US UNWIRED INC, 424B1, 2000-05-18

US UNWIRED INC
424B1, 2000-05-18
RADIOTELEPHONE COMMUNICATIONS

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Filed Pursuant to Rule 424(B)(1)
Registration No. 333-33964
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Prospectus
May 17, 2000

[US Unwired Logo]

8,000,000 Shares of Class A Common Stock

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US Unwired Inc.: The Offering:

. We provide wireless . We are offering 8,000,000
communications services in shares of our class A common
the Gulf States region stock.
through our affiliation with
Sprint PCS. . The underwriters may purchase
an additional 1,200,000
. We are the largest Sprint PCS shares from selling
affiliate by both population stockholders to cover over-
covered and number of allotments.
subscribers.
. This is our initial public
. One Lakeshore Drive, Suite offering.
1900
Lake Charles, Louisiana 70629 . We plan to use the net
(800) 673-2200 proceeds from this offering
www.usunwired.com to accelerate the
construction of our PCS
Symbol & Market: network and for other general
corporate purposes.
. UNWR/Nasdaq National Market
. Closing: May 23, 2000

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<TABLE>
<CAPTION>
Per
Share Total
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<S> <C> <C>
Public offering price: $11.00 $88,000,000
Underwriting fees: $ 0.77 $ 6,160,000
Proceeds to us: $10.23 $81,840,000
</TABLE>
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This investment involves risk. See "Risk Factors" beginning on page 5.

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Neither the SEC nor any state securities commission has determined whether this
prospectus is truthful or complete. Nor have they made, nor will they make, any
determination as to whether anyone should buy these securities. Any
representation to the contrary is a criminal offense.
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Donaldson, Lufkin & Jenrette

Credit Suisse First Boston

First Union Securities, Inc.

DLJdirect Inc.
<PAGE>

[map showing the registrant's Sprint PCS(R) markets and service area]
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C>
Prospectus Summary....................................................... 1
Risk Factors............................................................. 5
Use of Proceeds.......................................................... 15
Dividend Policy.......................................................... 15
Capitalization........................................................... 16
Dilution................................................................. 17
Selected Historical Consolidated Financial Information................... 19
Management's Discussion and Analysis of Financial Condition and Results
of Operations......................................................... 20
Business................................................................. 34
The Wireless Communications Industry..................................... 55
Sprint PCS Agreements.................................................... 58
Management............................................................... 66
Certain Relationships and Related Transactions........................... 73
Principal and Selling Stockholders....................................... 76
Certain Indebtedness..................................................... 78
Description of Capital Stock............................................. 82
Shares Eligible for Future Sale.......................................... 86
Important United States Federal Tax Consequences of Our Common Stock to
Non-U.S. Holders...................................................... 89
Underwriting............................................................. 92
Legal Matters............................................................ 96
Available Information.................................................... 96
Experts.................................................................. 96
Index to Financial Statements............................................ F-1
</TABLE>
<PAGE>

PROSPECTUS SUMMARY

You should not make an investment decision based only on summary
information. We therefore urge you to read carefully all of this prospectus.

US Unwired

General

We currently provide wireless personal communications services, commonly
referred to as PCS, in parts of Louisiana and Texas. We are a network partner
of Sprint PCS, the personal communications services group of Sprint
Corporation. Sprint PCS, directly and through affiliates like us, provides
wireless services in more than 4,000 cities and communities across the country.
We have the exclusive right to provide digital PCS services under the Sprint(R)
and Sprint PCS(R) brand names in a service area comprising approximately 9.7
million residents in the Gulf States region. Our service area has the largest
population and the most subscribers of any network partner of Sprint PCS.

We currently provide Sprint PCS service in eleven markets: Alexandria,
Houma-Thibodaux, Lake Charles, Monroe and Shreveport, Louisiana and Beaumont-
Port Arthur, Longview-Marshall, Lufkin-Nacogdoches, Texarkana and Tyler, Texas
and Montgomery, Alabama. Our network currently covers approximately 2.4 million
residents out of approximately 3.6 million total residents in those markets. We
expect to cover a total of approximately 6.1 million residents by December 2000
and 6.4 million residents by March 2001, at which point we expect to have
covered approximately 66% of the resident population in our service area. The
number of people in our service area does not represent the number of Sprint
PCS subscribers that we expect to have in our service area. At March 31, 2000,
we were providing PCS services to approximately 66,000 subscribers in our
service area. In addition, we were providing cellular and paging service to
approximately 81,000 subscribers in southwest Louisiana at March 31, 2000. For
the twelve month period ended March 31, 2000, we had revenues of approximately
$68.0 million and a net loss from continuing operations of approximately $30.4
million, and our operations used approximately $18.5 million more cash than
they generated.

Our service area covers 41 markets in eastern Texas, southern Oklahoma,
southern Arkansas, significant portions of Louisiana, Alabama and Mississippi,
the Florida panhandle and southern Tennessee. Our service area is contiguous
with Sprint PCS's launched markets of Houston, Dallas, Little Rock, New
Orleans, Birmingham, Tallahassee and Memphis. We are constructing a 100%
digital, 100% wireless PCS network that we expect to complete by March 2001. We
estimate that Sprint PCS paid over $100 million to acquire the PCS licenses in
our service area and to clear the licensed markets for microwave radio
frequency service.

Benefits of Our Affiliation with Sprint PCS

Our exclusive relationship with Sprint PCS allows us to take advantage of
the strength and reputation of Sprint PCS's national brand. We believe the
benefits of this relationship include:

Marketing. We market our products and services under the nationally
recognized Sprint PCS(R) brand. We benefit from Sprint PCS's national
advertising campaigns and subscriber programs and its relationships with
major national retailers.

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National Network. Subscribers in our service area can immediately
access Sprint PCS's growing network in over 4,000 cities and communities
across the United States.

Handset and Equipment Availability and Pricing. We have access to
network and subscriber equipment under Sprint PCS's vendor contracts that
provide for volume discounts.

Exclusive Traveling Partner. We are the exclusive provider of
traveling services for all non-US Unwired Sprint PCS customers in our
service area and benefit from the increased traffic created by other Sprint
PCS customers who travel in our service area.

Technology. Sprint PCS's extensive research and development effort
produces ongoing benefits through both new technological products as well
as enhanced service features.

As provided under our agreements with Sprint PCS, we receive from Sprint
PCS 92% of collected revenues from subscribers based in our service area and
Sprint PCS retains the remaining 8%. We also receive other revenue, including
Sprint PCS traveling revenues, calculated as a per minute charge paid to us by
Sprint PCS for each minute that Sprint PCS subscribers based outside our
service area use our portion of the Sprint PCS network, and 100% of revenues
from handset sales.

Our Competitive Strengths

In addition to the advantages provided by our strategic affiliation with
Sprint PCS, we have the following competitive strengths:

. extensive territorial reach.

. existing corporate infrastructure.

. significant number of owned licenses.

. 40 MHz of bandwidth in many of our markets.

. high-quality customer care.

Adequate Funding to Complete Our Network

We funded the initial phase of our PCS network buildout with a portion of
the proceeds from the sale of our non-Louisiana cellular assets in 1998. As of
the date of this prospectus, we have raised $264 million from the sale of $55
million of our convertible preferred stock and the issuance in a private
placement of $209 million of our senior subordinated discount notes. We also
have a $130 million senior credit facility under which, as of the date of this
prospectus, no funds have been drawn. Management expects that these funds,
together with the proceeds of this offering, will be sufficient to complete the
buildout of our PCS network, fund start up losses and maintain adequate working
capital.

2
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The Offering

<TABLE>
<S> <C>
Class A common stock offered...... 8,000,000 shares

Class A and Class B common stock
to be outstanding after this
offering....................... 79,009,231 shares

Use of proceeds................... For accelerating the construction of our
PCS network and for other general corporate
purposes. See "Use of Proceeds."

Nasdaq National Market symbol..... "UNWR"
</TABLE>

The number of shares of our common stock to be outstanding after this
offering includes:

. 2,559,597 shares of our class A common stock outstanding as of the date
of this prospectus.

. 68,449,634 shares of our class B common stock outstanding as of the
date of this prospectus.

. 8,000,000 shares of our class A common stock to be sold in this
offering.

The number of shares of our common stock to be outstanding after this
offering excludes:

. 6,817,518 shares of our class A common stock issuable upon exercise of
options that will have been granted as of the date of this offering
under our 1999 Equity Incentive Plan at an average exercise price of
$4.37 per share.

. 5,442,402 shares of our class A common stock reserved as of the date of
this offering for issuance under our 1999 Equity Incentive Plan.

Generally, the information in this prospectus:

. assumes that the underwriters do not exercise any of their over-
allotment option.

. gives effect to the conversion of our preferred stock.

. gives effect to a 5.3304 for 1 stock split that was approved by our
stockholders on April 11, 2000.

We describe our capitalization on page 16.

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3
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SUMMARY FINANCIAL INFORMATION

The table below shows summary consolidated financial information for 1998
and 1999 and for the three months ended March 31, 1999 and 2000. You should
read this information with our consolidated financial statements and the
related notes and the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations," all of which are included in
this prospectus.
<TABLE>
<CAPTION>
Year Ended Three Months Ended
December 31, March 31,
------------------ ---------------------
1998(/1/) 1999 1999 2000
--------- -------- -------- -----------
(unaudited)
(Dollars in thousands except for per
share data and other data)
<S> <C> <C> <C> <C>
Statement of Operations Data(/2/):
Revenues........................... $71,711 $ 58,632 $ 12,929 $ 22,291
Cost of services and merchandise
sold............................ 29,363 31,591 6,347 13,513
Other operating expenses........... 37,873 52,299 9,863 23,007
------- -------- -------- --------
Operating income (loss)............ $ 4,475 $(25,258) $ (3,281) $(14,229)
======= ======== ======== ========
Income (loss) from continuing
operations...................... $28,796 $(17,634) $ (1,392) $(14,203)
======= ======== ======== ========
Basic and Diluted Per Share Data:
Income (loss) from continuing
operations...................... $ 0.48 $ (0.29) $ (0.02) $ (0.32)
======= ======== ======== ========
Other Data:
Number of PCS subscribers(/3/)..... 14,611 46,838 23,606 66,753
Number of PCS markets
launched(/4/)................... 5 10 5 11
Total residents in launched markets
(millions)(/4/)................. 1.8 3.1 1.8 3.6
<CAPTION>
As of March 31, 2000
---------------------
Actual As Adjusted
-------- -----------
(unaudited)
<S> <C> <C> <C> <C>
Balance Sheet Data:
Cash and cash equivalents............................. $ 16,053 $ 97,093
Marketable securities................................. 109,010 109,010
Property and equipment, net........................... 138,599 138,599
Total assets(/5/)..................................... 332,278 407,955
Long term debt, including current maturities(/5/)..... 233,417 231,824
Equity................................................ 15,996 149,369
</TABLE>
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(1) In July 1998, in anticipation of the Sprint PCS buildout, US Unwired sold
all of its cellular assets related to its Mississippi, Alabama and Kansas
markets, along with its majority ownership interest in Mississippi 34
Cellular Corporation, for $161.5 million. This transaction resulted in a
gain of approximately $57.4 million which is included in income (loss) from
continuing operations.
(2) Includes results of operations for Unwired Telecom, our cellular and paging
operating subsidiary, which for the year ended December 31, 1999 generated
$46.2 million of revenues and $5.7 million of operating income and for the
year ended December 31, 1998 generated $67.7 million of revenues and $4.0
million of operating income. Presents LEC Unwired as a discontinued
operation. LEC Unwired began operations in 1998 and is presented on the
equity method for the year ended December 31, 1998.
(3) Reflects PCS subscribers for LA Unwired and Texas Unwired and does not
include our proportionate share of PCS subscribers in our Meretel
partnership, which were 1,538 at December 31, 1998, 5,045 at December 31,
1999 and 5,839 at March 31, 2000.
(4) Does not include the launched markets in our Meretel partnership or our
proportional ownership of the residents in those markets, which were
approximately 163,000 residents at December 31, 1998 and at December 31,
1999 and approximately 229,000 residents at March 31, 2000.
(5) The as adjusted column reflects the sale of certain PCS licenses and the
payoff of the related debt as if these events occurred as of March 31,
2000.
*****
We are located at One Lakeshore Drive, Suite 1900, Lake Charles, Louisiana
70629. Our phone number is (800) 673-2200, and our website is
www.usunwired.com.

4
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RISK FACTORS

You should carefully consider the following factors and other information
in this prospectus before deciding to invest in shares of our common stock.

Risks Related to US Unwired

Our substantial indebtedness could prevent us from fulfilling our obligations
to our creditors which could, in turn, adversely affect our stockholders.

We have a substantial amount of debt. On March 31, 2000, we had
outstanding debt of:

. approximately $221.0 million in principal amount of our notes.

. approximately $2.5 million of debt guaranteed by US Unwired. This
represents our share of the indebtedness of Meretel at March 31, 2000.

In addition, at March 31, 2000, we had a commitment to provide $3.9
million to LEC Unwired.

We may incur additional debt in the future. The indenture governing our
notes permits us to incur additional debt, but there are limitations. Our
credit facilities provide for total borrowings of up to $130.0 million. Some
of our obligations under our credit facilities may limit our ability to borrow
more money. If we cannot borrow more money, it could impair our ability to
repay our notes and other indebtedness.

Because of our substantial debt:

. we will use a substantial portion of our cash flow from operations to
pay interest and principal on our debt, which will reduce the cash that
is available for other purposes.

. we may not have enough cash to pay interest and principal on our debt.

. we may not be able to borrow more money or get additional financing.

. an increase in interest rates could increase our interest expense.

. most of our assets are encumbered with liens.

. we may not be able to adjust to changing market conditions or
competition.

. we may be at a competitive disadvantage to our competitors who have
less debt.

Our ability to generate cash to pay interest and principal on our indebtedness
depends on many factors beyond our control, and this could reduce our
flexibility and impair the value of our common stock.

Our ability to pay interest and principal on our debt depends on our
future operating performance. Our performance depends on general economic and
competitive conditions and on financial, business and other factors, many of
which we cannot control. We will use a substantial portion of our cash flow
from operations to repay our borrowings and interest under our debt
instruments. This will be a significant cost to us. We cannot assure you that
we will have enough cash

5
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flow from operations or future borrowings under our credit facilities to repay
our indebtedness or for our other liquidity needs.

We may try to:

. delay or reduce our capital expenditures.

. restructure our debt.

. sell some of our assets or operations.

. acquire equity capital from other investors.

We may not be able to take any of these actions on satisfactory terms or at
all. These actions may not provide us with enough cash to repay our debt. If we
cannot repay our debt or take any of these actions, the market value of the
common stock will be impaired.

As a holding company, we depend on dividends from our subsidiaries to meet
our debt obligations. The indenture governing our notes may allow our
subsidiaries to enter into future loan agreements which restrict or prohibit
them from paying dividends. State law may also limit the amount of the
dividends that our subsidiaries are permitted to pay.

If there is a change of control of US Unwired, we may not be able to satisfy
our obligations to our creditors.

If the persons who control US Unwired lose this control, we must offer to
buy back all of our outstanding notes. We cannot assure you that we will have
sufficient funds at the time of a change of control to perform this obligation
or that restrictions in our credit facilities will allow us to do so. Our
inability to buy back the notes could impair the value of our common stock.

If we need additional financing that we cannot obtain, we may have to change
our network construction plan.

We will make significant capital expenditures to complete our PCS network.
Actual expenditures may differ significantly from our estimates. We would have
to obtain additional financing if:

. any of our sources of capital is unavailable or insufficient.

. we significantly depart from our business plan.

. we experience unexpected delays or cost overruns in the construction of
our network, including changes to the schedule or scope of our network
buildout.

. changes in technology or governmental regulations create unanticipated
costs.

. we acquire additional licenses or Sprint PCS grants us more service
areas to build out and manage.

We cannot predict whether any additional financing will be available or on
what terms. If we need additional financing that we cannot obtain, we will have
to change our plans for the remainder of our network.

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If we cannot construct our communications network timely or successfully, our
ability to compete could be limited, and we could lose our PCS licenses or our
relationship with Sprint PCS.

We must lease or acquire rights to use locations for our PCS equipment and
our PCS network. This may require us to obtain zoning variances or governmental
approvals. If we are unable to obtain or use these locations, we may need to
alter the design of our network. This could prevent us from completing
construction of our network in a timely manner or at all.

There is considerable demand for the communications equipment that we need
to construct our network, and manufacturers of this equipment could have
substantial backlogs of orders. Competitors who purchase large quantities of
communications equipment may receive priority in the delivery of this
equipment. If we cannot get this equipment, we may fail to construct our
network timely. This could limit our ability to compete effectively or to meet
the construction requirements of the FCC or our Sprint PCS agreements. If we do
not meet these construction requirements, we could lose our licenses or breach
our agreements with Sprint PCS.

If we lose our agreements with Sprint PCS, our PCS business may not succeed.

Our agreements with Sprint PCS are central to our business plan.

. These agreements give us the right to use the Sprint PCS(R) brand name
and logo and related rights. If we lose these rights, our PCS
operations will be impaired.

. These agreements impose strict requirements on the construction of our
network. If we do not meet these requirements, these agreements may be
terminated and we could lose the right to be the sole provider of
Sprint PCS products and services in our service area.

. These agreements may be terminated also if any of Sprint PCS's FCC
licenses is lost or jeopardized, or if we become insolvent.

. These agreements give Sprint PCS a substantial amount of control over
the conduct of our business. Sprint PCS may make decisions that
adversely affect our business like setting the prices for its national
plans at levels that may not be economically sufficient for our
business.

. If our management agreements with Sprint PCS are terminated or
breached, we may be required to sell our PCS assets to Sprint PCS or
Sprint PCS may be required to assign to us some of their licensed
spectrum.

. If Sprint PCS decides not to renew our management agreements at the
expiration of the 20-year initial term or any 10-year renewal term, we
would no longer be a part of the Sprint PCS network and would be
limited in conducting our business.

Provisions of our management agreements with Sprint PCS may diminish our value
and restrict the sale of our business.

Under specific circumstances and without further stockholder approval,
Sprint PCS may purchase our operating assets for 72% or 80%, depending on the
circumstances, of our "entire business value," which is more fully described in
"Sprint PCS Agreements--The Management

7
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Agreements--Non-renewal of management agreements." Sprint PCS must approve any
change of control of our ownership and consent to any assignment of our
management agreements to an unrelated third party or to one of its
competitors. In addition, before we can accept an offer to sell the properties
used in specified markets, we must first offer them to Sprint PCS on the same
terms. Also, if we want to transfer an ownership interest in LA Unwired or
Texas Unwired to an unrelated third party, we must first give Sprint PCS a
right of first offer for the interest. These restrictions and other
restrictions in our management agreements with Sprint PCS could adversely
affect the value of our common stock, may limit our ability to sell the
business, may reduce the value a buyer would be willing to pay for our
business and may reduce our entire business value.

Problems with Sprint PCS's internal support systems could lead to customer
dissatisfaction or increase our costs.

We will rely on Sprint PCS's internal support systems, including customer
care, billing and back-office support, in some of our markets. As Sprint PCS
has expanded, its internal support systems have been subject to increased
demand and, in some cases, suffered problems in service. We cannot assure you
that Sprint PCS will be able to add system capacity successfully or that its
internal support systems will be adequate. Problems with Sprint PCS's internal
support systems could cause:

. delays or problems in our own operations or service.

. delays or difficulty in gaining access to customer and financial
information.

. a loss of Sprint PCS customers.

. an increase in the costs of customer care, billing and back office
services.

The Federal Communications Act of 1934 could affect our agreements with Sprint
PCS and could require changes in them.

The Communications Act prohibits any transfer of control of a radio
station license without prior approval of the FCC. Our agreements with Sprint
PCS provide for us to manage its licenses in our service area. If the FCC were
to conclude that our management constituted our control over Sprint PCS's
licenses, we would probably be required to modify our agreements to eliminate
that control. We cannot predict what modifications could be required or
whether we would be adversely affected by them.

If Sprint PCS does not succeed, or if we do not maintain a good relationship
with Sprint PCS, our PCS business may not succeed.

. If Sprint PCS has a significant disruption to its system, fails to
develop its system, or suffers a weakening of its brand name, our
operations and profitability would likely be impaired.

. We will use our relationship with Sprint PCS to obtain, at favorable
prices, the equipment for the construction and operation of our
network. Any disruption in our relationship with Sprint PCS could make
it much more difficult to obtain this equipment.

Our relationship with Sprint or its successor may be adversely affected by the
proposed merger of Sprint and MCI WorldCom.

Sprint and MCI WorldCom announced on October 5, 1999 that they have
agreed to merge to form a new company called WorldCom. The merger is subject
to various conditions, including the approvals of the shareholders of both
companies, the FCC, the Justice Department and various state

8
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governmental bodies and foreign antitrust authorities. We do not know what
effect the merger will have on Sprint's business. If the merger does not occur,
Sprint's business may be adversely affected. Any negative impact on Sprint
could have a negative effect on us as a Sprint PCS network partner.

Our competitors may have more resources or other advantages that may make it
difficult for us to compete effectively.

Competition in the wireless communications services industry is intense.
If we are unable to compete successfully, our business and operations will be
impaired. We may be at a disadvantage compared to our competitors who:

. have substantially greater financial, technological, marketing and
sales and distribution resources than we do.

. entered the wireless communications services market before we did.

. market other competitive services, like local dial tone, long distance
and internet, together with their wireless communications services.

. have more established networks, marketing programs and brand names.

. offer coverage in areas not served by our PCS network or offer lower
rates for placing and receiving calls outside of their own networks.

We expect that some of the existing cellular providers will continue to
upgrade their systems to provide digital wireless communication services that
compete with Sprint PCS. Many of these cellular providers have more financial
resources and customers than we do. Providers of traditional landline telephone
services, energy companies, utility companies and cable operators may expand
their services to offer competitive wired or wireless communications services.
We compete also with companies that use other communications technologies and
paging and dispatch companies. People who are considering using PCS systems may
find their communications needs satisfied by these other current and developing
technologies.

Changes in technology could adversely affect us.

PCS providers in the United States use one of three technological
standards. Even though the three standards share basic characteristics, they
are not compatible or interchangeable with each other. We and Sprint PCS use
the standard known as CDMA. If another standard becomes preferred in the
industry, we may be at a competitive disadvantage. If Sprint PCS changes its
standard, we will need to change ours as well, which will be costly and time
consuming. If we cannot change our standard, we may not be able to compete with
other systems.

