SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549


                                    FORM 10-Q

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarter ended      March 31, 2002           Commission File No.  0-16751
                      -----------------------                          ---------


                                   NTELOS Inc.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          VIRGINIA                                                54-1443350
--------------------------------------------------------------------------------
(State or other  jurisdiction of                               (I R S employer
 incorporation or organization)                              identification no.)


P. O. Box 1990, Waynesboro, Virginia                                  22980
--------------------------------------------------------------------------------
(Address of principal executive offices)                            (Zip code)


Registrant's telephone number, including area code         540-946-3500
                                                  ------------------------------


                                      None
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)


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

                                    Yes x No

                     (APPLICABLE ONLY TO CORPORATE ISSUERS)

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.



Class    COMMON STOCK, NO PAR VALUE           Outstanding 5/14/02     17,242,435
         --------------------------
<PAGE>
<TABLE>
                                   NTELOS Inc.

                                    I N D E X



                                                                                   Page
                                                                                  Number
                                                                                  ------

PART I. FINANCIAL INFORMATION
<S> <C>
         Condensed Consolidated Balance Sheets, March 31, 2002 and December
         31, 2001                                                                   3-4


         Condensed Consolidated Statements of Operations, Three Months Ended
         March 31, 2002 and 2001                                                     5


         Condensed Consolidated Statements of Cash Flows, Three Months Ended
         March 31, 2002 and 2001                                                     6


         Condensed Consolidated Statements of Shareholders' Equity, Three
         Months Ended March 31, 2002 and 2001                                        7


         Notes to Condensed Consolidated Financial Statements                      8-11


         Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                     12-20

         Quantitative and Qualitative Disclosures about Market Risk                 21

PART II. OTHER INFORMATION                                                          22

SIGNATURES                                                                         23-24
</TABLE>


                                       2
<PAGE>
<TABLE>
                                                           NTELOS Inc.

                                              Condensed Consolidated Balance Sheets

                                                                                       March 31, 2002            December 31,
(In thousands)                                                                           (Unaudited)                 2001
---------------------------------------------------------------------------------------------------------------------------------
Assets

Current Assets
<S>                                                                               <C>                       <C>
  Cash and cash equivalents                                                       $             1,914       $            7,293
  Restricted cash                                                                               4,549                   18,069
  Accounts receivable, net of allowance                                                        31,925                   30,328
  Inventories and supplies                                                                      5,827                    9,619
  Other receivables and deposits                                                                2,111                    4,669
  Prepaid expenses and other                                                                    5,075                    3,929
  Income taxes receivable                                                                       1,877                    1,945
---------------------------------------------------------------------------------------------------------------------------------
                                                                                               53,278                   75,852
---------------------------------------------------------------------------------------------------------------------------------

Investments and Advances
  Securities and investments                                                                   13,605                   13,963
  Restricted cash                                                                              13,515                   18,094
---------------------------------------------------------------------------------------------------------------------------------
                                                                                               27,120                   32,057
---------------------------------------------------------------------------------------------------------------------------------

Property, Plant and Equipment
  Land and building                                                                            50,953                   50,836
  Network plant and equipment                                                                 460,893                  447,585
  Furniture, fixtures and other equipment                                                      66,700                   65,283
  Radio spectrum licenses                                                                     456,096                  456,038
---------------------------------------------------------------------------------------------------------------------------------
     Total in service                                                                       1,034,642                1,019,742
  Under construction                                                                           35,296                   35,753
---------------------------------------------------------------------------------------------------------------------------------

                                                                                            1,069,938                1,055,495
  Less accumulated depreciation                                                               163,906                  154,440
---------------------------------------------------------------------------------------------------------------------------------

                                                                                              906,032                  901,055
---------------------------------------------------------------------------------------------------------------------------------

Other Assets
  Cost in excess of net assets of business acquired, net of accumulated
     amortization                                                                             135,351                  135,635
  Other intangibles, net of accumulated amortization                                           17,915                   23,677
  Deferred charges                                                                             19,463                   18,675
  Radio spectrum licenses not in service                                                        9,579                    9,935
---------------------------------------------------------------------------------------------------------------------------------

                                                                                              182,308                  187,922
---------------------------------------------------------------------------------------------------------------------------------

                                                                                  $         1,168,738       $        1,196,886
=================================================================================================================================
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

                                                                3
<PAGE>
<TABLE>
                                                          NTELOS Inc.

                                             Condensed Consolidated Balance Sheets

(In thousands)                                                                   March 31, 2002               December 31,
                                                                                  (Unaudited)                     2001
-----------------------------------------------------------------------------------------------------------------------------
Liabilities and Shareholders' Equity

Current Liabilities
<S>                                                                        <C>                          <C>
   Accounts payable                                                        $              42,812        $            39,917
   Advance billings and customer deposits                                                 10,689                      8,889
   Accrued payroll                                                                         5,466                      5,540
   Accrued interest                                                                        6,138                     18,332
   Deferred revenue                                                                        4,755                      5,092
   Other accrued liabilities                                                               6,449                      4,927
-----------------------------------------------------------------------------------------------------------------------------

                                                                                          76,309                     82,697
-----------------------------------------------------------------------------------------------------------------------------

Long-term Debt                                                                           621,179                    612,416
-----------------------------------------------------------------------------------------------------------------------------

Long-term Liabilities
   Deferred income taxes                                                                     921                      2,200
   Retirement benefits                                                                    16,745                     15,789
   Long-term deferred liabilities                                                         43,061                     43,624
-----------------------------------------------------------------------------------------------------------------------------

                                                                                          60,727                     61,613
-----------------------------------------------------------------------------------------------------------------------------

Minority Interests                                                                           847                        847
-----------------------------------------------------------------------------------------------------------------------------

Redeemable, Convertible Preferred Stock                                                  270,766                    265,747
-----------------------------------------------------------------------------------------------------------------------------

Commitments

Shareholders' Equity
   Preferred stock, no par value per share, authorized 1,000
      shares; none issued                                                                     -                           -
   Common stock, no par value per share, authorized 75,000 shares; issued
     17,242 shares (17,209 in 2001)                                                      182,297                    182,093
   Stock warrants                                                                         22,874                     22,874
   Accumulated deficit                                                                   (58,884)                   (23,201)
   Accumulated other comprehensive loss                                                   (7,377)                    (8,200)
-----------------------------------------------------------------------------------------------------------------------------

                                                                                         138,910                    173,566
-----------------------------------------------------------------------------------------------------------------------------

                                                                           $           1,168,738        $         1,196,886
=============================================================================================================================
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

                                                              4
<PAGE>
<TABLE>
                                                       NTELOS Inc.

                                     Condensed Consolidated Statements Of Operations
                                                       (Unaudited)

                                                                                          Three Months Ended
-----------------------------------------------------------------------------------------------------------------------
                                                                                     March 31,         March 31,
(In thousands, except per share amounts)                                               2002               2001
-----------------------------------------------------------------------------------------------------------------------

Operating Revenues
<S>                                                                               <C>               <C>
  Wireless PCS                                                                    $       35,771    $        25,265
  Wireline communications                                                                 22,318             19,915
  Other communication services                                                             1,932              2,384
-----------------------------------------------------------------------------------------------------------------------

                                                                                          60,021             47,564
-----------------------------------------------------------------------------------------------------------------------

Operating Expenses
  Cost of wireless sales (exclusive of items shown separately below)                      12,223             10,184
  Maintenance and support                                                                 16,891             13,828
  Depreciation and amortization                                                           23,095             17,853
  Customer operations                                                                     15,771             14,791
  Corporate operations                                                                     5,854              4,877
  Restructuring charge                                                                     1,267                  -
-----------------------------------------------------------------------------------------------------------------------

                                                                                          75,101             61,533
-----------------------------------------------------------------------------------------------------------------------

Operating Loss                                                                           (15,080)           (13,969)

Other Income (Expenses)
  Equity loss from investee - WV PCS Alliance                                                  -             (1,286)
  Gain on sale of assets                                                                   1,955                  -
  Interest expense                                                                       (19,004)           (18,197)
  Other income (expense)                                                                    (133)             3,028
-----------------------------------------------------------------------------------------------------------------------

                                                                                         (32,262)           (30,424)

Income Tax Benefit                                                                        (1,569)           (11,423)
-----------------------------------------------------------------------------------------------------------------------

                                                                                         (30,693)           (19,001)

Minority Interests in Losses of Subsidiaries                                                  29              1,747
-----------------------------------------------------------------------------------------------------------------------

Net Loss                                                                                 (30,664)           (17,254)

Dividend requirements on preferred stock                                                   5,019              4,687
-----------------------------------------------------------------------------------------------------------------------
Loss Applicable to Common Shares                                                  $      (35,683)   $       (21,941)
=======================================================================================================================

Loss per Common Share - Basic and Diluted                                         $       (2.07)    $         (1.46)

Average shares outstanding - basic & diluted                                              17,220             15,075
=======================================================================================================================
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

                                                           5
<PAGE>
<TABLE>
                                                            NTELOS Inc.

