2.44   | )                                  |  | $                                     | 0.06   |    |  | $      | (1.04   | )  |
|                                                                                                                              |

Alloutstanding Old AirGate stock options were terminated prior to closingthe acquisition on February 15, 2005. Options that had exercise pricesbelow the market price of Old AirGate common stock at that date weresettled in cash. The compensation expense associated with this payoutof approximately $6.7 million is included in merger related expenses inthe period from January 1, 2005 to February 15, 2005. Additionally, alloutstanding Old AirGate restricted stock units were cancelled onFebruary 15, 2005 and the fair market value of such units was settledin cash at that point. The compensation expense associated with thispayout of approximately $3.8 million is included in merger relatedexpenses in the period from January 1, 2005 to February 15, 2005. Therestricted stock units had been accounted for as variable awards underSFAS No. 123 and compensation expense had been recorded as anadjustment to equity. As the units were terminated without shares beingissued, the cumulative compensation recorded up to the 

9

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

settlement date as an adjustment to equitywas reversed and a non-cash compensation benefit of $823 was recordedin the period from January 1, 2005 to February 15, 2005. As a result ofthe above cancellations, the Company has no outstanding stock-basedcompensation awards as of June 30, 2005.

|          |                     |
|----------|---------------------|
| 6.  | ACCOUNTS RECEIVABLE |

Customeraccounts receivable — Customer accounts receivable representamounts owed to the Company by subscribers for PCS service. Customeraccounts receivable do not bear interest.

The amounts presentedin the consolidated balance sheets are net of an allowance foruncollectible accounts of $3,101 and $6,220 at June 30, 2005 andDecember 31, 2004, respectively. Estimates are used in determining theallowance for uncollectible accounts and are based on historicalcollection experience, current trends, credit policy, a percentage ofaccounts receivable by aging category and expectations of future baddebts based on current collection activities. In determining theallowance, the Company considers historical write-offs of itsreceivables as well as historical changes in its credit policies. TheCompany also takes into consideration current trends in the creditquality of its customer base.

Receivable from Sprint —Receivable from Sprint in the accompanying consolidated balancesheets consists of thefollowing:

|                             |  |              |                               |                  |  |        |                               |        |  |  |
|-----------------------------|--|--------------|-------------------------------|------------------|--|--------|-------------------------------|--------|--|--|
|                        |  | Company      |                               | OldAirGate       |
|                        |  | June 30,2005 |                               | December 31,2004 |
|                        |  |         |                          |             |  |   |                          |   |
|                        |  |         |                          |             |  |   |                          |   |
| Netroamingreceivable        |  | $            |     1,977 |             |  | $      |     2,818 |   |
| Accruedservice revenue      |  |         | 1,299                         |             |  |   | 2,038                         |   |
| Otheramounts due fromSprint |  |         | 116                           |             |  |   | 815                           |   |
|                        |  | $            |     3,392 |             |  | $      |     5,671 |   |
|                             |

Netroaming receivable includes net travel revenue due from Sprint relativeto PCS subscribers based outside of the Company's licensedterritory who utilize the Company's portion of the PCS network ofSprint. The net roaming receivable is net of amounts owed to Sprintrelative to the Company's subscribers who utilize the PCS networkof Sprint outside of the Company's licensed territory. Thereceivable is recorded net due to a right of offset with respect to thereceivable from/payable to Sprint with respect to travel and the factthat the activity has historically been settled on a net basis bySprint. In addition, net roaming receivable also includes amounts duefrom Sprint, which have been collected from other PCS providers andwholesale customers for their customers' usage of theCompany's portion of the PCS network of Sprint.

Accruedservice revenue represents the Company's estimate of airtimeusage and other charges that have been earned but not billed at the endof the period.

Other amounts due from Sprint at June 30, 2005and December 31, 2004 primarily consist of universal service fundrecoveries and interconnect revenue receivable.

|          |                        |
|----------|------------------------|
| 7.  | PROPERTY AND EQUIPMENT |

Property andequipment are stated net of accumulated depreciation and amortizationof $9.4 million and $192.8 million at June 30, 2005 and December 31,2004, respectively. In connection with the purchase price allocation onFebruary 15, 2005, as discussed in Note 4, property and equipmentacquired was allocated approximately $77.1 million in fair value basedon an independent appraisal of the assets.

10

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

|          |                             |
|----------|-----------------------------|
| 8.  | ASSET RETIREMENTOBLIGATIONS |

For the Company's leased telecommunicationsfacilities, primarily consisting of cell sites and switch siteoperating leases and operating leases for retail and office space, theCompany has adopted the provisions of SFAS No. 143,"Accounting for Asset RetirementObligations." The obligations associated with theCompany's operating leases primarily relate to the restoration ofthe leased sites to specified conditions described in the respectivelease agreements. For purposes of determining the amounts recorded asasset retirement obligations associated with the respective leases, theCompany has estimated the costs by type of lease to be incurred uponthe termination of the lease for restoration costs, as adjusted forexpected inflation. These costs have been discounted back to theorigination of the lease using an appropriate discount rate todetermine the amount of obligation to be recorded upon the inception ofthe lease. The liability is accreted up to the expected settlementamount over the life of the lease using the effective interest method.A corresponding asset is recorded at the inception of the lease in thesame amount as the asset retirement obligation. This asset isdepreciated using the same method and life of similar network assets orleasehold improvements.

The following table illustrates theactivity with respect to asset retirement obligations for the threemonths ended June 30, 2005 and 2004, for the period from acquisition toJune 30, 2005, for the period from January 1, 2005 to February 15, 2005and for the six months ended June 30,2004:

|                                             |  |                                    |                             |                                     |  |                                                        |                             |                                                    |  |                                   |                             |        |  |        |                             |        |  |        |                             |        |  |        |
|---------------------------------------------|--|------------------------------------|-----------------------------|-------------------------------------|--|--------------------------------------------------------|-----------------------------|----------------------------------------------------|--|-----------------------------------|-----------------------------|--------|--|--------|-----------------------------|--------|--|--------|-----------------------------|--------|--|--------|
|                                        |  | Company                            |                             | OldAirGate                          |  | Company                                                |                             | OldAirGate                                         |
|                                        |  | Forthethreemonthsended June30,2005 |                             | For thethreemonthsendedJune30, 2004 |  | For theperiodfromacquisition(see Note 4)to June30,2005 |                             | For theperiodfromJanuary 1,2005 toFebruary15, 2005 |  | Forthe sixmonthsended June30,2004 |
|                                        |  |                               |                        |                                |  |                                                   |                        |                                               |  |                              |                        |   |  |   |                        |   |  |   |                        |   |  |   |   |   |
| Balanceat beginning ofperiod                |  | $                                  |     596 |                                |  | $                                                      |     442 |                                               |  | $                                 |     575 |   |  | $      |     519 |   |  | $      |     416 |   |
| Initialobligation recorded during theperiod |  |                               | 22                          |                                |  |                                                   | —                     |                                               |  |                              | 28                          |   |  |   | —                     |   |  |   | —                     |   |
| Obligationssettled during theperiod         |  |                               | —                     |                                |  |                                                   | —                     |                                               |  |                              | —                     |   |  |   | —                     |   |  |   | —                     |   |
| Accretionof obligation during theperiod     |  |                               | 15                          |                                |  |                                                   | 26                          |                                               |  |                              | 30                          |   |  |   | 13                          |   |  |   | 52                          |   |
| Impactof revision inestimates               |  |                               | —                     |                                |  |                                                   | —                     |                                               |  |                              | —                     |   |  |   | 43                          |   |  |   | —                     |   |
| Balanceat end ofperiod                      |  | $                                  |     633 |                                |  | $                                                      |     468 |                                               |  | $                                 |     633 |   |  | $      |     575 |   |  | $      |     468 |   |
|                                             |

|          |                               |
|----------|-------------------------------|
| 9.  | GOODWILLAND INTANGIBLE ASSETS |

In connection with the merger discussedin Note 4, the Company allocated portions of the purchase price toidentifiable intangible assets consisting of (i) the value of theSprint agreements in place at Old AirGate and (ii) the value of thesubscriber base in place at Old AirGate. In addition to theidentifiable intangibles, goodwill has been recorded in the amount bywhich the purchase price exceeded the fair value of the net assetsacquired, including identified intangibles.

The Companyallocated $215,000 of the purchase price to the value of the subscriberbase in place at Old AirGate at the time of acquisition and allocated$210,000 to the value of the Sprint agreements in place at Old AirGateat the time of acquisition. The values were based on an independentappraisal. The subscriber base intangible will be amortized over theestimated life 

11

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

of the subscribers acquired, or approximately3 years, and the intangible associated with the Sprint agreements inplace will be amortized over the remaining original term of the Sprintagreements assumed in the acquisition, or approximately 13 years.

The Company accounts for goodwill and intangible assets inaccordance with the provisions of SFAS No. 142, "Goodwilland Other Intangible Assets." The provisions of SFAS No.142 (i) prohibit the amortization of goodwill and indefinite-livedintangible assets, (ii) require that goodwill and indefinite-livedintangible assets be tested annually for impairment (and in interimperiods if certain events occur indicating that the carrying value maybe impaired), and (iii) require that reporting units be identified forthe purpose of assessing potential future impairments of goodwill.

Goodwill and intangible assets consistof:

|                                       |  |             |                                 |         |  |  |
|---------------------------------------|--|-------------|---------------------------------|---------|--|--|
|                                  |  | Company     |
|                                  |  | June30,2005 |
| Goodwill                              |  | $           |     255,305 |    |
| Intangibleassets:                     |  |        |                            |    |
| Sprintaffiliation and otheragreements |  | $           |     210,000 |    |
| Accumulatedamortization               |  |        | (5,869                          | )  |
| Subtotal                              |  |        | 204,131                         |    |
| Subscriberbase acquired               |  |        | 215,000                         |    |
| Accumulatedamortization               |  |        | (26,875                         | )  |
| Subtotal                              |  |        | 188,125                         |    |
| Intangibleassets,net                  |  | $           |     392,256 |    |
|                                       |

Amortizationexpense related to intangible assets was $22,038 for the three monthsended June 30, 2005 and $32,745 for the period from acquisition to June30, 2005.

Aggregate amortization expense relative to intangibleassets for the periods shown will be asfollows:

|                        |  |        |                                 |        |  |  |
|------------------------|--|--------|---------------------------------|--------|--|--|
| Yearsended December31, |  |   |
| 2005                   |  | $      |     76,404  |   |
| 2006                   |  |   | 87,319                          |   |
| 2007                   |  |   | 87,319                          |   |
| 2008                   |  |   | 24,611                          |   |
| 2009                   |  |   | 15,652                          |   |
| Thereafter             |  |   | 133,695                         |   |
|                   |  | $      |     425,000 |   |
|                        |

12

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

|           |               |
|-----------|---------------|
| 10.  | LONG-TERMDEBT |

Long-term debt consists of thefollowing:

|                                                |  |              |                                 |                  |  |        |                                 |        |  |  |
|------------------------------------------------|--|--------------|---------------------------------|------------------|--|--------|---------------------------------|--------|--|--|
|                                           |  | Company      |                                 | OldAirGate       |
|                                           |  | June 30,2005 |                                 | December 31,2004 |
|                                           |  |         |                            |             |  |   |                            |   |
| 9 3/8%SeniorNotes                              |  | $            |     167,695 |             |  | $      |     137,478 |   |
| FloatingRateNotes                              |  |         | 179,254                         |             |  |   | 175,000                         |   |
| **TotalDebt**                                  |  |         | 346,949                         |             |  |   | 312,478                         |   |
| Lesscurrentmaturities                          |  |         | —                         |             |  |   | —                         |   |
| **Longterm debt, excluding currentmaturities** |  | $            |     346,949 |             |  | $      |     312,478 |   |
|                                                |

SENIORNOTES

9 3/8% Senior Notes— The 9 3/8% Senior Notes wereoriginally issued in February 2004 by Old AirGate, have a face value of$159,035, mature September 1, 2009 and carry a coupon rate of9 3/8%, payable semiannually on January 1 andJuly 1. The 9 3/8% Senior Notes are secured by asecond priority lien on the assets of AirGate. The9 3/8% Senior Notes were recorded at a fairvalue of $168,676 in the purchase price allocation as discussed in Note4. The premium to face amount will be amortized over the remaining lifeof the notes as an adjustment to the effective interest rate.