The wireless telecommunications industry is experiencing significant
technological change. This is evident from:

. an increase in the number of upgrades from analog systems to digital.

. improvements in digital technology.

. shorter development periods for new products and enhancements.

. changes in customer needs and preferences.

To be competitive, we must have access to new technology. Future
technology and advancements could be better than PCS service and even make our
service obsolete. The development of new or better technologies could impair
our business and operating results.

9
<PAGE>

Our agreement with Sprint PCS prohibits us from upgrading our cellular
network in Lake Charles, Louisiana from an analog network to a digital network
like the Sprint PCS network without Sprint PCS's approval. If cellular
equipment manufacturers stop making analog cellular equipment and we cannot buy
used analog cellular equipment on the open market, it could impair our ability
to service our existing cellular subscribers and attract new ones.

If the Sprint PCS network does not complete its nationwide expansion, we may
not be able to provide our customers with the services they demand.

Sprint PCS intends to cover a significant portion of the population of the
United States, Puerto Rico and the U.S. Virgin Islands with its PCS system, but
it has not yet completed the buildout of its planned network. If one of our
customers travels in an area where a Sprint PCS system or another CDMA-based
system is not yet operational, the customer will need a telephone handset that
can make calls on both CDMA-systems and non-CDMA-systems. Generally, these
handsets are more costly. Moreover, the Sprint PCS network does not allow for
calls to be transferred without interruption between the Sprint PCS network and
another wireless network. This means that a customer must end a call in
progress and initiate a new call when entering an area not served by the Sprint
PCS network. The quality of the service provided by another network may not be
equal to that of the Sprint PCS network, and our customers may not be able to
use some of the advanced features of our network. This could result in customer
dissatisfaction and loss of customers.

If there are any effects of the Year 2000 that are not yet known, there could
be an interruption or failure of our computer systems.

We use a significant number of computer systems and software programs in
our operations, including in support of our PCS network equipment and for
various administrative functions. Before the Year 2000, we discussed the nature
and progress of our plans to prepare for that year. In late 1999, we finished
testing and preparing our systems for the Year 2000 date change. As of the date
of this prospectus, we have experienced no significant disruptions in our
critical information technology and non-information technology systems that
resulted from the Year 2000 date change. We believe that our systems
successfully responded to the Year 2000 date change. We expensed less than
$550,000 during 1999 to prepare our systems for the Year 2000. We are not aware
of any material problems that resulted from the Year 2000 date change with our
products, our internal systems or the products and services of third parties.
We will continue to monitor our critical computer applications and those of our
suppliers and vendors throughout 2000 so we can promptly address any Year 2000
matters that may arise.

Our service area is threatened by bad weather, including hurricanes, which
could cause interruptions in service.

Much of our service area is on or near the Gulf of Mexico and could be
damaged by bad weather like hurricanes and excessive rain. Even though we
believe our insurance coverage is adequate, we may face service interruptions
for indefinite periods if a major hurricane strikes one or more of our Gulf
Coast service areas.

10
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Risks Related to the Wireless Telecommunications Industry

We are subject to broad and evolving government regulation that could cause us
to change our business plans or lose our licenses if we do not comply.

. Our business must comply with the rules and regulations of the FCC,
the FAA and state and local regulatory agencies.

. New regulations may require us to modify our business plan or
operations. This could increase our operating costs.

. The loss of any of our FCC licenses, or any of Sprint PCS's FCC
licenses for our service area, would impair our business and operating
results.

. The FCC may revoke any of our PCS licenses at any time for cause. Cause
could be our failure to comply with terms of the licenses or the FCC
rules that apply to us. We cannot ensure that our PCS licenses will be
renewed when they expire.

. The FCC regulates our relationship with Sprint PCS under our Sprint PCS
agreements.

. We may need to acquire additional licenses, which may require approval
of regulatory authorities. These regulatory authorities may not grant
approval in a timely manner, if at all.

. All PCS licenses, including our own licenses and Sprint PCS's
licenses, are subject to the FCC's buildout regulations. These
regulations require license holders to offer specified levels of
service to the population in their service areas within set time
periods. Even though we have developed a buildout plan that meets
these requirements, we may be unable to meet our buildout schedule. If
Sprint PCS or we do not meet these requirements, the FCC could take
back the portions of our service area that are not being served,
impose fines, or even revoke the related licenses.

. The FCC imposes limitations on the foreign ownership of license
holders. If foreign ownership is too great, the FCC may revoke our PCS
licenses or require an ownership restructuring.

. The FCC imposes additional requirements on holders of PCS licenses
reserved for small businesses. These licenses are called C-block and
F-block licenses. We hold F-block licenses and must meet special
requirements to hold them. If we do not meet these requirements, the
FCC could fine us, revoke our licenses or require us to restructure
our ownership.

Our future prospects are uncertain because the future prospects of the PCS
industry are uncertain.

PCS systems have not operated in the United States for very long, and we
cannot assure you that the operation of these systems in our markets will
become profitable. In addition, we cannot estimate how much demand there will
be for PCS in our markets or how much competitive pricing pressure there will
be. As a result, the future prospects of the PCS industry, including our
prospects, remain uncertain. The future demand for wireless communications
services in general is uncertain.

11
<PAGE>

Our PCS business may suffer because more subscribers generally disconnect their
service in the PCS industry than in the cellular industry.

The PCS industry has experienced a higher rate of subscribers who
disconnect their service than the cellular industry. This rate, or churn, of
PCS subscribers may be the result of limited network coverage, unreliable
performance of calls, costs, customer care or other competitive factors.

We plan to keep our PCS subscriber churn down by expanding network
coverage, improving network reliability, marketing affordable plans and
enhancing customer care. We cannot assure you that these strategies will be
successful. A high rate of PCS subscriber churn could harm our competitive
position and the results of operations of our PCS services.

Radio frequency emissions may pose health concerns which may cause people to
sue us or discourage them from using our services.

Media reports have suggested that some radio frequency emissions from
wireless telephone handsets may be linked to various health concerns, including
cancer, and may interfere with some electronic medical devices, including
hearing aids and pacemakers. These concerns may discourage the use of these
handsets or expose us to potential litigation.

Worse than expected fourth quarter results may cause our stock price to drop
and significantly reduce our overall results of operations.

The wireless industry is heavily dependent on fourth quarter results.
Among other things, the industry relies on significantly higher subscriber
additions and handset sales in the fourth quarter as compared to the other
three fiscal quarters. The price of our common stock may drop and our overall
results of operations could be significantly reduced if we have a worse than
expected fourth quarter for any reason, including the following:

.our inability to match or beat pricing plans offered by competitors.

.our failure to promote Sprint PCS's products, services and pricing plans
adequately.

.our inability to obtain an adequate supply or selection of handsets.

.a downturn in the economy of some or all markets in our service area.

.a poor holiday shopping season.

Risks Related to This Offering

The tangible book value attributable to shares of our common stock that you buy
in this offering will be substantially lower than the price that you pay for
those shares.

The initial public offering price of our common stock is substantially
higher than the tangible book value per share of our outstanding common stock.
Tangible book value per share is the amount of our total tangible assets less
total liabilities divided by the number of outstanding shares of our common
stock. If you purchase shares of our common stock in this offering, the value
of your purchased shares will be immediately and substantially reduced, or
diluted, because the tangible book value attributable to your shares will be
less than what you paid for the shares. This means that if we distributed our
tangible assets to our stockholders immediately following this offering, you
would receive less than the amount that you paid for your shares.

The dilution to purchasers in this offering will be approximately $9.11
per share. This offering will materially increase the tangible book value per
share of shares of common stock owned

12
<PAGE>

by our existing stockholders because your purchases will increase the tangible
book value attributable to their existing shares of our common stock. In
addition, as of March 31, 2000, we had granted options to purchase 5,810,136
shares of common stock, having an average weighted exercise price of $3.22 per
share. Further, we plan to grant additional options to purchase 1,007,382
shares of common stock at the initial public offering price. When the holders
of these options exercise them, new stockholders will experience further
dilution of their shares of common stock.

Provisions in our charter documents and in Louisiana law could prevent or
delay a change in the persons who control us. This could impair the market
price of our common stock.

Some of the provisions in our articles of incorporation, bylaws and
Louisiana law could:

.discourage potential acquisition proposals.

.delay or prevent a change in the persons who control us.

. limit the price that investors may be willing to pay in the future for
shares of our common stock.

In particular, our articles of incorporation and bylaws provide the
following:

. our board of directors is divided into three classes, as nearly equal
in size as possible, with each class beginning its three year term in a
different year.

.our board of directors may issue preferred stock without stockholder
approval.

. a stockholder may nominate directors only if the stockholder delivers
written notice to us not less than 45 days or more than 90 days before
the meeting of shareholders to elect directors.

. the Louisiana Business Corporation Law and our charter documents
require supermajority voting power to amend our articles of
incorporation or to approve a merger, consolidation, share exchange,
disposition of all or substantially all of US Unwired's assets or
dissolution.

Our existing stockholders will be able to control the outcome of significant
matters presented to stockholders after the completion of this offering.

We have two classes of common stock, class A and class B. Holders of our
class A common stock have one vote per share, and holders of our class B
common stock have 10 votes per share. Our class B common stock will not trade
in the public market, and there are restrictions on its transfer. Immediately
after this offering, the outstanding shares of our class A common stock will
represent approximately 1.5% of the combined voting power of our outstanding
class A and class B common stock, and 1.7% if the underwriters exercise their
over-allotment option in full. Our existing stockholders, most of whom will
hold class B shares, will continue to be able to control the election of our
directors and generally will be able to direct our affairs. These holders will
have the power to determine whether we should be sold, including a sale in
which a class A holder would receive a premium for the holder's shares over
the then-prevailing market price. This control may impair the market price of
our class A common stock.

Our stock has not been publicly traded before, and there may be volatility in
our stock price.

Prior to this offering, there has been no public market for our common
stock. We cannot predict how much interest investors will have in our common
stock or whether an active and liquid

13
<PAGE>

trading market will develop for our common stock. We and the representatives of
the underwriters together will set the initial public offering price for shares
of our common stock. This price may not necessarily represent the market price
of the common stock that will prevail in the trading market. The market price
of our common stock may fall below the initial public offering price. In recent
years, the securities markets have been extremely volatile in prevailing price
levels. This volatility has been unrelated or disproportionate to the operating
performance of individual companies. In some cases, stockholders of companies
that have had volatile stock prices have filed securities class action lawsuits
against those companies. If a suit were filed against us, regardless of the
outcome, it could result in substantial costs and a diversion of our
management's attention and resources.

Management will have broad discretion for the use of proceeds from this
offering, including the ability to apply the proceeds to uses that do not
increase our operating results or market value.

Most of the net proceeds of this offering are not allocated for specific
uses other than for accelerating the construction of our PCS network and for
general corporate purposes. Our management will have considerable discretion in
applying these net proceeds. You will not have the opportunity, as part of your
investment decision, to assess whether we are using the proceeds appropriately.
We may decide to use the net proceeds for corporate purposes that do not
increase our operating results or market value. Until we actually use the net
proceeds, we may place them in investments that do not produce income or that
lose value.

If a large number of shares of our common stock are available for sale after
this offering, the market price of our common stock could be impaired.

The market price of our common stock could decline if there are sales of a
large number of shares in the market after this offering or if the market
believes that these sales could occur. These factors could also make it more
difficult for us to raise funds through future offerings of common stock.

We will have 79,009,231 shares of our common stock outstanding immediately
after this offering regardless of whether the underwriters exercise any of
their over-allotment option. You may freely trade any shares that you purchase
in this offering unless you are our affiliate. Our affiliates may only resell
their shares pursuant to an effective registration statement or pursuant to
Rule 144 under the Securities Act or another available exemption from
registration. Any remaining shares will be "restricted securities." Holders of
restricted securities may sell them in the public market at various times after
180 days after the date of this prospectus, if they comply with Rule 144 under
the Securities Act.

Risks Related to Forward-Looking Statements

You should be aware that actual results or outcomes may be different from those
stated in any forward-looking statements included in this prospectus.

This prospectus includes forward-looking statements. Forward-looking
statements are statements about our current and future business strategy,
operations, capabilities and construction plan and schedule, as well as
financial projections, plans and objectives of management, expected actions of
third parties and other matters. They often include the words "believes,"
"belief," "expects," "plans," "anticipates," "intends," "projects" or similar
words. Forward-looking statements speak only as of the date made. They involve
known and unknown risks and other factors

14
<PAGE>

that could cause our actual results to be materially different from our
historical results or from any future results expressed or implied by any
forward-looking statements. Some of the factors that could cause this
difference are:

. the availability at acceptable terms of sufficient funds to pay for our
business plan.

. competition.

. changes in labor, equipment and capital costs.

. any inability to obtain required regulatory approvals.

. changes in technology.

. any inability to comply with the indenture that governs the notes or
with our credit agreements.

. changes in management.

. any inability to attract and retain qualified employees.

. future acquisitions.

. general economic and business conditions.

You should not rely too heavily on any forward-looking statement. We
cannot assure you that our forward-looking statements will prove to be correct.
We have no obligation to update or revise publicly any forward-looking
statement based on new information, future events or otherwise. We are required
to report to the SEC on a periodic basis specified information about us and our
business. The information in these reports must be accurate and complete as of
the date of the report.

USE OF PROCEEDS

We expect to receive $81.0 million of net proceeds from the sale of the
8,000,000 shares of common stock at the initial public offering price of $11.00
per share (whether or not the underwriters exercise their over-allotment
option), after we deduct the underwriting discounts and estimated offering
expenses payable by us.

We intend to use the net proceeds of the offering:

. to accelerate the construction of our PCS network.

. for other general corporate purposes.

Until we actually use these net proceeds, we will invest them in
investment grade, interest-bearing securities.

DIVIDEND POLICY

We have never paid cash dividends on our common stock, and we do not plan
to pay any cash dividends on our common stock in the near future. We intend to
retain all of our future earnings, if any, and use them to expand and operate
our business and for general corporate purposes. In addition, our debt
instruments limit our ability to declare or pay cash dividends on our common
stock. We may incur future indebtedness or enter into loan arrangements that
also restrict our ability to pay dividends or make distributions to our
stockholders.

15
<PAGE>

CAPITALIZATION

The table below shows:

. the actual cash and capitalization of US Unwired as of March 31, 2000,
which reflects a retroactive restatement for a 5.3304 for 1 stock split
as approved by our stockholders on April 11, 2000.

. the cash and capitalization of US Unwired as adjusted to reflect
proceeds of $81.0 million from the sale in this offering of 8,000,000
shares of common stock at an assumed initial offering price of $11.00
per share, and the conversion of $55 million of preferred stock into
common stock.

You should read this table with our consolidated financial statements and
related notes, which are included in this prospectus.

<TABLE>
<CAPTION>
As of March 31, 2000
----------------------
As
Actual Adjusted(/1/)
-------- -------------
(In thousands)
<S> <C> <C>
Cash and cash equivalents................................ $ 16,053 $ 97,093
Marketable securities.................................... 109,010 109,010
-------- --------
Total cash and marketable securities................... $125,063 $206,103
======== ========
Debt, including current maturities:
US Unwired senior credit facilities.................... $ -- $ --
Senior subordinated discount notes..................... 221,046 221,046
Other debt(/2/)........................................ 12,371 10,778
-------- --------
Total debt........................................... 233,417 231,824
-------- --------
Mandatory redeemable convertible preferred stock......... 55,000 --
Stockholders' equity:
Common stock........................................... 600 790
Additional paid-in capital(/3/)........................ 8,856 142,039
Accumulated other comprehensive income................. 617 617
Retained earnings...................................... 5,923 5,923
-------- --------
Total stockholders' equity........................... 15,996 149,369
-------- --------
Total capitalization................................. $304,413 $381,193
======== ========
</TABLE>
- ---------------------
(1) Upon completion of this offering our $50 million of series A preferred
stock, which was issued on October 29, 1999, and $5 million of series B
preferred stock, which was issued on February 15, 2000, will be converted
into 11,042,255 shares of our common stock. The as adjusted amount reflects
this conversion.
(2) The as adjusted column reflects the payoff of certain debt related to the
sale of certain PCS licenses as if these events occurred as of March 31,
2000.
(3) The as adjusted column reflects a reduction of $2.7 million related to
costs incurred in the sale of $55 million of preferred stock. These costs
were originally capitalized as deferred financing costs.

16
<PAGE>

DILUTION

Our pro forma net tangible book value as of March 31, 2000 was $68.3
million or approximately $0.96 per share of common stock after giving effect to
the conversion of our preferred stock. Net tangible book value per share
represents the amount of our total tangible assets reduced by the amount of
total liabilities and divided by the number of shares of common stock
outstanding. After giving effect to our sale of 8,000,000 shares of common
stock in the offering, and deducting underwriting discounts and commissions and
estimated offering expenses, our as-adjusted net tangible book value as of
March 31, 2000 would have been approximately $149.4 million, or approximately
$1.89 per share. This represents an immediate dilution of $9.11 per share to
new investors purchasing shares of common stock in the offering and an
immediate increase in net tangible book value to existing stockholders of $0.93
per share.

Dilution per share represents the difference between the amount that
purchasers pay in this offering for each share of our common stock and the net
tangible book value per share immediately after the sale of common stock in
this offering.

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share.................... $11.00
Pro forma net tangible book value per share as of March 31,
2000.......................................................... $0.96
Increase per share attributable to new investors in this
offering...................................................... 0.93
-----
As-adjusted net tangible book value per share after the offering... 1.89
------
Dilution per share to new investors................................ $ 9.11
======
</TABLE>

This table excludes all options that will remain outstanding after we
complete this offering and gives effect to a 5.3304 for 1 stock split that was
approved by our stockholders on April 11, 2000. As of March 31, 2000, we had
granted options to purchase a total 5,810,136 shares of common stock, with a
weighted average exercise price of $3.22 per share. If the holders of
outstanding options exercise them at a price that is less than the offering
price, our new investors will have further dilution.

The following table shows on an as-adjusted basis as of March 31, 2000 the
number of shares of common stock purchased, the total price paid and the
average price per share paid by our existing stockholders and by new investors,
before deducting estimated underwriting discounts and commissions and estimated
offering expenses of $7.0 million payable by us, at an assumed initial public
offering price of $11.00 per share.

<TABLE>
<CAPTION>
Shares Purchased Total Consideration
------------------ -------------------- Average Price
Number Percent Amount Percent Per Share
---------- ------- ------------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing stockholders..... 71,009,231 89.9% $ 56,948,000 39.3% $ 0.80
New investors............. 8,000,000 10.1 88,000,000 60.7 $11.00
---------- ----- ------------ -----
Total................... 79,009,231 100.0% $144,948,000 100.0%
========== ===== ============ =====
</TABLE>

17
<PAGE>

We calculated the existing stockholder amounts in the table above on an
as-adjusted basis, which:

. includes 59,966,976 shares outstanding as of March 31, 2000.

. includes 11,042,255 shares issued upon the conversion of our preferred
stock.

. excludes 5,810,136 shares of our class A common stock that we have
reserved for issuance under our 1999 Equity Incentive Plan. As of
March 31, 2000, we had granted options for these shares with a
weighted average exercise price of $3.22 per share.

. gives effect to our stock split.

If the underwriters exercise their entire over-allotment option, our new
investors will hold 9,200,000 shares, or approximately 11.6% of the total
number of shares of our common stock outstanding after this offering.

18
<PAGE>

SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION

The table below shows some of our historical financial information based
on our audited consolidated financial statements for each of the five years in
the period ended December 31, 1999 and our unaudited consolidated financial
statements for the three months ended March 31, 1999 and 2000. You should read
this information with our consolidated financial statements and the related
notes and the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations," all of which are included in
this prospectus.

You should keep in mind the following points as you read this information:

. in July 1998, we sold all of our cellular assets related to our
Mississippi, Alabama and Kansas markets, including our majority
interest in Mississippi 34 Cellular Corporation.

. in August 1998, we ended our practice of reselling the PCS service of
Meretel when we sold our wholesale PCS subscribers to Meretel.

. the results for LA Unwired are consolidated with those of US Unwired
for 1999 and for the three months ended March 31, 1999 and 2000 due to
US Unwired's increased equity ownership in 1999, but results are
presented on the equity method for 1998.

. the results for LA Unwired for the three months ended March 31, 2000
include the consolidation of Texas Unwired, but results for the three
months ended March 31, 1999 include the Texas Unwired markets as a part
of Meretel and are presented on an equity basis.
<TABLE>
<CAPTION>
Three Months
Year Ended December 31, Ended March 31,
----------------------------------------------------------- -----------------
1995 1996 1997 1998(/1/)(/2/)(/4/) 1999(/3/)(/4/) 1999 2000
------- ------- ------- ------------------- -------------- ------- --------
Statement of Operations
Data: (In thousands) (unaudited)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues................ $39,252 $61,893 $74,668 $71,711 $ 58,632 $12,929 $ 22,291
Cost of services and
merchandise sold..... 14,803 21,949 29,054 29,363 31,591 6,347 13,513
Other operating
expenses............. 17,256 27,781 36,053 37,873 52,299 9,863 23,007
------- ------- ------- ------- --------- ------- --------
Operating income
(loss)............... $ 7,193 $12,163 $ 9,561 $ 4,475 $ (25,258) $(3,281) $(14,229)
======= ======= ======= ======= ========= ======= ========
Income (loss) from
continuing
operations........... $ 2,603 $ 3,854 $(1,509) $28,796 $ (17,634) $(1,392) $(14,203)
======= ======= ======= ======= ========= ======= ========
Income (loss) from
continuing operations
per diluted common
share................ $ 0.04 $ 0.06 $ (0.03) $ 0.48 $ (0.29) $ (0.02) $ (0.32)
======= ======= ======= ======= ========= ======= ========
</TABLE>

<TABLE>
<CAPTION>
At
At December 31, March 31,
-------------------------------------------- -----------
1995 1996 1997 1998(/2/) 1999(/3/) 2000
------- ------- -------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance Sheet Data: (In thousands) (unaudited)
Cash and cash
equivalents.......... $ 5,102 $ 5,464 $ 4,955 $32,475 $ 14,695 $ 16,053
Marketable securities... -- -- -- -- 141,453 109,010
Property and equipment,
net.................. 20,911 28,692 38,891 22,565 106,067 138,599
Total assets............ 78,754 132,328 142,133 87,629 317,110 332,278
Long-term debt,
including current
maturities........... 52,051 95,901 100,066 29,067 216,080 233,417
Equity.................. 21,403 25,437 23,929 51,479 28,585 15,996
</TABLE>
- ---------------------
(1) In July 1998, in anticipation of the Sprint PCS buildout, US Unwired sold
all of its cellular assets related to its Mississippi, Alabama and Kansas
markets, along with its majority ownership interest in Mississippi 34
Cellular Corporation, for $161.5 million. This transaction resulted in a
gain of approximately $57.4 million which is included in income (loss) from
continuing operations.
(2) In June 1998, Meretel returned its PCS licenses to the FCC in exchange for
cancellation of Meretel's debt and interest owed to the FCC. Meretel
returned its PCS licenses so it could manage Sprint PCS's licenses in
Meretel's service areas. This transaction resulted in a loss of $3.5
million, and our partnership share of that loss, which is approximately
$850,000, is included in income (loss) from continuing operations.
(3) In 1999, US Unwired made a series of capital contributions to LA Unwired
which increased its ownership percentage in LA Unwired to 93.7% as of
December 31, 1999. As a result, the operating results for 1999 and for the
three months ended March 31, 1999 and 2000 include the operations of LA
Unwired on a consolidated basis.
(4) Includes results of operations for Unwired Telecom, our cellular and paging
operating subsidiary, which for the year ended December 31, 1999 generated
$46.2 million of revenues and $5.7 million of operating income and for the
year ended December 31, 1998 generated $67.7 million of revenues and $4.0
million of operating income. Presents LEC Unwired as a discontinued
operation. LEC Unwired began operations in 1998 and is presented on the
equity method for the year ended December 31, 1998.