                                          Condensed Consolidated Statements of Cash Flows
                                                            (Unaudited)
                                                                                              Three Months Ended
---------------------------------------------------------------------------------------------------------------------------------
(In thousands)                                                                      March 31, 2002             March 31, 2001
---------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                            <C>                        <C>
Net income (loss)                                                              $            (30,664)      $           (17,254)

Adjustments to reconcile net income to net cash provided by operating
   activities:
   Gain on sale of assets                                                                    (1,955)                        -
   Depreciation                                                                              22,110                    15,235
   Amortization                                                                                 985                     2,618
   Deferred taxes                                                                            (1,820)                  (11,230)
   Retirement benefits and other                                                                784                     1,587
   Net interest expense from restricted cash                                                  8,998                     7,239
   Equity loss from WV PCS Alliance                                                               -                     1,286
   Accretion of loan discount and origination fees                                            1,072                       582
Changes in assets and liabilities from operations, net of effects of
   acquisitions and dispositions:
   Increase in accounts receivable                                                           (1,597)                   (4,039)
   Decrease in inventories and supplies                                                       3,792                     4,559
   (Increase) decrease in other current assets                                                1,412                      (163)
   Changes in income taxes                                                                       68                     2,548
   Increase (decrease) in accounts payable                                                    2,896                      (676)
   Increase (decrease) in other accrued liabilities                                          (1,645)                   (5,340)
   Increase in other current liabilities                                                      1,503                       791
---------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) operating activities                                           5,939                    (2,257)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment                                                         (29,120)                  (25,505)
Proceeds from sale of discontinued operation                                                      -                     3,500
Investments in PCS Alliances                                                                      -                      (634)
Cash on hand in merged entity                                                                     -                     4,096
Advances to PCS Alliances                                                                         -                    (2,960)
Deposit refunds on assets                                                                         -                     8,000
Proceeds from sale of assets                                                                 10,859                     1,050
Other                                                                                          (253)                     (814)
---------------------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities                                                       (18,514)                  (13,267)
---------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of long-term debt                                                          -                    20,000
Borrowings under line of credit, net                                                         10,000                         -
Additional payments on other debt instruments                                                (1,770)                   (1,652)
Net proceeds from issuance of stock                                                             147                       145
Other                                                                                        (1,181)                      (60)
---------------------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities                                                     7,196                    18,433
---------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents                                             (5,379)                    2,909
Cash and cash equivalents:
Beginning                                                                                     7,293                     1,637
---------------------------------------------------------------------------------------------------------------------------------

Ending                                                                         $              1,914       $             4,546
=================================================================================================================================
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

                                                                6
<PAGE>
<TABLE>

                                                            NTELOS Inc.

                                     Condensed Consolidated Statements of Shareholders' Equity
                                                            (Unaudited)

                                                                                       Retained      Accumulated
                                                                                       Earnings         Other            Total
                                             Common Stock                             (Accumulated  Comprehensive     Shareholders'
(In thousands)                          Shares          Amount         Warrants        Deficit)        Income           Equity
----------------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>       <C>             <C>             <C>             <C>             <C>
Balance, December 31, 2000                13,132    $     45,272    $     22,874    $     59,355    $      8,458    $    135,959
Comprehensive loss:
   Net loss                                                                              (17,254)
   Cash flow hedge:
     Cumulative effect of the adoption
       of SFAS No. 133, net of $2,489
       of deferred tax benefit                                                                            (3,900)
     Derivative losses, net of $1,523
       of deferred tax benefit                                                                            (2,402)
   Unrealized loss on securities
     available for sale, net of $979
     of deferred tax benefit                                                                              (1,531)
       Comprehensive loss                                                                                                (25,087)
Dividends on preferred shares                                                             (4,687)                         (4,687)
Common stock issuance
   pursuant to R&B Merger                  3,716         131,807                                                         131,807
Shares issued through
   Employee Stock Purchase
   Plan                                        7             145                                                             145
----------------------------------------------------------------------------------------------------------------------------------
Balance, March 31, 2001                   16,855    $    177,224    $     22,874    $     37,414    $        625    $    238,137
----------------------------------------------------------------------------------------------------------------------------------





----------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 2001                17,209    $    182,093    $     22,874    $    (23,201)   $     (8,200)   $    173,566
Comprehensive loss:
   Net loss                                                                              (30,664)
   Derivative gain, net of $735 of
     deferred tax benefit                                                                                  1,156
   Unrealized loss on securities
     available for sale, net of $212
     of deferred tax benefit                                                                                (333)
       Comprehensive loss                                                                                                (29,841)
Dividends on preferred shares                                                             (5,019)                         (5,019)
Common stock issuance                          4              58                                                              58
Shares issued through
   Employee Stock Purchase
   Plan                                       29             146                                                             146
----------------------------------------------------------------------------------------------------------------------------------
Balance, March 31, 2002                   17,242    $    182,297    $     22,874    $    (58,884)   $     (7,377)   $    138,910
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

                                                                7
<PAGE>
                                   NTELOS Inc.
              Notes to Condensed Consolidated Financial Statements


1. SIGNIFICANT ACCOUNTING POLICIES

        In  the  opinion  of  NTELOS  Inc.  ("NTELOS"  or  the  "Company"),  the
        accompanying  condensed  consolidated  financial  statements  which  are
        unaudited,  except for the  condensed  consolidated  balance sheet dated
        December 31, 2001, which is derived from audited  financial  statements,
        contain all adjustments  (consisting of only normal recurring  accruals)
        necessary to present fairly the financial  position as of March 31, 2002
        and December 31, 2001,  the results of  operations  for the three months
        ended March 31, 2002 and 2001 and cash flows for the three  months ended
        March 31, 2002 and 2001.  The results of operations for the three months
        ended  March 31,  2002 and 2001 are not  necessarily  indicative  of the
        results to be expected for the full year.

        The Company adopted Statement of Financial  Accounting Standard ("SFAS")
        No. 142, Goodwill and Other Intangible Assets, on January 1, 2002. Under
        these  new  rules,   goodwill  and  intangible  assets  deemed  to  have
        indefinite  lives  will no longer be  amortized  but will be  subject to
        annual  impairment  tests  in  accordance  with  this  Statement.  Other
        intangible assets will continue to be amortized over their useful lives.
        Accordingly,  the Company ceased amortization of goodwill,  an assembled
        workforce  intangible  asset, and PCS radio spectrum licenses on January
        1, 2002.  The cost and net book value of these  assets at March 31, 2002
        follows:
        (In thousands)                               Cost     Net Book Value
        -----------------------------------------------------------------------
        Goodwill                                   147,082         135,351
        PCS Radio Spectrum Licenses In Service     446,487         429,009
        Assembled Workforce                          1,800           1,390
        -----------------------------------------------------------------------
            Total                                  595,369         565,750
        =======================================================================

        Amortization  of  indefinite  lived  intangible  assets was $4.3 million
        ($3.1 million after tax) for the first quarter of 2001.  Therefore,  pro
        forma loss  applicable  to common  shares for the first  quarter of 2001
        adjusted  for the  impact of SFAS No. 142 was $18.9  million  ($1.25 per
        common share).

        During  2002,  the  Company  will  perform  the  first  of the  required
        impairment tests of goodwill and intangible assets with indefinite lives
        as of January 1, 2002.  The  Company has not yet  determined  the effect
        these  tests will have on the  earnings  and  financial  position of the
        Company.  Based  on  current  market  conditions,  the  impact  could be
        material.

        Certain  amounts  on the  prior  year  financial  statements  have  been
        reclassified,   with  no   effect  on  net   income,   to   conform   to
        classifications  adopted in 2002. At March 31, 2002, accounts receivable
        is shown net of $16.4  million  allowance for doubtful  accounts  ($14.0
        million at December 31, 2001). Costs in excess of net assets of business
        acquired and other intangibles are shown net of accumulated amortization
        of $20.5 million at March 31, 2002 ($20.0 million at December 31, 2001).

2. DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED INFORMATION

        The Company  manages its business  segments  with  separable  management
        focus and  infrastructures.  The  "Other"  segment is  comprised  of the
        paging  operation,  all  cable  operations,  and  the  alarm  and  other
        communications  services operations.  Additionally,  certain unallocated
        corporate  related  items that,  in  management's  opinion don't provide
        direct benefit to the operating  segments,  are included in Other. Total
        unallocated  corporate  operating  expenses  were $2.1  million  and $.5
        million  for the three  month  period  ended  March  31,  2002 and 2001,
        respectively.  Within  this  current  year  amount  is $1.3  million  of
        restructuring charges (Note 8).

        Depreciation  and  amortization  of corporate  assets is included in the
        "Other" column in the tables below. This amounted to $.1 million and $.2
        million for the quarters ended March 31, 2002 and 2001, respectively, of
        the total "Other" depreciation and amortization.

        Summarized  financial  information  concerning the Company's  reportable
        segments is shown in the following  table.  These segments are described
        in  more  detail  in  Note 2 of the  Company's  2001  Annual  Report  to
        Shareholders.

                                        8
<PAGE>
                                   NTELOS Inc.
              Notes to Condensed Consolidated Financial Statements
                                    Continued


<TABLE>
(in thousands)            Telephone     Network       CLEC      Internet   Wireless PCS      Other          Total
-----------------------------------------------------------------------------------------------------------------------
As of and for the three months ended March 31, 2002
---------------------------------------------------
<S>                     <C>            <C>        <C>          <C>         <C>           <C>           <C>
Revenues                $     10,509   $    2,243 $     4,943  $    4,622  $      35,771 $      1,933  $       60,021
EBITDA*                        6,263        1,671         542         719            245       (1,425)          8,015
Depreciation &
   Amortization                1,807          700         710         982         18,196          700          23,095

Total Segment Assets         142,022       58,087      32,239      17,420        771,170       31,033       1,051,971
Corporate Assets                                                                                              116,767
                                                                                                       ----------------
Total Assets                                                                                           $    1,168,738
                                                                                                       ================

As of and for the three months ended March 31, 2001
---------------------------------------------------
Revenues                $      9,712   $    1,776 $     4,293  $    4,134  $      25,265 $      2,384  $       47,564
EBITDA*                        6,449        1,367         812          85         (5,743)         914           3,884
Depreciation
   &Amortization               1,801          501         502         987         13,512          550          17,853

Total Segment Assets         132,362       52,249      31,175      19,316        799,700       35,658       1,070,460
Corporate Assets                                                                                              153,151
                                                                                                       ----------------
Total Assets                                                                                           $    1,223,611
                                                                                                       ================
</TABLE>

* Operating Income before depreciation and amortization.

3. INVESTMENTS IN WIRELESS AFFILIATES
        On February 13, 2001,  pursuant to the  Company's  merger with R&B (Note
        4), the Company's  common ownership  interest  increased in the Virginia
        PCS Alliance,  L.C. ("VA Alliance") from 65% to 91% and increased in the
        West Virginia PCS Alliance,  L.C. ("WV  Alliance")  from 45% to 79%. The
        Company began  consolidating  the results of the VA Alliance in 2000 and
        began consolidating the results of the WV Alliance on February 13, 2001.
        From this date to March 31, 2002,  the Company has purchased  additional
        minority  interest in the VA Alliance and the WV Alliance  and, at March
        31, 2002, held common interests of 97% and 98%, respectively.

        The VA Alliance is a PCS provider  serving a 1.7 million  populated area
        in central and  western  Virginia.  The WV  Alliance  is a PCS  provider
        serving  a 2.0  million  populated  area in West  Virginia  and parts of
        eastern Kentucky, southwestern Virginia and eastern Ohio.

4. MERGER AND ACQUISITIONS
        R&B Communications Merger
        -------------------------
        Effective  February 13, 2001, the Company closed on its merger with R&B.
        Under the terms of the merger,  the  Company  issued  approximately  3.7
        million  shares  of its  common  stock  in  exchange  for  100% of R&B's
        outstanding  common stock.  The merger is being  accounted for using the
        purchase  method of  accounting  and was  valued at $131.8  million,  or
        $35.47  per  share  based on the  average  share  price for the two days
        preceding  May 18,  2000,  the date the merger  terms were agreed to and
        announced.  The purchase price in excess of the net assets  acquired was
        $95.5  million,  $68.5 million of which was allocated to goodwill in the
        telephone  segment  and the  remaining  $27  million  was  allocated  to
        goodwill in the network segment. Additionally, fair value adjustments of
        $14.4  million  were made to certain  PCS  licenses in which R&B held an
        ownership interest. As of February 13, 2001, the Company assumed debt of
        $7.3 million from R&B payable in the years 2001 through 2026.

        R&B is an Integrated Communications Provider ("ICP") providing local and
        long distance  telephone  service,  and dial-up and high-speed  Internet
        service to business and residential  customers in Roanoke,  Virginia and
        the surrounding area, as well as in the New River Valley of Virginia.

5. SUPPLEMENTARY DISCLOSURES OF CASH FLOW INFORMATION
        The Company made  scheduled  semi-annual  payments of interest for $18.2
        million on the $280 million  senior notes out of restricted  cash during
        the quarters  ending  March 31, 2001 and 2002,  in  accordance  with the
        terms  and   conditions   set  forth  in  the  senior  note   indenture.
        Additionally,  see Note 4 above for the non-cash merger transaction with
        R&B.



                                       9
<PAGE>
                                   NTELOS Inc.
              Notes to Condensed Consolidated Financial Statements
                                    Continued


        During the quarter ended March 31, 2002, the Company sold  communication
        towers for total proceeds of $8.2 million, deferring a $1.3 million gain
        which  is  being  amortized  over  the  twelve  year  leaseback  period.
        Additionally,  the  Company  sold  certain  inactive  PCS  licenses  for
        proceeds of $2.4 million, recognizing a $2.0 million gain.

        On March 6, 2002,  the Company  entered  into an  amendment  to its $325
        million Senior Secured Term Loan (also referred to as the "Senior Credit
        Facility")  which amended  certain  covenants and terms of the agreement
        (discussed  more fully in Note 6 of the Company's  2001 Annual Report to
        Shareholders)  for a fee of $1.2  million.  This fee was deferred and is
        being amortized to interest expense over the life of this loan.

        In April 2002, the Company sold certain excess PCS licenses for proceeds
        of $12.0 million, recognizing a $3.3 million gain.

6. INCOME TAXES
        The effective tax rate in the first quarter of 2002 was 4.9% as compared
        to an effective  income tax rate at December  31, 2001 of 35.1%.  During
        the first quarter of 2002, the Company reported an income tax benefit of
        $1.6  million.  This  benefit is net of a valuation  allowance  recorded
        during this period of $11.0 million. This valuation allowance takes into
        consideration  the  Company's  projected  tax losses  for the year,  the
        existence of an unrealized  loss  associated with the interest rate swap
        agreement  and the deferred tax  financial  position.  The allowance was
        required  based on lack of  certainty  that the net  operating  loss tax
        assets will be recoverable within the statutory carryforward period. The
        current year rate,  absent the valuation  allowance,  was 39.0%.  In the
        prior year,  the effective  income tax rate was below the statutory rate
        primarily  due to  non-deductible  goodwill.  Due to  absence  of  these
        permanent  differences  (Note  1),  the  current  year rate  before  the
        valuation allowance is near statutory rate.

7. EARNINGS PER SHARE
        The weighted average number of common shares outstanding, which was used
        to  compute  diluted  net  income  per  share in  accordance  with  FASB
        Statement  No. 128,  Earnings  Per Share,  was not  increased by assumed
        conversion of dilutive stock options in the three months ended March 31,
        2002 and 2001 due to the fact that the  Company  recorded a net loss for
        both  periods.  For the three months ended March 31, 2002 and 2001,  the
        Company had common  stock  equivalents  from  options  totaling  145,000
        shares and 51,000 shares, respectively, and 300,000 stock warrants which
        would  be  dilutive.   However,   these  common  stock  equivalents  are
        antidilutive  as additional  shares would decrease the computed loss per
        share  information and therefore,  basic and diluted  earnings per share
        are the same. The Company  currently has a total of 1.5 million  options
        outstanding  and 1.3 million  warrants  outstanding to acquire shares of
        common stock.  Of these,  .6 million options and all of the warrants are
        currently exercisable.