Floating Rate Notes — The Floating Rate Notes wereoriginally issued in October 2004 by Old AirGate, have a face value of$175,000, mature October 15, 2011 and bear interest at LIBOR plus3.75%, payable quarterly on January 15, April 15, July 15 andOctober 15. The Floating Rate Notes are secured by a first prioritylien on the assets of AirGate. The Floating Rate Notes were recorded ata fair value of $179,715 in the purchase price allocation as discussedin Note 4. The premium to face amount will be amortized over theremaining life of the notes as an adjustment to the effective interestrate.

On January 11, 2005, Old AirGate began soliciting consentsfrom holders of the outstanding 9 3/8% SeniorNotes and Floating Rate Notes to amend certain provisions of indenturesgoverning the respective notes. On January 25, 2005, the expirationdate of the consent solicitation, Old AirGate received the necessaryconsents to amend the respective indentures and paid a consent fee of0.25% of the principal amount of the notes to thenoteholders.

|           |                     |
|-----------|---------------------|
| 11.  | STOCKHOLDERS'EQUITY |

As discussed in Note 4, the acquisition of Old AirGateby Alamosa Holdings was completed on February 15, 2005. Stockholders ofOld AirGate received approximately 26.1 million shares of AlamosaHoldings common stock and approximately $100 million in cashconsideration. As a result, Old AirGate stockholders' deficit of$124,129 was eliminated on February 15, 2005. In connection with thepurchase price allocation discussed in Note 4, the Company recordedcontributed capital consisting of $330,848 in value of Alamosa Holdingscommon stock issued, $100,001 cash consideration plus $6,143 in directtransaction costs incurred by Alamosa Holdings and $2,568 in value ofcommon stock purchase warrants assumed by Alamosa Holdings. The totalcontributed capital of $439,560 was reduced by $15,000 in cashdistributions from the Company to Alamosa Holdings.

Old AirGatehad three sets of common stock purchase warrants outstanding prior tothe acquisition by Alamosa Holdings. All of these warrants were assumedby Alamosa Holdings in the acquisition.

13

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

AirGate Warrants — TheAirGate Warrants were originally issued by Old AirGate in connectionwith an offering of Old AirGate notes in 1999. As of June 30, 2005,8,620 AirGate Warrants were outstanding. Each warrant entitles theholder to receive 0.9482 shares of Alamosa Holdings common stock and$3.64 in cash at an exercise price of $0.02 per share and expires onOctober 1, 2009. Due to the fact that these warrants require settlementwith registered shares of Alamosa Holdings common stock, these warrantsare reflected as a liability in the consolidated balance sheet ofAlamosa Holdings at fair market value. Changes in fair market value arereflected in earnings of Alamosa Holdings for the period. The fairvalue of the AirGate Warrants at June 30, 2005 is approximately$145.

iPCS Note Warrants — The iPCS Note Warrantswere originally issued by iPCS, Inc. ("iPCS")in 2000 and assumed by Old AirGate upon its acquisition of iPCS in2001. As of June 30, 2005, 300,000 iPCS Note Warrants were outstanding.Each warrant entitles the holder to receive 0.6996 shares of AlamosaHoldings common stock at an exercise price of $74.34 per share andexpires on July 15, 2010. Due to the fact that these warrants requiresettlement with registered shares of Alamosa Holdings common stock,these warrants are reflected as a liability in the consolidated balancesheet of Alamosa Holdings at fair market value. Changes in fair marketvalue are reflected in earnings of Alamosa Holdings for the period. Thefair value of the iPCS Note Warrants at June 30, 2005 is approximately$2,180.

iPCS Sprint Warrant — The iPCS SprintWarrant was originally issued by iPCS in 2000 and assumed by OldAirGate upon its acquisition of iPCS in 2001. As of June 30, 2005, theiPCS Sprint Warrant to purchase 81,050 shares of Alamosa Holdingscommon stock at an exercise price of $66.52 per share was outstanding.This warrant expires on July 15, 2007 and is not reflected as aliability in the consolidated balance sheet of Alamosa Holdings as itwas included in the fair value of equity issued in the transaction.

|           |              |
|-----------|--------------|
| 12.  | INCOME TAXES |

The Company'seffective income tax rate is based on statutory tax rates, tax planningopportunities, expected future taxable income and expected reversals oftaxable temporary differences. The forecasted annual rate is thenapplied to the Company's quarterly operating results. The Companyestablishes a valuation allowance for deferred tax assets when it ismore likely than not that the deferred tax assets will not be realized.Due to a limited operating history and lack of positive taxableearnings, a valuation allowance was established by Old AirGate asdeferred tax assets were expected to exceed deferred tax liabilities.The establishment of this valuation allowance resulted in an effectivetax rate of zero for the period from January 1, 2005 to February 15,2005 and for the six months ended June 30, 2004. Due to the differencein basis for book and tax purposes after the purchase price allocationas discussed in Note 4, the Company established a net deferred taxliability of $27,700 in connection with the merger. The reversal of thetiming differences which give rise to this deferred tax liability willallow the Company to realize the benefit of certain deferred tax assetssuch that the valuation allowance was reduced. The effective tax ratefor the period from acquisition to June 30, 2005 is 38.5 percent. Thedifference between the statutory rate of 35 percent and the projectedrate is primarily due to state income taxes.

|           |                   |
|-----------|-------------------|
| 13.  | SPRINT AGREEMENTS |

In accordance withthe Company's affiliation agreements with Sprint, Sprint providesthe Company various services including billing, customer care,collections and inventory logistics. In addition, Sprint bills theCompany for various pass-through items such as commissions and rebatesto national retail merchants, handset subsidies on handsets activatedin the Company's territory but not sold by the Company and longdistance charges.

14

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

In 2004, Old AirGate executed amendmentsto its affiliation agreements with Sprint. The amendments, among otherthings, established fixed per subscriber costs for services that theCompany purchases from Sprint through December 31, 2006 in the form oftwo new fees. The amendments created a new combined service bureau fee,which consolidates numerous fees that were previously settledseparately, for back office services such as billing and customer care.The combined service bureau fee was set at $7.00 per average subscriberper month through December 31, 2006 and will be recorded in cost ofservice and operations in the consolidated statement of operations. Theamendments also created a new per-activation fee, which consolidatesnumerous fees that were previously settled separately, for marketingservices, such as subscriber activation and handset logistics. Theper-activation fee is $23.00 per activation and will be applied to theactual number of gross subscriber activations the Company experienceson a monthly basis through December 31, 2006. The per-activation fee isrecorded in selling and marketing expenses in the consolidatedstatement of operations.

In addition to the new fees, theamendments changed the methodology used for settling cash received fromsubscribers. Historically, actual weekly cash receipts were passedthrough to Old AirGate by Sprint based on a calculation of an estimateof the portion of that cash related to Old AirGate's activity.Under the new methodology, the Company receives its portion of billedrevenue (net of an 8% affiliation fee) less actual written offaccounts in the month subsequent to billing regardless of when Sprintcollects the cash from the subscriber.

Expenses reflected in theconsolidated statements of operations related to the Sprint affiliationagreementsare:

|                              |  |                                     |                                |                                     |  |                                                       |                                |                                                   |  |                                    |                                |        |  |        |                                |        |  |        |                                |        |  |  |
|------------------------------|--|-------------------------------------|--------------------------------|-------------------------------------|--|-------------------------------------------------------|--------------------------------|---------------------------------------------------|--|------------------------------------|--------------------------------|--------|--|--------|--------------------------------|--------|--|--------|--------------------------------|--------|--|--|
|                         |  | Company                             |                                | OldAirGate                          |  | Company                                               |                                | OldAirGate                                        |
|                         |  | Forthethreemonthsended June30, 2005 |                                | Forthethreemonthsended June30, 2004 |  | Fortheperiodfromacquisition(see Note 4)to June30,2005 |                                | For theperiodfromJanuary1,2005 toFebruary15, 2005 |  | For thesixmonthsended June30, 2004 |
| Cost ofservice andoperations |  | $                                   |     39,795 |                                |  | $                                                     |     28,661 |                                              |  | $                                  |     54,692 |   |  | $      |     17,122 |   |  | $      |     56,412 |   |
| Costof productssold          |  |                                | 7,698                          |                                |  |                                                  | 6,670                          |                                              |  |                               | 12,126                         |   |  |   | 6,528                          |   |  |   | 13,872                         |   |
| Sellingandmarketing          |  |                                | 3,892                          |                                |  |                                                  | 2,750                          |                                              |  |                               | 7,553                          |   |  |   | 3,269                          |   |  |   | 5,379                          |   |
| Total                        |  | $                                   |     51,385 |                                |  | $                                                     |     38,081 |                                              |  | $                                  |     74,371 |   |  | $      |     26,919 |   |  | $      |     75,663 |   |
|                              |

Inconnection with the billing services provided to the Company by Sprint,the Company relies on Sprint to provide information as to monthlybilling activity relative to all subscriber revenues. In addition,Sprint provides the information utilized for the settlement of allroaming revenue.

The Company relies upon Sprint as a serviceprovider to provide accurate information for the settlement of revenueand expense items. The Company makes estimates used in connection withthe preparation of financial statements based on the financial andstatistical information provided by Sprint. The Company assesses theaccuracy of this information through analytic review and reliance onthe service auditor report on Sprint's internal control processesprepared by Sprint's external service auditor.

|           |                               |
|-----------|-------------------------------|
| 14.  | COMMITMENTS AND CONTINGENCIES |

Litigation — In May 2002, putative class actioncomplaints were filed in the United States District Court for theNorthern District of Georgia against AirGate PCS, Inc., Thomas M.Dougherty, Barbara L. Blackford, Alan B. Catherall, Credit Suisse FirstBoston, Lehman

15

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

Brothers, UBS Warburg LLC, William Blair& Company, Thomas Wiesel Partners LLC and TD Securities. Thecomplaints alleged that the prospectus used in connection with thesecondary offering of Old AirGate stock by certain former stockholdersof iPCS, a former subsidiary of AirGate, on December 18, 2001 containedmaterially false and misleading statements and omitted materialinformation necessary to make the statements in the prospectus notfalse and misleading. After initially denying motions for appointmentof lead plaintiffs and lead plaintiffs' counsel, the Courtgranted a modified renewed motion for appointment of lead plaintiffsand lead plaintiffs' counsel on August 17, 2004. Pursuant to aconsent scheduling order, lead plaintiffs filed a consolidated amendedclass action complaint on October 15, 2004, naming the same defendants(the "Consolidated Complaint"). 

The Consolidated Complaint  asserts claims underSections 11, 12(a)(2) and 15 of the Securities Act of 1933 based on anumber of purported false or misleading statements in the prospectus.Plaintiffs' claims are premised on allegations, among others,that (i) AirGate's business plan was not "fullyfunded," contrary to what was asserted in the prospectus;(ii) disclosures in the prospectus regarding the churn rate experiencedby AirGate were untrue and/or misleading; (iii) AirGate did not havestrong future revenue and profit growth prospects based on its rapidcustomer growth, contrary to what was allegedly asserted in theprospectus; (iv) AirGate's allowance for doubtful accounts wasunderstated in its fiscal 2001 financial statements, and hence AirGateunderstated its net losses for 2001 and the prospectus incorrectlystated that AirGate's financial statements complied withgenerally accepted accounting principles; (v) iPCS's networkbuild-out was not nearly complete, contrary to what was allegedlyasserted in the prospectus; and (vi) the iPCS merger did notsignificantly enhance shareholder value, contrary to alleged assertionsin the prospectus.

On December 30, 2004,defendants filed motions to dismiss the Consolidated Complaint, whichare presently pending before the Court. The Company believes thatAirGate and the other defendants have meritorious defenses to theclaims asserted in the Consolidated Complaint and intends to defend theaction vigorously. However, the ultimate outcome of the litigation isnot currently predictable, there can be no assurance that thelitigation will be resolved in our favor, and an adverse outcome couldadversely affect our financial condition, results of operations or cashflows. We maintain insurance coverage which could mitigate our exposureto loss in the event of an adverse outcome.