19
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read this section with our consolidated financial statements
and the related notes in this prospectus. This section contains forward-looking
statements. You should read the risk factor about forward-looking statements.

Overview

We currently offer PCS service in eleven markets: Beaumont-Port Arthur,
Longview-Marshall, Lufkin-Nacogdoches, Texarkana and Tyler, Texas and
Alexandria, Houma-Thibodaux, Lake Charles, Monroe and Shreveport, Louisiana and
Montgomery, Alabama. Our network currently covers approximately 2.4 million
residents out of approximately 3.6 million total residents in those markets. We
expect to cover a total of approximately 6.1 million residents by December 2000
and 6.4 million residents by March 2001, at which point we expect to have
covered approximately 66% of the resident population in our service area. The
number of people in our service area does not represent the number of Sprint
PCS subscribers that we expect to have in our service area. At March 31, 2000,
we had approximately 66,000 subscribers within those eleven markets. This phase
of our buildout represents 330 constructed and co-located towers. We have begun
radio frequency design, network design and cell site engineering in the
remaining markets to be built out.

Beginning in 1987, we acquired 14 cellular rural markets and one cellular
metropolitan market in Louisiana, Mississippi, Alabama and Kansas. In July
1998, we sold our cellular markets in Mississippi, Alabama and Kansas for gross
proceeds of $161.5 million. We kept the Lake Charles, Louisiana cellular
market, which had approximately 58,000 cellular subscribers and 23,000 paging
subscribers as of March 31, 2000. As a result of these transactions, there is
no comparability of the results for the 2000 first quarter or for the years
1999, 1998 and 1997.

In 1995, US Unwired formed Meretel Communications Limited Partnership to
bid for, develop and operate PCS licenses in specified markets. In the original
partnership agreement, Meretel's general partner, Wireless Management
Corporation, owned 2%; US Unwired, Fort Bend Telephone Company, and EATELCORP,
Inc. each owned 24 1/3%; XIT Leasing, Inc. owned 5%; and Meretel Wireless, Inc.
owned 20%. The FCC awarded Meretel the PCS licenses for the Baton Rouge,
Lafayette and Hammond, Louisiana and Beaumont and Lufkin, Texas markets. US
Unwired and EATEL jointly managed Meretel through the completion of the
buildout of the Beaumont, Lafayette and Baton Rouge markets in November 1997.
After completing buildout of the first three markets, Meretel sold wholesale
wireless minutes to US Unwired and EATEL, both of which resold the minutes to
the general public.

20
<PAGE>

On June 8, 1998, Meretel returned its five PCS licenses to the FCC and
agreed to manage Sprint PCS's spectrum in those five markets. On August 1,
1998, we sold our wholesale PCS subscriber base in the Beaumont, Lafayette and
Baton Rouge markets to Meretel, so Meretel could operate as a retailer of PCS
services. At the same time, US Unwired agreed to manage Meretel's retail
operations, including sales, customer care and back end services. EATEL
continued to buy wholesale wireless minutes from Meretel.

The owners of Meretel recently restructured the partnership. Under the
new agreement:

. Meretel transferred ownership of the Beaumont-Port Arthur and Lufkin-
Nacogdoches markets to Texas Unwired, a general partnership of which LA
Unwired owns 80% and is the managing partner.

. we transferred to Meretel the Biloxi, Mississippi market.

. EATEL sold its wholesale PCS subscriber base to Meretel.

. Meretel will continue to manage the Lafayette, Hammond, Baton Rouge and
Biloxi markets for Sprint PCS.

We now own approximately 13.3% of Meretel. We have terminated our management
agreement with Meretel, but we continue to provide limited back-end services
in transition. We plan to transfer our partnership interest in Meretel to LA
Unwired. As of March 31, 2000, Meretel had approximately 44,000 subscribers,
and Texas Unwired had approximately 16,000 subscribers. Texas Unwired is
consolidated for the three months ended March 31, 2000. For the year ended
December 31, 1999 and for the three months ended March 31, 1999, the operating
results for the Beaumont and Lufkin markets included in Texas Unwired were
included in Meretel and presented on an equity basis.

As of March 31, 2000, we owned 100% of Unwired Telecom, 93.4% of LA
Unwired and 59.8% of LEC Unwired, which is a competitive local exchange
carrier. On March 22, 2000, we adopted a formal plan to sell our interest in
LEC Unwired, which is therefore presented as a discontinued operation. As of
March 31, 2000, LA Unwired owned 80% of Texas Unwired. For the three months
ended March 31, 2000, LA Unwired had approximately $12.7 million in revenues
and had a subscriber base at March 31, 2000 of approximately 66,000 compared
to approximately $2.7 million in revenues for the three months ended March 31,
1999 and a subscriber base of approximately 13,000 at March 31, 1999. Amounts
for 2000 include the effect of consolidating Texas Unwired.

Results of Operations

2000 first quarter compared to 1999 first quarter.

You should keep in mind that our operating results for the three months
ended March 31, 2000 include the consolidation of Texas Unwired but our
operating results for the three months ended March 31, 1999 include the Texas
Unwired markets as a part of Meretel and are presented on an equity basis.
Results for LEC Unwired are presented as discontinued operations for both
periods.

21
<PAGE>

Revenues

<TABLE>
<CAPTION>
Three Months
Ended March 31,
---------------
2000 1999
------- -------
(In thousands)
<S> <C> <C>
Subscriber revenues.......................................... $13,765 $ 9,329
Roaming revenues............................................. 4,336 1,813
Merchandise sales............................................ 3,054 1,250
Other revenue................................................ 1,136 537
------- -------
Total revenues............................................. $22,291 $12,929
======= =======
</TABLE>

Subscriber revenues were $13.8 million for the three months ended March
31, 2000 as compared to $9.3 million for the three months ended March 31, 1999,
representing an increase of $4.5 million. LA Unwired's subscriber revenues
increased to $5.7 million at March 31, 2000 from $1.5 million at March 31,
1999, representing a $4.2 million increase due to an increase in subscribers to
approximately 50,000 at March 31, 2000 from approximately 13,000 at March 31,
1999. Texas Unwired accounted for $1.8 million in revenues and had
approximately 16,000 subscribers at March 31, 2000. Unwired Telecom's
subscriber revenues were $6.3 million for the three months ended March 31, 2000
as compared to $7.8 million for the three months ended March 31,1999,
representing a decrease of $1.5 million due to a decrease in subscribers to
81,000 at March 31, 2000 from 92,000 at March 31, 1999.

Roaming revenues were $4.3 million for the three months ended March 31,
2000 as compared to $1.8 million for the three months ended March 31, 1999,
representing an increase of $2.5 million. LA Unwired's roaming revenues
increased to $1.8 million at March 31, 2000 from $265,000 at March 31, 1999,
representing a $1.5 million increase due to an expansion in coverage to nine
markets at March 31, 2000 from four markets at March 31, 1999. Texas Unwired
added $496,000 in roaming revenues with coverage in two markets. Unwired
Telecom's roaming revenues increased to $2.0 million at March 31, 2000 from
$1.5 million at March 31, 1999, representing an increase of $500,000 due to
higher usage in our service area.

Merchandise sales were $3.1 million for the three months ended March 31,
2000 as compared to $1.3 million for the three months ended March 31, 1999,
representing an increase of $1.8 million. LA Unwired merchandise sales
increased to $2.2 million from $863,000 at March 31, 1999, representing an
increase of $1.3 million. This was due primarily to an increase in initial
sales to 19,000 new subscribers during the three months ended March 31, 2000
compared to 7,600 new subscribers added during the three months ended March 31,
1999. Texas Unwired had $547,000 in merchandise sales for the three months
ended March 31, 2000 and added approximately 4,000 new subscribers. Unwired
Telecom's merchandise sales were $300,000 for the three months ended March 31,
2000 as compared to $400,000 for the three months ended March 31, 1999,
representing a decrease of $100,000. This decrease was primarily due to higher
discounts on handset sales. Unwired Telecom added 3,100 new cellular
subscribers during the three months ended March 31, 2000 compared to 3,500 new
cellular subscribers during the three months ended March 31, 1999.

Other revenues increased to $1.1 million at March 31, 2000 from $537,000
at March 31, 1999, representing an increase of $600,000 primarily attributable
to increased management fees.

22
<PAGE>

Operating Expenses

Cost of service was $7.4 million for the three months ended March 31, 2000
as compared to $3.7 million for the three months ended March 31, 1999,
representing an increase of $3.7 million. LA Unwired's cost of service
increased to $4.2 million for the three months ended March 31, 2000 from $1.4
million for the three months ended March 31,1999, representing an increase of
$2.8 million. This increase primarily resulted from the increased number of new
subscribers, coverage area and additional lease costs incurred in eleven yet to
be opened markets in Florida, Alabama and Mississippi. Texas Unwired's cost of
sales added $1.0 million with coverage for its two markets. Unwired Telecom's
cost of service decreased to $2.2 million at March 31, 2000 from $2.4 million
at March 31, 1999, representing a decrease of $200,000 which was primarily
related to the decrease in our cellular subscriber base.

Merchandise cost of sales was $6.1 million for the three months ended
March 31, 2000 as compared to $2.6 million for the three months ended March 31,
1999, an increase of $3.5 million. LA Unwired's merchandise cost of sales
increased to $4.3 million for the three months ended March 31, 2000 from $1.9
million at March 31, 1999, representing an increase of $2.4 million. This was
primarily due to the number of new subscribers added. Texas Unwired added $1.0
million in merchandise cost of sales that was also related to new subscriber
additions. Unwired Telecom's merchandise cost of sales increased to $800,000 at
March 31, 2000 from $700,000 at March 31, 1999, representing an increase of
$100,000 which was primarily attributable to the sale of more expensive
handsets and promotional discounts.

Selling, general and administrative expenses were $13.2 million for the
three months ended March 31, 2000 as compared to $6.1 million for the three
months ended March 31, 1999, an increase of $7.1 million. Corporate selling,
general and administrative expenses were $6.4 million for the three months
ended March 31, 2000 as compared to $3.1 million for the three months ended
March 31, 1999, representing an increase of $3.4 million. Approximately $1.7
million of this increase is attributable to stock compensation expense related
to our issuance of stock options. The remaining $1.7 million is primarily
headcount growth associated with back-end services related to our growth in PCS
subscribers to 66,000 at March 31, 2000 from 13,000 at March 31, 1999 and our
expansion efforts associated with opening new markets. LA Unwired's selling,
general and administrative expenses increased to $5.2 million for the three
months ended March 31, 2000 from $1.4 million at March 31, 1999, representing
an increase of $3.8 million. This was primarily due to the costs associated
with expanding our market coverage and the consolidation of Texas Unwired.
Selling, general and administrative expenses for Unwired Telecom remained
unchanged at $1.6 million.

Depreciation and amortization expense was $7.8 million for the three
months ended March 31, 2000 as compared to $3.8 million for the three months
ended March 31, 1999, representing an increase of $4.0 million. LA Unwired's
depreciation increased to $5.9 million for the three months ended March 31,
2000 from $2.4 million at March 31, 1999, representing an increase of $3.5
million. This was primarily due to the increase in capital costs associated
with building out our markets and the consolidation of Texas Unwired. Net
property and equipment for our PCS markets increased to $115.7 million at March
31, 2000 from $65.2 million at March 31, 1999. Unwired Telecom's depreciation
expense remained unchanged at $1.2 million.

23
<PAGE>

Operating Loss

The total operating loss was $14.2 million for the three months ended
March 31, 2000 as compared to $3.3 million for the three months ended March 31,
1999, an increase of $10.9 million. LA Unwired recorded an operating loss of
$11.1 million for the three months ended March 31, 2000 as compared to a $4.7
million loss for the three months ended March 31, 1999, representing an
increase of $6.4 million. This is primarily attributable to the increased
operational costs associated with building out our markets. Unwired Telecom
recorded operating income of $1.4 million for the three months ended March 31,
2000 compared to operating income of $1.6 million for the three months ended
March 31, 1999, representing a decrease of $200,000, which is primarily
attributable to a decrease in cellular subscribers. The balance of the
remaining change of $5.4 million is primarily attributable to the increase in
selling, general and administrative expenses that, as discussed above, are
associated with market expansion and include approximately $1.7 million of
stock compensation expense related to stock options.

Other Income/(Expense)

<TABLE>
<CAPTION>
Three Months
Ended March 31,
----------------
2000 1999
------- -------
(In thousands)
<S> <C> <C>
Interest expense.......................................... $(7,843) $(1,240)
Interest income........................................... 2,187 420
Other..................................................... 4,820 --
------- -------
Total other income/(expense)............................ $ (836) $ (820)
======= =======
</TABLE>

Interest expense was $7.8 million for the three months ended March 31,
2000 as compared to $1.2 million for the three months ended March 31, 1999, an
increase of $6.6 million. The increase in interest expense results from the
increase in outstanding debt. Our outstanding debt was $233.4 million at March
31, 2000 as compared to $74 million at March 31, 1999. The increase in debt
primarily resulted from our senior subordinated discount note offering in
October 1999.

Interest income was $2.2 million for the three months ended March 31, 2000
as compared to $420,000 for the three months ended March 31, 1999. The increase
resulted from investing available funds in marketable securities until the
funds are required to fund our market build out.

Other income for the three months ended March 31, 2000 represents a gain
of approximately $2.2 million from the sale of a portion of the Company's
ownership interest in Meretel and a gain of approximately $2.6 million due to
the reduction of the Company's guarantee of Meretel debt.

Minority Interest in Subsidiaries

Minority interest in losses of affiliates was $655,000 for the three
months ended March 31, 2000 as compared to $3.1 million for the three months
ended March 31, 1999. This relates to the consolidation of LA Unwired and
represents the portion of the losses from LA Unwired allocable to minority
shareholders. The operating loss of LA Unwired is described above.

24
<PAGE>

Equity in Income (Losses) of Affiliates

Equity in income of affiliates was $207,000 for the three months ended
March 31, 2000 as compared to an equity loss in affiliates of $1.0 million for
the three months ended March 31, 1999, an increase of $1.2 million. This was
primarily the result of our reduction in ownership of Meretel from 24.33% for
the three months ended March 31, 1999 to 13.28% for the three months ended
March 31, 2000.

Result of Discontinued Operations

On March 22, 2000 US Unwired adopted a formal plan to sell its 59.8%
ownership interest in LEC Unwired. For financial reporting purposes, LEC
Unwired is presented as a discontinued operation.

1999 compared to 1998.

You should keep in mind the following points when reading these results:

. in July 1998, we sold all of our cellular assets related to our
Mississippi, Alabama and Kansas markets and our majority interest in
Mississippi 34 Cellular Corporation. Accordingly, the results for 1998
include the operating results of the sold assets, but the results for
1999 do not include those operating results.

. in August 1998, we ended our practice of reselling Meretel's PCS
service when we sold our wholesale PCS subscribers to Meretel. Thus,
the results for 1998 include PCS reseller activity, but the results for
1999 do not include that reseller activity.

. results for LA Unwired are consolidated with those of US Unwired for
1999 due to US Unwired's increased equity ownership in 1999, but
results are presented on the equity method for 1998.

. results for LEC Unwired are presented as discontinued operations for
1999 and 1998.

Revenues

<TABLE>
<CAPTION>
Years Ended
December 31,
---------------
1998 1999
------- -------
(In thousands)
<S> <C> <C>
Subscriber revenues.......................................... $48,723 $39,734
Roaming revenues............................................. 11,914 10,867
Merchandise sales............................................ 3,915 5,371
Other revenue................................................ 7,159 2,660
------- -------
Total revenues............................................. $71,711 $58,632
======= =======
</TABLE>

Subscriber revenues were $39.7 million for 1999 compared to $48.7 million
for 1998. The decrease of $9.0 million was attributable to the sale of selected
cellular markets in 1998, which generated $13.5 million of revenues through the
point of sale in July 1998 and the loss of $2.1 million of subscriber revenue
related to the conclusion of our PCS reseller activity. Additionally, cellular
and paging revenues for our Louisiana cellular markets decreased $3.7 million
from $33.1 million in 1998 to $29.4 million in 1999. These decreases were
offset by the consolidation of LA Unwired in 1999, which generated subscriber
revenue of $10.3 million.

25
<PAGE>

Roaming revenues were $10.9 million for 1999 compared to $11.9 million for
1998. The decrease of $1.0 million is attributable to the sale of selected
cellular markets in 1998, which generated roaming revenues of $5.3 million
through the point of sale in July 1998. This decrease was offset by the 1999
consolidation of LA Unwired which generated roaming revenue of $3.6 million in
1999. In addition, 1999 roaming revenue for our Louisiana cellular markets
increased $600,000 from $6.6 million in 1998 to $7.2 million in 1999.

Merchandise sales were $5.4 million for 1999 compared to $3.9 million for
1998. This increase of $1.5 million was substantially due to the inclusion of
LA Unwired as a consolidated entity in 1999, resulting in an additional $4.0
million in merchandise sales. Offsetting the increase was the inclusion of PCS
reseller activity in 1998 amounting to $1.6 million, which was discontinued in
August 1998 when we sold our Meretel market PCS subscribers to Meretel, and the
inclusion of $500,000 in 1998 merchandise sales attributable to the sale of
selected cellular markets sold in July 1998. Louisiana market cellular and
paging merchandise sales decreased $400,000 from $1.8 million in 1998 to $1.4
million in 1999.

Other revenues were $2.7 million in 1999 compared to $7.2 million in 1998.
PCS reseller activity, which concluded in August 1998, accounted for $2.2
million. LA Unwired management fees accounted for $1.2 million in 1998, and
were eliminated in consolidation in 1999. LEC Unwired management fees were
approximately $500,000 in 1998. We collected $1.7 million in management fees in
1998 for management services following the sale of selected markets. This was
offset by an increase in 1999 of management fees related to Meretel of $1.3
million.

Operating Expenses

Cost of service was $19.6 million for 1999 as compared to $18.6 million
for 1998. The increase of $1.0 million was primarily due to the inclusion of LA
Unwired presented in 1999 on a consolidated basis versus an equity basis in
1998. Cost of service in 1999 for LA Unwired was $10.3 million. This increase
was offset by the 1998 sale of selected cellular markets and the conclusion of
PCS reseller activity that accounted for 1998 cost of service of $6.2 million
and $1.5 million, respectively. Cost of service in our Louisiana cellular and
paging markets decreased $1.3 million from $10.9 million in 1998 to $9.6
million in 1999.

Merchandise cost of sales was $12.0 million for 1999 and $10.8 million for
1998. This increase of $1.2 million was primarily the result of the inclusion
in 1998 of merchandise cost of sales of $1.5 million associated with selected
cellular markets sold in 1998, and the inclusion of $4.2 million of merchandise
sales in 1998 related to PCS reseller activity that was concluded in 1998. The
inclusion of LA Unwired on a consolidated basis in 1999 added $9.2 million to
cost of sales. Merchandise cost of sales for our Louisiana cellular and paging
properties decreased $2.3 million from $5.1 million in 1998 to $2.8 million in
1999.

General and administrative expenses were $20.1 million for 1999 and $17.2
million for 1998, an increase of $2.9 million. The sale of selected cellular
markets in 1998 resulted in a $2.4 million decrease and the conclusion of PCS
reseller activity in 1998 accounted for a $1.6 million decrease. This was
offset by the inclusion of LA Unwired in 1999 on a consolidated basis which
added $6.5 million to 1999. General and administrative expenses for our
Louisiana cellular and paging

26
<PAGE>

markets remained unchanged in 1999 and included an adjustment to salaries of
$799,000 for the compensation associated with the issuance of stock options
below market value.

Sales and marketing expenses were $12.8 million for 1999 and $10.9 million
for 1998. This increase of $1.9 million was primarily the result of the 1999
consolidation of LA Unwired, which accounted for $8.3 million. This was offset
by $3.2 million associated with the sale of selected markets in 1998 and $3.6
million associated with PCS reseller activity which concluded in 1998. Sales
and marketing expenses for our Louisiana cellular and paging markets increased
by $400,000 from $4.1 million in 1998 to $4.5 million in 1999.

Depreciation and amortization expense was $19.4 million for 1999 and $9.8
million for 1998, an increase of $9.6 million. The inclusion of LA Unwired in
1999 added $13.5 million. Depreciation and amortization expense for our
Louisiana cellular and paging markets increased $1.3 million from $4.6 million
in 1998 to $5.9 million in 1999. These increases were partially offset by the
elimination of $5.2 million related to the sale of selected cellular markets in
1998.

Operating Income/(Loss)

The total operating loss for 1999 was $25.3 million as compared to
operating income of $4.5 million for 1998. This decrease of $29.8 million was
primarily the result of the reduction of income associated with the sale of
selected cellular markets of $800,000; losses of $29.6 million associated with
the start-up of LA Unwired; and a decrease in operating income of $3.9 million
related to our Louisiana cellular markets, which included $799,000 related to
option compensation. These decreases were offset by the conclusion of our PCS
reseller activity that resulted in operating losses of $5.0 million in 1998.