8. RESTRUCTURING CHARGE
        In March  2002,  the  Company  approved  a plan that  would  reduce  its
        workforce by approximately  15% through the offering of early retirement
        incentives, the elimination of certain vacant and budgeted positions and
        the  elimination  of some jobs. The plan also involved  exiting  certain
        facilities in connection with the workforce  reduction and  centralizing
        certain  functions.  A  restructuring  charge was  reported in the first
        quarter  of 2002  for $1.3  million  relating  to  severance  costs  for
        employees  notified  in the  first  quarter  2002  and  estimated  lease
        obligations associated with the exit of certain facilities. An estimated
        $1.8  million  of  additional  charges  will be  recorded  in the second
        quarter  of  2002  for  severance  and  pension  curtailment  costs  for
        employees notified in the second quarter of 2002.

9. PRO FORMA RESULTS
        The pro forma unaudited results of operations for the three months ended
        March 31, 2001,  assuming  consummation,  as of January 1, 2001,  of the
        transactions  more fully  described in the Note 4 above and in the Notes
        to the  Consolidated  Financial  Statements in the Company's 2001 Annual
        Report are as follows:

                                       10
<PAGE>
                                   NTELOS Inc.
              Notes to Condensed Consolidated Financial Statements
                                    Continued

<TABLE>

         (In thousands, except per share data)                          Three Months Ended
                                                                          March 31, 2001
         ------------------------------------------------------------------------------------
         <S>                                                            <C>
         Operating revenues                                             $       52,731
         Operating expenses other than depreciation and amortization            48,950
         Depreciation and amortization                                          19,015
         Operating loss                                                        (15,234)
         Net loss                                                              (18,894)
         Dividend requirements on preferred stock                                4,849
         Loss applicable to common shares                               $      (23,743)
         Loss per common share - basic and diluted                      $        (1.43)

</TABLE>

                                       11
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations


Overview

We are a leading regional  integrated  communications  provider offering a broad
range of wireless and wireline products and services to business and residential
customers  primarily  in Virginia  and West  Virginia and in portions of certain
other  adjoining  states.  We own our own  digital  PCS  licenses,  fiber  optic
network,  switches  and  routers,  which  enables  us  to  offer  our  customers
end-to-end  connectivity  in the regions  that we serve.  This  facilities-based
approach  allows  us  to  control   product   quality  and  generate   operating
efficiencies.  Additionally,  through our 57 retail  stores  located  across the
regions we serve and a direct  business  sales  approach,  our sales strategy is
focused  largely on a direct  relationship  with our customers.  As of March 31,
2002, we had  approximately  228,300 digital PCS subscribers (up from 186,100 at
March 31, 2001) and  approximately  87,800  combined  incumbent  local  exchange
carrier  ("ILEC") and competitive  local exchange  carrier ("CLEC") access lines
installed (up from 75,600 installed lines at March 31, 2001).

Historically,  we have derived much of our revenues and EBITDA  (earnings before
interest,  taxes,  depreciation and amortization)  from our ILEC services.  As a
result of our increasing focus on and growth in digital PCS, Internet access and
CLEC services,  a significant  portion of our operating  revenues and EBITDA are
generated  by  businesses  other  than our ILEC.  These  newer  businesses  have
generated  lower  operating  margins  due  to  start-up  costs  associated  with
expansion into new markets, introduction of new service offerings throughout the
regions we serve and significant  competitive pricing pressures.  As we continue
to grow these  businesses,  we expect these operating  margins to improve but to
continue to be lower than those  realized  before  these other  businesses  were
significant to the Company's consolidated operations.

We completed a majority of our  geographic  expansion in 2001 and are continuing
to focus our  growth  efforts  on our core  communications  services,  primarily
digital PCS services,  Internet access, including dedicated,  high-speed DSL and
dial-up  services,  high-speed data  transmission  and local telephone  services
within our existing markets.  In February 2001, the Company completed closing of
the merger  agreement  with R&B,  an  integrated  communications  provider  in a
geographic  market  contiguous  to  ours,  and  commensurate  therewith,   began
consolidating the results of WV Alliance (Note 4).

As mentioned above, the Company  references  EBITDA (or operating cash flows) as
one measure of operating performance. Management believes EBITDA is a meaningful
indicator of the Company's performance.  EBITDA is commonly used in the wireless
communications  industry  and by  financial  analysts  and others who follow the
industry to measure operating performance.  EBITDA should not be construed as an
alternative to operating income or cash flows from operating activities (both of
which  are  determined  in  accordance   with  generally   accepted   accounting
principles) or as a measure of liquidity.

Discussions throughout the results of operations section refer to comparisons on
a pro forma basis.  The actual  results in the first quarter of 2001 exclude R&B
and WV Alliance for the period January 1, 2001 to February 13, 2001, the date of
the R&B merger and concurrent consolidation of WV Alliance. Therefore, pro forma
comparisons add R&B and WV Alliance results for this 43 day period to the actual
first quarter 2001 results.

The  discussion  and  analysis  herein  should be read in  conjunction  with the
financial  statements  and  the  notes  thereto  included  herein.  Much  of the
discussion  in this section  involves  forward-looking  statements  that involve
risks and  uncertainties.  Our actual results could differ materially from those
results anticipated in these  forward-looking  statements as a result of certain
risk  factors,  including  those set  forth in the Form 10-K for the year  ended
December 31, 2001, under "Investment Considerations". We wish to caution readers
that these forward-looking  statements and any other forward-looking  statements
made by us are  based on a number  of  assumptions,  estimates  and  projections
including  but not limited  to:  capital  intensity  of the  wireless  telephone
business  and our debt  structure;  our  substantial  debt  obligations  and our
ability to service those obligations;  restrictive covenants and consequences of
default  contained in our  financing  arrangements;  the cash flow and financial
performance  of  our  subsidiaries;  the  competitive  nature  of  the  wireless
telephone and other  communications  services  industries;  the  achievement  of
build-out,  operational,  capital,  financing  and marketing  plans  relating to


                                       12
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


deployment of PCS services;  retention of our existing customer base,  including
our wholesale customers,  our ability to attract new customers, and maintain and
improve  average revenue per subscriber;  unfavorable  economic  conditions on a
national  and local  basis;  effects of acts of terrorism or war (whether or not
declared);   changes  in  industry  conditions  created  by  federal  and  state
legislation  and  regulations;  demand for wireless and wireline  communications
services;  rapid changes in technology;  adverse changes in the roaming rates we
charge  and  pay;  our  opportunities   for  growth  through   acquisitions  and
investments  and our ability to manage this growth;  successful  integration  of
acquisitions;  the level of demand for  competitive  local exchange  services in
smaller markets; our ability to manage and monitor billing; and, possible health
effects of radio frequency  transmission.  Investors are cautioned that any such
forward-looking  statements are not guarantees of future performance and involve
risks  and  uncertainties,  and  that  any  significant  deviations  from  these
assumptions  could cause actual results to differ  materially  from those in the
above and other forward-looking statements.  Forward-looking statements included
herein are as of the date hereof.  We are not  obligated to update or revise any
forward-looking  statements  or to advise of any changes in the  assumptions  on
which they are based,  whether as a result of new information,  future events or
otherwise.

         Revenues

         Our revenues, net of bad debt expense, are generated from the following
categories:

          o    wireless  communications,   consisting  of  retail,  service  and
               wholesale digital PCS revenues;

          o    wireline  communications,  including  telephone  revenues,  fiber
               optic network usage (or carrier's  carrier  services),  Internet,
               CLEC service and long distance revenues; and,

          o    other communications  services revenues,  including revenues from
               paging,  wireless and  wireline  cable  television,  our sale and
               lease of  communications  equipment and security alarm monitoring
               and rental of property and equipment.

         Operating Expenses

         Our  operating  expenses  are  generally  incurred  from the  following
categories:

          o    cost of  sales,  exclusive  of  other  operating  expenses  shown
               separately,  including  digital PCS handset equipment costs which
               we  sell  to  our  customers  at a  price  below  our  cost,  and
               usage-based  access  charges,  including long  distance,  roaming
               charges, and other direct costs;

          o    maintenance  and support  expenses,  including  costs  related to
               specific  property and equipment,  as well as indirect costs such
               as  engineering  and  general   administration  of  property  and
               equipment;

          o    depreciation   and   amortization,   including   amortization  of
               intangible  assets where applicable (Note 1) and depreciable long
               lived property, plant and equipment;

          o    customer  operations  expenses,   including  marketing,   product
               management, product advertising, sales, billing, publication of a
               regional  telephone   directory,   customer  care  and  directory
               services;

          o    corporate operations expenses, including taxes other than income,
               executive, accounting, legal, purchasing, information technology,
               human  resources and other general and  administrative  expenses;
               and,

          o    restructuring charges associated with organizational initiatives,
               workforce reductions and exiting of certain facilities.