 OnFebruary  23, 2003, iPCS and its two subsidiaries, iPCS Wireless,Inc. and iPCS Equipment, Inc. (the "Debtors")filed voluntary petitions for relief under Chapter  11 of theBankruptcy Code. During the bankruptcy cases, iPCS filed a motion andobtained an order authorizing it to assume a management agreementbetween iPCS, AirGate PCS and AirGate Services Co., as amended. AirGatePCS subsequently filed an administrative expense priority claim foramounts that it contends were owed by the Debtors under the assumedmanagement agreement. The claim was for amounts that AirGate PCS mightbe liable to certain third party vendors for goods and servicesprovided by such vendors to or for the benefit of the Debtors. In theirdisclosure statement, the Debtors indicated that they might seek todefend against the claim by arguing, among other things, that AirGatePCS has failed to disgorge an alleged preferential transfer in theamount of $3,079 and that Old AirGate, its affiliates, officers, anddirectors may be subject to claims of the Debtors for mismanagement,breach of fiduciary duties, officer and director liability and similarclaims. The parties engaged in settlement discussions in an effort toresolve all of the disputes between them and on or about April 8, 2005,AirGate PCS and the Debtors entered into a settlement agreementresolving the claims between them. Under the settlement, the Companywill receive 8,200 shares of the common stock issued by the Debtorsunder their confirmed plan of reorganization.

16

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

The Company is involved in various claimsand legal actions arising in the ordinary course of business. Theultimate disposition of these matters is not expected to have amaterial adverse impact on the Company's financial position,results of operations or liquidity.

|           |                                |
|-----------|--------------------------------|
| 15.  | PROFORMA FINANCIAL INFORMATION |

The unaudited pro forma condensedconsolidated statements of operations for the period from acquisitionto June 30, 2005 and for the three and six months ended June 30, 2004set forth below present the results of operations as if the acquisitionof Old AirGate by Alamosa Holdings had occurred at the beginning ofeach period and are not necessarily indicative of future results oractual results that would have been achieved had this acquisitionoccurred as of the beginning of theperiod.

|                              |  |                                      |                                 |                                         |  |                                     |                                |               |  |        |                                 |                |  |  |
|------------------------------|--|--------------------------------------|---------------------------------|-----------------------------------------|--|-------------------------------------|--------------------------------|---------------|--|--------|---------------------------------|----------------|--|--|
|                         |  | Forthe six monthsended June 30, 2005 |                                 | For the threemonths ended June 30, 2004 |  | For the six monthsendedJune 30,2004 |
|                         |  |                                 |                            |                                    |  |                                |                           |          |  |   |                            |           |
|                         |  |                                 |                            |                                    |  |                                |                           |          |  |   |                            |           |
| Totalrevenues                |  | $                                    |     195,202 |                                    |  | $                                   |     86,038 |          |  | $      |     164,074 |           |
| Lossbefore income taxbenefit |  | $                                    |             | (30,516)                           |  | $                                   |            | (9,168)  |  | $      |             | (28,513)  |
| Incometaxbenefit             |  |                                 | 11,746                          |                                    |  |                                | —                        |          |  |   | —                         |           |
| Netloss                      |  | $                                    |             | (18,770)                           |  | $                                   |            | (9,168)  |  | $      |             | (28,513)  |
|                              |

|           |                                                     |
|-----------|-----------------------------------------------------|
| 16.  | EFFECTSOF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS |

In December 2004,the Financial Accounting Standards Board("FASB") issued SFAS No. 123(R),"Share-Based Payment," which is a revision ofSFAS No. 123 and supersedes APB Opinion No. 25. SFAS No. 123(R)requires all share-based payments to employees, including grants ofemployee stock options, to be valued at fair value on the date ofgrant, and to be expensed over the applicable vesting period. Pro formadisclosures of the income statement effects of share-based payments isno longer an alternative. SFAS No. 123(R) is effective for allstock-based awards granted on or after July 1, 2005. In addition,companies must also recognize compensation expense related to anyawards that are not fully vested as of July 1, 2005. Compensationexpense for the unvested awards will be measured based on the fairvalue of the awards previously calculated in developing the pro formadisclosures in accordance with the provisions of SFAS No. 123. On April14, 2005, the SEC announced the adoption of a new rule that amends thecompliance dates for SFAS No. 123(R). The new rule allows registrantsto implement SFAS No. 123(R) at the beginning of their next fiscal yearthat begins after June 15, 2005. As a result, the Company will berequired to adopt the provisions of SFAS No. 123(R) on January 1, 2006.The Company is currently assessing the impact of adopting SFAS No.123(R) to its consolidated results of operations.

In June 2005,the FASB issued SFAS No. 154, "Accounting Changes andError Corrections a replacement of APB Opinion No. 20 and FASBStatement No. 3." This Statement changes the requirementsfor the accounting for and reporting of a change in accountingprinciple. This Statement applies to voluntary changes as well as thosechanges required by an accounting pronouncement if that pronouncementdoes not include specific transition provisions. This Statementrequires retrospective application to prior periods' financialstatements of changes in accounting principle as opposed to being shownas a cumulative adjustment in the period of change. The Statement iseffective for all changes and corrections of errors made in fiscalyears beginning after December 15, 2005. The adoption of this standardis not expected to materially impact the Company.

17

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

On March 31, 2005, the FASB issuedInterpretation No. ("FIN") 47,"Accounting for Conditional Asset RetirementObligations" which is an interpretation of SFAS No. 143,"Accounting for Asset RetirementObligations." FIN 47 clarifies that the recognition andmeasurement provisions of SFAS No. 143 apply to asset retirementobligations in which the timing and/or method of settlement may beconditional on a future event, including obligations to remediateasbestos at the end of a building's useful life and obligationsto dispose of chemically-treated telephone poles at the end of theiruseful lives. FIN 47 is effective for fiscal years ending afterDecember 15, 2005. The Company is currently assessing the impact ofadopting FIN 47 to its consolidated results of operations.

|           |                  |
|-----------|------------------|
| 17.  | SUBSEQUENT EVENT |

On December 15,2004, Sprint Corporation ("Sprint") andNextel Communications, Inc. ("Nextel")announced a proposed merger of their two companies. Nextel currentlyoperates a wireless mobility communications network in certainterritories in which the Company also provides digital wirelessmobility communications network services under the Sprint or affiliatedbrands. Sprint and Nextel have announced that they intend to close themerger on August 12, 2005.

Based upon the terms of theexclusivity covenants contained in the management agreement betweenSprint and AirGate PCS, Inc., the Company believes that Nextel'soperation of a wireless mobility communications network in territoriesin which AirGate operates from and after the closing of theSprint-Nextel merger will constitute a breach of the exclusivitycovenants in the AirGate management agreement with Sprint. Moreover,based upon public statements and disclosures made by Sprint and Nextelfollowing the announcement of their pending merger, Alamosa Holdingsbelieves that actions that Sprint and Nextel intend to take inconnection with the integration of their operations followingcompletion of the merger may constitute a breach of the exclusivity andcertain other provisions of the management agreements between Sprintand Alamosa Holdings' other operating subsidiaries.

Aspreviously disclosed, Alamosa Holdings had been engaged in discussionswith Sprint in an attempt to reach a mutually acceptable resolution ofthe issues related to the Sprint-Nextel merger and its effect on theexisting management agreements between Sprint and AlamosaHoldings' subsidiaries. However, Alamosa Holdings concluded thatit was unlikely that it would be able to reach a mutually acceptableresolution with Sprint prior to the closing of the Sprint-Nextelmerger, and, on August 8, 2005, AirGate filed a lawsuit against Sprint,certain of its affiliates and Nextel in the Delaware Court of Chanceryalleging, among other things, that following the completion of thepending merger, Sprint will breach the exclusivity covenants containedin its management agreement with AirGate and that Nextel unlawfullyinterfered with AirGate's exclusive rights under such agreement.The complaint seeks, among other things, an order directing Sprint andits affiliates to specifically perform their contractual obligationsunder their agreements with AirGate, an injunction preventing Sprintand Nextel from taking any action or entering into any agreement thatwould violate the exclusivity covenants contained in the agreements, adeclaratory judgment declaring the rights, remedies and obligations ofthe parties under the agreements, and damages. Alamosa Holdings'other operating subsidiaries also may decide to pursue remedies againstSprint and Nextel, including bringing a lawsuit against Sprint andNextel.

Under the Company's affiliation agreements withSprint, an event of termination can be declared by the Company after amaterial breach by Sprint is not cured within the applicable graceperiod, which, without extension by the Company, could be as much as180 days. If the Company has the right to terminate its managementagreements because of an event of termination caused 

18

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

by Sprint, generally the Company may (i)require Sprint to purchase all of its operating assets used inconnection with its portion of the PCS network of Sprint, (ii) in allareas in the Company's territory where Sprint is the licensee for20 MHz or more of the spectrum on the date it terminates our managementagreements, require Sprint to assign to the Company, subject togovernmental approval, up to 10 MHz of licensed spectrum or (iii)choose not to terminate its management agreements and sue Sprint fordamages or other relief or submit the matter to arbitration.

Should the breach not be cured by Sprint or a modification, waiveror extension not be granted by the Company, the election by the Companyto terminate the affiliation agreements would constitute an event ofdefault under each series of the Company's outstanding seniornotes. Upon an event of default, the holders of the senior notes wouldhave the right to demand payment and the Company may not have adequateliquidity to satisfy this obligation. At this point in time, managementof the Company does not anticipate that an event of termination of theaffiliation agreements willoccur.

|           |                                             |
|-----------|---------------------------------------------|
| 18.  | CONDENSED CONSOLIDATING FINANCIALSTATEMENTS |

Set forth below are consolidating financialstatements of the Company and guarantor subsidiaries as of June 30,2005 and December 31, 2004, for the three months ended June 30, 2005and 2004, for the period from acquisition to June 30, 2005, for theperiod from January 1, 2005 to February 15, 2005 and for the six monthsended June 30, 2004. The guarantor subsidiaries are all 100%owned by the Company and the guarantees are full and unconditional.Separate financial statements of each guarantor subsidiary have notbeen provided because management has determined that they are notmaterial to investors.

AGW Leasing Company, Inc.("AGW") is a wholly-owned restrictedsubsidiary of AirGate. AGW has fully and unconditionally guaranteed theSenior Notes (see Note 10). AGW was formed to hold the real estateinterests for the Company's PCS network and retail operations.After the acquisition of Old AirGate by Alamosa Holdings on February15, 2005, all interests were transferred to the Company.

AirGateNetwork Services, LLC ("ANS") is awholly-owned restricted subsidiary of AirGate. ANS has fully andunconditionally guaranteed the Senior Notes (see Note 10). ANS wasformed to provide construction management services for theCompany's PCS network. All assets and liabilities of ANS wereassumed by the Company in connection with the acquisition of OldAirGate by Alamosa Holdings on February 15, 2005.

AirGateService Company, Inc. ("Service Co") is awholly-owned restricted subsidiary of AirGate. Service Co has fully andunconditionally guaranteed the Senior Notes (see Note 10). Service Cowas formed to provide management services to Old AirGate and iPCS. Atthe time of the acquisition of Old AirGate by Alamosa Holdings onFebruary 15, 2005, Service Co had no assets or liabilities.