Other Income/(Expense)

<TABLE>
<CAPTION>
Years Ended
December 31,
-----------------
1998 1999
------- --------
<S> <C> <C>
Interest expense......................................... $(6,157) $(11,225)
Interest income.......................................... 1,778 2,949
Other income/(expense)................................... -- 587
Losses on sale of assets................................. (114) --
Gain on sale of selected markets......................... 57,364 819
------- --------
Total other income/(expense)........................... $52,871 $ (6,870)
======= ========
</TABLE>

Interest expense was $11.2 million for 1999 and $6.2 million for 1998. Our
outstanding debt was $216.1 million at December 31, 1999 as compared to $29.1
million at December 31, 1998. The increase in debt was the result of our
offering of our senior subordinated discount notes in October 1999. Interest
income was $2.9 million for 1999 and $1.8 million for 1998. Interest income in
1999 was associated with the proceeds from the note offering. Interest income
in 1998 was associated with the sale of selected cellular markets. Other income
for the year ended December 31, 1999 represents income earned on the settlement
of LA Unwired's interest rate swap agreement.

27
<PAGE>

Gain on sale of markets was $57.4 million in 1998. In 1998, we received
gross proceeds of $161.5 million from the sale of selected cellular markets.
The $819,000 recognized in 1999 is also associated with the 1998 sale, as we
concluded our settlement of the working capital and related items relative to
the original sale.

Minority Interest in Subsidiaries

Minority interest in losses of subsidiaries was $10.4 million for 1999 and
$0 in 1998. The increase in minority interest in losses of subsidiaries
resulted from the consolidation of LA Unwired in 1999 and represents the
portion of the losses from LA Unwired allocable to minority shareholders of
these subsidiaries.

Equity in Losses of Affiliates

Equity in losses of affiliates was $4.9 million for 1999 and $11.7 million
in 1998. The decrease of $6.8 million was primarily due to the consolidation of
LA Unwired in 1999 versus reporting for the losses under the equity method in
1998.

Result of Discontinued Operations

On March 22, 2000 US Unwired adopted a formal plan to sell its 59.8%
ownership interest in LEC Unwired. For financial reporting purposes, we are
presenting this as a discontinued operation and recognizing a charge of
approximately $3.5 million, net of $1.5 million in income taxes.

1998 compared to 1997.

You should keep in mind the following points when reading these results:

. the 1997 financial information includes 12 months of operating results
from the assets related to our selected cellular markets that we sold
in July 1998, and the 1998 financial information reflects only six
months of operations for those assets along with the gain from the sale
of those assets.

. the 1998 financial information includes the results of seven months of
PCS reseller activity, and the 1997 financial information includes the
results of only three months of PCS reseller activity.

Revenues
<TABLE>
<CAPTION>
Twelve Months
Ended
December 31,
---------------
1997 1998
------- -------
(In thousands)
<S> <C> <C>
Subscriber revenues....................................... $53,255 $48,723
Roaming revenues.......................................... 16,079 11,914
Merchandise sales......................................... 2,685 3,915
Other revenues............................................ 2,649 7,159
------- -------
Total revenues.......................................... $74,668 $71,711
======= =======
</TABLE>

28
<PAGE>

Subscriber revenues were $48.7 million for 1998 as compared to $53.3
million for 1997. The primary reason for this decrease of $4.6 million was our
1998 sale of selected cellular markets. Subscriber revenues for the selected
cellular markets in 1997 was $24.2 million as compared to $13.7 million in
1998, resulting in a decrease of $10.5 million. Offsetting the reduction in
revenues from the sale of selected cellular markets was the increase in
subscriber revenues from our Louisiana cellular markets of $4.0 million and
$1.9 million from our PCS reseller activity.

Roaming revenues were $11.9 million for 1998 as compared to $16.1 million
for 1997. This decrease of $4.2 million was primarily a result of our 1998 sale
of selected cellular markets. Roaming revenues for the selected cellular
markets sold were $10.2 in 1997 million as compared to $5.6 million for 1998,
resulting in a decrease of $4.6 million. Our Louisiana cellular markets had
roaming revenues of $6.3 million for 1998 as compared to $5.8 million for 1997,
representing an increase of $500,000.

Merchandise sales were $3.9 million for 1998 as compared to $2.7 million
for 1997. This increase of $1.2 million was primarily the result of an increase
of 11,000 in gross additional subscribers from PCS reseller activity resulting
in an increase of $1.2 million in merchandise sales.

Other revenues were $7.2 million for 1998 as compared to $2.6 million for
1997. This increase of $4.6 million was primarily the result of an increase in
management fee revenue of $3.1 million and incentive revenue of $1.0 million
from Meretel for our gross additions of 2,900 PCS reseller subscribers.

Operating Expenses

Cost of service was $18.6 million for 1998 as compared to $20.1 million
for 1997. This decrease of $1.5 million was mainly attributable to our 1998
sale of selected cellular markets, which generated cost of service of $6.7
million for 1998 as compared to $9.7 million for 1997, resulting in a decrease
of $3.0 million. An increase of $1.3 million in PCS reseller cost of service
and an increase of $200,000 in our Louisiana cellular markets' cost of service
offset this decrease.

Merchandise cost of sales was $10.8 million for 1998 as compared to $8.9
million for 1997. This increase of $1.9 million was primarily the result of our
gross additional subscribers of 11,000 from our PCS reseller activity,
resulting in an increase of $3.3 million in merchandise cost of sales. We
incurred an additional increase of $400,000 in merchandise cost of sales
relating to our Louisiana cellular markets. This increase was offset by a
decrease of $1.8 million related to our 1998 sale of selected cellular markets.

General and administrative expenses were $17.2 million for 1998 as
compared to $12.7 million for 1997. This increase of $4.5 was attributable to
additional employee costs, despite our having sold the selected cellular
markets, as the majority of our employees were redeployed to manage the
expansion of our PCS activity through LA Unwired and Meretel and to establish
our data and CLEC activities through LEC Unwired. US Unwired manages these
subsidiaries, employs the majority of personnel for these operations and
charges a management fee to these subsidiaries for these management services.

Sales and marketing expenses were $10.9 million for 1998 and 1997.

29
<PAGE>

Depreciation and amortization was $9.8 million for 1998 as compared to
$12.5 million for 1997. This decrease of $2.7 million was primarily the result
of our 1998 sale of depreciable assets related to the selected cellular
markets. Depreciation and amortization for the selected cellular markets was
$9.8 million in 1997 as compared to $5.6 million in 1998, resulting in a
decrease of $4.2 million. An increase of $1.5 million in depreciation and
amortization of our Louisiana cellular markets offset this decrease.

Operating Income

Operating income was $4.5 million for 1998 as compared to $9.6 million for
1997. The decrease of $5.1 million was primarily the result of an increase in
losses resulting from our PCS reseller activity of $4.4 million and $4.0
million related to our 1998 sale of selected cellular markets. These decreases
were offset by an increase of $3.3 million in operating income related to our
Louisiana cellular markets.

Other Income/Expense

<TABLE>
<CAPTION>
Twelve Months
Ended
December 31,
----------------
1997 1998
------- -------
(In thousands)
<S> <C> <C>
Interest expense.......................................... $(8,580) $(6,157)
Interest income........................................... 1,690 1,778
Other costs............................................... (1,082) --
Losses on sale of assets.................................. -- (114)
Gain on sale of markets................................... -- 57,364
------- -------
Total other income/(expense)............................ $(7,972) $52,871
======= =======
</TABLE>

Interest expense was $6.2 million for 1998 as compared to $8.6 million for
1997. This decrease of $2.4 million was the result of our application of a
portion of the proceeds from our 1998 sale of selected cellular markets to our
outstanding debt obligations. Total long-term debt decreased from $100.1
million at December 31, 1997 to $29.1 million at December 31, 1998.

Interest income was $1.8 million for 1998 as compared to $1.7 million for
1997. Interest income for 1998 was primarily generated from our investment of
proceeds from our 1998 sale of selected cellular markets in interest bearing
accounts.

Other costs totaled $1.1 million in 1997 for US Unwired's preparation for
an initial public offering that was canceled due to unfavorable market
conditions.

Gain on sale of markets totaled $57.4 million for 1998. This was
attributable to our 1998 sale of selected cellular markets. Gross proceeds
allocated to us from the sale totaled $161.5 million.

Minority Interest in Losses of Subsidiaries

Minority interest in losses of subsidiaries was $0 for 1998 as compared to
$134,000 for 1997. The 1997 amount relates to the portion of the losses from
Mississippi 34 Cellular Corporation allocable to the minority shareholders of
that corporation. No minority interest in subsidiary is reflected in 1998 due
to the sale of Mississippi 34 Cellular Corporation in July 1998.

30
<PAGE>

Equity in Losses of Affiliates

Equity in losses of affiliates was $11.7 million for 1998 as compared to
$3.1 million for 1997 resulting in an increase of $8.6 million. US Unwired's
proportionate share of Meretel's losses increased from $3.5 million for 1997 to
$7.2 million for 1998. In their first year of operations in 1998, LA Unwired
contributed losses of $4.7 million. LA Unwired did not report any losses in
1997 due to commencement of operations in 1998.

Liquidity and Capital Resources

We need approximately $303.8 million to build out our PCS network and to
market and distribute our products and services from January 2000 through
December 2001. We believe that the proceeds from our financings and internally
generated cash will be enough to build out our network as planned, cover
anticipated operating losses and meet our debt service requirements through
December 2001. We expect to cover approximately 66% of the population in a
majority of markets in our service area by March 2001. We plan to use this
$303.8 million for capital requirements, including capital expenditures,
working capital, debt service requirements and anticipated operating losses for
the period from January 2000 through December 2001. We will use this capital
also for switches, base stations, towers and antennae, radio frequency
engineering, cell site acquisition and construction and microwave relocation.
The actual amounts required to build out our PCS network may vary materially
from these estimates. We may need more capital if we have unforeseen delays,
cost overruns, unanticipated expenses, regulatory expenses, engineering design
changes and other technological risks.

In the past, we have paid our working capital requirements, acquisitions,
capital expenditures and debt service through bank financing and retained
earnings from operations and the one-time gain from our 1998 sale of selected
cellular markets.

On October 29, 1999, we issued approximately $400 million in principal
amount of 13 3/8% senior subordinated discount notes of US Unwired and received
net proceeds of approximately $209 million. These notes are unsecured
obligations. They bear interest at a rate of 13 3/8% per year, payable twice
per year on May 1 and November 1, beginning May 1, 2005. LA Unwired and Unwired
Telecom fully and unconditionally and jointly and severally guarantee our
obligations under the notes.

On October 1, 1999, US Unwired entered into a credit facility with CoBank,
ACB, The Bank of New York, BNY Capital Markets, Inc., First Union Securities,
Inc., First Union National Bank and other lenders for $130 million. At March
31, 2000, we had full availability of $130 million under our new credit
facility for the buildout of our PCS network and anticipated operating losses.

In addition, we issued $50 million of preferred stock on October 29, 1999
and $5 million of preferred stock on February 15, 2000, all of which will be
converted into our common stock at the completion of this offering.

On March 31, 2000, LEC Unwired had $12.4 million outstanding under two
senior credit facilities dated July 22, 1998. The first credit facility is a
$15.0 million senior facility with a three year drawdown period and five year
amortization. The second facility is a $3.0 million subordinated

31
<PAGE>

facility with a three year drawdown period and five year amortization. Both
facilities mature on July 1, 2006. On March 22, 2000, we adopted a formal plan
to sell our 59.8% ownership interest in LEC Unwired.

On April 11, 2000, the stockholders of US Unwired approved a 5.3304 for 1
stock split.

Cash used in operating activities was $8.5 million for the three months
ended March 31, 2000. Cash provided by investing activities was $14.7 million
for the three months ended March 31, 2000 and includes $32.3 million provided
by the purchase and sale of marketable securities offset by $15.9 million used
to purchase property and equipment. Cash used in financing activities was $4.8
million for the three months ended March 31, 2000 and included $13.8 million
used in the payment of long-term debt offset by $5.0 million in proceeds from
preferred stock and $2.6 million in proceeds from long-term debt.

Cash used in operating activities was $7.4 million in 1999. This use
primarily consisted of our net loss of $24.2 million offset by $19.4 million in
depreciation and amortization, $4.9 million in equity losses in affiliates,
$3.9 million in debt extinguishment charges, $4.8 million in debt discount
accretion, $177,000 in discontinued operations and $799,000 in non-cash
compensation. Other reductions included a $10.4 million loss in our minority
share in affiliates, a $5.9 million decrease in working capital and a deferred
tax benefit of $516,000. Net cash used by operations for 1998 was $14.7
million, and net cash provided by operations was $12.0 million in 1997.

Cash used in investing activities was $198.4 million in 1999. These uses
primarily consisted of $49.9 million to purchase property and equipment, $8.2
million for discontinued operations and $140.7 million to purchase marketable
securities. Net cash provided by investing activities was $113.2 million in
1998, and net cash used in investing activities was $17.6 million in 1997.

Cash flow provided by financing activities was $188.0 million in 1999. We
received $240.2 million in net proceeds from long-term debt, $11.8 million from
discontinued operations and $50 million from the issuance of preferred stock.
Cash used in financing activities consisted of $98.4 million in principal
payments on long-term debt and $15.7 million of debt issuance costs. Net cash
used in financing activities was $71.0 million in 1998, and net cash provided
by financing activities was $3.9 million in 1997.

Seasonality

Like the wireless communications industry in general, our subscribers
increase in the fourth quarter due to the holiday season. A greater number of
phones sold at holiday promotional prices causes our losses on merchandise
sales to increase. Our sales and marketing expenses increase also with holiday
promotional activities. We generally have the most use and revenue per
subscriber in the summer because of an increase in revenues from fees charged
to non-US Unwired, non-Sprint PCS customers who use our network while traveling
in our service area. We believe that the increased traffic in our service area
comes from people traveling during summer vacation. We expect these trends to
continue based on historical operating results.

Impact of Year 2000 Issue on Our Operations and Financial Condition

We use a significant number of computer systems and software programs in
our operations, including in support of our PCS network equipment and for
various administrative functions. Before

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<PAGE>

the Year 2000, we discussed the nature and progress of our plans to prepare for
that year. In late 1999, we finished testing and preparing our systems for the
Year 2000 date change. As of the date of this prospectus, we had experienced no
significant disruptions in our critical information technology systems and non-
information technology systems that resulted from the Year 2000 date change. We
believe that our systems successfully responded to the Year 2000 date change.
We expensed less than $550,000 during 1999 to prepare our systems for the Year
2000. We are not aware of any material problems that resulted from the Year
2000 date change with our products, our internal systems or the products and
services of third parties. We will continue to monitor our critical computer
applications and those of our suppliers and vendors throughout 2000 so we can
promptly address any Year 2000 matters that may arise.

Quantitative and Qualitative Disclosure about Market Risk

We are not exposed to fluctuations in currency exchange rates, as all of
our services are invoiced in U.S. dollars. We are exposed to the impact of
interest rate changes on our short-term cash investments, consisting of U.S.
Treasury obligations and other investments in respect of institutions with the
highest credit ratings, all of which investments mature on or before July 13,
2000. These short-term investments carry a degree of interest rate risk. We
believe that the impact of a 1% increase or decline in current average
investment rates would not have a material impact on our investment income.

Inflation

We believe that inflation has not impaired, and will not impair, our
results of operations.

Accounting

We do not believe that any recently issued accounting pronouncements will
have any material impact on our financial position, results of operations or
cash flows.

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<PAGE>

BUSINESS

General

We currently provide Sprint PCS service in eleven markets: Alexandria,
Houma-Thibodaux, Lake Charles, Monroe and Shreveport, Louisiana and Beaumont-
Port Arthur, Longview-Marshall, Lufkin-Nacogdoches, Texarkana and Tyler, Texas
and Montgomery, Alabama. Our network currently covers approximately 2.4 million
residents out of approximately 3.6 million total residents in those markets. We
expect to cover a total of approximately 6.1 million residents by December 2000
and 6.4 million residents by March 2001, at which point we expect to have
covered approximately 66% of the resident population in our service area. The
number of people in our service area does not represent the number of Sprint
PCS subscribers that we expect to have in our service area. At March 31, 2000,
we were providing PCS service to approximately 66,000 subscribers in our
service area. In addition, we were providing cellular and paging service to
approximately 81,000 subscribers in southwest Louisiana at March 31, 2000. For
the twelve month period ended March 31, 2000, we had revenues of approximately
$68.0 million and a net loss from continuing operations of approximately $30.4
million, and our operations used approximately $18.5 million more cash than
they generated.

Our Background

We have a long heritage in the telecommunications business. The Henning
family, which controls US Unwired, has been involved in telecommunications
continuously since 1928. The Henning family has a history of being first-to-
market in southwestern Louisiana with many major telephony developments,
including first wireline operator in Cameron Parish, Louisiana in 1928, first
cellular provider in southwestern Louisiana in 1987 and first PCS service
provider in southwestern Louisiana in 1997.

We formed our parent corporation, US Unwired, in Louisiana in September
1999. At that time it acquired the stock of its subsidiaries from their
shareholders. In return, it issued its own stock to those shareholders. We
formed the predecessor to our parent company in March 1967.

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Our Affiliation with Sprint PCS

Under our agreements with Sprint PCS, we market Sprint PCS products and
services in our service area using licenses that Sprint PCS acquired from the
FCC in 1994 and 1996. We will be the only provider of Sprint PCS products and
services in our service area. Some key points about these agreements are:

. each agreement lasts 50 years with an initial period of 20 years and
three automatic, successive 10-year renewal periods.

. each agreement requires revenue sharing of 8% to Sprint PCS and 92% to
US Unwired, except that US Unwired retains 100% of revenues from non-US
Unwired Sprint PCS customers traveling in our service area,
extraordinary income and equipment sales.

. if we terminate or breach the agreements, we may be required to sell
our PCS business and network to Sprint PCS or to purchase the Sprint
PCS licenses from Sprint PCS.

. if Sprint PCS terminates or breaches the agreements, we may be able to
sell our PCS business and network to Sprint PCS or to purchase the
Sprint PCS licenses from Sprint PCS.

We believe that our service area is important to Sprint PCS's plan to
expand its PCS network. To date, Sprint PCS has made considerable investments
in the licenses covering our service area. We estimate that Sprint PCS paid
over $100 million to acquire the PCS licenses in our service area and to
prepare the licensed markets for service.

Benefits of Our Affiliation with Sprint PCS

Our relationship with Sprint PCS provides us with many operational and
business advantages, including:

Exclusive access to Sprint PCS products and services. We are the only
provider of Sprint PCS products and services in our service area. We have the
right to provide these products and services under the Sprint(R) and Sprint
PCS(R) brand names.

Strong brand recognition and national advertising support. We expect to
benefit from the strength and reputation of the Sprint(R) and Sprint PCS(R)
brands. In our local markets, we use the Sprint(R) and Sprint PCS(R) brands and
logos without having to pay for this right. We benefit from Sprint PCS's
national advertising campaigns and developed marketing programs at no
additional cost.

Sprint PCS "Free and Clear" one-rate pricing plans. We offer our customers
the same free long distance, free traveling on the Sprint PCS network and other
promotional campaigns, like telephone handsets and accessories, that Sprint PCS
offers to all of its customers throughout the United States.

Established distribution channels. We have access to all national
distribution channels that Sprint PCS uses. These channels include:

. major national third party retailers like Radio Shack, Office Depot,
Circuit City, Dillard's, Sam's Wholesale Club, Office Max and Best Buy.

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<PAGE>

. Sprint PCS's national inbound telemarketing sales program.

. Sprint PCS's Business-to-Business and national accounts sales programs.

. Sprint PCS's electronic commerce sales platform.

National network. We operate our PCS network as part of the Sprint PCS
network. We believe that our ability to offer access to the Sprint PCS network,
with current service in more than 280 major metropolitan markets across the
country, represents a competitive advantage over regional offerings. Our
customers can place calls in any area of the United States where Sprint PCS
service is available without charges for traveling on Sprint PCS's network or,
under specified pricing plans, for long distance. In areas where Sprint PCS
service is not available, our customers must pay a fee to use another wireless
provider's service.

Exclusive traveling partner to Sprint PCS. We are the only provider of PCS
services to non-US Unwired Sprint PCS customers in our service area. We benefit
from the increased traffic from other Sprint PCS customers who travel in our
service area.

Sprint PCS engineering and network design. In markets where we use
spectrum owned by Sprint PCS, Sprint PCS provides the engineering services for
microwave clearance and handles all of the design, planning and relocation of
any radio cell sites.

Better equipment availability and pricing. We can buy network and
subscriber equipment under Sprint PCS's contracts that provide for volume
discounts. These discounts will reduce the overall capital required to build
our PCS network and will lower our cost of subscriber equipment.

Reduced startup costs. We estimate that Sprint PCS spent over $100 million
to purchase a substantial portion of the licenses covering our service area and
for microwave clearing. As a Sprint PCS network partner, we did not have to
acquire most of the licenses in our service area. This reduced our start-up
costs.

Availability of technology and service advances developed by Sprint
PCS. Sprint PCS's extensive research and development effort produces ongoing
benefits through both new technological products as well as enhanced service
features. We have immediate access to any developments produced by Sprint PCS
for its nationwide PCS network.

Our Competitive Strengths

Our competitive strengths include the following:

Extensive territorial reach. There are approximately 9.7 million residents
in our service area. This is a significant percentage of the population in the
Gulf States region. The number of residents in our service area does not
represent the number of PCS subscribers that we expect to have in our service
area. At March 31, 2000, we were providing PCS services to approximately 66,000
subscribers in our service area. Our service area has characteristics that are
favorable to wireless communications, including:

. extensive highway miles and commuter zones.

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<PAGE>

. high commuter activity.

. concentration of major industries.

. major regional tourist destinations.

. a large number of higher education institutions.

Existing corporate infrastructure. We have employees to handle billing,
customer care, accounting, treasury and legal services in our markets where we
currently offer PCS service and in most of our new markets. We believe that
providing these functions ourselves is more cost-effective than having third
parties provide them. In a limited number of markets, however, Sprint PCS will
provide us on a contract basis with selected back office functions like billing
and customer care. We anticipate that we may over time transfer control of
these functions to Sprint PCS if Sprint PCS can provide them more cost-
effectively and efficiently than we can.

