1064735--3/16/2006--SUNCOM_WIRELESS

related topics

{product, market, service}

{acquisition, growth, future}

{regulation, government, change}

{debt, indebtedness, cash}

{capital, credit, financial}

{customer, product, revenue}

{personnel, key, retain}

{investment, property, distribution}

{cost, operation, labor}

{control, financial, internal}

{operation, natural, condition}

{cost, contract, operation}

If we are unable to continue as a going concern, we may be required to substantially modify our business plan, restructure our balance sheet or file for bankruptcy protection. We have experienced losses during four of the last five years, and we may be unable to regain profitability. We are highly leveraged and do not project sufficient cash flow to fund our debt service and operating expenses past early 2007. Accordingly, absent Holdings determination to make additional investments in us or our ability to secure another source of liquidity this year, we will need to restructure our balance sheet and/or implement an alternative financial plan, such as a significant asset sale, to reduce our debt. Our future growth may require significant additional capital, and our substantial indebtedness could impair our ability to fund our capital requirements. Our debt instruments contain restrictive covenants that may limit our operating flexibility. Our average revenue per user has declined for several years and may not stabilize. We have had and may continue to have difficulty penetrating the North Carolina markets we acquired from AT T Wireless, which has adversely affected our results of operations and may continue to do so in the near future. Substantial competition in all aspects of our business could continue to cause reduced pricing and have adverse effects on our profit margins. Our business could be harmed by adverse regulatory changes. Our inability to effectively manage our planned growth could adversely affect our operations. The wireless industry is experiencing rapid technological change, and we may lose customers if we fail to keep up with these changes. A high rate of customer turnover would negatively impact our business and could reduce our revenues. If our wireless service offerings or customer care service do not meet customer expectations, it could limit our ability to retain or attract customers. Our FCC licenses are one of our principal assets, and our business could be harmed if the value of these licenses decreases or if our licenses are revoked by the FCC. Our Universal Service Funding may be reduced or eliminated. Roaming revenue represents a significant portion of our total revenues, and its seasonality will subject our revenue and operating income (loss) to seasonal fluctuations. Termination or impairment of our relationship with a small number of key suppliers or vendors could adversely affect our revenues and results of operations. Our success depends on our ability to attract and retain qualified personnel. Equipment failure and disasters may adversely affect our operations. If hand-held phones pose health and safety risks, we may be subject to new regulations, and there may be a decrease in demand for our services. Our institutional investors invest in other wireless communications services companies, and conflicts of interest may arise from these investments and from other directorships held by Holdings directors that may not be resolved in our favor.

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1064735--3/16/2006--SUNCOM_WIRELESS_INC