19

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

CONDENSED CONSOLIDATING BALANCESHEET AS OF JUNE 30,2005    

|                                          |  |        |                                 |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                 |        |  |  |
|------------------------------------------|--|--------|---------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|---------------------------------|--------|--|--|
|                                     |  | Issuer |                                 | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |   |
| Cashand cashequivalents                  |  | $      |     4,366   |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     4,366   |   |
| Shortterminvestments                     |  |   | 39,549                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 39,549                          |   |
| Othercurrentassets                       |  |   | 48,733                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 48,733                          |   |
| Totalcurrentassets                       |  |   | 92,648                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 92,648                          |   |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |   |
| Propertyand equipment,net                |  |   | 90,644                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 90,644                          |   |
| Othernoncurrentassets                    |  |   | 648,964                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 648,964                         |   |
| Totalassets                              |  | $      |     832,256 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     832,256 |   |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |   |
| Currentliabilities                       |  | $      |     44,140  |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     44,140  |   |
| Long-termdebt                            |  |   | 346,949                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 346,949                         |   |
| Otherlong-termliabilities                |  |   | 28,770                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 28,770                          |   |
| Investmentinsubsidiaries                 |  |   | —                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                         |   |
| Totalliabilities                         |  |   | 419,859                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 419,859                         |   |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |   |
| Stockholders'equity                      |  |   | 412,397                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 412,397                         |   |
| Totalliabilities and stockholders'equity |  | $      |     832,256 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     832,256 |   |
|                                          |

20

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AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

CONDENSED CONSOLIDATING BALANCESHEET AS OF DECEMBER 31,2004    

|                                           |  |        |                                 |                       |  |              |                                |              |  |        |                                 |         |  |        |                                 |         |  |  |
|-------------------------------------------|--|--------|---------------------------------|-----------------------|--|--------------|--------------------------------|--------------|--|--------|---------------------------------|---------|--|--------|---------------------------------|---------|--|--|
|                                      |  | Issuer |                                 | GuarantorSubsidiaries |  | Eliminations |                                | Consolidated |
|                                      |  |   |                            |                  |  |         |                           |         |  |   |                            |    |  |   |                            |    |
| Cashand cashequivalents                   |  | $      |     15,927  |                  |  | $            | (10                            | )       |  | $      |     — |    |  | $      |     15,917  |    |
| Shortterminvestments                      |  |   | 94,059                          |                  |  |         | —                        |         |  |   | —                         |    |  |   | 94,059                          |    |
| Othercurrentassets                        |  |   | 96,596                          |                  |  |         | 529                            |         |  |   | (61,943                         | )  |  |   | 35,182                          |    |
| Totalcurrentassets                        |  |   | 206,582                         |                  |  |         | 519                            |         |  |   | (61,943                         | )  |  |   | 145,158                         |    |
|                                      |  |   |                            |                  |  |         |                           |         |  |   |                            |    |  |   |                            |    |
| Propertyand equipment,net                 |  |   | 105,522                         |                  |  |         | 25,287                         |         |  |   | —                         |    |  |   | 130,809                         |    |
| Othernoncurrentassets                     |  |   | 7,266                           |                  |  |         | —                        |         |  |   | —                         |    |  |   | 7,266                           |    |
| Totalassets                               |  | $      |     319,370 |                  |  | $            |     25,806 |         |  | $      | (61,943                         | )  |  | $      |     283,233 |    |
|                                      |  |   |                            |                  |  |         |                           |         |  |   |                            |    |  |   |                            |    |
| Currentliabilities                        |  | $      |     62,352  |                  |  | $            |     61,414 |         |  | $      | (61,943                         | )  |  | $      |     61,823  |    |
| Intercompany                              |  |   | (134,537                        | )                |  |         | 134,537                        |         |  |   | —                         |    |  |   | —                         |    |
| Long-termdebt                             |  |   | 312,478                         |                  |  |         | —                        |         |  |   | —                         |    |  |   | 312,478                         |    |
| Otherlong-termliabilities                 |  |   | 3,363                           |                  |  |         | —                        |         |  |   | —                         |    |  |   | 3,363                           |    |
| Investmentinsubsidiaries                  |  |   | 170,145                         |                  |  |         | —                        |         |  |   | (170,145                        | )  |  |   | —                         |    |
| Totalliabilities                          |  |   | 413,801                         |                  |  |         | 195,951                        |         |  |   | (232,088                        | )  |  |   | 377,664                         |    |
|                                      |  |   |                            |                  |  |         |                           |         |  |   |                            |    |  |   |                            |    |
| Stockholders'deficit                      |  |   | (94,431                         | )                |  |         | (170,145                       | )       |  |   | 170,145                         |    |  |   | (94,431                         | )  |
| Totalliabilities and stockholders'deficit |  | $      |     319,370 |                  |  | $            |     25,806 |         |  | $      | (61,943                         | )  |  | $      |     283,233 |    |
|                                           |

CONDENSEDCONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDEDJUNE 30,2005    

|                                   |  |        |                                 |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                 |         |  |  |
|-----------------------------------|--|--------|---------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|---------------------------------|---------|--|--|
|                              |  | Issuer |                                 | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                              |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
| Revenue                           |  | $      |     101,602 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     101,602 |    |
| Costofrevenue                     |  |   | 60,777                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 60,777                          |    |
| Sellingandmarketing               |  |   | 12,393                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 12,393                          |    |
| Generaland administrativeexpenses |  |   | 5,373                           |                  |  |         | —                         |         |  |   | —                         |   |  |   | 5,373                           |    |
| Depreciationandamortization       |  |   | 27,798                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 27,798                          |    |
| Non-cashcompensation              |  |   | 550                             |                  |  |         | —                         |         |  |   | —                         |   |  |   | 550                             |    |
| Lossfromoperations                |  |   | (5,289                          | )                |  |         | —                         |         |  |   | —                         |   |  |   | (5,289                          | )  |
| Equityin loss ofsubsidiaries      |  |   | —                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                         |    |
| Interestand otherincome           |  |   | 706                             |                  |  |         | —                         |         |  |   | —                         |   |  |   | 706                             |    |
| Interestexpense                   |  |   | (5,729                          | )                |  |         | —                         |         |  |   | —                         |   |  |   | (5,729                          | )  |
| Lossbefore income taxbenefit      |  |   | (10,312                         | )                |  |         | —                         |         |  |   | —                         |   |  |   | (10,312                         | )  |
| Incometaxbenefit                  |  |   | 3,966                           |                  |  |         | —                         |         |  |   | —                         |   |  |   | 3,966                           |    |
| Netloss                           |  | $      | (6,346                          | )                |  | $            |     — |         |  | $      |     — |   |  | $      | (6,346                          | )  |
|                                   |

21

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

CONDENSED CONSOLIDATING STATEMENT OFOPERATIONS FOR THE THREE MONTHS ENDED JUNE 30,2004    

|                                          |  |        |                                |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                |         |  |  |
|------------------------------------------|--|--------|--------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|--------------------------------|---------|--|--|
|                                     |  | Issuer |                                | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                     |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
| Revenue                                  |  | $      |     86,038 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     86,038 |    |
| Costofrevenue                            |  |   | 45,627                         |                  |  |         | 4,321                           |         |  |   | —                         |   |  |   | 49,948                         |    |
| Sellingandmarketing                      |  |   | 10,377                         |                  |  |         | 513                             |         |  |   | —                         |   |  |   | 10,890                         |    |
| Generaland administrativeexpenses        |  |   | 4,846                          |                  |  |         | 124                             |         |  |   | —                         |   |  |   | 4,970                          |    |
| Depreciationandamortization              |  |   | 9,638                          |                  |  |         | 2,377                           |         |  |   | —                         |   |  |   | 12,015                         |    |
| Gainon disposal of property andequipment |  |   | (2                             | )                |  |         | —                         |         |  |   | —                         |   |  |   | (2                             | )  |
| Income(loss) fromoperations              |  |   | 15,552                         |                  |  |         | (7,335                          | )       |  |   | —                         |   |  |   | 8,217                          |    |
| Equityin loss ofsubsidiaries             |  |   | (7,294                         | )                |  |         | —                         |         |  |   | 7,294                           |   |  |   | —                        |    |
| Interestand otherincome                  |  |   | 188                            |                  |  |         | —                         |         |  |   | —                         |   |  |   | 188                            |    |
| Interestexpense                          |  |   | (6,271                         | )                |  |         | 41                              |         |  |   | —                         |   |  |   | (6,230                         | )  |
| Income(loss) before incometaxes          |  |   | 2,175                          |                  |  |         | (7,294                          | )       |  |   | 7,294                           |   |  |   | 2,175                          |    |
| Incometaxes                              |  |   | —                        |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                        |    |
| Netincome(loss)                          |  | $      |     2,175  |                  |  | $            | (7,294                          | )       |  | $      |     7,294   |   |  | $      |     2,175  |    |
|                                          |

CONDENSEDCONSOLIDATING STATEMENT OF OPERATIONS FOR THE PERIOD FROMACQUISITION TO JUNE 30,2005    

|                                   |  |        |                                 |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                 |         |  |  |
|-----------------------------------|--|--------|---------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|---------------------------------|---------|--|--|
|                              |  | Issuer |                                 | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                              |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
| Revenue                           |  | $      |     146,339 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     146,339 |    |
| Costofrevenue                     |  |   | 86,566                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 86,566                          |    |
| Sellingandmarketing               |  |   | 21,150                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 21,150                          |    |
| Generaland administrativeexpenses |  |   | 8,272                           |                  |  |         | —                         |         |  |   | —                         |   |  |   | 8,272                           |    |
| Mergerrelatedexpenses             |  |   | —                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                         |    |
| Depreciationandamortization       |  |   | 42,103                          |                  |  |         | —                         |         |  |   | —                         |   |  |   | 42,103                          |    |
| Non-cashcompensation              |  |   | 550                             |                  |  |         | —                         |         |  |   | —                         |   |  |   | 550                             |    |
| Lossfromoperations                |  |   | (12,302                         | )                |  |         | —                         |         |  |   | —                         |   |  |   | (12,302                         | )  |
| Interestand otherincome           |  |   | 1,025                           |                  |  |         | —                         |         |  |   | —                         |   |  |   | 1,025                           |    |
| Interestexpense                   |  |   | (8,497                          | )                |  |         | —                         |         |  |   | —                         |   |  |   | (8,497                          | )  |
| Lossbefore income taxbenefit      |  |   | (19,774                         | )                |  |         | —                         |         |  |   | —                         |   |  |   | (19,774                         | )  |
| Incometaxbenefit                  |  |   | 7,611                           |                  |  |         | —                         |         |  |   | —                         |   |  |   | 7,611                           |    |
| Netloss                           |  | $      | (12,163                         | )                |  | $            |     — |         |  | $      |     — |   |  | $      | (12,163                         | )  |
|                              |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
|                              |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
|                                   |

22

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

CONDENSED CONSOLIDATING STATEMENT OFOPERATIONS FOR THE PERIOD FROM JANUARY 1, 2005 TO FEBRUARY 15,2005    

|                                          |  |        |                                |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                |         |  |  |
|------------------------------------------|--|--------|--------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|--------------------------------|---------|--|--|
|                                     |  | Issuer |                                | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                     |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
| Revenue                                  |  | $      |     48,863 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     48,863 |    |
| Costofrevenue                            |  |   | 27,745                         |                  |  |         | 2,342                           |         |  |   | —                         |   |  |   | 30,087                         |    |
| Sellingandmarketing                      |  |   | 9,100                          |                  |  |         | 193                             |         |  |   | —                         |   |  |   | 9,293                          |    |
| Generaland administrativeexpenses        |  |   | 2,848                          |                  |  |         | 75                              |         |  |   | —                         |   |  |   | 2,923                          |    |
| Mergerrelatedexpenses                    |  |   | 23,748                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 23,748                         |    |
| Depreciationandamortization              |  |   | 6,709                          |                  |  |         | 1,205                           |         |  |   | —                         |   |  |   | 7,914                          |    |
| Losson disposal of property andequipment |  |   | 20                             |                  |  |         | —                         |         |  |   | —                         |   |  |   | 20                             |    |
| Lossfromoperations                       |  |   | (21,307                        | )                |  |         | (3,815                          | )       |  |   | —                         |   |  |   | (25,122                        | )  |
| Equityin earnings ofsubsidiaries         |  |   | (3,815                         | )                |  |         | —                         |         |  |   | 3,815                           |   |  |   | —                        |    |
| Interestand otherincome                  |  |   | 346                            |                  |  |         | —                         |         |  |   | —                         |   |  |   | 346                            |    |
| Interestexpense                          |  |   | (4,111                         | )                |  |         | —                         |         |  |   | —                         |   |  |   | (4,111                         | )  |
| Incomebefore incometaxes                 |  |   | (28,887                        | )                |  |         | (3,815                          | )       |  |   | 3,815                           |   |  |   | (28,887                        | )  |
| Incometaxes                              |  |   | —                        |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                        |    |
| Netloss                                  |  | $      | (28,887                        | )                |  | $            | (3,815                          | )       |  | $      |     3,815   |   |  | $      | (28,887                        | )  |
|                                     |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
|                                     |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
|                                          |