Significant number of owned licenses. In addition to the Sprint PCS
licenses that we manage, we own thirteen 10 MHz PCS licenses and three 25 MHz
cellular licenses within our service area. The combination of the Sprint PCS
licenses and our licenses gives us access to 40 MHz of bandwidth in many of our
markets. We believe that this positions us well for the possible future
introduction of wireless internet and data transmission service.

High-quality customer care. We are committed to building strong customer
relationships by providing high-quality customer care. We serve our customers
from our state-of-the-art call center facility in Lake Charles, Louisiana. Our
customers can contact our customer care representatives from any of our
handsets without charge. Additionally, we are staffing each of our retail
outlets with full-time customer care representatives to deal directly with the
customers concerning billing and service issues. Our web-based services allow
customers to check billing and manage their accounts on line.

Our Business Strategy

We plan to offer high-capacity, high-quality, advanced communications on
our PCS wireless network. We believe the following elements of our business
strategy will distinguish our wireless service from those of our competitors
and will enable us to compete successfully in the wireless communications
marketplace:

Leverage relationship with Sprint PCS. We intend to capitalize on the
benefits of our relationship with Sprint PCS. These benefits include:

. strong brand recognition and national marketing campaigns.

. exclusive Sprint PCS traveling partner.

. access to Sprint PCS products and services.

. availability of Sprint PCS "Free and Clear" one-rate pricing plans.

. access to Sprint PCS's network, which includes more than 4,000 cities
and communities across the United States.

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<PAGE>

. established direct and indirect distribution channels.

. volume-driven vendor discounts.

. access to Sprint PCS engineering and network design.

. reduced startup costs.

. long-term management agreement.

. availability of technology and service advances developed by Sprint
PCS.

Execute integrated marketing plan. Our marketing approach leverages Sprint
PCS's highly recognizable brand name and reputation and its relationship with
major national retailers. We emphasize the improved quality, enhanced features
and favorable pricing of Sprint PCS service. In addition, we benefit from the
Sprint PCS:

. organized national accounts sales force.

. e-commerce website.

. pre-negotiated contracts with national retail chain outlets.

On the local level, we provide:

. multi-media marketing efforts, including point-of-sale, print,
television and radio campaigns for our own co-branded US Unwired(R) and
Sprint PCS(R) retail outlets.

. approximately 131 independent agent representatives.

. direct mail efforts and a website, www.usunwired.com.

Execute high-quality buildout plan. We are constructing a state-of-the-
art, high quality 100% PCS network using 100% digital technology.

. our network design allows our system to handle higher traffic demand
than cellular operators. This allows us to offer lower per-minute
rates.

. our network design enables us to service expensive, difficult to reach
locations and coverage gaps within our wireless network.

. we will maintain low construction costs for our network by planning to
co-locate on existing towers as our primary strategy and developing our
radio frequency design around this strategy.

Our Service Area

Our Sprint PCS service area covers 41 markets spanning over 164,500
square miles with a population of approximately 9.7 million. Our service area
is the largest in the United States by measure of population for all of the
territories assigned to Sprint PCS network partners. Even though our service
area comprises approximately 9.7 million residents, the number of residents in
our service area does not represent the number of PCS subscribers that we
expect to have in our service area. At March 31, 2000, we were providing PCS
services to approximately 66,000 subscribers in our service area.

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<PAGE>

Our service area is contiguous with Sprint PCS's recently launched markets
of Houston, Dallas, Little Rock, New Orleans, Birmingham, Tallahassee and
Memphis. Our network buildout will link these existing Sprint PCS markets. We
will be the only provider of Sprint PCS products and services in the markets
connecting these major cities.

We believe that our service area has many regional characteristics that
are favorable for wireless communication, including the following:

Extensive highway miles and commuter zones. Our service area includes high
traffic corridors traversed by major interstate highways. Overall, our service
area covers 4,509 total highway miles; 2,073 are interstate.

High commuter activity. We have high commuter activity. Over 24% of the
average commute time is greater than 30 minutes.

Concentration of major industries. The Gulf States region is home to many
large businesses in the oil and gas, gaming and agriculture industries. These
businesses are very important to the region and provide the majority of
business travelers who visit our service area.

Major regional tourist destinations. According to major tourist
publication guides, the Gulf Coast region is a major tourist and vacation
destination. The Gulf Coast beaches in Mississippi, Alabama and Florida draw
millions of visitors annually. Our service area has many historical sites, and
the numerous casino gaming establishments in our service area are major travel
destinations. The Mississippi casino market alone is the largest casino market
in the United States between Las Vegas and Atlantic City.

Large number of higher education institutions. There are 86 colleges and
universities in and around our service area, including the University of
Alabama, the University of Southern Mississippi, Mississippi State University
and Louisiana State University. Over 415,000 students attend these
institutions.

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<PAGE>

The following table shows some key information about our PCS markets
(population in thousands):

<TABLE>
<CAPTION>
Basic Total Expected Sprint Spectrum Total
Trading Market % Population Online Spectrum (Owned Spectrum
Market(/1/) Area # Population(/1/) Owned Owned Date (Managed MHz) MHz) (MHz)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Anniston, AL......................... 17 167.2 100% 167.2 Jun-00 30 -- 30
Chilton Area Counties, AL(/2/)(/3/).. 44 246.4 100 246.4 Sep-00 30 -- 30
Decatur, AL.......................... 108 145.6 100 145.6 Sep-00 30 -- 30
Florence, AL......................... 146 185.8 100 185.8 Sep-00 30 -- 30
Gadsen, AL........................... 158 188.2 100 188.2 Sep-00 30 -- 30
Huntsville, AL....................... 198 512.9 100 512.9 Sep-00 30 -- 30
Mobile, AL........................... 302 667.8 100 667.8 Jun-00 30 -- 30
Montgomery, AL....................... 305 477.4 100 477.4 Online 30 -- 30
Selma, AL............................ 415 72.1 100 72.1 Sep-00 30 -- 30
Tuscaloosa, AL....................... 450 254.5 100 254.5 Sep-00 30 10 40
El Dorado, AR........................ 125 102.2 100 102.2 Mar-01 30 10 40
Hot Springs, AR...................... 193 135.7 100 135.7 Jun-00 30 -- 30
Nevada Area Counties, AR(/2/)(/4/)... 257 57.3 100 57.3 Jun-00 30 -- 30
Pine Bluff, AR....................... 348 147.4 100 147.4 Mar-01 30 10 40
Fort Walton Beach, FL................ 154 225.6 100 225.6 Sep-00 30 -- 30
Jackson Area County, FL(/2/)......... 439 50.9 100 50.9 Jun-00 10 -- 10
Panama City, FL...................... 340 210.6 100 210.6 Sep-00 10 -- 10
Pensacola, FL........................ 343 428.9 100 428.9 Jun-00 30 -- 30
Alexandria, LA....................... 9 273.6 100 273.6 Online 30 10 40
Houma, LA............................ 195 277.1 100 277.1 Online 30 -- 30
Lake Charles, LA..................... 238 282.6 100 282.6 Online 10 10 20
Monroe, LA........................... 304 330.4 100 330.4 Online 30 10 40
Shreveport, LA....................... 419 586.7 100 586.7 Online 30 10 40
Columbus, MS......................... 94 171.5 100 171.5 Dec-00 10 10 20
Greenville, MS....................... 175 205.8 100 205.8 Dec-00 10 -- 10
Grenada Area Counties, MS(/2/)(/5/). 290 62.4 100 62.4 Dec-00 10 -- 10
Hattiesburg, MS...................... 186 186.5 100 186.5 Dec-00 30 -- 30
Jackson, MS.......................... 210 667.0 100 667.0 Jun-00 10 -- 10
Laurel, MS........................... 246 82.3 100 82.3 Mar-01 30 -- 30
McComb, MS........................... 269 111.7 100 111.7 Mar-01 30 -- 30
Meridian, MS......................... 292 206.7 100 206.7 Jun-00 10 -- 10
Natchez, MS.......................... 315 72.1 100 72.1 Jun-00 10 10 20
Tupelo, MS........................... 449 318.4 100 318.4 Dec-00 10 10 20
Vicksburg, MS........................ 455 62.4 100 62.4 Mar-01 10 -- 10
Marshall Area Counties,
TN(/2/)(/6/)........................ 314 56.9 100 56.9 Sep-00 30 -- 30
Longview, TX......................... 260 320.8 100 320.8 Online 30 10 40
Paris, TX............................ 341 93.0 100 93.0 Mar-01 30 10 40
Texarkana, TX........................ 443 262.0 100 262.0 Online 30 10 40
Tyler, TX............................ 452 310.0 100 310.0 Online 30 -- 30
Beaumont, TX......................... 34 464.3 80 371.4 Online 10 -- 10
Lufkin, TX........................... 265 165.2 80 132.2 Online 10 -- 10
-------- -------
Subtotal........................... 9,845.9 9,720.0
Minority Interests:
Baton Rouge, LA..................... 32 685.2 13 91.0 Online 30 -- 30
Hammond, LA......................... 180 107.7 13 14.3 Online 30 -- 30
Lafayette, LA....................... 236 543.1 13 72.1 Online 30 -- 30
Biloxi, MS.......................... 42 389.1 13 51.7 Sep-00 30 -- 30
-------- -------
Subtotal........................... 1,725.1 229.1

Total............................ 11,571.0 9,949.1
======== =======
</TABLE>
- --------
(1)Source: Paul Kagan Associates, Inc., 2000 PCS Atlas and Databook.
(2)County based information.
(3)Includes Chilton, Cullman, Talladega, Coosa and Tallapoosa Counties.
(4)Includes Nevada, Clark, Dallas, and Grant Counties.
(5)Includes Grenada, Yalobusha, Tallahatchie and Montgomery Counties.
(6)Includes Marshall and Giles Counties.

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<PAGE>

The following table shows some information about our cellular markets
(population in thousands):

<TABLE>
<CAPTION>
Metropolitan Total Spectrum
or Rural Market % Population Online (Owned
Market Service Area # Population (/1/) Owned Owned Date MHz)
<S> <C> <C> <C> <C> <C> <C>
Beauregard, LA.......... RSA 5 B-1 147.0 100% 147.0 Online 25
De Soto, LA............. RSA 3 B-1 54.0 100% 54.0 Online 25
Lake Charles, LA........ MSA 197 179.9 100% 179.9 Online 25
Chambers, TX............ RSA 21 23.3 25% 5.8 Online 25
----- -----
Total................... 404.2 386.7
===== =====
</TABLE>
- ---------------------
(/1/) Source: Paul Kagan Associates, Inc., Cellular Telephone Atlas 1998.

Network Buildout Plan

As of March 31, 2000, we were providing PCS service in the following
eleven markets covering a total population of approximately 3.6 million:
Alexandria, Houma-Thibodaux, Lake Charles, Monroe and Shreveport, Louisiana and
Beaumont-Port Arthur, Longview-Marshall, Lufkin-Nacogdoches, Texarkana and
Tyler, Texas and Montgomery, Alabama. Our network currently covers
approximately 2.4 million of the approximately 3.6 million total residents in
those markets. When we complete our network buildout, we expect to cover
approximately 66% of the population in a majority of markets in our service
area.

We expect that the combined proceeds of our financings will be sufficient
to provide the $303.8 million required for our network buildout plan and for
anticipated operating losses from January 2000 through December 2001. We plan
to complete construction of our network and be providing PCS service in all of
our markets by March 2001. We expect our network to cover approximately 6.1
million residents by December 2000 and approximately 6.4 million residents by
March 2001, at which point we expect to have covered approximately 66% of the
9.7 million resident population in our service area. The number of people in
the service area covered by our network does not represent the number of PCS
subscribers that we expect to have in our service area. At March 31, 2000, we
were providing PCS services to approximately 66,000 subscribers in our service
area.

We are focusing our network construction first on the concentrated
population and business centers of the major metropolitan areas in our service
area and the adjoining interstate highways. We will then build out the smaller
markets surrounding the existing built out areas and will continue to build out
interstate and state highways. We intend to launch PCS service only after we
complete a significant portion of the planned buildout for a given major city.
Before we launch service, we will perform extensive field testing to ensure
comprehensive and reliable coverage within a particular market. We are
providing the overall project and construction management of the design, site
acquisition, installation and testing of our PCS system.

Initial radio frequency design. Lucent Technologies, Inc. and the
engineering firm of 3Ngineering, L.L.C. are performing the initial radio
frequency design for our network. Lucent or 3Ngineering determines the required
number of cell sites to operate our network and identifies the general
geographic areas for proposed cell site locations. We have completed the
initial radio frequency design for all of our markets that are expected to be
completed by December 2000 and for 30% of our markets that are expected to be
completed by March 2001.

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Site identification, acquisition and construction. Either we or a
commercial real estate firm that advises us identifies and acquires the sites
where we will locate the towers, antennae and other equipment to operate our
PCS system. After a general geographic area is identified, the commercial real
estate firm, or we, identify two potential tower sites within that area
location and evaluate them based on various engineering criteria and economic
desirability.

We obtain cell sites in three ways: (1) co-location, (2) construction of a
tower by an independent build-to-suit company, or (3) construction of a tower
by us. We prefer to co-locate with another wireless company by leasing space on
an existing tower or building. When we co-locate, we generally have lower
construction costs and it is likely that any zoning difficulties have been
resolved. We believe that we need approximately 833 cell sites to achieve
approximately 66% coverage of the population in our service area. We expect to
co-locate approximately 40% of our cell sites, hire tower construction
companies to build 10% and manage construction of 50% ourselves.

Microwave relocation. Fixed microwave operators previously used the
frequencies that are now allocated for PCS licenses. The FCC has established
procedures for PCS licensees to relocate these existing microwave paths,
generally at the PCS licensee's expense. We have relocated all microwave paths
for the PCS licenses that we own. Sprint PCS is helping us relocate the
microwave paths for the PCS licenses that it owns. Sprint PCS is analyzing
these relocations as we continue the buildout of our network. We expect to
spend less than $20.0 million for relocation. We plan to complete the microwave
relocation for the Sprint PCS licenses before our targeted buildout completion
date.

Switching centers. We lease five switching centers for our service area.
These centers are located in our four markets of Shreveport and Lake Charles,
Louisiana, Jackson, Mississippi and Montgomery, Alabama. Each switching center
will serve several purposes, including routing calls, managing call handoff,
managing access to landlines and providing access to voice mail.

Interconnection. We will connect our digital PCS network to the landline
telephone system through interconnection agreements with local exchange
carriers. Before entering the Sprint PCS agreements, we entered into
interconnection agreements with BellSouth. Through our agreements with Sprint
PCS, we will benefit from the interconnection agreements that Sprint PCS
negotiates.

Long distance and back haul. We have a long distance agreement with our
affiliate, Cameron Communications Corporation, for preferred rates for long
distance services. We can also buy long distance services from Sprint PCS at
favorable rates.

Network communications equipment. Lucent Technologies, Inc. and Nortel
Networks will supply the radio base stations, switches and other related PCS
transmission equipment, software and services necessary for our markets that we
expect will be built out by December 2000 and some of our markets that we
expect will be completed by March 2001. Lucent and Nortel are helping us
install and test this transmission equipment. We are still deciding who will
provide these products and services for our remaining markets that we expect
will be completed by March 2001.

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Network monitoring systems. Our network operations center in Lake Charles,
Louisiana will provide around-the-clock monitoring and maintenance of our
entire network, including:

. the constant monitoring for blocked or dropped calls, call clarity and
signs of tampering, cloning or fraud.

. the recording of network traffic.

. the overseeing of customer usage, data collected at switch facilities
and billing.

Services and Features

We offer Sprint PCS products and services in our service area. Our
products and services are designed to mirror those of Sprint PCS and to become
part of the Sprint PCS nationwide network. Our PCS network has significant
advantages over competing digital networks.

Improved quality and technology. We expect an increase in PCS customers as
the quality of digital wireless networks continues to approach that of wireline
systems. We believe that PCS providers will be first to be able to offer mass
market wireless applications in competition with traditional wireline telephone
service.

. Cellular carriers must reserve portions of their cellular spectrum for
analog subscribers who cannot use a digital network with their analog
equipment or take advantage of the numerous features offered by digital
service. Spectrum reserved for this use limits a cellular carrier's
ability to offer a mass market product that competes with traditional
wireline telephone service.

. In many smaller metropolitan and rural areas, digital cellular service
has not been deployed. Analog service in these areas precludes deployment
of a mass market replacement of the traditional wireline phone service in
these areas.

. The shorter travel distance of the signal on PCS spectrum permits PCS
carriers to reuse frequencies and increase capacity to a greater extent
than cellular carriers.

. PCS providers have access to 30 MHz of spectrum in major markets and 15
MHz in others. These amounts are more than enough to offer a replacement
for traditional wireline telephone service.

. One PCS provider, Leap Wireless, exclusively markets its digital PCS
service as a replacement for traditional wireline telephone service. In
its first year of services, Leap Wireless attracted over 2% penetration
in its markets. Through Sprint PCS, we will market pricing plans that are
competitive with offerings like Leap Wireless's.

100% digital wireless mobility. Our PCS network is part of the largest
100% digital, 100% PCS network in the nation. We offer customers in our service
area enhanced voice clarity, advanced features and simple, affordable Sprint
PCS "Free and Clear" pricing plans. These plans include long distance and
wireless airtime minutes that can be used on the Sprint PCS network at no
additional charge. Our basic wireless service includes voice mail, caller
identification, enhanced call waiting, three-way conferencing, call forwarding,
distinctive ringing and call blocking.

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National network. Sprint PCS customers can use Sprint PCS services in our
service area and throughout the Sprint PCS network. Sprint PCS, directly and
through its affiliates, currently provides wireless service in more than 4,000
cities and communities throughout the United States, Puerto Rico and the U.S.
Virgin Islands. Dual-band/dual-mode telephone handsets allow customers to make
calls on analog networks where CDMA coverage is not available.

Caller identification, voicemail, message waiting indicator, short
messaging, paging. Caller identification lets users choose which calls to
accept and which to send to voicemail. This feature increases the customer's
willingness to leave the phone on for incoming calls. Digital voicemail is
available at a very cost effective rate and allows for fewer missed calls.
Digital handset displays with message waiting indicators eliminate the need to
"dial-in" to check voicemail and deliver short messages similar to e-mail or
alpha-numeric paging.

Advanced handsets. Our dual-band/dual-mode telephone handsets allow
customers to make and receive calls on both PCS and cellular systems using both
digital and analog technology. These advanced handsets allow calls to continue
without interruption on cellular networks where PCS service is not offered.
They can be equipped for a variety of enhanced features and applications.

Extended battery life. Our digital handsets can operate in sleep mode
while powered on but not in use. This improves efficiency and extends battery
life by an estimated five to six times of that of analog handsets. We expect
that this feature will increase usage, especially for incoming calls, as the
phone can be left on for longer periods.

Improved voice quality. Our technology offers significantly improved voice
quality, more powerful error correction, less susceptibility to call fading and
enhanced interference rejection. All of these things result in fewer dropped
calls.

Voice privacy. We use technology that provides for greater privacy and
fraud protection. We believe that new features and services will be developed
on the Sprint PCS network to take advantage of CDMA technology. Sprint PCS
conducts ongoing research and development to produce innovative services that
give it a competitive advantage. We offer a portfolio of products and services
developed by Sprint PCS to accommodate the growth in, and the unique
requirements of, high speed data traffic. We plan to provide, when available, a
number of applications for wireless data services including facsimile, internet
access and point-of-sale terminal connections.

Marketing Strategy

We use a two-tiered marketing approach that:

. leverages Sprint PCS's nationwide presence, brand name and proven
strategies.

. capitalizes on our regional focus, our history of providing
communications services and our ability to respond quickly and
creatively to changing customer needs.

Use of Sprint PCS's brand name and marketing. We benefit from the
recognizable Sprint PCS brand names and logos and from Sprint PCS's
technological developments.

Pricing. We use the Sprint PCS pricing strategy. This offers customers in
our service area simplified, customer-friendly service plans with preferred
options and features. Under our agreements

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<PAGE>

with Sprint PCS, we offer Sprint PCS's consumer pricing plans, including the
"Free and Clear" price plans. These plans typically offer service features such
as voicemail, enhanced caller identification, call waiting, three-way calling
and low per-minute rates. The greater capacity of our and Sprint PCS's
technology allows us to offer lower per-minute rates.

Sprint PCS's "Free and Clear" price plans offer simple and affordable rate
plans for the consumer and business customer. These plans include large numbers
of base minutes which can be used anywhere on the Sprint PCS network and free
long distance calling from anywhere on Sprint PCS's nationwide network. All of
Sprint PCS's current national plans:

. include minutes in any Sprint PCS market (with no traveling charges).

. have many features and generally require no annual contracts and
contain no hidden charges.

. offer a wide selection of phones.

. provide the first incoming minute free.

We offer long-term traveling arrangements with set pricing. We are the
only provider of PCS service for non-US Unwired Sprint PCS customers traveling
in our service area.

Advertising. We use the Sprint PCS name and reputation to attract
customers more efficiently than competitors with low brand awareness. Sprint
PCS has launched a national advertising campaign to promote its products, and
we benefit from this national advertising in our service area at no additional
cost to us. Sprint PCS also runs numerous promotional campaigns which provide
customers with benefits such as additional features at the same rate or free
ancillary services. We purchase promotional materials related to these programs
from Sprint PCS at their cost.

In addition, Sprint PCS sponsors many national, regional and local events.
These sponsorships provide Sprint PCS with brand name and product recognition
in high profile events, provide a forum for sales and promotional activities
and enhance our promotional efforts in our service area.

Prepaid Subscribers. US Unwired is a leading proponent of prepaid products
in the wireless industry. Industry experts believe that 70% of all new wireless
activations will be prepay by 2002. We have a system that permits us to track
minutes of use, replenish minutes and extinguish minutes not used within 30
days.

Our prepaid services include a pre-packaged wireless handset, marketed
under the brand name Chatpak,(TM) that is pre-activated and includes a pre-set
number of minutes. We acquired most of the market for prepaid services by
simplifying the phone activation process and allowing the subscriber to control
pre-set spending limits. A key component of any prepaid product is the
carrier's ability to encourage the subscriber to purchase minutes. We have
implemented three key strategies designed to promote high levels of prepaid
usage: handset pricing, airtime replenishment and dedicated customer care.

We believe that the handsets should be priced at a level that encourages
the subscriber to think of the handset as a reusable asset and not an impulse
purchase. We do not subsidize the phone sales to prepay subscribers to the same
extent as we do for sales to post-pay subscribers. We price prepaid minutes at
a modest premium to the rates of our post-pay plans.