         Other Income (Expenses)

         Our other income  (expenses)  are  generated  (incurred)  from interest
income and  expense,  equity loss from the WV  Alliance  (through  February  13,
2001), and gain on sale of investments and assets.


                                       13
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued

         Income Taxes

         Our income tax liability or benefit and effective tax rate increases or
decreases  based upon  changes in a number of  factors,  including  our  pre-tax
income or loss,  net  operating  losses  and  related  carryforwards,  valuation
allowances,  alternative  minimum tax credit  carryforwards,  state  minimum tax
assessments,  gain or loss on the sale of assets and investments,  write-down of
assets and investments,  non-deductible  amortization,  and other tax deductible
amounts.


Results of Operations

Three Months Ended March 31, 2002
Compared to Three Months Ended March 31, 2001

OVERVIEW
EBITDA  increased  $4.1 million or 106%,  from $3.9 million for the three months
ended March 31, 2001 to $8.0  million for the three months ended March 31, 2002.
Operating loss increased $1.1 million, from a loss of $14.0 million to a loss of
$15.1 million for the three months ended March 31, 2001 and 2002,  respectively.
Included in the first  quarter 2002 results were  restructuring  charges of $1.3
million,  $7.2 million of accelerated  depreciation on certain PCS assets due to
early  replacement  during the quarter or based on scheduled  early  replacement
later  in  2002  or  2003,  and a $4.3  million  reduction  in  amortization  of
intangibles due to the adoption of SFAS No. 142 (Note 1). Excluding these items,
EBITDA  increased  $5.4 million (139%) and operating loss decreased $3.0 million
(22%) in the first quarter 2002 compared to first quarter 2001.

WIRELESS  PCS OVERVIEW - A 23% growth in  customers,  an 11% increase in average
monthly  revenue per  subscriber  ("ARPU") and a 90%  increase in wholesale  and
roaming  revenues  resulted  in  revenue  growth of $10.5  million  or 42% ($8.0
million or 29% on a pro forma  basis) in the first  quarter of 2002  compared to
the  first  quarter  of  2001.   Operating   expense  before   depreciation  and
amortization over these periods grew $4.5 million,  or 15% ($.8 million or 2% on
a  pro  forma  basis).   The  rate  of  expense  growth  lagged  revenue  growth
significantly  due to reductions in costs of acquisition per gross addition ($17
or 6%), a reduction in incollect roaming expenses,  and focused cost containment
measures,  as well as the leveraging of the fixed  infrastructure.  All of these
factors resulted in an EBITDA  improvement of $5.9 million,  from an EBITDA loss
of $5.7 million in the first  quarter of 2001 to positive  EBITDA of $.2 million
for the first  quarter of 2002.  On a pro forma  basis,  the  quarter to quarter
improvement was $7.3 million.

WIRELINE  COMMUNICATIONS  OVERVIEW - Wireline  communications  services realized
revenue  improvement of $2.4 million which  translated to EBITDA  improvement of
$.5 million.  EBITDA margin over these periods declined  slightly from 43.8 % to
41.2%.  On a pro forma basis,  revenues and EBITDA  declined $.1 million and $.6
million,  respectively.  These results are driven by less than 1% growth in ILEC
access lines, 2001 mid-year reductions in CLEC reciprocal compensation rates and
the recording of certain adjustments related to accounts receivable reserves and
accruals. Reciprocal compensation was down $.8 million in the first quarter 2002
compared to first  quarter  2001 and the  adjustments  noted  above  totaled $.5
million. Our CLEC and DSL customers increased by 51% and 111%, respectively,  as
of March 31, 2002  compared to 2001.  This,  along with cost  control  measures,
partially offset the effects of the other items mentioned above.

OTHER COMMUNICATION  SERVICES OVERVIEW - Other  communications  services revenue
declined  $.5  million  primarily  from the  movement  of  voicemail  assets and
operations  out of other  communications  services to the  wireless  PCS segment
(which is the primary user of this  service).  This accounted for $.3 million of
the decline and the balance is from the declining cable businesses which are not
actively  marketed.  EBITDA was down $2.3 million for the first  quarter of 2002
compared  to  first  quarter  2001.  The  restructuring  charge  (Note  8 and as
discussed  below)  accounts  for $1.3  million of the total.  The  exclusion  of
voicemail  and a decline in the paging  businesses  accounted  for $.4  million.
Finally,  unallocated  corporate  expenses  related  to  insurance  and  certain
professional  fees  were up $.3  million  in the  current  over the  prior  year
comparable period.


                                       14
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


OPERATING REVENUES
Operating revenues  increased $12.4 million,  or 26%, from $47.6 million for the
three  months  ended March 31, 2001 to $60.0  million for the three months ended
March 31, 2002.

WIRELESS PCS REVENUES -- Digital PCS customers grew 42,200, or 23%, from the end
of the first quarter 2001 to the end of the first  quarter 2002.  Over this same
period, ARPU grew $4.28, from $40.49 for the first quarter of 2001 to $44.77 for
the first  quarter of 2002 due  primarily  to a shift in the  customer  mix to a
higher percentage of post-pay type plans versus pre-pay plans (from 66% at March
31,  2001  to 86% at  March  31,  2002).  Additionally,  wholesale  and  roaming
revenues,  primarily from our network services agreement with Horizon, were $7.2
million for the first  quarter of 2002  compared  to $3.8  million for the first
quarter of 2001.  Also, the WV Alliance was  consolidated  on February 13, 2001.
Therefore,  the first quarter 2001 excluded $2.5 million of revenues from the WV
Alliance  for the  first 43 days of 2001.  The  combination  of these  and other
factors resulted in increased  revenues of $10.5 million,  from $25.3 million to
$35.8 million for the quarters ended March 31, 2001 and 2002, respectively. On a
pro forma basis, revenues increased $8.0 million in the current quarter over the
prior year comparative quarter.

WIRELINE  COMMUNICATIONS  REVENUES--Wireline  communications  revenues increased
$2.4  million,  or 12%, from $19.9 million to $22.3 million for the three months
ended March 31, 2001 and 2002,  respectively.  Wireline  revenues  decreased $.1
million,  or .5%,  from $22.4  million to $22.3 million on a pro forma basis for
the three months ended March 31, 2001 and 2002, respectively.

o Telephone Revenues.  Telephone  (Incumbent Local Exchange or "ILEC") revenues,
which include local service, access and toll service,  directory advertising and
calling feature  revenues from our ILEC business  increased $.8 million,  or 8%,
from $9.7 million for the three months ended March 31, 2001 to $10.5 million for
the three months ended March 31, 2002. In the first quarter 2001,  revenues from
the R&B ILEC prior to consolidation were $1.3 million.  Therefore, ILEC revenues
were down $.5 million  during these  periods on a pro forma  comparative  basis.
This  decline  is  due  primarily  to  $.3  million  in  regulatory   settlement
adjustments and receivable reserve adjustments.

o Fiber Optic  Network Usage  Revenues.  Revenues from fiber optic network usage
operations increased $.4 million, or 26%, from $1.8 million for the three months
ended March 31, 2001 to $2.2  million for the three months ended March 31, 2002.
Of this  increase,  $.6  million is  attributable  to the  consolidation  of R&B
Network in February 2001. Therefore, on a pro forma basis, network revenues were
down $.2  million  due to  reductions  in network  rates and the loss of certain
traffic in the second half of 2001, offset by growth in usage.

o CLEC Revenues.  CLEC revenues increased $.8 million, or 20%, from $4.1 million
for the three  months  ended March 31, 2001 to $4.9 million for the three months
ended March 31, 2002. Of this increase,  $.5 million is attributable to excluded
revenues  from R&B CLEC prior to the first quarter 2001  consolidation  and $1.1
million is due to customer  growth,  as total CLEC customers  increased  12,200,
from 23,700 at March 31, 2001 to 35,900 at March 31,  2002.  These  factors were
partially  offset by a decline in reciprocal  compensation of $.8 million,  from
$1.4 million in the first quarter 2001 to $.6 million in the first quarter 2002,
due to a decline in rates in mid-year 2001.

o Internet Revenues.  Revenues from Internet services increased $.3 million,  or
8%, from $4.3  million to $4.6 million for the three months ended March 31, 2001
and 2002,  respectively.  The  consolidation  of R&B  Internet in February  2001
accounted for $.1 million of the total increase.  Internet subscribers increased
10,400 or 16%, in first quarter 2002 over first quarter 2001,  with DSL customer
additions  accounting for 2,300 of this total, from 2,000 customers at March 31,
2001 to 4,300 customers at March 31, 2002.