CONDENSEDCONSOLIDATING STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDEDJUNE 30,2004    

|                                          |  |        |                                 |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                 |         |  |  |
|------------------------------------------|--|--------|---------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|---------------------------------|---------|--|--|
|                                     |  | Issuer |                                 | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
| Revenue                                  |  | $      |     164,074 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     164,074 |    |
| Costofrevenue                            |  |   | 88,053                          |                  |  |         | 8,519                           |         |  |   | —                         |   |  |   | 96,572                          |    |
| Sellingandmarketing                      |  |   | 21,724                          |                  |  |         | 1,082                           |         |  |   | —                         |   |  |   | 22,806                          |    |
| Generaland administrativeexpenses        |  |   | 11,026                          |                  |  |         | 281                             |         |  |   | —                         |   |  |   | 11,307                          |    |
| Depreciationandamortization              |  |   | 19,146                          |                  |  |         | 4,761                           |         |  |   | —                         |   |  |   | 23,907                          |    |
| Gainon disposal of property andequipment |  |   | (5                              | )                |  |         | —                         |         |  |   | —                         |   |  |   | (5                              | )  |
| Income(loss) fromoperations              |  |   | 24,130                          |                  |  |         | (14,643                         | )       |  |   | —                         |   |  |   | 9,487                           |    |
| Equityin loss ofsubsidiaries             |  |   | (14,561                         | )                |  |         | —                         |         |  |   | 14,561                          |   |  |   | —                         |    |
| Interestand otherincome                  |  |   | 353                             |                  |  |         | —                         |         |  |   | —                         |   |  |   | 353                             |    |
| Interestexpense                          |  |   | (17,623                         | )                |  |         | 82                              |         |  |   | —                         |   |  |   | (17,541                         | )  |
| Lossbefore incometaxes                   |  |   | (7,701                          | )                |  |         | (14,561                         | )       |  |   | 14,561                          |   |  |   | (7,701                          | )  |
| Incometaxes                              |  |   | —                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                         |    |
| Netloss                                  |  | $      | (7,701                          | )                |  | $            | (14,561                         | )       |  | $      |     14,561  |   |  | $      | (7,701                          | )  |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
|                                     |  |   |                            |                  |  |         |                            |         |  |   |                            |   |  |   |                            |    |
|                                          |

23

----

AIRGATEPCS, INC.NOTES TO THE CONSOLIDATED FINANCIALSTATEMENTS  (CONTINUED) (UNAUDITED)(dollars in thousands,except asnoted)

CONSOLIDATING STATEMENT OF CASHFLOWS FOR THE PERIOD FROM ACQUISITION TO JUNE 30,2005    

|                                                |  |        |                               |                       |  |              |                                 |              |  |        |                                 |        |  |        |                               |         |  |  |
|------------------------------------------------|--|--------|-------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|-------------------------------|---------|--|--|
|                                           |  | Issuer |                               | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                           |  |   |                          |                  |  |         |                            |         |  |   |                            |   |  |   |                          |    |
| Operatingactivities,net                        |  | $      | (3,960                        | )                |  | $            |     — |         |  | $      |     — |   |  | $      | (3,960                        | )  |
| Investingactivities,net                        |  |   | 23,326                        |                  |  |         | —                         |         |  |   | —                         |   |  |   | 23,326                        |    |
| Financingactivities,net                        |  |   | (15,000                       | )                |  |         | —                         |         |  |   | —                         |   |  |   | (15,000                       | )  |
| Netincrease in cash and cashequivalents        |  |   | 4,366                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 4,366                         |    |
| Cashand cash equivalents at beginning ofperiod |  |   | —                       |                  |  |         | —                         |         |  |   | —                         |   |  |   | —                       |    |
| Cashand cash equivalents at end ofperiod       |  | $      |     4,366 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     4,366 |    |
|                                                |

CONSOLIDATINGSTATEMENT OF CASH FLOWS FOR THE PERIOD FROM JANUARY 1, 2005 TOFEBRUARY 15,2005    

|                                                |  |        |                                |                       |  |              |                                 |              |  |        |                                 |        |  |        |                                |         |  |  |
|------------------------------------------------|--|--------|--------------------------------|-----------------------|--|--------------|---------------------------------|--------------|--|--------|---------------------------------|--------|--|--------|--------------------------------|---------|--|--|
|                                           |  | Issuer |                                | GuarantorSubsidiaries |  | Eliminations |                                 | Consolidated |
|                                           |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
| Operatingactivities,net                        |  | $      | (18,630                        | )                |  | $            |     12      |         |  | $      |     — |   |  | $      | (18,618                        | )  |
| Investingactivities,net                        |  |   | 40,824                         |                  |  |         | —                         |         |  |   | —                         |   |  |   | 40,824                         |    |
| Financingactivities,net                        |  |   | (1,617                         | )                |  |         | —                         |         |  |   | —                         |   |  |   | (1,617                         | )  |
| Netincrease in cash and cashequivalents        |  |   | 20,577                         |                  |  |         | 12                              |         |  |   | —                         |   |  |   | 20,589                         |    |
| Cashand cash equivalents at beginning ofperiod |  |   | 15,929                         |                  |  |         | (12                             | )       |  |   | —                         |   |  |   | 15,917                         |    |
| Cashand cash equivalents at end ofperiod       |  | $      |     36,506 |                  |  | $            |     — |         |  | $      |     — |   |  | $      |     36,506 |    |
|                                           |  |   |                           |                  |  |         |                            |         |  |   |                            |   |  |   |                           |    |
|                                                |

CONSOLIDATINGSTATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30,2004    

|                                                |  |        |                                |                       |  |              |                             |              |  |        |                                 |        |  |        |                                |         |  |  |
|------------------------------------------------|--|--------|--------------------------------|-----------------------|--|--------------|-----------------------------|--------------|--|--------|---------------------------------|--------|--|--------|--------------------------------|---------|--|--|
|                                           |  | Issuer |                                | GuarantorSubsidiaries |  | Eliminations |                             | Consolidated |
|                                           |  |   |                           |                  |  |         |                        |         |  |   |                            |   |  |   |                           |    |
| Operatingactivities,net                        |  | $      |     33,855 |                  |  | $            |     198 |         |  | $      |     — |   |  | $      |     34,053 |    |
| Investingactivities,net                        |  |   | (9,998                         | )                |  |         | (206                        | )       |  |   | —                         |   |  |   | (10,204                        | )  |
| Financingactivities,net                        |  |   | (21,930                        | )                |  |         | —                     |         |  |   | —                         |   |  |   | (21,930                        | )  |
| Netincrease in cash and cashequivalents        |  |   | 1,927                          |                  |  |         | (8                          | )       |  |   | —                         |   |  |   | 1,919                          |    |
| Cashand cash equivalents at beginning ofperiod |  |   | 60,043                         |                  |  |         | —                     |         |  |   | —                         |   |  |   | 60,043                         |    |
| Cashand cash equivalents at end ofperiod       |  | $      |     61,970 |                  |  | $            | (8                          | )       |  | $      |     — |   |  | $      |     61,962 |    |
|                                                |

24

----

|              |                                                                                      |
|--------------|--------------------------------------------------------------------------------------|
| ITEM2.  | MANAGEMENT'S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS |

Forward-LookingStatements

This quarterly report on Form 10-Q includes"forward-looking statements" within themeaning of Section 27A of the Securities Act of 1933, as amended (the"Securities Act"), and Section 21E of theSecurities Exchange Act of 1934, as amended (the "ExchangeAct"), which can be identified by the use offorward-looking terminology such as "may,""might," "could,""would," "believe,""expect," "intend,""plan," "seek,""anticipate,""estimate,""project" or"continue" or the negative thereof or othervariations thereon or comparable terminology. All statements other thanstatements of historical fact included in this quarterly report on Form10-Q regarding our financial position and liquidity may be deemed to beforward-looking statements. These forward-looking statementsinclude:

|              |                                                 |
|--------------|-------------------------------------------------|
| •  | forecasts of populationgrowth in our territory; |

|              |                                                                                                                    |
|--------------|--------------------------------------------------------------------------------------------------------------------|
| •  | statementsregarding our anticipated revenues, expense levels, liquidity, capitalresources and operating losses;and |

|              |                                                                                   |
|--------------|-----------------------------------------------------------------------------------|
| •  | statements regarding expectationsor projections about markets in our territories. |

Although webelieve that the expectations reflected in such forward-lookingstatements are reasonable, we can give no assurance that suchexpectations will prove to have been correct. Important factors thatcould cause actual results to differ materially from those in theforward-looking statements include, but are not limitedto:

|              |                                               |
|--------------|-----------------------------------------------|
| •  | our dependence on our affiliationwith Sprint; |

|              |                                                                                                                                                   |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | the ability of Sprintto alter the terms of our affiliation agreements with it, includingfees paid or charged to us and other programrequirements; |

|              |                                   |
|--------------|-----------------------------------|
| •  | our anticipation offuture losses; |

|              |                                                                                              |
|--------------|----------------------------------------------------------------------------------------------|
| •  | our dependence onback office services, such as billing and customer care, provided bySprint; |

|              |                                                         |
|--------------|---------------------------------------------------------|
| •  | inaccuracies in financialinformation provided bySprint; |

|              |                                                 |
|--------------|-------------------------------------------------|
| •  | potential fluctuations in ouroperating results; |

|              |                                                                                      |
|--------------|--------------------------------------------------------------------------------------|
| •  | our ability topredict future customer growth, as well as other key operatingmetrics; |

|              |                                   |
|--------------|-----------------------------------|
| •  | changes or advances intechnology; |

|              |                                                               |
|--------------|---------------------------------------------------------------|
| •  | the ability to leveragethird generation products andservices; |

|              |                                                            |
|--------------|------------------------------------------------------------|
| •  | competition in the industryand markets in which weoperate; |

|              |                           |
|--------------|---------------------------|
| •  | subscriber creditquality; |

|              |                                                     |
|--------------|-----------------------------------------------------|
| •  | our ability to attract andretain skilled personnel; |

|              |                                                                                            |
|--------------|--------------------------------------------------------------------------------------------|
| •  | ourpotential need for additional capital or the need for refinancingexisting indebtedness; |

|              |                                                                                                                                                           |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | our potentialinability to expand our services and related products in the event ofsubstantial increases in demand for these services and relatedproducts; |

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| •  | our inability to predictthe outcomes of potentially materiallitigation; |

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| •  | the potential impact ofwireless local number portability, orWLNP; |

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|--------------|----------------------------------|
| •  | changes in governmentregulation; |

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| •  | futureacquisitions; |

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| •  | general economic andbusiness conditions; and |

|              |                                                                                                                                                                        |
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| •  | effects ofmergers and consolidations within the telecommunications industry andunexpected announcements or developments from others in thetelecommunications industry. |

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All subsequent written and oralforward-looking statements attributable to us or persons acting on ourbehalf are expressly qualified in their entirety by the cautionarystatements set forth above.

Definitions of OperatingMetrics

We discuss the following operating metrics relating toour business in this section:

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| •  | ARPU,or average monthly revenue per user, is a measure used to determine themonthly subscriber revenue earned for subscribers based in ourterritory. This measure is calculated by dividing subscriber revenuesin our consolidated statement of operations by our average dailysubscribers during the period divided by the number of months in theperiod. |

|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Average monthly churn is usedto measure the rate at which subscribers based in our territorydeactivate service on a voluntary or involuntary basis. We calculateaverage monthly churn based on the number of subscribers deactivatedduring the period (net of transfers out of our service area and thosewho deactivated within 30 days of activation) as a percentage of ouraverage daily subscriber base during the period divided by the numberof months during the period. |

|              |                                                                                                                                                                                                                                                                                                                                                                            |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | LicensedPOPs represent the number of residents (usually expressed in millions)in our territory in which we have an exclusive right to providewireless mobility communications services under the Sprint brand name.The number of residents located in our territory does not represent thenumber of wireless subscribers that we serve or expect to serve in ourterritory. |

|              |                                                                                                                                                                                                                                                                                                         |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  | Covered POPs represent thenumber of residents (usually expressed in millions) covered by ourportion of the PCS network of Sprint in our territory. The number ofresidents covered by our network does not represent the number ofwireless subscribers that we serve or expect to serve in ourterritory. |

General

On December 7, 2004, AirGate PCS,Inc. ("Old AirGate") entered into anAgreement and Plan of Merger with Alamosa Holdings, Inc.("Alamosa Holdings") and A-Co. Merger Sub,Inc. ("A-Co."), a direct wholly-ownedsubsidiary of Alamosa Holdings. Pursuant to the merger agreement, OldAirGate merged with and into A-Co. on February 15, 2005 with A-Co.surviving the merger. Immediately after the closing of the transaction,A-Co. was renamed AirGate PCS, Inc.("AirGate") and remains a wholly-ownedsubsidiary of Alamosa Holdings. In connection with the acquisition ofOld AirGate, the purchase price was allocated to the assets andliabilities of AirGate based on fair value resulting in a new basis ofaccounting.