45
<PAGE>

The subscriber may purchase additional minutes at hundreds of US Unwired's
convenient locations, including our stores, indirect retailers and vending
machines located in high traffic areas. Other options include inbound telesales
with credit card purchases of airtime through our customer care department or
our computerized interactive voice response unit. The dedicated customer care
team contacts each prepaid subscriber within 30 days following the purchase of
the handset to welcome the subscriber and to validate the subscriber's
knowledge of the handset and how to replenish airtime.

Finally, we have focused our efforts on retaining subscribers. We receive
weekly and monthly reports of prepay usage. These reports allow us to focus on
subscribers who show less than normal usage patterns.

Regional focus and customer care. Our regional focus enables us to
supplement Sprint PCS's marketing strategies with our own strategies tailored
to each of our specific markets. This includes attracting local businesses to
enhance our distribution and drawing on our management team's local experience.
Our large local sales force executes our marketing strategy through our retail
stores and kiosks. Our outside sales force targets business sales.
Additionally, we are staffing our retail outlets with full-time customer care
representatives to communicate directly with the customers concerning billing
and service issues.

We direct our media and promotional efforts at the community level by
advertising Sprint PCS's products and services through television, radio, print
advertisements, outdoor advertising, billing inserts and promotional displays
in our retail stores. We market our products and services under the name US
Unwired along with the Sprint(R) and Sprint PCS(R) logos. Also, we sponsor
local and regional events. In addition, Sprint PCS's existing agreements with
national retailers provide us with access to over 550 national retail locations
in our service area.

We offer the business user cost-saving features like:

. home regional roaming rates.

. free long distance throughout the contiguous United States.

. voicemail.

. reduced rates for incoming calls.

In addition, we offer shared minute pools to businesses and families who have
multiple users who share the base plan of minutes.

We are committed to building strong customer relationships by providing
customer care that exceeds expectations. Our customers can contact our customer
care representatives from any of our handsets at no charge. Our web-based
services allow customers to check billing or otherwise manage their accounts on
line.

Sales and Distribution

We target a broad range of consumer and business markets through a sales
and distribution plan. We use traditional cellular channels, like our retail
stores, mass merchandisers and other

46
<PAGE>

national retail outlets, independent agents and an outside sales force. We also
use lower-cost methods like direct marketing and a corporate website.

Retail stores. We have 20 retail stores and six kiosks and plan to open
between 30 and 40 additional retail stores by March 2001. Our retail stores are
located in the principal retail districts in each market. Kiosks, which are
located in Wal-Mart stores, maximize our retail presence in some of our markets
and take advantage of high traffic areas. We use our stores and kiosks for much
of the distribution and sale of our handsets and services. Sales
representatives in these stores and kiosks receive in-depth training which
allows them to explain PCS service in an informed manner. We believe that these
representatives will foster effective and enduring customer relationships.

Independent agents. We have a network of over 131 independent agents which
creates additional opportunities for local distribution. Most of these
businesses are family-owned consumer electronics dealers and wireless
telecommunication retailers.

Mass merchandisers and outlets. We target customers through our mass
market retail outlets. We are negotiating distribution agreements based on
Sprint PCS's arrangements with national and regional mass merchandisers and
consumer electronic retailers, including Radio Shack, Office Depot, Circuit
City, Dillard's, Sam's Wholesale Club, Office Max and Best Buy. There are over
550 national retail outlet locations where our customers can purchase our
services. We choose these distributors for their ability to target customers in
our service area. We support their dedication of valuable floor space to
wireless communications products through a local team of retail merchandisers,
attention-grabbing materials and consumer appeal.

Outside sales force. We participate in Sprint PCS's national accounts
program, which targets Fortune 1000 companies. Under this program, when a
Sprint PCS representative reaches an agreement with the corporate headquarters
of a Fortune 1000 company, we service the offices of that corporation that are
located within our service area. We generate additional subscribers through
Sprint PCS's Business to Business Accounts Teams, which call on businesses of
all sizes below the Fortune 1000 tier. In addition, our own outside corporate
sales force targets businesses that are not covered by Sprint PCS's national
accounts program or its Business to Business Account Teams.

Inbound telemarketing. Sprint PCS provides inbound telemarketing sales
when customers call from our service area. We expect to use the national Sprint
PCS (800) 480-4PCS number campaigns that generate call-in leads. These leads
are then handled by a US Unwired retail outlet.

Electronic commerce. Sprint PCS launched an internet site in December 1998
which contains information on Sprint PCS products and services. A visitor to
Sprint PCS's internet site who is interested in purchasing a handset for postal
zip codes in our service area is referred to our toll free customer care
telephone number for assistance. Customers in our service area who purchase
products and services over the Sprint PCS internet site become customers of our
PCS network.

Direct marketing and website. In addition to Sprint PCS's efforts, we use
direct marketing efforts through direct mail and our own website. We are
developing these less expensive and more

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<PAGE>

innovative sales channels to complement the retail presence within our service
area as the buildout continues. Our website, www.usunwired.com, provides
current information about us, our markets and our product offerings and
includes an online store. Our web-based services allow customers to check
billing or otherwise manage their accounts on line.

Sprint PCS

Sprint Corporation is a diversified telecommunications service provider of
long distance service, local service, wireless telephone products and services,
product distribution and directory publishing activities and other
telecommunication activities, investments and alliances. Sprint PCS, a group of
subsidiaries of Sprint, operates the only 100% digital, 100% PCS wireless
network in the United States. Sprint PCS, directly and through its network
partners like US Unwired, holds PCS licenses to provide this service in more
than 4,000 cities and communities throughout the United States, Puerto Rico and
the U.S. Virgin Islands. The Sprint PCS network uses CDMA technology.

Through an affiliate, Sprint launched the first commercial PCS service in
the United States in November 1995. Since then, the number of Sprint PCS
subscribers has grown to approximately 5.7 million as of December 31, 1999:

. in 1999, Sprint PCS added approximately 3.1 million new subscribers,
including 20,000 in Hawaii acquired from PrimeCo Personal
Communications.

. as of December 31, 1999, Sprint PCS, together with its network
partners, operated PCS systems within the United States and its
territories covering approximately 270 million people in more than
4,000 cities and communities.

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<PAGE>

The chart below illustrates Sprint PCS's subscriber growth from the
beginning of 1997 to the end of the fourth quarter of 1999.

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
1997 1997 1997 1997 1998 1998 1998 1998
------- ------- ------- ------- ------- ------- ------- -------
.2 .3 .6 .9 1.1 1.4 1.8 2.6

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
1999 1999 1999 1999
- ------- ------- ------- -------
3.4 4.0 4.7 5.7

Sprint PCS currently provides service through:

. operation of its own digital network.

. strategic affiliations with other companies, primarily in and around
smaller metropolitan areas.

. placing and receiving calls on analog cellular networks of other
providers using dual-band/dual-mode handsets.

. placing and receiving calls on digital PCS networks of other CDMA-
based providers.

Sprint PCS has a strategy to expand its PCS network through agreements
with independent wireless companies, like US Unwired, to construct and manage
the Sprint PCS markets and to market Sprint PCS services. Through these
affiliations, Sprint PCS services will be available in key cities next to
current and future Sprint PCS markets. For example, our service area connects
to Sprint PCS's markets in Houston, Dallas, Little Rock, New Orleans, Memphis,
Tallahassee and Birmingham.

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Cellular and Paging Services

We provide cellular and paging service in Lake Charles, Leesville,
Jennings, Sulphur and Cameron, Louisiana through our subsidiary, Unwired
Telecom Corp. At March 31, 2000, we had approximately 58,000 cellular
subscribers and approximately 23,000 paging subscribers. Our Louisiana cellular
and paging business had approximately $43.9 million in revenues for the twelve
month period ended March 31, 2000.

We are currently reviewing our strategic options with respect to our
cellular operations. These options include:

. sale of the system.

. conversion of our cellular subscribers to Sprint PCS subscribers.

We have not made a decision to take either of these actions or any action
at all.

Competitive Local Exchange Carrier Services

As of March 31, 2000, we owned a 59.8% interest in LEC Unwired, LLC, a
competitive local exchange carrier company. A competitive local exchange
carrier provides local telephone and data services in competition with the
current local service provider. On March 22, 2000, we adopted a formal plan to
sell our interest in LEC Unwired. See "Certain Relationships and Related
Transactions."

Competition

We will compete in our service area with the current cellular providers
and new PCS providers. The cellular providers in our service area serve
different geographic segments of our service area, but no one cellular carrier
provides complete coverage throughout our service area. Some of these cellular
providers offer a digital product also, but it typically covers only a small
segment of our service area.

Of our PCS competitors, only PrimeCo, TeleCorp PCS, Inc., Tritel PCS, Inc.
and Alltel Corp. will provide service comparable to ours in our service area.
PrimeCo uses CDMA technology and is licensed to offer PCS services in all of
our Louisiana and Texas markets but has not indicated any intention to buildout
a network in these markets. Telecorp and Tritel recently announced that they
intend to merge and will operate in parts of the south-central and southeastern
United States under a common regional brand name, SunCom, as members of the
AT&T wireless network. We expect the merged company to compete with us in our
Monroe, Louisiana market and in our Alabama, Arkansas and Mississippi markets.
Alltel is a current PCS provider in several of our markets.

Our ability to compete effectively with other PCS providers will depend
on:

. the continued success of CDMA technology in providing better call
quality and clarity than analog cellular systems.

. our competitive pricing with various options suiting individual
subscriber's calling needs.

. the continued expansion and improvement of the Sprint PCS network,
customer care system and telephone handset options.

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<PAGE>

We will compete also with paging, enhanced specialized mobile radio and
dispatch companies in our markets. Potential users of PCS systems may satisfy
their communications needs with other current and developing technologies. One
or two-way paging or beeper services that feature voice messaging and data
display as well as tone-only service may be adequate for potential subscribers
who do not need to speak to the caller.

Sprint PCS has chosen CDMA technology, which we believe offers
significant advantages in the marketplace. CDMA is one of three languages that
wireless telephones use to communicate with the phone network. The other two
predominant standards are TDMA and GSM.

CDMA offers superior call quality and clarity. CDMA also offers the
highest capacity of the three standards. This means that more simultaneous
calls can be handled on a CDMA network than on equivalent TDMA or GSM
networks. CDMA also offers a high level of security, giving customers
confidence that their calls remain private. CDMA offers many advanced features
such as short text messaging, internet access, call waiting, call forwarding
and three way calling. Several providers in the United States, including
Sprint PCS, Bell Atlantic and PCS PrimeCo, have adopted CDMA.

TDMA is generally less expensive to deploy if a carrier seeks to overlay
an analog network, like a cellular carrier would be required to do. TDMA also
offers increased call security and advanced features like those available on a
CDMA network. Several providers in the United States, including AT&T Wireless
Services, Tritel, Triton and Telecorp, have adopted TDMA.

GSM is the most widely adopted standard around the world. It originated
in Europe, where it continues to be the dominant standard. It has been widely
deployed for over ten years, which means that economies of scale for network
and handset equipment have been achieved. This has lowered the cost of
purchasing the equipment for a GSM system. GSM also offers increased call
security and advanced features like those available on a CDMA network. Several
providers in the United States, including BellSouth, VoiceStream Wireless, and
Powertel, have adopted GSM.

We do not currently face competition from resellers on our facilities. A
reseller buys blocks of wireless telephone numbers and capacity from a
licensed carrier and resells service through its own distribution network to
the public but does not hold FCC licenses or own facilities. Thus, a reseller
is both a customer of a wireless licensee's services and also a competitor of
that and other licensees. We expect to continue to be subject to the FCC rule
that requires cellular and PCS licensees to permit resale of carrier service.

Over the past several years the FCC has auctioned and will continue to
auction large amounts of wireless spectrum that could be used to compete with
PCS services. Based upon increased competition, we anticipate that market
prices for two-way wireless services generally will decline in the future. We
will compete to attract and retain subscribers principally on the basis of
services and features, the size and location of our service areas, network
coverage and reliability, customer care and pricing. Our ability to compete
successfully will also depend, in part, on our ability to anticipate and
respond to various competitive factors affecting the industry, including new
services that may be introduced, changes in consumer preferences, demographic
trends, economic conditions and discount pricing strategies by competitors.

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Government Regulation

The FCC and other state and local regulatory agencies regulate our PCS and
cellular systems and our competitive local exchange carrier operations.

Licensing of PCS systems. A broadband PCS system operates under a service
area license granted by the FCC for a particular market. These licenses operate
on one of six frequency blocks allocated for broadband PCS service. Narrowband
PCS is for non-voice applications such as paging and data service and is
separately licensed. The FCC awards all PCS licenses by auction.

We hold some F-block PCS licenses. We had to qualify as a "designated
entity" to get them from the FCC. Our "designated entity" status may limit our
ability to accept additional equity investments in the future.

All PCS licenses have a 10-year term and must be renewed at the end of
this term. The FCC generally will renew a PCS license if the licensee provided
substantial service during the past license term and substantially complied
with applicable law. The FCC may revoke a license for serious violations of FCC
rules. All PCS licensees must satisfy coverage requirements. Licensees that
fail to meet the coverage requirements may lose the service area that is not
covered, or the license.

For up to five years after a PCS license is granted, a PCS licensee must
share spectrum with existing licensees that operate fixed microwave systems
within its license area. To operate our PCS systems efficiently and with
adequate population coverage, we must relocate many of these existing
licensees. The FCC has adopted a transition plan to relocate microwave
operators and a cost sharing plan for relocation that benefits more than one
PCS licensee. These plans expire on April 4, 2005.

The FCC regulates PCS resale practices also.

Licensing of cellular telephone systems. The FCC awards licenses for
cellular telephone systems by auction. Cellular licenses generally last for 10
years and may be renewed for periods of up to 10 years. The FCC may revoke a
license for serious violations of FCC rules. The FCC may deny renewal if it
determines that the grant of an application would not serve the public
interest. In addition, at the renewal time, other parties may file competing
applications for the license. A license in good standing is entitled to a
renewal expectancy. This gives the current license holder an advantage over
competing applicants.

The FCC regulates cellular service resale practices and the terms under
which ancillary services may be provided through cellular facilities.

We use landline facilities to connect cell sites and to link them to the
main switching office. The FCC separately licenses and regulates these
landlines.

Other regulatory requirements. The FCC imposes additional regulatory
requirements on all commercial mobile radio service, or CMRS, operators, which
include PCS and cellular systems as well as some specialized mobile radio
systems. These requirements may change. Some of the current requirements
include:

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<PAGE>

. Resale. Most CMRS operators, including us, largely may not restrict
the resale of their services so that resellers may use the facilities
of the CMRS operator to introduce a competitive service.

. Roaming. CMRS carriers must provide service to all subscribers of a
compatible CMRS service in another geographic region.

. Number portability. CMRS carriers will soon be required to allow their
customers to take their phone numbers with them if they change to a
competitive service and must now be able to deliver calls to carried
numbers.

. Enhanced 911. CMRS carriers must transmit 911 calls from any qualified
handset without credit check or validation, must provide 911 service
to individuals with speech or hearing disabilities, and must provide
the approximate location of the 911 caller.

. Wiretaps. CMRS carriers must provide law enforcement personnel with
sufficient capacity to enable wiretaps on the CMRS network.

. Calling party pays. The FCC is considering rules to permit CMRS
operators to charge the party making the call. The new rules, if
adopted, would place consumer protection and uniform notification
requirements on the service.

. Customer information. The FCC has rules that protect the customer
against the use of customer proprietary information for marketing
purposes. A federal court recently struck down these rules, but the
FCC has stayed the effect of this decision by petitioning for
rehearing.

. Interconnection. All telecommunications carriers, including CMRS
carriers, must interconnect directly or indirectly with other
telecommunications carriers.

. Universal service and other fees. The FCC imposes large universal
service support fees on telecommunications carriers, including CMRS
carriers. The FCC imposes smaller fees for telecommunications relay
service, number portability and the cost of FCC regulation.

. Spectrum cap. There are limitations on a person's ownership in
licenses for more than 45 MHz of PCS, cellular and some specialized
mobile radio services in metropolitan statistical areas and 55 MHz in
rural service areas where there is significant overlap in any
geographic area. Significant overlap means that at least ten percent
of the population of the PCS licensed service area is within the
cellular and/or SMR service area(s). We believe that we are in
compliance with these limits.

Transfers and assignments of PCS and cellular licenses. The FCC must
approve the assignment or transfer of control of a license for a PCS or
cellular system. In addition, the FCC requires licensees who transfer control
of a PCS license within the first three years of their license term to
disclose the total consideration received for the transfer. FCC approval is
not required for the sale of an interest that does not transfer control of a
license. Any acquisition or sale of PCS or cellular interests may also require
the prior approval of the Federal Trade Commission, the Department of Justice
and state or local regulatory authorities.

Foreign ownership. The Communications Act of 1934 limits the non-U.S.
ownership of licensees. If foreign ownership exceeds the permitted level, the
FCC may revoke the PCS licenses or require an ownership restructuring. We
believe that we comply with these limitations.

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<PAGE>

Additional spectrum. In 2000, the FCC is expected to auction spectrum
which could be used to compete with our PCS system. We have no way of knowing
whether the persons who acquire the licenses for the new spectrum in our
service area will offer a competitive service.

Intellectual Property

The Sprint(R) and Sprint PCS(R) brand names and logos are registered
service marks owned by Sprint. We have license agreements with Sprint that
allow us to use, without payment and only in our service area, the Sprint
design logo and "diamond" symbol and other Sprint service marks, like the
phrases "The Clear Alternative to Cellular" and "Clear Across the Nation." We
can use some of Sprint's licensed marks on some wireless telephone handsets.
The license agreements have many restrictions on our use of their licensed
marks. We are the only person entitled to market Sprint PCS products and
services in our service area, except for the Sprint PCS national marketing
programs.

Employees

As of March 31, 2000, we had approximately 690 employees, of which
approximately 65 were associated with our discontinued operations. Our
employees are not represented by a union. A recent employee survey conducted by
an independent third party reported a high level of job satisfaction for over
90% of the employees surveyed.

Properties

We lease space for our switches in Lake Charles and Shreveport, Louisiana,
Jackson, Mississippi and Montgomery, Alabama. We lease space also for our
corporate operations, network operators and customer care and data center in
Lake Charles, Louisiana. We own two store sites, and we lease nine store sites
in Louisiana, five in Texas, two in Alabama and one in Mississippi. At March
31, 2000, we owned 176 and leased 154 cellular, PCS, paging and microwave
towers.

We recently purchased for $2.7 million an 11-story, 115,300 square foot
office building in downtown Lake Charles for our corporate headquarters. Even
though we are in the initial stages of evaluating the project, we expect to
spend approximately $5.0 million over several years to upgrade and renovate the
facility.

Legal Proceedings

We are from time to time involved in litigation that we believe ordinarily
accompanies the communications business. We do not believe that any of our
pending or threatened litigation will materially impair our business.

In April 2000, we received an assessment of approximately $4.0 million for
Louisiana local sales and use taxes as a result of a routine audit. We are
continuing to discuss this assessment with the local tax authorities, but
management believes that we have adequately provided for any additional sales
and use taxes that may result from this assessment.

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THE WIRELESS COMMUNICATIONS INDUSTRY

Wireless communications systems use radio frequencies to transmit voice
and data. These systems are:

. one-way radio applications, like paging or beeper services.

. two-way radio applications, like cellular, PCS, enhanced specialized
mobile radio networks and two-way paging.

The FCC has licensed each application and allocated to each application a
distinct radio frequency block.

Cellular and PCS are the major two-way applications licensed by the FCC.
Most subscribers today use cellular service as their wireless voice
communications service. Cellular systems are mostly analog-based systems, but
digital technology has been introduced in most metropolitan markets. Analog-
based systems send signals that resemble the input signal. In digital systems,
the input signal is coded into a binary form before the signal is transmitted.

In 1993, the FCC allocated the 1900 MHz frequency block of the radio
spectrum for a new wireless personal communications service known as PCS. PCS
differs from traditional analog cellular telephone service because it operates
at a higher frequency and uses only advanced digital technology. Many cellular
systems now use digital technology, but all continue to offer analog service as
well. Digital systems convert voice or data signals into a stream of digits
that permit a single radio channel to carry multiple simultaneous
transmissions. Digital systems also have greater frequency reuse than analog
systems resulting in greater capacity than analog systems. This enhanced
capacity, along with enhancements in digital protocols, allows digital-based
wireless technologies (whether using PCS or cellular frequencies) to offer new
and enhanced services and more robust data transmission like greater clarity,
better security, facsimile, electronic mail and connection to notebook
computers with computer/data networks.

Cellular service was first introduced in the United States in 1983. Paul
Kagan Associates, Inc., an independent media and telecommunications
association, estimates that there were approximately 87 million wireless
subscribers in the United States as of December 31, 1999. This amount
represents an overall wireless penetration rate of 31.1%. This means that 31.1%
of the United States population at that time were wireless subscribers.

The following table shows some statistics for the domestic wireless
telephone industry as a whole:

<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------------------------
1994 1995 1996 1997 1998 1999
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Total service revenues (in
billions)........................ $14.2 $19.1 $23.6 $27.5 $33.1 $40.0
Ending wireless subscribers (in
millions)........................ 24.1 33.8 44.0 55.3 69.2 86.0
Subscriber growth................... 50.8% 40.0% 30.4% 25.6% 25.1% 24.3%
Average monthly revenue per
subscriber(/1/).................. $59.08 $54.91 $50.61 $46.11 $44.35 $42.96
Ending penetration.................. 9.2% 12.8% 16.5% 20.6% 25.3% 31.4%
</TABLE>
- ---------------------
Source: Cellular Telecommunications Industry Association; U.S. Census Bureau.

(1) Including roaming revenues.

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<PAGE>

Paul Kagan estimates that the number of wireless users will increase to
approximately 151 million by 2002 and 198 million by 2005. Paul Kagan expects
that 34% of total users in 2002 and 43% in 2005 will be PCS users. Paul Kagan
estimates that total wireless industry penetration will grow to 53% in 2002 and
69% in 2005.

We believe that the predicted growth in the consumer market for wireless
telecommunications will come from:

. declines in costs of service.

. increased functional versatility.

. increased awareness of the benefits associated of PCS service.

. rapid growth of notebook computers and personal digital assistants.

. software programs for electronic mail, faxes and database searching.

We believe that our markets are well positioned to benefit from the growth
predicted for the wireless industry as forecast by the Cellular
Telecommunications Industry Association, or CTIA. We believe that our markets
and other markets similar to ours will experience the fastest growth in
subscribers because we currently have relatively low wireless penetration.