OTHER COMMUNICATION SERVICES  REVENUES--Other  communications services revenues,
including other R&B operations, decreased $.5 million, or 19%, from $2.4 million
to $1.9  million  for the three  month  periods  ended  March 31, 2001 and 2002,
respectively,  due  to  the  factors  noted  in  "Other  Communication  Services
Overview" section above.

                                       15
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


OPERATING EXPENSES

TOTAL OPERATING  EXPENSES--Total  operating expenses increased $13.6 million, or
22%,  from $61.5  million in the first  quarter of 2001 to $75.1 million for the
first  quarter  2002.  Of this total  increase,  $5.2  million  pertained  to an
increase in depreciation and amortization expense, $2.9 million of which relates
to the net effect of  accelerated  depreciation  and the  effects of SFAS 142 on
amortization of intangible assets (see further discussion below in "Depreciation
and Amortization" section).  Additionally, $6.1 million is from the exclusion of
R&B and WV Alliance from the operating expenses in the first 43 days of 2001. Of
the  remaining  $2.3 million  increase,  $1.3 million is from the  restructuring
charge and the balance  represents  a 2% increase  driven  primarily  from costs
associated with serving and  maintaining  the overall  increase in customer base
and network assets.  Operating expenses excluding  depreciation and amortization
increased  $8.3  million,  or 19%,  from $43.7  million to $52.0 million for the
three months ended March 31, 2001 and 2002,  respectively.  Pro forma  operating
expenses excluding  depreciation and amortization increased $3.1 million, or 6%.
Wireline operating expenses, excluding depreciation and amortization,  increased
$1.9  million,  from $11.2  million to $13.1  million for the three months ended
March 31, 2001 and 2002,  respectively.  Wireless operating expenses,  excluding
depreciation and  amortization,  increased $4.5 million,  from $31.0 million for
the three  months  ended  March 31, 2001 to $35.5  million for the three  months
ended March 31, 2002. Within the wireline business, $1.4 million of the increase
is from the  exclusion of R&B for the first 43 days of 2001,  and $.6 million is
from  the  CLEC   segment.   Other  than  the  increase  from  the  WV  Alliance
consolidation,  changes within the wireless  businesses netted to an increase of
$.8 million, or 2%. Operating expenses, excluding depreciation and amortization,
from the other  communication  service  businesses  increased  $1.9  million due
primarily to the $1.3 million  restructuring  charge and  increases in corporate
related professional fees and insurance costs.

COST OF SALES--Cost of sales increased $2.0 million,  or 20%, from $10.2 million
for the three months ended March 31, 2001 to $12.2  million for the three months
ended March 31, 2002.  The exclusion of the WV Alliance for the first 43 days of
2001  accounted  for  $1.4  million  of  this  increase.  Additionally,  handset
insurance  costs  increased  $.4  million  due to pricing  increases  and higher
customer take rates.

MAINTENANCE AND SUPPORT  EXPENSES--Maintenance  and support  expenses  increased
$3.1  million,  or 22%, from $13.8 million to $16.9 million for the three months
ended March 31, 2001 and 2002,  respectively.  On a pro forma basis, maintenance
and support expenses increased $1.2 million,  or 8%. This increase was primarily
attributable  to the increased  costs  (primarily  maintenance and repair costs)
associated  with the increased  network asset base,  which increased $91 million
(25%).

DEPRECIATION AND AMORTIZATION  EXPENSES--Depreciation  and amortization expenses
increased  $5.2  million,  or 29%, from $17.9 million for the three months ended
March 31, 2001 to $23.1  million for the three months ended March 31, 2002. On a
pro forma basis,  depreciation and amortization expenses increased $4.3 million.
As mentioned  above,  we reported  accelerated  depreciation  of $7.2 million on
wireless  digital PCS equipment  replaced during the first quarter 2002 or which
is scheduled to be replaced  over the  remainder of 2002 and into the first half
of 2003. The 2002 replacement schedule was accelerated within the year resulting
in this  significant  increase in  depreciation  during the first three  months.
Accelerated  depreciation  will  continue on the assets  scheduled to be retired
later this year and next.  The quarterly  effect of this is expected to be under
$2  million in the  second  quarter  of 2002 and a total of $4 million  over the
entire  replacement  period.  In  addition  to this,  we adopted  SFAS No.  142,
Goodwill and Other Intangible Assets, on January 1, 2002. In accordance with the
provisions of SFAS 142, we discontinued  amortization of goodwill,  wireless PCS
spectrum  licenses and certain other intangibles as of that date as these assets
are considered  indefinite lived intangible  assets not subject to amortization.
These  assets  will be  subject to  periodic  impairment  testing  which will be
completed later in 2002.  Amortization of indefinite lived intangible assets was
$4.3 million for the first  quarter of 2001 ($4.9 million on a pro forma basis).
The  remaining  increase in  depreciation  is due to an increase in  depreciable
assets from March 31, 2001 to March 31, 2002 of $123 million or 27%.

CUSTOMER  OPERATIONS   EXPENSES--Customer  operations  expenses  increased  $1.0
million, or 7%, from $14.8 million in the first quarter of 2001 to $15.8 million
in the first quarter of 2002. On a pro forma basis, customer operations expenses
decreased $.7 million or 4% from the prior year.  This decrease is  attributable
to lower commissions paid per gross PCS subscriber addition,  primarily due to a
decrease in the percent of sales sold through the higher cost indirect  channel.
Additionally,  we incurred  outsource  billing  costs for the VA East PCS market
through July 2001.  After  conversion of these customers onto our billing system
and insourcing these billing functions, these costs decreased significantly.

CORPORATE  OPERATIONS  EXPENSES--Corporate  operations  expenses  increased $1.0
million,  or 20%,  from $4.9  million to $5.9 million for the three months ended
March 31, 2001 and 2002,  respectively.  On a pro forma basis, this increase was


                                       16
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


$.8  million or 15%.  As  mentioned  above,  most of this  relates to  corporate
expense increases, particularly related to legal and other professional services
fees (primarily in the ILEC and Other segments), insurance expense, and deferred
benefit cost increases.

RESTRUCTURING  CHARGE--A  restructuring charge was recorded in the first quarter
of 2002 based on an approved plan to reduce our workforce by  approximately  15%
through the offering of early retirement incentives,  the elimination of certain
vacant and budgeted  positions and the  elimination  of some jobs. The plan also
involved exiting certain  facilities in connection with the workforce  reduction
and centralizing of certain functions. The first quarter charge was $1.3 million
which  related to severance  costs for  employees  notified in the first quarter
2002 and  estimated  lease  obligations  associated  with  the  exit of  certain
facilities.  An estimated $1.8 million of additional charges will be recorded in
the second  quarter of 2002 for  severance  and  pension  curtailment  costs for
employees  notified  in the second  quarter  of 2002.  This  restructuring  will
generate net savings and reduce future  expenses by  approximately  $3.0 million
for the year 2002 and $8.5 million for 2003.

OTHER INCOME (EXPENSES)

Other income  (expenses)  was  comprised  of equity loss from WV Alliance  (2001
only), a gain on sale of assets (2002 only),  interest  expense and other income
(expense).  Our share of losses from the WV Alliance  reported  under the equity
method of accounting,  which commenced  being  consolidated on February 13, 2001
concurrent  with our merger with R&B, were $1.3 million during the 43 day period
prior to the merger date.  Also,  in the first  quarter of 2002, we recognized a
$2.0 million gain on the sale of certain  inactive PCS  licenses.  Additionally,
interest  expense  increased $.8 million or 4%, from $18.2 million for the three
months  ended March 31, 2001 to $19.0  million for the three  months ended March
31,  2002.  This  increase is due to the  increase in the average  debt over the
respective periods primarily from capital  expenditures needed to support future
growth in excess of cash flow generated from current operations.