As a PCS Affiliate of Sprint, we have the exclusiveright to provide wireless mobility communications services under theSprint brand name in our licensed territory. We own and are responsiblefor building, operating and managing the portion of the PCS network ofSprint located in our territory. We offer national plans designed bySprint as well as local plans tailored to our market demographics. Ourportion of the PCS network of Sprint is designed to offer a seamlessconnection with the 100% digital PCS nationwide wireless networkof Sprint. We market Sprint PCS products and services through a numberof distribution outlets located in our territory, including our ownretail stores, major national distributors and local third partydistributors. At June 30, 2005, we had total licensed POPs of over 7.4million, covered POPs of approximately 6.4 million and totalsubscribers of approximately 432,000.

We recognize revenues fromour subscribers for the provision of wireless telecommunicationsservices, proceeds from the sales of handsets and accessories throughchannels controlled by us and fees from Sprint and other wirelessservice providers and resellers when their customers roam onto ourportion of the PCS network of Sprint. Sprint retains 8% of allservice revenue collected from our subscribers (not including productssales and roaming charges billed to our subscribers) and all feescollected from other wireless service providers and resellers whentheir customers use our portion of 

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the PCS network of Sprint. We report theamount retained by Sprint as an operating expense. In addition, Sprintbills our subscribers for taxes, handset insurance, equipment andUniversal Service Fund charges and other surcharges which we do notrecord. Sprint collects these amounts from the subscribers and remitsthem to the appropriate tax authority.

As part of ouraffiliation agreements with Sprint, we have contracted with Sprint toprovide back office services such as customer activation, handsetlogistics, billing, customer care and network monitoring services. Weinitially elected to delegate the performance of these services toSprint to take advantage of their economies of scale, to accelerate ourbuild-out and market launches and to lower our initial capitalrequirements. We continue to contract with Sprint for these servicestoday and are obligated to continue using Sprint to provide theseservices through December 31, 2006. The cost for these services isprimarily on a per-subscriber or per-transaction basis and is recordedas an operating expense.

Critical Accounting Policies

The fundamental objective of financial reporting is to provideuseful information that allows a reader to comprehend the businessactivities of an entity. To aid in that understanding, we haveidentified our "critical accountingpolicies." These policies have the potential to have amore significant impact on our consolidated financial statements,either because of the significance of the financial statement item towhich they relate or because they require judgment and estimation dueto the uncertainty involved in measuring, at a specific point in time,events which are continuous in nature.

Accounting forbusiness combinations — The acquisition of Old AirGate byAlamosa Holdings on February 15, 2005 has been accounted for as abusiness combination in accordance with the provisions of SFAS No. 141,"Business Combinations." Significantassumptions used in connection with allocating the purchase price toidentifiable tangible and intangible assets and liabilities as well asunidentifiable goodwill include (i) the value of Alamosa Holdingscommon stock issued in the transaction, (ii) the value of identifiableintangible assets including value assigned to acquired subscribers andvalue assigned to the Sprint agreements assumed, (iii) the value ofproperty and equipment acquired, (iv) the value of long term debtassumed and (iv) deferred income tax assets and liabilitiesattributable to the assets and liabilities acquired. The operations ofthe acquired company are included in the consolidated results ofoperations of Alamosa Holdings, from the date of acquisition.

Allowance for doubtful accounts — Estimates are usedin determining our allowance for doubtful accounts and are based on ourhistorical collection experience, current trends, credit policy, apercentage of our accounts receivable by aging category andexpectations of future bad debts based on current collectionactivities. In determining the allowance, we consider historicalwrite-offs of our receivables as well as historical changes in ourcredit policies. We also look at current trends in the credit qualityof our customer base.

Revenue recognition — Werecord equipment revenue for the sale of handsets and accessories tocustomers in our retail stores and to local resellers in ourterritories. We do not record equipment revenue on handsets andaccessories purchased by our customers from national resellers ordirectly from Sprint. Our customers pay an activation fee when theyinitiate service. We allocate amounts charged to customers at the pointof sale between the sale of handsets and other equipment and the saleof wireless telecommunications services in those transactions takingplace in distribution channels that we directly control. Activationfees charged in transactions outside of our directly controlleddistribution channels continue to be deferred and amortized over theaverage life of the subscriber base.

We recognize revenue fromour customers as they use the service. Additionally, we provide areduction of recorded revenue for billing adjustments and billingcorrections.

The cost of handsets sold generally exceeds theretail sales price, as it is common in our industry to subsidize theprice of handsets for competitive reasons. For handsets sold throughchannels controlled by Sprint that are activated by a subscriber in ourterritory, we reimburse Sprint for the 

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amount of subsidy incurred by them inconnection with the sale of these handsets. This reimbursement paid toSprint is reflected in our selling and marketing expenses in theconsolidated statements of operations.

Accounting forgoodwill and intangible assets — We have recorded certainintangible assets in connection with the purchase price allocationresulting from the acquisition of Old AirGate by Alamosa Holdings,including both identifiable intangibles and goodwill. Identifiableintangibles consist of the Sprint agreements and the subscriber base inplace at the time of acquisition. The intangible assets related to theSprint agreements are being amortized on a straight line basis over theremaining original term of the underlying Sprint agreements. Thesubscriber base intangible asset is amortized on a straight line basisover the estimated life of the acquired subscribers. We account forgoodwill in accordance with the provisions of SFAS No. 142,"Goodwill and Other Intangible Assets." Inaccordance with SFAS No. 142, goodwill is tested annually forimpairment.

Long-lived asset recovery —Long-lived assets, consisting primarily of property, equipment andintangibles, comprised approximately 89 percent of our total assets atJune 30, 2005. Changes in technology or in our intended use of theseassets may cause the estimated period of use or the value of theseassets to change. In addition, changes in general industry conditionscould cause the value of certain of these assets to change. We monitorthe appropriateness of the estimated useful lives of these assets.Whenever events or changes in circumstances indicate that the carryingamounts of these assets may not be recoverable, we review therespective assets for impairment. In performing this review, assets aregrouped according to identifiable cash flow streams and theundiscounted cash flow over the life of the asset group is compared tothe carrying value of the asset group. We have determined that we haveone asset grouping related to cash flows generated by our subscriberbase, which includes all of our assets. The life of this asset groupfor purposes of these impairment tests is assumed to be ten years.Estimates and assumptions used in both estimating the useful life andevaluating potential impairment issues require a significant amount ofjudgment.

Operating leases — Operating leases andrelated leasehold improvement costs are accounted for based on theprovisions of SFAS No. 13, "Accounting forLeases." We have a significant number of leases primarilyassociated with towers and other locations on which we install ournetwork equipment. These leases are considered operating leases and themonthly rentals are expensed as incurred while any capital expendituresassociated with preparing the site for our use are capitalized anddepreciated. These capital expenditures are depreciated over theshorter of the lease term or the economic life of the respectiveassets. Additionally, certain of these operating leases contain rentescalation provisions over the term of the respective leases. For thoseleases with escalation provisions, the periodic rental expense isrecorded on a straight line basis over the lease term.

Income taxes — We account for income taxes inaccordance with SFAS No. 109, "Accounting for IncomeTaxes." Under this method, we utilize an asset andliability approach to accounting for income taxes, wherein deferredtaxes are provided for book and tax basis differences for assets andliabilities. In the event differences exist between the book and taxbasis of our assets and liabilities that result in deferred assets, anevaluation of the probability of being able to realize the futurebenefits indicated by such assets is made. A valuation allowance isprovided for the portion of deferred tax assets for which there issufficient uncertainty regarding our ability to recognize the benefitsof those assets in future years.

On a quarterly basis, weevaluate the need for and adequacy of the valuation allowance basedupon the expected realizability of our deferred tax assets and adjustthe amount of such allowance, if necessary. The factors used to assessthe likelihood of realization are the latest forecast of future taxableincome, available tax planning strategies and the future reversal ofexisting taxable temporary differences.

Reliance on thetimeliness and accuracy of data received from Sprint - We placesignificant reliance on Sprint as a service provider in terms of thetimeliness and accuracy of financial and statistical data related tocustomers based in our service territory that we receive on a periodicbasis from Sprint. We make significant estimates in terms of revenue,cost of service, selling and marketing costs and the adequacy of ourallowance for uncollectible accounts based on this data we receive fromSprint. We 

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obtain assurance as to the accuracy of thisdata through analytic review and reliance on the service auditor reporton Sprint's internal control processes prepared by Sprint'sexternal service auditor. Inaccurate or incomplete data from Sprintcould have a material adverse effect on our results of operations andcash flow.

Consolidated Results of Operations (dollars inthousands)

The discussion of the results of operations below issignificantly affected by the acquisition of Old AirGate by AlamosaHoldings on February 15, 2005 and the resulting allocation of purchaseprice to the assets and liabilities of the Company. The results ofoperations for the three months ended June 30, 2005 are not comparablewith the results of operations for the three months ended June 30, 2004and the results of operations from acquisition through June 30, 2005are not comparable with the results of operations for the period fromJanuary 1, 2005 to February 15, 2005 nor with the results of operationsfor the six months ended June 30, 2004 as Old AirGate periods arepre-acquisition results and do not include the impact of the purchaseprice allocation resulting from the acquisition of Old AirGate byAlamosa Holdings.

For the three month periodended June 30, 2005 and the combined period from acquisition throughJune 30, 2005 and the period from January 1, 2005 to February 15, 2005,compared to the three and six month periods ended June 30, 2004

Subscriber growth and key performance indicators — Wehad total subscribers of approximately 432,000 at June 30, 2005compared to approximately 375,000 at June 30, 2004. This growth ofapproximately 57,000 subscribers represents 15 percent year over yearcompared to 3 percent growth from June 30, 2003 to June 30, 2004. Theincrease in growth is primarily attributable to an increase in ourdistribution channels, primarily in our own Sprint retail stores andbranded dealers in our territory as well as overall growth in thewireless telecommunications industry.

Average monthly churn forthe quarter ended June 30, 2005 was approximately 2.4 percent comparedto approximately 2.6 percent for the quarter ended June 30, 2004. Weincur significant up front costs in acquiring customers such that ifchurn were to increase, it could negatively impact our operations.

Service revenues — Service revenues consist ofrevenues from our subscribers and roaming and wholesale revenue earnedwhen subscribers from other carriers or resellers of PCS service useour portion of the PCS network of Sprint.

Subscriber revenueconsists of payments received from our subscribers for monthly serviceunder their service plans. Subscriber revenue also includesamortization of deferred activation fees and charges for the use ofvarious features including PCS Vision, the wireless web and voiceactivated dialing. Subscriber revenues were $73,821 for the quarterended June 30, 2005 compared to $65,037 for the quarter ended June 30,2004. This increase of 14 percent was primarily due to the increase inour subscriber base discussed above. Subscriber revenues were $108,770for the period from acquisition to June 30, 2005 and $34,680 for theperiod from January 1, 2005 to February 15, 2005. This combinedsubscriber revenue of $143,450 was approximately 13 percent higher than$126,693 for the six months ended June 30, 2004. This increase wasprimarily due to the increase in our subscriber base discussed above.Base ARPU (which does not include roaming revenue) in the quarter endedJune 30, 2005 was $57 compared to $58 in the quarter ended June 30,2004. Base ARPU for the period from acquisition to June 30, 2005 was$57, which was consistent with base ARPU of $57 in the first six monthsof 2004.

Roaming and wholesale revenue is comprised of revenuefrom Sprint and other PCS subscribers based outside of our territorywho roam onto our portion of the PCS network of Sprint as well asrevenue from resellers of PCS service whose subscribers use our portionof the PCS network of Sprint.

Roaming and wholesale revenue was$24,776 for the quarter ended June 30, 2005, which was 42 percenthigher than $17,389 for the quarter ended June 31, 2004. Roaming andwholesale revenue was 

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$32,916 for the period from acquisition toJune 30, 2005 and $10,972 for the period from January 1, 2005 toFebruary 15, 2005. This combined roaming and wholesale revenue of$43,888 was approximately 42 percent higher than $30,887 for the sixmonths ended June 30, 2004. The increase in both the quarter and sixmonths ended June 30, 2005 was due to a combination of an increase ininbound roaming minutes and an increase in our reciprocal rate withSprint to 5.8 cents per minute in connection with entering into theamendments to the Sprint agreements in August of 2004. The reciprocalrate with Sprint is fixed at 5.8 cents per minute until December 31,2006. We are currently a net receiver of roaming with Sprint, meaningthat the minute volume from other Sprint subscribers roaming onto ournetwork is greater than the minute volume from our subscribers roamingonto other portions of the PCS network of Sprint. We have experiencedan increase in the volume of inbound roaming traffic from PCS providersother than Sprint. This traffic is settled at rates separatelynegotiated by Sprint on our behalf with the other PCS providers andthese rates have declined in some cases during 2005 compared to2004.