The following chart illustrates the annual growth in wireless subscribers
and total industry revenues during the periods indicated:

1985 1986 1987 1988 1989 1990 1991 1992 1993
---- ---- ----- ----- ----- ----- ----- ------ ------
340 682 1,231 2,069 3,509 5,283 7,557 11,033 16,009

1994 1995 1996 1997 1998
------ ------ ------ ------ ------
24,134 33,786 44,043 55,312 69,209

Wireless communications systems, whether PCS or cellular, are divided into
multiple geographic areas, known as cells. Each cell contains a transmitter, a
receiver and signaling

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<PAGE>

equipment, together referred to as the cell site. The cell site is connected
by microwave or landline telephone lines to a switch that uses computers to
control the operation of the cellular or PCS communications system for the
entire service area. The system controls the transfer of calls from cell to
cell as a subscriber's wireless telephone handset travels, coordinates calls
to and from wireless telephone handsets, allocates calls among the cells
within the system and connects calls to the local landline telephone system or
to a long distance carrier. Wireless communications providers establish
interconnection agreements with local exchange carriers and interexchange
carriers to integrate their systems with the existing landline communications
system. Because the signal strength of a transmission between a wireless
telephone handset and a cell site declines as the handset moves away from the
cell site, the switching office and the cell site monitor the signal strength
of calls in progress. When the signal strength of a call declines to a
predetermined level, the switching office may "hand off" the call to another
cell site where the signal strength is stronger.

Wireless systems in the United States can be either analog or digital.
Traditional cellular providers have analog systems. Most of these systems have
been in operation for over ten years. Many cellular providers are converting
their analog systems to digital systems. These digital systems are new and
less established. PCS systems are totally digital, and PCS equipment vendors
have never made analog equipment for a PCS system.

Digital wireless systems in the United States, whether PCS or cellular,
are not necessarily compatible. U.S. digital systems use one of three designs,
known as CDMA, TDMA and GSM. Each design uses a different digital language to
send calls. The FCC has never required all U.S. digital systems to work
together. This means that, for example, a subscriber who carries a CDMA phone
into an area with a system that uses GSM language will not be able to make a
call with that phone on the GSM system. The subscriber could make a call on
the existing analog cellular system if the subscriber has a special phone that
works on both CDMA and analog cellular systems. Despite the limitations of
wireless system compatibility described above, once a wireless subscriber
accesses the telephone network, the subscriber can complete a call to any
other telephone, including wireline telephones and telephones that use
incompatible wireless technologies.

Vendors of wireless equipment have somewhat solved the problem of the
incompatibility of the three languages. These vendors have created phones that
work on more than one frequency, like PCS and cellular, and more than one
mode, like CDMA and analog. This means that a subscriber using one of these
phones can make calls on more than one type of system. For example, if we
distribute one of these phones for use on our PCS network, which uses CDMA
language, but the subscriber is in an area without a CDMA system, the
subscriber can use the phone on other networks in that area.

All digital wireless providers, whether they use CDMA, TDMA or GSM
language, face the same problems of incompatible systems that we do with our
CDMA system. Analog cellular subscribers have the greatest coverage area, but
digital cellular subscribers enjoy other benefits like longer battery life and
better quality of calls.

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<PAGE>

SPRINT PCS AGREEMENTS

Overview of Sprint PCS Agreements

We have three management agreements with Sprint PCS. Under the first
agreement dated June 8, 1998, LA Unwired has the right to manage the Sprint PCS
services in the service areas listed below.

El Dorado-Magnolia-Camden, Arkansas Shreveport, Louisiana
Pine Bluff, Arkansas Longview-Marshall, Texas
Alexandria, Louisiana Paris, Texas
Houma-Thibodaux, Louisiana Texarkana, Texas
Lake Charles, Louisiana Tyler, Texas
Monroe, Louisiana

We own the PCS licenses for the Alexandria, Lake Charles, Monroe and
Shreveport, Louisiana and Longview-Marshall, Paris and Texarkana, Texas service
areas. We currently offer PCS service in Alexandria, Houma-Thibodaux, Lake
Charles, Monroe and Shreveport, Louisiana, and Beaumont-Port Arthur, Longview-
Marshall, Lufkin-Nacogdoches, Texarkana and Tyler, Texas and Montgomery,
Alabama.

The second agreement dated February 8, 1999 gives LA Unwired the right to
manage Sprint PCS services in the following service areas:

Anniston, Alabama Pensacola, Florida
Birmingham, Alabama (Chilton, Tallahassee, Florida (Jackson county
Cullman, Talladega, Coosa and only)
Tallapoosa counties only) Columbus, Mississippi
Decatur, Alabama Greenville, Mississippi
Florence, Alabama Hattiesburg, Mississippi
Gadsen, Alabama Jackson, Mississippi
Huntsville, Alabama Laurel, Mississippi
Mobile, Alabama McComb, Mississippi
Montgomery, Alabama Meridian, Mississippi
Selma, Alabama Natchez, Mississippi
Tuscaloosa, Alabama Tupelo, Mississippi
Hot Springs, Arkansas Vicksburg, Mississippi
Little Rock, Arkansas (Clark, Memphis, Tennessee (Grenada,
Dallas, Grant and Nevada counties Montgomery, Tallahatchie and
only) Yalobusha counties in Mississippi
Fort Walton Beach, Florida only)
Panama City, Florida Nashville, Tennessee (Marshall and
Giles counties only)

As part of the Meretel transaction described in the section entitled
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," we entered into a third agreement dated January 7, 2000. Under
this agreement, Texas Unwired, a Louisiana general partnership, has the right
to manage Sprint PCS services in Beaumont-Port Arthur and Lufkin-Nacogdoches,
Texas.

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Sprint PCS owns the PCS licenses for all of the service areas covered by
the Sprint management agreements (other than the Alexandria, Lake Charles,
Monroe and Shreveport, Louisiana and Longview-Marshall, Paris and Texarkana,
Texas service area licenses, which we own). Sprint PCS gives us the right to
use their licenses in the management agreements.

The Sprint management agreements require us to:

. construct and manage the service areas in the manner described in the
Sprint management agreements.

. distribute Sprint PCS products and services and establish distribution
areas in the service areas.

. conduct advertising and promotion activities in the service areas.

. manage the customer base of Sprint PCS that has an area code and prefix
assigned to the service areas covered by the agreements.

Sprint PCS can access the network that we build for Sprint PCS. Sprint PCS
pays us a management fee to use our service area for sales and marketing and to
manage the service areas covered by Sprint PCS's licenses. In areas where we
use our own licenses, we pay Sprint a fee to be a Sprint PCS network partner.

Each Sprint management agreement requires us to follow program
requirements that are used throughout the nationwide Sprint PCS network. We
must continue to follow these program requirements if Sprint PCS changes them.
The program requirements involve:

. management of the service area.

. our participation in Sprint PCS distribution programs on a national and
regional basis.

. cost sharing and auditing in connection with distribution programs.

. handset logistics and distribution.

. retail store guidelines.

. participation in Sprint PCS national account programs.

. establishment of integrated networks with Sprint PCS in each area
serviced by us.

. roaming and inter-service area programs.

. adherence to Sprint technical program requirements.

. customer service matters.

. invoice presentation.

. billing cycles.

. management of fraud and receivables.

. disaster contingencies.

We also have trademark and service mark license agreements with Sprint
Communications Company, L.P. and trademark and service mark license agreements
with Sprint Spectrum L.P. We

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plan to enter into a services agreement for Sprint to provide us on a contract
basis with selected back office functions such as billing and customer care for
a limited number of our markets.

The Management Agreements

Under our management agreements with Sprint PCS, we have agreed to:

. construct and manage a network in our service area in compliance with
our and Sprint PCS's PCS licenses and the management agreement.

. distribute Sprint PCS products and services.

. use Sprint PCS's and our own distribution channels in our service area.

. conduct advertising and promotion activities in our service area.

. manage that portion of Sprint PCS's customer base assigned to our
service area.

Sprint PCS will supervise our PCS network operations and has unconditional
access to our PCS network.

Exclusivity. We are the only person who is entitled to manage or operate a
PCS network for Sprint PCS in our service area. Sprint PCS is prohibited from
owning, operating, building or managing another wireless mobility
communications network in our service area while our management agreements are
in place. Sprint PCS may make national sales to companies in our service area
and, as permitted by the FCC, may resell Sprint PCS products and services in
our service area.

Expansion. If Sprint PCS decides to expand our service area, it must give
us written notice. We then have 90 days to decide whether to buildout the
proposed area. If we do not, Sprint PCS may buildout the proposed area or
permit another third party to do so.

Network buildout. The management agreements describe our Sprint PCS
affiliation and the required network buildout plan. We have agreed to cover a
specified percentage of the population at coverage levels ranging from 65% to
75% within each of the 41 markets in our service area by specified dates ending
in June 2001.

Products and services. The management agreements identify the products and
services that we may offer in our service area. These services include Sprint
PCS consumer and business products and services. We are allowed to sell non-
Sprint PCS wireless products and services if they do not cause distribution
channel conflicts or consumer confusion with Sprint PCS's products and
services. We may cross-sell services like internet access, handsets, and
prepaid phone cards with Sprint, Sprint PCS and other Sprint PCS affiliates. If
we decide to use third parties to provide these services, we must give Sprint
PCS an opportunity to provide the services on the same terms and conditions. We
cannot offer wireless local loop services specifically designed for the
competitive local exchange market in areas where Sprint owns the local exchange
carrier unless we either name Sprint's local exchange carrier as the only
distributor or get approval from Sprint PCS.

We participate in the Sprint PCS sales programs for national sales to
customers and handle national accounts located in our service area. We have a
long distance agreement with our affiliate,

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Cameron Communications Corporation, for preferred long distance rates. We can
also buy long distance services from Sprint PCS at favorable rates.

Service pricing, traveling and fees. We must offer national and regional
Sprint PCS pricing plans, including Sprint PCS's "Free and Clear" plans. We can
set our own local price plans for Sprint PCS products and services offered only
in our service area, but we must get Sprint PCS's approval.

Our management agreements require revenue sharing of 8% to Sprint PCS and
92% to US Unwired, except for amounts collected with respect to taxes. We keep
100% of revenues, however, from:

. non-US Unwired Sprint PCS customers traveling in our service area.

. sales of handsets and accessories.

. proceeds from sales not in the ordinary course of business.

Although many Sprint PCS subscribers will purchase a pricing plan that
allows traveling anywhere on the Sprint PCS network without additional charges,
we earn revenues from every minute that we carry a non-Sprint PCS subscriber's
call on our PCS network. This is called roaming. We earn revenues from Sprint
PCS for Sprint PCS's or its network partners' subscribers traveling in our
service area. Similarly, we pay for every minute that our own subscribers use
the Sprint PCS nationwide network outside our service area. Sprint PCS's third
party roaming agreements set the rate for roaming onto a non-Sprint PCS
provider's network.

Advertising and promotions. Sprint PCS is responsible for all national
advertising and promotion of Sprint PCS products and services. We are
responsible for advertising and promotion in our service area. Sprint PCS's
service area includes the urban markets around our service area. Sprint PCS
will pay for advertising in these markets. Given the proximity of those markets
to ours, we expect considerable overlap from Sprint PCS's advertising in
surrounding urban markets.

Program requirements. We will comply with Sprint PCS's program
requirements for technical standards, customer service standards, national and
regional distribution, national accounts programs and traveling and inter-
service area services. Sprint PCS can adjust the program requirements from time
to time. We can appeal Sprint PCS's adjustments, but this could cause an
unreasonable increase in cost to us if the adjustment:

. costs more than 5% of the sum of our equity plus our outstanding long
term debt.

. increases our operating expenses by more than 10% on a net present value
basis.

If Sprint PCS denies our appeal and we do not follow the program adjustment,
Sprint PCS has the termination rights described below.

Non-competition. We may not offer Sprint PCS products and services outside
our service area without the prior written approval of Sprint PCS. Within our
service area, we may offer, market or promote telecommunications products and
services only under the Sprint PCS brands, our own brand or brands of our
related parties. We may offer other products and services approved under the

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management agreements, but we may not use a brand of a significant competitor
of Sprint PCS or its related parties for those products and services.

Inability to use non-Sprint PCS brand. We may not sell Sprint PCS products
and services on a non-branded, "private label" basis or under any name other
than the Sprint PCS brand. There are exceptions for sales to resellers and in
the trademark and service mark license agreements.

Termination of management agreements. Each management agreement lasts for
50 years with an initial period of 20 years and three automatic, successive 10-
year renewal periods. The management agreements can be terminated for:

. the termination of Sprint PCS's PCS licenses.

. a breach of the management agreement that is not corrected.

. the bankruptcy of a party to the management agreement.

. the management agreement not complying with any applicable law in any
material respect.

. the termination of either of the trademark and service mark license
agreements.

. our failure to obtain the financing necessary for the buildout of our
PCS network and for our working capital needs.

Sprint PCS agreed that the issuance of our senior subordinated discount
notes and the preferred stock investment by The 1818 Fund would meet the
financing requirements of the management agreements.

If a management agreement is terminated or not renewed, we and Sprint PCS
have specified rights. If we can terminate the management agreement because of
something that Sprint PCS did or did not do, generally we may:

. require Sprint PCS to purchase all of our operating assets used in our
PCS network for at least 80% of our entire business value, which is
described below;

. if Sprint PCS is the licensee for 20 MHz or more of the spectrum on the
date we terminate the management agreement, require Sprint PCS to
assign to us, subject to governmental approval, up to 10 MHz of
licensed spectrum for an amount equal to the greater of:

. the original cost to Sprint PCS of the license plus any microwave
relocation costs paid by Sprint PCS, or

. 9% of our entire business value; or

. sue Sprint PCS for damages instead of terminating the management
agreement.

If Sprint PCS can terminate the management agreement because of something
that we did or did not do, generally Sprint PCS may:

. require us to sell our PCS operating assets to Sprint PCS for an amount
equal to 72% of our entire business value;

. require us to purchase, subject to governmental approval, the licensed
spectrum for the greater of:

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. the original cost to Sprint PCS of the license plus any microwave
relocation costs paid by Sprint PCS or

. 10% of our entire business value;

. take any action to correct our breach of the management agreement. This
may include taking responsibility for, and operating, our PCS network;
or

. sue us for damages instead of terminating the management agreement.

Non-renewal of management agreements. If Sprint PCS gives us timely notice
that it does not intend to renew the management agreement, we may:

. require Sprint PCS to purchase all of our operating assets used in our
PCS network for 80% of our entire business value; or

. the original cost to Sprint PCS of the license plus any microwave
relocation costs paid by Sprint PCS, or

. 10% of our entire business value.

If we give Sprint PCS timely notice that we do not intend to renew the
management agreement, or if we both give notice of non-renewal, or if the
management agreement can be terminated because it does not comply with legal or
regulatory requirements, Sprint PCS may:

. purchase all of our operating assets for 80% of our entire business
value; or

. require us to purchase, subject to governmental approval, the licensed
spectrum for the greater of:

. the original cost to Sprint PCS of the license plus any microwave
relocation costs paid by Sprint PCS, or

. 10% of our entire business value.

If the entire business value must be determined, we and Sprint PCS will
each select one independent appraiser and the two appraisers will select a
third appraiser. The three appraisers will determine the entire business value
on a going concern basis using the following assumptions:

. the entire business value is based on the price a willing buyer would
pay a willing seller for the entire on-going business.

. the then-current customary means of valuing a wireless
telecommunications business will be used.

. the business is conducted under the Sprint and Sprint PCS brands and
the Sprint PCS agreements.

. we own the spectrum and frequencies presently owned by Sprint PCS and
subject to the Sprint PCS agreements.

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. the valuation will not include any value for the business not directly
related to the Sprint PCS products and services.

If the management agreement is terminated or not renewed, we may be
obligated to allow Sprint PCS customers to travel at favorable prices in the
service areas where we own the licenses and to allow Sprint PCS to sell some of
our products there.

If the management agreement ends for any reason other than a loss of the
licenses or regulatory considerations, and if Sprint PCS does not transfer the
disaggregated licenses to us, then Sprint PCS must buy our PCS operating assets
except those for the Shreveport, Alexandria and Monroe service areas.

Right of first refusal/offer. Before we can accept an offer to sell the
properties used in specified markets, we must first offer them to Sprint PCS on
the same terms. Also, if we want to transfer an ownership interest in LA
Unwired or Texas Unwired to an unrelated third party, we must first give Sprint
PCS a right of first offer for the interest.

The Trademark and Service Mark License Agreements

We are permitted to use the Sprint and Sprint PCS brand names, "diamond"
symbol and other trademarks and service marks like "The Clear Alternative to
Cellular" and "Clear Across the Nation" on Sprint PCS products and services. We
do not pay to use these names and marks, but we cannot transfer the right to
use them. We believe that the Sprint and Sprint PCS brand names and symbols
enjoy a very high degree of awareness and provide us an immediate benefit in
the market place. To use the licensed marks, we must follow quality standards
determined by Sprint and Sprint PCS. We cannot use the licensed marks in a
manner that would reflect adversely on the image of quality symbolized by the
licensed marks. We will notify Sprint and Sprint PCS promptly if we know of any
violation of any of the licensed marks within our service area and will help
Sprint and Sprint PCS enforce their rights. We have agreed with Sprint and
Sprint PCS to repay each other for losses caused by a significant violation of
the trademark license agreements. In addition, we will repay Sprint and Sprint
PCS for any loss suffered from our use of the licensed marks or sale of any
Sprint or Sprint PCS products and services, unless the losses are from our use
of the licensed marks in compliance with certain guidelines.

Sprint and Sprint PCS can terminate the trademark and service mark license
agreements if we file for bankruptcy or significantly violate the agreement, or
if our management agreement is terminated. We can terminate the trademark and
service mark license agreements if Sprint or Sprint PCS abandons the licensed
marks or files for bankruptcy, or if the management agreement is terminated.

Consent and Agreement for the Benefit of our Senior Lenders

Sprint PCS has a consent and agreement, or lender consent, with the
lenders under our credit facilities. The lender consent modifies Sprint PCS's
rights and remedies under our Sprint PCS management agreements for the benefit
of the lenders and vendor guarantor under our credit facilities and any
refinancing of it.

The lender consent generally provides for:

. Sprint PCS's consent to the pledge of the stock of our subsidiaries and
a security interest in all of our assets, including the Sprint PCS
management agreements.

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. Sprint PCS not to end our management agreements until our senior
financing is satisfied under the lender consent.

. a prohibition on competing Sprint PCS networks in our service area.

. Sprint PCS to maintain 10 MHz of PCS spectrum in all our markets.

. redirection of payments from Sprint PCS to our lenders under specified
circumstances.

. Sprint PCS and our lenders to provide to each other notices of default.

. the appointment of a temporary replacement manager, including Sprint
PCS, to operate our PCS network under the Sprint PCS management
agreements if our lenders accelerate our repayment of our financing or
if there is a reason to end the Sprint PCS management agreements.

. our lenders or Sprint PCS to assign the Sprint PCS agreements and sell
our assets or stock to a qualified purchaser other than a major
competitor of Sprint PCS or Sprint.

. us to buy spectrum from Sprint PCS and sell our assets or stock to any
qualified purchaser.

. Sprint PCS to buy our assets or our debt.

. the vendor guarantor to have a claim on assets following the payment of
the guarantee.

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MANAGEMENT

Executive Officers and Directors

These persons are our directors and executive officers:

<TABLE>
<CAPTION>
Name Age Office
<S> <C> <C>
William L. Henning, Jr 47 Chairman of the Board of Directors
Robert W. Piper 41 President, Chief Executive Officer and Director
Jerry E. Vaughn 55 Chief Financial Officer
Thomas G. Henning 40 Secretary, General Counsel and Director
William L. Henning, Sr. 76 Director
John A. Henning 44 Director
Lawrence C. Tucker 57 Director
Henry P. Hebert, Jr. 74 Director
Charles T. Cannada 41 Director
Andrew C. Cowen 29 Director
Michael D. Bennett 35 Vice President and General Manager of Wireless Operations
Jack J. Blanchard 40 Vice President of Marketing
Don A. Matz 41 Vice President of Information Technologies
Brenda S. McElveen 54 Vice President of Administration
Paul J. Clifton 45 Vice President of Research and Development
</TABLE>

William L. Henning, Jr. presently serves as the Chairman of our board of
directors. He has served as our director since 1988. From 1988 to 2000, he was
our Chief Executive Officer. Before 1988, he was our General Manager. He has
been involved in the senior management of Cameron Telephone Company and us
since 1976. He has also served as our Chairman, President and Vice President.
He was also President of Mercury Information Technologies, Inc., which has
owned and operated a cable television franchise, a voice mail service and an
internet access service, for over five years. From 1991 to 1998, he served as a
director of First National Bank of Lake Charles.

Robert W. Piper presently serves as our President and Chief Executive
Officer. He has been our President since 1995. He served as our Chief Operating
Officer from 1995 to 2000 and as our Chief Financial Officer from 1994 to 1995.
He was Vice President and General Manager of our long distance operations from
1987 to 1990 and of our wireless business from 1987 until 1994. He joined us in
1985 as comptroller. He served on the Board of Directors of the Cellular
Telecommunications Industry Association from 1992 to 1994 and from 1998 to
1999.

Jerry E. Vaughn has served as our Chief Financial Officer since June 7,
1999. He has over 20 years of diversified financial management experience and
focused the last 11 of these years in the telecommunications industry. From
1994 until he joined us, Mr. Vaughn was President of NTFC Capital Corporation,
a subsidiary of GE Capital. Before that, he was Treasurer of Northern Telecom
Finance Corporation and Vice President of Mellon Bank Corporation.

Thomas G. Henning has been General Counsel of us and Cameron Telephone
Company since 1994. He is responsible for general corporate, regulatory and
other legal matters. Before becoming General Counsel, Mr. Henning was a partner
with the law firm of Stockwell, Sievert, Viccellio, Clements and Shaddock. He
remains of counsel to this firm. He has been an officer and director of us
since 1988.

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William L. Henning, Sr. has been our director since our predecessor's
incorporation in 1967. He practiced law for ten years after law school and has
been involved in the telecommunications industry for over 45 years. He was an
executive officer and director of Cameron Telephone Company for over 40 years.
He has also served as director of the National Rural Telecom Association since
1973. He was President of the Louisiana Telephone Association in 1955. He
served as a director of the West Calcasieu Port, Harbor and Terminal District
from 1964 to 1978, of the Calcasieu Parish Industrial Development Board from
1972 to 1986, of the United States Telephone Association from 1982 to 1988 and
of Calcasieu Marine National Bank from 1985 to 1996. He was a commissioner of
the Chenault Industrial Airpark Authority from 1986 to 1988.