Other income (expense) decreased $3.1 million,  from income of $3.0 in the first
quarter  of 2001 to expense of $.1  million  in the first  quarter of 2002.  The
prior year  income was  comprised  primarily  of  interest  income  earned on an
average  restricted  cash balance of  approximately  $62 million,  interest from
advances to WV Alliance,  which  averaged  approximately  $68 million during the
first 43 days of 2001, and other  miscellaneous  asset retirement gains.  During
the  first  quarter  of  2002,  interest  income  for  restricted  cash was down
significantly   due  to  the  reduced   average   restricted   cash  balance  of
approximately  $24  million.  This  income  was  offset  by other  miscellaneous
expenses and asset retirement losses.

INCOME TAXES
Income tax benefits decreased $9.8 million,  from a tax benefit of $11.4 million
for the three  months  ended March 31, 2001 to a tax benefit of $1.6 million for
the three months  ended March 31,  2002.  The 2002 benefit is net of a valuation
allowance recorded during this period of $11.0 million.  Additionally,  with the
adoption of SFAS No. 142, we no longer have the permanent differences associated
with  non-deductible  goodwill.  Also,  we are subject to state minimum taxes in
2002. As a result,  the effective tax rate  approximates  the statutory rates in
2002, excluding the impact of the $11.0 million valuation reserve (Note 6).

LIQUIDITY AND CAPITAL RESOURCES
We have funded our working capital  requirements and capital  expenditures  from
net  cash  provided  from  operating  activities  and  borrowings  under  credit
facilities. At March 31, 2002, we had $90 million in unused borrowings available


                                       17
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


under our Senior  Secured  Term Loan (also  referred  to as the  "Senior  Credit
Facility").  We borrowed $10 million  against our $100  million  lines of credit
under the Senior Credit Facility in the first quarter of 2002.

OPERATING CASH FLOWS
During the first quarter of 2002, net cash provided by operating  activities was
$5.9  million,  with $.5 used in  operations  offset by net positive  changes in
operating assets and liabilities  totaling $6.4 million.  Within the $.5 million
used in operations,  one of the  reconciling  items  adjusting net income to net
cash is an adjustment for $9.0 million which  represents  interest  expense paid
from restricted  cash, net of interest income earned from this restricted  cash.
This is reflected as an adjustment to reconcile net income to net cash since the
payment of interest on the Senior Notes is paid out of  restricted  cash through
August 15, 2002.  Therefore,  as these interest  payments will be paid from cash
for periods  after August 15, 2002,  this will not be an adjustment to reconcile
net income to net cash in periods after August 15, 2002.  The principal  changes
in  operating  assets  and  liabilities  were as  follows:  accounts  receivable
increased by $1.6 million or 5% due  primarily to a 5% increase in revenues over
the fourth quarter 2001;  inventories and supplies decreased $3.8 million due to
efforts to reduce  handset  inventory  levels in  recognition  of improvement in
handset availability;  other current assets decreased $1.4 million primarily due
to favorable  collections  experience of other receivables;  increase in current
liabilities  totaling  $2.8 million due to a $3.2  million  decrease in interest
accrued on the Senior  Subordinate  Notes due to the $6.4  February  semi-annual
interest payment offset by $6.0 million in increased current  liabilities due to
the timing of other payments at the respective period ends.

During the first quarter of 2001, net cash used in operating activities was $2.3
million,  with less than $.1  million  provided  by  operations  offset by a net
reduction of operating assets and liabilities  totaling $2.3 million.  Principal
changes in operating assets and liabilities were as follows: accounts receivable
increased  $4.0  million,  primarily  due to the  increase  in  revenues of $9.6
million  from  customer  additions  during the fourth  quarter of 2000 and first
quarter 2001;  inventories  and supplies  decreased $4.6 million due to year end
inventory stock build up being sold through the first quarter busy sales season;
income  taxes went from a receivable  at the 2001  year-end of $2.9 million to a
$.2  million  payable  position at March 31, 2001 due to the receipt of the year
end  receivable  and the state  minimum  tax  payable  at March 31,  2001;  and,
accounts payable and other liabilities  (including  additional payables from R&B
and the WV Alliance)  decreased by $5.2  million,  with  accrued  interest  from
Senior  Subordinate  Notes  decreasing  by $3.9  million due to the $7.1 million
February  semi-annual interest payment and $1.3 million from the timing of other
payments.

Our cash  flows  used in  investing  activities  for the first  quarter  of 2002
aggregated $18.5 million and primarily  included $29.1 million for first quarter
capital  expenditures,  $9.9  million  of which is for the  wireless  upgrade to
3G-1XRTT  technology in the western markets in support of the Horizon  wholesale
network services agreement, offset by $10.9 million in proceeds from the sale of
communications towers and inactive PCS licenses.

Our cash  flows  used in  investing  activities  for the first  quarter  of 2001
aggregated $13.3 million and include the following:

o    $25.5 million for the purchase of property and equipment;

o    $3.5  million  of  proceeds  from the  final  payment  from the sale of the
     directory assistance operation in 2000;

o    $4.1 million of cash and cash equivalents on hand at R&B at the time of the
     merger;

o    $3.6  million  of  net  additional  advances  to and  investment  in the WV
     Alliance  from January 1, 2001 to the February  13, 2001  transaction  date
     (Note 4), after which the entire amounts of the advances and the investment
     were  included  in the WV  Alliance  acquisition  and  were  eliminated  in
     consolidation;

o    $8.0  million of  deposits  refunded  at the  conclusion  of an FCC license
     auction as no additional licenses were purchased from this auction; and,



                                       18
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


o    $1.1 million received from the sale of four towers in West Virginia.

Net cash provided by financing  activities for the first quarter 2002 aggregated
$7.2 million,  which included $10 million of additional  borrowings  against the
Senior  Credit  Facility,  a $1.8  million use of cash for  scheduled  principal
payments on other  long-term  debt,  and $1.2 million used to pay loan amendment
fees.

Net  cash  provided  by  financing  activities  for the  first  quarter  of 2001
aggregated $18.4 million, which included $20 million in additional draws against
the  Senior  Credit  Facility  and a $1.7  million  use of cash for  other  debt
payments, primarily on capital leases.

Throughout  2002, we anticipate  increasing  levels of PCS  subscribers and ARPU
growth,  continued  lowering of PCS churn,  positive cash flow from our wireless
segment, continued revenue growth from our wireline segments and continuing cost
containment  measures.  Achievement  of these  results  is  important  to ensure
long-term  liquidity and continued  access to borrowings under our Senior Credit
Facility. In addition, our liquidity needs will be impacted by:

o    capital  expenditures  required to deploy 3G-1XRTT technology in certain of
     the VA Alliance and WV Alliance markets;
o    capital  expenditures  required to support  customer  growth and  wholesale
     usage to provide sufficient PCS capacity;
o    capital  expenditures  required  to support  access line growth in existing
     markets; and,
o    significant  interest  expense  associated with current and increasing debt
     levels.

Regarding our Senior Credit Facility  covenants,  the 2002 annual EBITDA minimum
level is $49.6 million and includes  quarterly  rolling twelve month thresholds.
This is a significant  increase over our 2001 EBITDA levels of $20.5 million. At
March  31,  2002,  we were in  compliance  with  all of our  financial  covenant
requirements.

Our liquidity sources include:

o    cash flow from operations;
o    approximately  $18.1 million held in the escrow  account to fund the August
     15, 2002 interest payment on our Senior Notes;
o    $90  million  available  under our Senior  Credit  Facility as of March 31,
     2002, subject to compliance with amended covenant requirements;
o    disposition  of additional  non-strategic  businesses  and assets,  such as
     additional  sales of excess PCS spectrum and other types of spectrum,  such
     as WCS,  LMDS and MMDS.  The Company holds PCS licenses in 17 markets where
     service is currently  being  provided and 20 markets  where  service is not
     currently being provided.  In many cases we own licenses  covering spectrum
     in  excess of what will be needed  to  execute  our  business  plan for the
     foreseeable  future.  In 2001,  the  Company  sold $11.6  million of excess
     spectrum  for a gain of $8.6  million and has sold  additional  inactive or
     excess PCS  spectrum  for  proceeds of $14.5  million in 2002 to date ($2.5
     million  of which  closed in the first  quarter  2002 and $12.0  million of
     which closed in April 2002) and has  announced  definitive  agreements  for
     other  spectrum  sales worth $7.1 million  which are expected to close over
     the next six months of 2002; and,
o    public and private debt and equity markets.