Product sales and cost of products sold —We record revenue from the sale of handsets and accessories, netof an allowance for returns, as product sales. Product sales revenueand cost of products sold are recorded for all products that are soldthrough our retail stores as well as those sold to our local indirectagents. The cost of handsets sold generally exceeds the retail salesprice as we subsidize the price of handsets for competitive reasons.Sprint's handset return policy allows customers to return theirhandsets for a full refund within 14 days of purchase. When handsetsare returned to us, we may be able to reissue the handsets to customersat little additional cost to us. However, when handsets are returned toSprint for refurbishing, we may receive a credit from Sprint, which isless than the amount we originally paid for the handset.

Productsales revenue for the quarter ended June 30, 2005 was $3,005 comparedto $3,612 for the quarter ended June 30, 2004. Cost of products soldfor the quarter ended June 30, 2005 was $7,698 compared to $6,670 forthe quarter ended June 30, 2004. As such, the subsidy on handsets soldthrough our retail and local indirect channels was $4,693 in thequarter ended June 30, 2005 and $3,058 for the quarter ended June 30,2004. The increase in subsidies of $1,635 is due to an increase in thenumber of activations through our retail and local indirect channels.Product sales revenue for the period from acquisition to June 30, 2005was $4,653 and for the period from January 1, 2005 to February 15, 2005was $3,211. This combined product sales revenue of $7,864 compares to$6,494 for the six months ended June 30, 2004. Cost of products soldfor the period from acquisition to June 30, 2005 was $12,126 and forthe period from January 1, 2005 to February 15, 2005 was $6,528. Thiscombined cost of products sold of $18,654 compares to $13,872 for thesix months ended June 30, 2004. As such, the subsidy on handsets soldthrough our retail and local indirect channels on a combined basis was$10,790 for the six months ended June 30, 2005 compared to $7,378 forthe six months ended June 30, 2004. The increase in subsidies of $3,412in the first six months of 2005 is primarily due to an increase in thenumber of activations through our retail and local indirectchannels.

Cost of service and operations — Costof service and operations includes the costs of operating our portionof the PCS network of Sprint. These costs include items such as toweroperating leases and maintenance as well as backhaul costs, which arecosts associated with transporting wireless calls across our portion ofthe PCS network of Sprint to another carrier's network. Inaddition, cost of service and operations includes outbound roamingcosts, long distance charges, the fees we pay to Sprint for our 8percent affiliation fee, back office services such as billing andcustomer care, as well as our provision for estimated uncollectibleaccounts. Expenses were $53,079 in the quarter ended June 30, 2005,which was approximately 23 percent higher than $43,278 in the quarterended June 30, 2004. Expenses were $74,440 in the period fromacquisition to June 30, 2005 and $23,559 from January 1, 2005 toFebruary 15, 2005. This combined cost of service and operations of$97,999 in the six months ended June 30, 2005 was approximately 18percent higher than the $82,700 incurred in the six months ended June30, 2004. The increase in expenses in 2005 was due to the increasedvolume of traffic carried on our network due both to the increase inboth our subscribers as well as wholesale and resale customers.

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Selling and marketing expenses —Selling and marketing expenses include advertising, promotion,sales commissions and expenses related to our distribution channels,including our retail store expenses. In addition, we reimburse Sprintfor the subsidy on handsets sold through national retail stores due tothe fact that these retailers purchase their handsets from Sprint. Thissubsidy is recorded as a selling and marketing expense. Selling andmarketing expenses were $12,393 in the quarter ended June 30, 2005 and$10,890 in the quarter ended June 30, 2004. Selling and marketingexpenses were $21,150 in the period from acquisition to June 30, 2005and $9,293 from January 1, 2005 to February 15, 2005. These combinedselling and marketing expenses of $30,443 in the six months ended June30, 2005 were 33 percent higher than the $22,806 incurred in the sixmonths ended June 30, 2004. The increase experienced in 2005 isattributable to an increase in variable costs resulting from increasesin gross activations.

General and administrative expenses— General and administrative expenses include corporatecosts and expenses such as administration and finance. General andadministrative expenses were $5,373 in the quarter ended June 30, 2005and $4,970 in the quarter ended June 30, 2004. General andadministrative expenses were $8,272 in the period from acquisition toJune 30, 2005 and $2,923 from January 1, 2005 to February 15, 2005.These combined general and administrative expenses of $11,195 in thesix months ended June 30, 2005 were consistent with the $11,307incurred in the six months ended June 30, 2004.

Mergerrelated expenses — Merger related expense in the period fromJanuary 1, 2005 to February 15, 2005 related to the acquisition of OldAirGate by Alamosa Holdings and was $23,748. Approximately $10,693 wasrelated to the payment for cancellation of employee stock options andrestricted stock units. Approximately $6,133 related to employeeseverance costs associated with terminating employees, including thoseto be terminated after the close of the acquisition. Approximately$4,269 related to investment banking fees. Approximately $1,474 relatedto future lease payments (net of expected sublease income) for afacility to be closed in May 2005. The remaining $1,179 related tolegal and other professional fees incurred in connection with theacquisition.

Depreciation and amortization —Depreciation and amortization includes depreciation of ourproperty and equipment as well as amortization of intangibles.Depreciation is calculated on the straight-line method over theestimated useful lives of the underlying assets and totaled $5,760 forthe quarter ended June 30, 2005. Depreciation was $12,015 for thequarter ended June 30, 2004 based on the historical cost of propertyand equipment. Depreciation was $9,358 in the period from acquisitionto June 30, 2005 based on the value allocated to property and equipmentin the purchase price allocation. Depreciation was $7,914 from January1, 2005 to February 15, 2005 and was based on the historical cost ofproperty and equipment. Depreciation was $23,907 for the six monthsended June 30, 2004 based on the historical cost of property andequipment.

Amortization expense relates to identifiableintangible assets we have recorded related to value assigned to theagreements with Sprint and the customer base in connection withpurchase accounting associated with the acquisition of Old AirGate byAlamosa Holdings. Amortization expense was $22,038 for the quarterended June 30, 2005 and $32,745 in the period from acquisition to June30, 2005.

Non-cash compensation — Non-cashcompensation expense of $550 in the three months ended June 30, 2005and the period from acquisition to June 30, 2005 relates to theallocation of consolidated Alamosa Holdings non-cash compensationexpense associated with vesting of restricted stock awarded toofficers.

Income (loss) from operations — Ouroperating loss for the quarter ended June 30, 2005 was $5,289 comparedto operating income of $8,217 for the quarter ended June 30, 2004. Thedecrease in operating income of $13,506 in the three months ended June30, 2005 is primarily due to $22,038 in amortization of intangibles.Our operating loss in the period from acquisition to June 30, 2005 was$12,302 and for the period from January 1, 2005 to February 15, 2005was $25,122. This combined operating loss of $37,424 for the six monthsended June 30, 2005 was significantly higher than operating income forthe six months ended June 30, 2004 of $9,487. The increase in operatingloss of 

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$46,911 in the six months ended June 30, 2005is primarily due to $23,748 in merger related expenses plus $32,745 inamortization of intangibles.

Interest and other income— Interest and other income represents amounts earned on theinvestment of excess cash. Income was $706 in the quarter ended June30, 2005 and $188 in the quarter ended June 30, 2004. Income was $1,025in the period from acquisition to June 30, 2005 and $346 in the periodfrom January 1, 2005 to February 15, 2005. This combined interestincome of $1,371 in the six months ended June 30, 2005 wassignificantly higher than the $353 earned in the six months ended June30, 2004. The increase in interest and other income is primarily due tothe fact that in October 2004, the Company completed an offering ofFloating Rate Notes in the amount of $175,000 and used the proceeds topay off existing debt of approximately $131,200 resulting in a netincrease in cash to the Company of approximately $43,800. Earnings onthis excess cash during the three and six months ended June 30, 2005account for the respective increases in interest income.

Interest expense — Interest expense was $5,729 in thequarter ended June 30, 2005 and $6,230 in the quarter ended June 30,2004. Interest expense for the period from acquisition to June 30, 2005was $8,497 and for the period from January 1, 2005 to February 15, 2005was $4,111. This combined interest expense of $12,608 in the six monthsended June 30, 2005 was 28% lower than interest expense of$17,541 in the six months ended June 30, 2004. The decrease in interestexpense was due to the debt restructuring completed in February 2004resulting in a lower amount of borrowings as well as a lower effectiveinterest rate on borrowings.

Income Taxes

We accountfor income taxes in accordance with SFAS No. 109,"Accounting for Income Taxes." Under thismethod, we utilize an asset and liability approach to accounting forincome taxes, wherein deferred taxes are provided for book and taxbasis differences for assets and liabilities. In the event differencesexist between the book and tax basis of our assets and liabilities thatresult in deferred assets, an evaluation of the probability of beingable to realize the future benefits indicated by such assets is made. Avaluation allowance is provided for the portion of deferred tax assetsfor which there is sufficient uncertainty regarding our ability torecognize the benefits of those assets in future years.

On aquarterly basis, we evaluate the need for and adequacy of the valuationallowance based upon the expected realizability of our deferred taxassets and adjust the amount of such allowance, if necessary. Thefactors used to assess the likelihood of realization are the latestforecast of future taxable income, available tax planning strategiesand the future reversal of existing taxable temporary differences.

Cash Flows

Operating activities — Operatingcash flows were negative $3,960 in the period from acquisition to June30, 2005 and negative $18,618 from January 1, 2005 to February 15,2005. The combined negative cash flows from operations of $22,578 forthe six months ended June 30, 2005 compares to positive cash flow of$34,053 for the six months ended June 30, 2004. The decrease of $56,631was primarily attributable to working capital changes of negative$34,968 due to reductions of payables and accrued expenses as well asan increase in net loss driven by approximately $23,748 in mergerrelated expenses during the first six months of 2005.

Investing activities — Our investing cash flows were$23,326 in the period from acquisition to June 30, 2005 including$36,314 net cash recorded in the purchase price allocation. Excludingthe purchase accounting adjustment, the investing cash flows werenegative $12,988 primarily associated with purchases of property andequipment. Investing cash flows for the period from January 1, 2005 toFebruary 15, 2005 were positive $40,824 including a decrease in shortterm investments of $49,435 reduced by purchases of property andequipment of $8,611. Investing cash flows in the six months ended June30, 2004 were negative $10,204 due to purchases of property andequipment.

Financing activities — Our financingcash flows in the period from acquisition to June 30, 2005 werenegative $15,000 representing distributions paid to Alamosa Holdings.Financing cash flows in 

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the period from January 1, 2005 to February15, 2005 were negative $1,617 due to $1,629 in debt issuance costs.Financing activities in the six months ended June 30, 2004 werenegative $21,930 including repayments of borrowings of $16,513 andequity issuance costs of $4,759.

Liquidity and CapitalResources

Old AirGate financed their operations through debtfinancing and through proceeds generated from public offerings of OldAirGate common stock and cash provided by operations. The proceeds fromthese transactions and cash provided by operations have been used tofund the build-out of our portion of the PCS network of Sprint,subscriber acquisition costs and working capital.

As of June 30,2005, we had $4 million in cash and cash equivalents as well as $40million in short-term investments which we believe will be sufficientto fund expected capital expenditures and to cover our working capitaland debt service requirements for at least the next 12 months.

Our future liquidity will be dependent on a number of factorsinfluencing its projections of operating cash flows, including thoserelated to subscriber growth, average revenue per user, average monthlychurn and cost per gross addition. Should actual results differsignificantly from these assumptions, our liquidity position could beadversely affected and it could be in a position that would require itto raise additional capital which may or may not be available on termsacceptable to us, if at all, and could have a material adverse effecton our ability to achieve its intended business objectives.

Future Trends That May Affect Operating Results, Liquidity andCapital Resources

On December 15, 2004, Sprint Corporation("Sprint") and Nextel Communications, Inc.("Nextel") announced a proposed merger oftheir two companies. Nextel currently operates a wireless mobilitycommunications network in certain territories in which we also providedigital wireless mobility communications network services under theSprint or affiliated brands. Sprint and Nextel have announced that theyintend to close the merger on August 12, 2005.