We expect  capital  expenditures  for the  remainder  of 2002 to be between  $45
million and $55 million. We expect these capital expenditures to be used to:

o    deploy  3G-1XRTT  technology  in certain of the VA Alliance and WV Alliance
     markets;
o    support network  capacity and coverage  demands of VA East, VA Alliance and
     WV Alliance operations;
o    support customer growth in CLEC and Internet access services; and,
o    support back office  tools in order to improve  customer  satisfaction  and
     improve our internal controls and efficiencies.



                                       19
<PAGE>
                                   NTELOS Inc.

Item 2.               Management's Discussion And Analysis
                Of Financial Condition And Results Of Operations
                                    Continued


Approximately  $30  million  to  $35  million  of  these   incurred-to-date  and
anticipated  2002 capital  expenditures  are based on an  obligation  within our
wholesale  agreement  with  Sprint/Horizon  to build out a  3G-1XRTT  network in
certain markets. The estimated total cost of this build-out is approximately $40
million to $45 million which will be completed by 2003.

VA East and the  Alliances  have  substantially  satisfied  their FCC  build-out
requirements.  Accordingly,  aside from the 3G-1XRTT network upgrade commitment,
the  expenditures  forecast noted above is primarily driven by the expected need
to support customer growth and wholesale usage. To the extent that this customer
growth and wholesale usage is less than expected,  our capital expenditures will
be reduced.  Since these are generally capacity related  expenditures to support
customer  growth,  it is uncertain when these proposed uses will be initiated or
completed.

Based on our assumptions  about the future of our operating  results,  including
positive   EBITDA  from  our  wireless  PCS  operations  in  2002,  our  capital
expenditure  needs,  and the  availability of borrowings under our Senior Credit
Facility  and our other  sources  of  liquidity,  we  believe  that we will have
sufficient  financial  resources to fund our existing and currently  anticipated
operational plans.  However,  if any of our assumptions prove incorrect,  we may
not have  sufficient  financial  resources or may not be able to access  current
availability  under our Senior Credit  Facility.  If so, we may have to delay or
abandon  some of our  anticipated  capital  expenditures,  modify our  operating
plans,  expedite the sale of  non-strategic  assets or seek  additional  capital
resources, and our ability to make interest and principal payments on our senior
and subordinated notes could be significantly impaired.



                                       20
<PAGE>
                                   NTELOS Inc.

Item 3.    Quantitative and Qualitative Disclosures about Market Risk

The Company's Senior Credit Facility of $325 million,  $235 million of which was
outstanding  at March  31,  2002,  bears  interest  at rates 3% to 4% above  the
Eurodollar  rate or 2.5% to 3% above the  federal  funds  rates.  The  Company's
unsecured  senior notes and unsecured  subordinated  notes are at fixed interest
rates  of 13% and  13.5%,  respectively.  The  Company  has  other  fixed  rate,
long-term debt totaling $17.9 million at March 31, 2002.

The Company is exposed to market risks  primarily  related to interest rates. To
manage its exposure to interest rate risks and in accordance  with conditions of
the senior note indenture, the Company entered into two, five year interest rate
swap agreements with notional amounts of $162.5 million in September 2000. These
swap  agreements  manage the Company's  exposure to interest  rate  movements by
effectively  converting a portion of the  long-term  debt from variable to fixed
rates.  The net face amount of interest rate swaps subject to variable  rates as
of March 31, 2002 and December  31, 2001 was $162.5  million.  These  agreements
involve the exchange of fixed rate payments for variable  rate payments  without
the effect of leverage and without the exchange of the  underlying  face amount.
Fixed  interest  rate  payments are at a per annum rate of 6.76%.  Variable rate
payments are based on one month US dollar LIBOR. The weighted average LIBOR rate
applicable  to these  agreements  was 1.88% as of March 31,  2002.  The notional
amounts do not represent  amounts  exchanged by the parties,  and thus are not a
measure of exposure of the Company.  The amounts exchanged are normally based on
the notional amounts and other terms of the swaps.  Interest rate  differentials
paid or received  under  these  agreements  are  recognized  over the  one-month
maturity  periods as  adjustments  to interest  expense.  The fair values of our
interest rate swap  agreements are based on dealer  quotes.  Neither the Company
nor the counterparties,  which are prominent bank institutions,  are required to
collateralize  their  respective  obligations  under these swaps. The Company is
exposed to loss if one or more of the counterparties default. At March 31, 2002,
the Company had no exposure to credit loss on interest rate swaps.  At March 31,
2002 and December 31, 2001,  the swap  agreements had a fair value $11.2 million
and $13.1  million,  respectively,  below  their face value.  These  amounts are
recorded as long-term  liabilities at the respective period ends. The effects of
a one percentage  point change in LIBOR rates would change the fair value of the
swap agreements by $6.2 million for a one percentage  point increase in the rate
(to $5.0 million below face value) and $6.4 million for a one  percentage  point
decrease in the rate (to $17.6 million below face value).

The Company has  interest  rate risk on the amount  above the $162.5  million of
senior bank debt covered by the swap noted above. At March 31, 2002, the Company
senior  bank  debt  totaled  $235  million,  or  $72.5  million  over  the  swap
agreements.

The  Company's  senior  notes are trading at rates well below their book values.
The Company's  management believes that the risk of the fair value exceeding the
carrying  value of this debt in the  foreseeable  future  is  remote  due to the
current trading level, as well as market and industry conditions.

At March  31,  2002,  the  Company's  financial  assets  included  cash and cash
equivalents of $1.9 million, restricted cash of $18.1 million and securities and
investments of $13.6 million.  With respect to the cash and cash equivalents and
the restricted  cash, as well as $9.2 million of the  investments,  there are no
material market risks as these are fixed rate, fixed maturity instruments. Also,
we believe there are minimal  credit risks as the  counterparties  are prominent
financial  institutions.  Additionally,  our $2.8  million 3% minority  interest
investment in America's Fiber Network L.L.C.  ("AFN") was sold in April 2002 for
proceeds of $2.6  million.  The  remaining  $1.6 million of  investments  are in
equity  securities.  These  investments  are  treated  as  available  for  sale.
Accordingly,  these  investments  are marked to market and at March 31, 2002, we
have  recorded a $.3 million  unrealized  loss,  net of $.2 million tax benefit,
related to these investments.  The Company is exposed to market and credit risks
with these investments. However, we do not believe that this risk is material to
our financial position or will be material to the results of future operations.


                                       21
<PAGE>
                                   NTELOS Inc.

                           Part II. OTHER INFORMATION


Item 1.  Legal Proceedings

         Not applicable

Item 2.  Changes In Securities

         Not applicable

Item 3.  Defaults Upon Senior Securities

         Not applicable

Item 4.  Submission Of Matters To A Vote Of Security Holders

         Not applicable

Item 5.  Other Information

         Not applicable

Item 6.  Exhibits and Reports on Form 8-K

         (A)      Exhibits

         Not applicable

         (B)      Reports on Form 8-K

             Form 8-K dated February 6, 2002,  pertaining to presentations to be
             made by Mr. James S. Quarforth,  Chief Executive  Officer,  and Mr.
             Michael  B.  Moneymaker,   Chief  Financial  Officer,  at  investor
             meetings,  providing an overview of NTELOS' strategy,  transactions
             and certain performance through 2001 and guidance for 2002.

             Form 8-K dated February 11, 2002, pertaining to presentations to be
             made by Mr. James S. Quarforth,  Chief Executive  Officer,  and Mr.
             Michael  B.  Moneymaker,   Chief  Financial  Officer,  at  investor
             meetings,  providing an overview of NTELOS' strategy,  transactions
             and certain performance through 2001 and guidance for 2002.

             Form 8-K dated March 6, 2002, announcing that on March 6, 2002, the
             Company's  entered into  Amendment No. 3 (the  "Amendment")  to the
             Credit  Agreement,  dated  as of July 26,  2000,  as  amended  (the
             "Credit  Agreement").  The  Amendment  modifies  certain  financial
             covenants and other provisions of the Credit Agreement.

             Form 8-K dated  March 13,  2002,  providing  an overview of NTELOS'
             strategy,  operations and performance  through fiscal year 2001 and
             includes certain projections and guidance for 2002.


                                       22
<PAGE>

                                   SIGNATURES


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



                             NTELOS Inc.

May 14, 2002                 /s/J. S. Quarforth
                             -------------------------------------------------
                             J. S. Quarforth, Chief Executive Officer








May 14, 2002                 /s/M. B. Moneymaker
                             ------------------------------------------------
                             M. B. Moneymaker, Senior Vice President and
                             Chief Financial Officer, Treasurer and Secretary







                                       23