Based upon theterms of the exclusivity covenants contained in the managementagreement between Sprint and AirGate PCS, Inc., we believe thatNextel's operation of a wireless mobility communications networkin territories in which AirGate operates from and after the closing ofthe Sprint-Nextel merger will constitute a breach of the exclusivitycovenants in the AirGate management agreement with Sprint. Moreover,based upon public statements and disclosures made by Sprint and Nextelfollowing the announcement of their pending merger, Alamosa Holdingsbelieves that actions that Sprint and Nextel intend to take inconnection with the integration of their operations followingcompletion of the merger may constitute a breach of the exclusivity andcertain other provisions of the management agreements between Sprintand Alamosa Holdings' other operating subsidiaries.

Aspreviously disclosed, Alamosa Holdings had been engaged in discussionswith Sprint in an attempt to reach a mutually acceptable resolution ofthe issues related to the Sprint-Nextel merger and its effect on theexisting management agreements between Sprint and AlamosaHoldings' subsidiaries. However, Alamosa Holdings concluded thatit was unlikely that it would be able to reach a mutually acceptableresolution with Sprint prior to the closing of the Sprint-Nextelmerger, and, on August 8, 2005, AirGate filed a lawsuit against Sprint,certain of its affiliates and Nextel in the Delaware Court of Chanceryalleging, among other things, that following the completion of thepending merger, Sprint will breach the exclusivity covenants containedin its management agreement with AirGate and that Nextel unlawfullyinterfered with AirGate's exclusive rights under such agreement.The complaint seeks, among other things, an order directing Sprint andits affiliates to specifically perform their contractual obligationsunder their agreements with AirGate, an injunction preventing Sprintand Nextel from taking any action or entering into any agreement thatwould violate the exclusivity covenants contained in the agreements, adeclaratory judgment declaring the rights, remedies and obligations ofthe parties under the agreements, and damages. Alamosa Holdings'other operating subsidiaries also may decide to pursue remedies againstSprint and Nextel, including bringing a lawsuit against Sprint andNextel.

Under our affiliation agreements with Sprint, an eventof termination can be declared by us after a material breach by Sprintis not cured within the applicable grace period, which, withoutextension 

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by us, could be as much as 180 days. If wehave the right to terminate our management agreements because of anevent of termination caused by Sprint, generally we may (i) requireSprint to purchase all of our operating assets used in connection withour portion of the PCS network of Sprint, (ii) in all areas in ourterritory where Sprint is the licensee for 20 MHz or more of thespectrum on the date it terminates our management agreements, requireSprint to assign to us, subject to governmental approval, up to 10 MHzof licensed spectrum or (iii) choose not to terminate our managementagreements and sue Sprint for damages or other relief or submit thematter to arbitration.

Should the breach not be cured by Sprintor a modification, waiver or extension not be granted by us, theelection by us to terminate the affiliation agreements would constitutean event of default under each series of our outstanding senior notes.Upon an event of default, the holders of the senior notes would havethe right to demand payment and we may not have adequate liquidity tosatisfy this obligation. At this point in time, we do not anticipatethat an event of termination of the affiliation agreements willoccur.

During 2002 and 2003, the wireless industry experiencedoverall declining net subscriber growth compared to previous periods.This trend was attributable to increased competition and slowingaggregate subscriber growth in the wireless telecommunicationsindustry. We are continuing to incur net losses as we continue to addsubscribers, which requires a significant up-front investment toacquire those subscribers. If net subscriber growth does not continueto improve, it will lengthen the amount of time it will take for us toreach a sufficient number of subscribers to achieve profitability.

We may experience a higher average monthly churn rate than we arecurrently anticipating. Our average monthly churn for the quarter endedJune 30, 2005 was 2.4 percent compared to 2.6 percent for the quarterended June 30, 2004. If average monthly churn increases over thelong-term, we would lose the cash flows attributable to those customersand have greater than projected losses.

We may incur significanthandset subsidy costs for existing customers who upgrade to a newhandset. As our customer base matures and technological advances in ourservices take place, more existing customers will begin to upgrade tonew handsets to take advantage of these services. We have limitedhistorical experience regarding the rate at which existing customersupgrade their handsets and if more customers upgrade than we arecurrently anticipating, it could have a material adverse impact on ourearnings and cash flows.

We may not realize the anticipatedbenefits of our acquisition by Alamosa Holdings, which took place inFebruary 2005. If we are unable to effectively operate the territoriesacquired in connection with the acquisition, our expected synergies andresults of operations may not be realized, which could have a materialadverse impact on our earnings and cash flows.

We may not beable to access the credit or equity markets for additional capital ifthe liquidity discussed above is not sufficient for the cash needs ofour business. We continually evaluate options for additional sources ofcapital to supplement our liquidity position and maintain maximumfinancial flexibility. If the need for additional capital arises due toour actual results differing significantly from our business plan orfor any other reason, we may be unable to raise additional capital.

Recently Issued Accounting Pronouncements

In December 2004,the Financial Accounting Standards Board("FASB") issued SFAS No. 123(R),"Share-Based Payment," which is a revision ofSFAS No. 123 and supersedes APB Opinion No. 25. SFAS No. 123(R)requires all share-based payments to employees, including grants ofemployee stock options, to be valued at fair value on the date ofgrant, and to be expensed over the applicable vesting period. Pro formadisclosures of the income statement effects of share-based payments isno longer an alternative. SFAS No. 123(R) is effective for allstock-based awards granted on or after July 1, 2005. In addition,companies must also recognize compensation expense related to anyawards that are not fully vested as of July 1, 2005. Compensationexpense for the unvested awards will be measured based on the fairvalue of the awards previously calculated in developing the pro formadisclosures in accordance with the provisions of SFAS No. 123. On April14, 2005, the SEC announced the adoption of a new rule that amends thecompliance dates for SFAS No. 123(R). The 

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new rule allows registrants to implementSFAS No. 123(R) at the beginning of their next fiscal year that beginsafter June 15, 2005. As a result, the Company will be required to adoptthe provisions of SFAS No. 123(R) on January 1, 2006. The Company iscurrently assessing the impact of adopting SFAS No. 123(R) to itsconsolidated results of operations.

In June 2005, the FASBissued SFAS No. 154, "Accounting Changes and ErrorCorrections a replacement of APB Opinion No. 20 and FASB Statement No.3." This Statement changes the requirements for theaccounting for and reporting of a change in accounting principle. ThisStatement applies to voluntary changes as well as those changesrequired by an accounting pronouncement if that pronouncement does notinclude specific transition provisions. This Statement requiresretrospective application to prior periods' financial statementsof changes in accounting principle as opposed to being shown as acumulative adjustment in the period of change. The Statement iseffective for all changes and corrections of errors made in fiscalyears beginning after December 15, 2005. The adoption of this standardis not expected to materially impact the Company

On March 31,2005, the FASB issued Interpretation No.("FIN") 47, "Accounting forConditional Asset Retirement Obligations" which is aninterpretation of SFAS No. 143, "Accounting for AssetRetirement Obligations." FIN 47 clarifies that therecognition and measurement provisions of SFAS No. 143 apply to assetretirement obligations in which the timing and/or method of settlementmay be conditional on a future event, including obligations toremediate asbestos at the end of a building's useful life andobligations to dispose of chemically-treated telephone poles at the endof their useful lives. FIN 47 is effective for fiscal years endingafter December 15, 2005. The Company is currently assessing the impactof adopting FIN 47 to its consolidated results of operations.

|               |                                                           |
|---------------|-----------------------------------------------------------|
| ITEM 3.  | QUANTITATIVE AND QUALITATIVE DISCLOSURESABOUT MARKET RISK |

Omitted under the reduced disclosure formatpursuant to General Instruction H(2)(c) of Form 10-Q.

|              |                         |
|--------------|-------------------------|
| ITEM4.  | CONTROLS AND PROCEDURES |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)  | Evaluation of Disclosure Controls andProcedures. The Company's management with the participation ofthe Company's Chief Executive Officer and Principal Financial andAccounting Officer has evaluated the effectiveness of our disclosurecontrols and procedures (as such term is defined in Rules 13a-15(e) or15d-15(e) under the Exchange Act of 1934, as amended (the"Exchange Act")), as of the end of the periodcovered by this quarterly report. Based on such evaluation, suchofficers have concluded that, as of the end of the period covered bythis quarterly report, the Company's disclosure controls andprocedures are effective. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b)  | Changes inInternal Control Over Financial Reporting. There have not been anychanges in our internal controls over financial reporting (as such termis defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)during the fiscal quarter to which this report relates that havematerially affected, or are reasonably likely to materially affect, ourinternal controls over financial reporting. |

We place reliance onSprint to adequately design its internal controls with respect to theprocesses established to provide financial information and otherinformation to us and the other PCS Affiliates of Sprint. To addressthis issue, Sprint engages its independent auditors to perform aperiodic evaluation of these controls and to provide a"Report on Controls Placed in Operation and Tests ofOperating Effectiveness for Affiliates" under guidanceprovided in Statement of Auditing Standards No. 70. This report isprovided to us semi-annually.

PART II — OTHERINFORMATION

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

See Part I, Item 1, Note 14 under the caption"Commitments and Contingencies –Litigation" for a description of legal proceedings.

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|               |                                                             |
|---------------|-------------------------------------------------------------|
| ITEM 2.  | UNREGISTEREDSALES OF EQUITY SECURITIES AND USE OF PROCEEDS. |

Omitted underthe reduced disclosure format pursuant to General Instruction H(2)(c)of Form 10-Q.

|               |                                 |
|---------------|---------------------------------|
| ITEM 3.  | DEFAULTS UPON SENIORSECURITIES. |

None.

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

Omitted under thereduced disclosure format pursuant to General Instruction H(2)(c) ofForm 10-Q.

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

None.

|               |           |
|---------------|-----------|
| ITEM 6.  | EXHIBITS. |

See theExhibit Index following the signature page hereto for a list of theexhibits filed pursuant to Item 601 of RegulationS-K.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,the registrant has duly caused this report to be signed on its behalfby the undersigned thereunto duly authorized.

|  | AIRGATE PCS, INC. (Registrant) |
|--|--------------------------------|

|  | /s/ David E.Sharbutt |
|--|----------------------|

|  |
|--|
|  |  |  |
|  |

|  | DavidE. Sharbutt Chairman of the Board of Directors andChiefExecutive Officer (Principal Executive Officer) |
|--|-------------------------------------------------------------------------------------------------------------|

|  | /s/ Kendall W.Cowan |
|--|---------------------|

|  |
|--|
|  |  |  |
|  |

|  | KendallW. Cowan Vice President, Treasurer and Secretary(PrincipalFinancial and Accounting Officer) |
|--|----------------------------------------------------------------------------------------------------|

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EXHIBITINDEX

|               |  |                                                                                                                                                                                                                                       |  |  |  |  |
|---------------|--|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|--|--|
| EXHIBITNUMBER |  | EXHIBITTITLE                                                                                                                                                                                                                          |
| 3.1           |  | Certificateof Incorporation of AirGate PCS, Inc., filed as Exhibit 3.1 to theRegistration Statement on Form S-4, dated April 1, 2005 of AirGate PCS,Inc. (SEC File No. 333-123755), which exhibit is incorporated herein byreference. |
| 3.2           |  | Bylaws of AirGate PCS, Inc.,filed as Exhibit 3.2 to the Registration Statement on Form S-4, datedApril 1, 2005 of AirGate PCS, Inc. (SEC File No. 333-123755), whichexhibit is incorporated herein by reference.                      |
| 31.1*         |  | Certification of CEO Pursuant to Section 302 of theSarbanes-Oxley Act of 2002.                                                                                                                                                        |
| 31.2*         |  | Certification of principal financial officer Pursuant toSection 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                |
| 32.1*         |  | Certification of CEO Pursuant to 18 U.S.C. Section 1350, asadopted Pursuant to Section 906 of the Sarbanes-Oxley Act of2002.                                                                                                          |
| 32.2 *        |  | Certification of principalfinancial officer Pursuant to 18 U.S.C. Section 1350, as adoptedPursuant to Section 906 of the Sarbanes-Oxley Act of2002.                                                                                   |
|               |

|  |
|--|
|  |  |
|  |

|   |                           |
|---|---------------------------|
| * | Exhibit is filedherewith. |

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