John A. Henning has served as our officer and director and as a director
of Cameron State Bank since 1988. He served as President of our Louisiana
cellular operations from 1987 to 1995. He was a director of the Louisiana
Telephone Association from 1984 to 1995 and its President from 1993 to 1995.

Lawrence C. Tucker has been our director since November 1999. He has been
a General Partner of Brown Brothers Harriman & Co. since 1979 and currently
serves as a member of the Steering Committee of the firm's partnership. He co-
founded and has supervisory responsibility for BBH & Co.'s private equity
funds, which are known as The 1818 Funds and which have raised capital
commitments of $1.5 billion. He is a director of MCI WorldCom, Inc., the MCI
WorldCom Venture Fund, National Healthcare Corporation, Riverwood Holdings,
Inc., VAALCO Energy Inc., World Access, Inc. and National Equipment Services,
Inc.

Henry P. Hebert, Jr. has agreed to serve as our director upon consummation
of this offering. Mr. Hebert has been the owner of H.P. Hebert Oil Properties
since 1962 and has been the managing member of Hebert & Rucks, L.L.C. since
1998. These companies are involved in oil and gas exploration, production
management and operating and producing property acquisitions. Mr. Hebert has
been involved in the oil and gas exploration and production business since
1956. He presently serves as the Chairman of the Board of Trustees of Lafayette
General Medical Center.

Charles T. Cannada has agreed to serve as our director upon consummation
of this offering. Mr. Cannada has been a director of Nova Corp. since 1995. Mr.
Cannada previously served from 1995 to 2000 as Senior Vice President in charge
of corporate development, international ventures and alliances, facility
management, internal audit and flight operations for MCI WorldCom, Inc. From
1989 to 1994, Mr. Cannada served as WorldCom Inc.'s Chief Financial Officer.
Mr. Cannada presently serves as a director of First Commercial Bank in Jackson,
Mississippi and is the Chairman of the Business Affairs Committee of the Board
of Trustees for Belhaven College.

Andrew C. Cowen has been our director since January 2000. He has been
employed by Brown Brothers Harriman & Co. since 1992 and is currently a senior
vice president and specializes in private equity investments. He is a director
of Computerized Medical Systems, Inc.

Michael D. Bennett has served as Vice President and General Manager of
wireless operations since January 2000 when he joined us. He has 15 years of
telecommunications experience and spent the last five years in various
positions with PrimeCo, including area director and sales and marketing
director in Jacksonville, Florida, and director of strategy and planning in
Dallas, Texas. He has also

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worked in various management positions at U.S. Intelco Networks in Olympia,
Washington and Century Telephone Enterprises, Inc. in Monroe, Louisiana.

Jack J. Blanchard has served as our Vice President of Marketing since
January 1998. Before that, he served for at least five years as our Sales
Manager and Director of Sales and Marketing. He is responsible for all
marketing and public relations efforts for our cellular, PCS, paging, internet
and landline services. He had a leadership role in naming and developing our
very successful wireless prepaid program "Chat Pak." He has been instrumental
in our winning numerous advertising campaign awards such as CLIO's Best Overall
Campaign at the "One Awards" and first place in the television division at the
1998 Cellular Telecommunications Industry Association's EMA awards.

Don A. Matz has served as our Vice President of Information Systems since
October 26, 1998. He is responsible for our management information system and
support. Before joining us in 1998, he was employed for 18 years with Century
Telephone Enterprises, Inc., a telecommunications company engaged in wireline
and wireless activities. With Century Telephone, he held various positions
within Information Systems, the last seven years of which were in director-
level positions in Applications Development, Systems and Networks, and Research
and Development.

Brenda S. McElveen presently serves as our Vice President of
Administration and is responsible for customer care, credit collections,
customer retention and employee training for our cellular, paging, PCS,
competitive local exchange carrier and internet services. She joined us in 1984
as Office Manager.

Paul J. Clifton has served as our Vice President of Research and
Development since 1998. From 1994 to 1998, he was our Vice President for
Engineering and Technical Services. From 1988 to 1994, he served us in various
capacities such as manager of network systems and traffic manager. He was first
hired by Cameron Telephone Company in 1980 and began to work for us in 1988. In
those capacities between 1980 and 1994, he was responsible for design and
implementation of projects associated with the operation of our cellular,
paging, voicemail, central office, personal computer, cable television and long
distance operations.

William L. Henning, Jr., Thomas G. Henning and John A. Henning are
brothers. William L. Henning, Sr. is their father.

Board of Directors

Our board of directors is divided into three classes. Each class serves
for three years. The terms of each class are staggered. The Class I directors
are John A. Henning, Thomas G. Henning and Henry P. Hebert, Jr., and their
terms expire in 2001. The Class II directors are William L. Henning, Sr.,
Robert Piper and Charles T. Cannada, and their terms expire in 2002. The Class
III directors are William L. Henning, Jr., Lawrence C. Tucker and Andrew C.
Cowen, and their terms expire in 2003. We have an agreement with the holders of
our series A preferred stock, who will hold our class B common stock after this
offering is completed, that entitles them to nominate up to two individuals to
serve on our board of directors. These individuals are Mr. Tucker and Mr.
Cowen. We have agreed to recommend that our stockholders elect their nominees.

Our audit committee consists of Charles T. Cannada, who is the chairman,
Henry P. Hebert, Jr. and Andrew C. Cowen.

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We do not presently have a compensation committee. Instead, our board of
directors performs these functions. William L. Henning, Jr., Thomas G. Henning
and Robert Piper, who are some of our executive officers and directors,
participate in deliberations of our board of directors about executive officer
compensation.

Under our by-laws, the board of directors may establish an executive
committee. If established, the committee will consist of up to five members and
will have all powers of the board of directors when the board is not in session
except powers expressly delegated to other committees. Every member of the
executive committee must approve the sale of any shares of capital stock or the
incurrence of any indebtedness, except for trade indebtedness incurred in the
ordinary course of our business and indebtedness not in excess of $1.0 million.

No Employment Agreements

We do not presently have employment agreements with any of our officers or
employees. Each may terminate his employment, or we may terminate his
employment, at will. Employees who started within the last five years have
agreed to some restrictions on competing with us after the person is no longer
our employee.

Director Compensation

We do not presently pay our directors fees for service in their capacity
as directors. We reimburse their expenses of attendance at meetings of our
board and its committees. We will grant to two of our directors, Mr. Cannada
and Mr. Hebert, options to purchase an aggregate of 15,000 shares of our class
A common stock at the offering price when they become members of our board of
directors upon the consummation of this offering.

69
<PAGE>

Executive Compensation

The following table shows what our CEO and most highly compensated
officers earned in 1997, 1998 and 1999.

<TABLE>
<CAPTION>
Annual Compensation
-----------------------------------------
Bonus
--------------
All Other
Name and Principal Position Year Salary Cash Stock Compensation
--------------------------- ---- -------- -------- ----- ------------
<S> <C> <C> <C> <C> <C>
William L. Henning, Jr.(/3/).... 1997 $102,750 $ 25,075 -- --
Chairman of the Board of
Directors 1998 $135,000 -- -- $950,000(/1/)
1999 $110,000 $300,000 -- --

Robert W. Piper(/4/)............ 1997 $ 87,951 $ 10,000 -- --
President & Chief Executive
Officer 1998 $105,750 $ 25,000 -- $500,000(/1/)
1999 $112,973 $150,000 -- --

Thomas G. Henning............... 1997 $ 56,875 $ 10,000 -- --
Secretary & General Counsel 1998 $ 60,000 $ 17,500 -- $700,000(/1/)
1999 $ 60,000 $150,000 -- --

Don A. Matz..................... 1997 -- -- -- --
VP-Information Systems 1998 $ 21,154 $ 10,000 -- --
1999 $111,008 $ 14,810 -- $ 56,874(/2/)
</TABLE>
- ---------------------
(/1/)Consideration from third parties for non-competition agreements in
connection with the 1998 sale of selected cellular markets.
(/2/)Relocation expenses.
(/3/)William L. Henning, Jr. served as Chief Executive Officer in 1997, 1998
and 1999.
(/4/)Robert W. Piper served as President and Chief Operating Officer in 1997,
1998 and 1999.

The following table shows the options granted to these executive officers
in 1999:

<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
---------------------------------------------------------------------------
Potential Realizable Value at
Number of % of total Assumed Annual Rates of Stock
Securities options Price Appreciation for Option
underlying granted to Exercise Term
options employees or base Expiration --------------------------------
Name and Principal Position granted during 1999 price date 0% 5% 10%
--------------------------- ---------- ----------- -------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
William L. Henning, Jr.(/1/).. 1,066,080 30.1% $1.13 9-30-09 $2,800,000 $5,315,579 $9,174,970
Chairman of the Board of 155,115 4.4% $4.98 9-30-09 -- $ 175,412 $ 736,953
Directors

Robert W. Piper(/2/).......... 533,040 15.0% $1.13 9-30-09 $1,400,000 $2,657,789 $4,587,485
President & Chief Executive 81,022 2.3% $4.98 9-30-09 -- $ 91,624 $ 384,938
Officer

Thomas G. Henning............. 533,040 15.0% $1.13 9-30-09 $1,400,000 $2,657,789 $4,587,485
Secretary & General Counsel 63,965 1.8% $4.98 9-30-09 -- $ 72,335 $ 303,898

Don A. Matz................... 23,987 0.7% $1.13 9-30-09 $ 63,000 $ 119,601 $ 206,437
VP-Information Systems 52,771 1.5% $4.98 9-30-09 -- $ 59,676 $ 250,716
</TABLE>
- ---------------------
(/1/)William L. Henning, Jr. served as Chief Executive Officer in 1997, 1998
and 1999.
(/2/)Robert W. Piper served as President and Chief Operating Officer in 1997,
1998 and 1999.

1999 Equity Incentive Plan

We have adopted the US Unwired Inc. 1999 Equity Incentive Plan. Under the
plan, we may grant stock options and other equity-based awards to our
directors, officers, selected employees and consultants. Our board of directors
administers the plan.

70
<PAGE>

The board may grant stock options, stock appreciation rights and other
equity-based awards to eligible persons. These awards may not relate to more
than 12,259,920 shares of class A common stock. We may reissue shares subject
to awards that are not exercised or paid. We do not count awards paid in cash
against the number of shares that we may issue under the plan.

We may satisfy awards with either authorized but unissued class A common
stock or class A common stock held as treasury shares. The board may grant one
or more types of awards in any combination to a particular participant in a
particular year. Unless our board of directors terminates it earlier, the plan
will remain in effect until all awards have been satisfied in stock or in cash
or terminated and there are no more restrictions on stock issued under the
plan. Except when we award
stock as additional payment for services to us, we will confirm each award and
sign an agreement with the participant.

We may make the following types of awards or grants under the plan:

Stock options. Stock options may be incentive stock options that qualify
under of Section 422 of the Internal Revenue Code or nonqualified stock
options. The board will set the exercise price and other terms of options.

A person who has been granted a stock option, or an optionee, may pay the
exercise price for an option in shares of class A common stock valued at their
then fair market value if the optionee has held the shares for at least six
months. The board may permit the optionee to pay in shares of class A common
stock that have been held for less time, or in any other manner.

We may not grant incentive options after September 30, 2009. If the
optionee does not exercise these options, they expire no later than 10 years
after the date of grant. We may not grant incentive options to any participant
in the plan who, at the time of the grant, would own (as determined by the
Internal Revenue Code) more than 10% of the total combined voting power of all
classes of our stock or of any of our subsidiaries.

Stock appreciation rights and limited stock appreciation rights. A stock
appreciation right is a right to receive, without payment to us, a number of
shares of stock, cash or both, as determined by a formula. A limited stock
appreciation right is a right to receive, without payment to us, cash in amount
determined by a formula if there is a change in the persons who control us. We
may grant stock appreciation rights with all or any part of a stock option or
independently. If a participant exercises a stock appreciation right, he is
entitled to receive, for each share of class A common stock relating to the
exercised stock appreciation right, the excess of the fair market value per
share of class A common stock on the date of exercise over the grant price of
the stock appreciation right. The board sets the terms of stock appreciation
rights. If a participant exercises a limited stock appreciation right, he is
entitled to receive a cash payment, for each share of class A common stock
relating to the exercised limited stock appreciation right, equal to excess of
the defined change of control value over the grant price of the limited stock
appreciation right.

Other stock-based awards. The board may make other awards based on shares
of class A common stock. These awards may depend on our performance. The board
will determine the participants to whom and the times at which these awards
will be made, the number of shares of class A common stock to be awarded and
all other terms of the awards.

71
<PAGE>

We will adjust the number of shares of class A common stock available or
issued under the plan if there is any recapitalization, reclassification, stock
dividend, stock split, combination of stock or other similar change in class A
common stock. If there is an adjustment, the board will make appropriate
adjustments to the purchase price of any option, the performance objectives of
any award and the stock issuable pursuant to any award so that participants
will have the same relative rights before and after the adjustment.

If there is a change in the persons who control us, all outstanding
options that we have granted, including incentive options, stock appreciation
rights and limited stock appreciation rights, will become fully exercisable,
all restrictions on any award will lapse, and all performance criteria and
other conditions relating to the payment of awards will be deemed achieved or
waived by us without further action.

Our board may change or terminate the plan at any time. Tax or regulatory
laws may require our stockholders to approve some changes.

The plan is not subject to ERISA and is not qualified under Section 401(a)
of the Internal Revenue Code.

We will have granted an aggregate of 6,817,518 options under our plan as
of the date of this offering. This amount includes 1,376,309 options to William
L. Henning, Jr., 695,084 options to Robert W. Piper, 661,503 options to Thomas
G. Henning, 191,894 options to Jerry E. Vaughn and 129,529 options to Don A.
Matz.

72
<PAGE>

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Corporate Restructuring

We recently changed our corporate structure. US Unwired previously was our
operating cellular company, and LA Unwired and LEC Unwired were its
subsidiaries. In September 1999, we formed a holding company named US Unwired,
and all of the stockholders of old US Unwired became stockholders of the new
holding company. We did this by exchanging all of the issued and outstanding
capital stock of old US Unwired, the operating cellular company, for an equal
number of shares of new US Unwired, the holding company. Old US Unwired was
renamed Unwired Telecom and became a wholly owned subsidiary of new US Unwired.
Unwired Telecom made a stock dividend to US Unwired of all of its ownership
interest in LA Unwired and LEC Unwired. LA Unwired and LEC Unwired are now
subsidiaries of the holding company.

Our affiliate Command Connect used to hold some of our FCC licenses and
owed $2.3 million to the FCC for those licenses. US Unwired and our affiliate
Cameron Communications Corporation equally own Command Connect. As of December
17, 1999, Command Connect transferred its PCS licenses and related FCC debt to
LA Unwired. The Henning family owns approximately 60% of Cameron.

Disposition of Assets

Sale of LEC Unwired. On March 22, 2000, US Unwired adopted a formal plan
to sell its 59.8% ownership interest in LEC Unwired to LEC Unwired for the fair
market value of that interest. That value has not yet been determined. Upon
conclusion of such a sale, LEC Unwired would be owned approximately 76.9% by
Cameron and 23.1% by a corporation that is owned by existing stockholders of US
Unwired. Completion of this transaction would require consents of US Unwired's
and LEC Unwired's lenders.

Sale of Command Connect. In April 2000, Unwired Telecom agreed to sell its
50% interest in Command Connect, including its interest in the LMDS licenses
that Command Connect holds, to Cameron for approximately $1.4 million of
Cameron's interest in LA Unwired.

Sale of PCS Licenses. In April 2000, LA Unwired agreed to sell its PCS
licenses for service areas not covered by the Sprint PCS management agreements
to Cameron for approximately $1.1 million of Cameron's interest in LA Unwired,
the assumption of $1.4 million of debt of LA Unwired related to the licenses
and $1.3 million in cash, and LA Unwired agreed to use this $1.3 million of
cash to purchase Command Connect's 0.5% interest in LA Unwired.

Consummation of all of the above transactions may be subject to prior
receipt of FCC approval.

The indenture under which our notes were issued requires that US Unwired
receive fair value in these transactions with its affiliates.

Affiliate Transactions

General. US Unwired, Cameron and their subsidiaries have agreements with
one another and with other companies under common control. We describe some of
those agreements below. Other agreements include sharing of costs, services and
salary expenses and sales of assets between companies.

73
<PAGE>

Bill processing procedures. Under agreements made in 1997 and 1998,
Unibill, Inc., a wholly owned subsidiary of Cameron, provides bill processing
and related services for us and Meretel. We believe that the terms of these
agreements are no less favorable to us than would be available from
unaffiliated third persons. For these services, Unibill received approximately
$2.7 million in 1997, $2.9 million in 1998 and $2.8 million in 1999.

Property leases. In March 1998, US Unwired agreed to lease office,
equipment and warehouse space from Unibill for 60 months. We believe that the
terms of this lease are no less favorable to us than would be available from
unaffiliated third persons. US Unwired paid Unibill $173,500 in 1998 and
$294,500 in 1999 to lease these properties.

System management and construction services. On January 1, 1998, US
Unwired agreed to provide Meretel with construction and management services for
its systems. These services included reviewing and modifying system design,
obtaining governmental and regulatory approvals, preparing control point, base
station and business office sites, purchasing and installing switching and base
station equipment, negotiating interconnection to the local exchange switched
telephone network, and generally managing the operations of the system. In
return for these services, Meretel paid US Unwired a management fee and
reimbursed it for all of its expenses. As part of the Meretel transaction
described in the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations," we no longer provide these
services. Meretel paid US Unwired approximately $1.1 million in 1997, $1.4
million in 1998 and $1.6 million in 1999 for these services and expense
reimbursements. In 1997, Meretel agreed to pay US Unwired a commission for each
customer activated for Meretel. Meretel paid US Unwired commissions of
approximately $1.2 million in 1997 and $1.9 million in 1998. Effective November
1, 1999, US Unwired agreed to provide specified management services to Meretel
in connection with Meretel's provision of PCS services. In 1999, Meretel paid
US Unwired approximately $674,000 for these services.

Long distance services. US Unwired purchases long distance service from
Cameron and resells that service to US Unwired's customers. US Unwired pays
rates for this service that are comparable to rates at similar volumes charged
by Cameron to other customers. These rates are competitive with rates that US
Unwired would expect to pay for similar service from an unaffiliated third
party. US Unwired paid Cameron approximately $951,000 in 1997, $764,000 in 1998
and $1.5 million in 1999 for long distance services.

Flight services. US Unwired uses, for a rate of $2.75 per air mile, a
Mitsubishi Diamond 1A aircraft owned and operated by Cameron. US Unwired paid
Cameron approximately $93,800 in 1997, $84,500 in 1998 and $97,100 in 1999 for
these flight services. These rates are comparable to what US Unwired would be
required to pay to an unaffiliated third party for similar services.

Consulting agreements. In October 1999, US Unwired entered into consulting
agreements with William L. Henning, Sr. and John A. Henning, both of whom serve
on US Unwired's board of directors. US Unwired paid $250,000 to William L.
Henning, Sr. and $150,000 to John A. Henning for consulting services for
matters involving financing of our wireless business through potential bank
financing and senior subordinated discount notes.

Management and other services. In 1999, LEC Unwired began providing US
Unwired with voicemail services which US Unwired uses and also resells to its
cellular and digital subscribers.

74
<PAGE>

LEC agreed also to provide technical support to Cameron for $2,600 per month.
We believe that the terms of these arrangements are no less favorable to US
Unwired than would be expected in comparable arrangements with unaffiliated
third persons.

On September 30, 1998, US Unwired purchased from Maas.net all of its
internet assets for approximately $620,000. This amount represented the then
current outstanding liabilities of Maas.net. Maas.net is a limited liability
company owned 63% by MIT. MIT owns 20% of Wireless Management Corporation,
which is the general partner of Meretel. Two of our directors and one of our
officers own interests in MIT, and the chairman of our board of directors owns
27% of MIT.

Internet services. Effective October 1, 1998, US Unwired began providing
to Cameron and its affiliates internet services for resale to their customers.

Preferred stock sale. On October 29, 1999, we sold $50 million of our
convertible preferred stock to The 1818 Fund III, L.P., a Delaware private
equity partnership managed by Brown Brothers Harriman & Co. Pursuant to the
sale, Lawrence C. Tucker, who is a general partner of Brown Brothers Harriman &
Co., which is the general partner of The 1818 Fund, and Andrew C. Cowen, who is
a senior vice president at Brown Brothers Harriman & Co., became members of our
board of directors.

Loan to Cameron. In April 2000, US Unwired loaned $1.1 million to Cameron
on an unsecured basis. The loan is payable on demand or, if no demand is made,
five years from its date. The loan bears interest, which is payable when the
principal is due, at the federal funds rate plus 2.75%. US Unwired may loan
Cameron additional amounts, the aggregate of which, including the initial $1.1
million, is not expected to exceed $5.0 million. Any additional loans are
expected to be made on the same terms as the $1.1 million loan.

75
<PAGE>

PRINCIPAL AND SELLING STOCKHOLDERS

Principal Stockholders

The following table shows as of March 31, 2000 the beneficial ownership of
the capital stock of US Unwired by (a) each of our directors and officers
listed in the summary compensation table, (b) all directors and officers as a
group and (c) each person known to us to be the beneficial owner of 5% or more
of any class of our voting securities. These amounts have been adjusted to
reflect a 5.3304 for 1 stock split that was approved by our stockholders on
April 11, 2000. In this table, beneficial ownership means the sole or shared
power to vote or direct the voting or to dispose or direct the disposition of
any security. A person is deemed as of any date to have beneficial ownership of
any security that the person has a right to acquire within 60 days after that
date. Any security that any person has the right to acquire within 60 days is
deemed to be outstanding for purposes of calculating the ownership percentage
of any other person. Under Rule 13d-4 of the Securities Exchange Act, each
person named in this table disclaims the beneficial ownership of all shares
shown as beneficially owned by that person except for shares owned of record by
that person. Except as otherwise indicated, the address for each stockholder is
c/o US Unwired Inc., One Lakeshore Drive, Suite 1900, Lake Charles, Louisiana
70629.

<TABLE>
<CAPTION>
Class A Common Stock Class B Common Stock
-------------------- -------------------------------
Percentage Percentage
Name of Beneficial Owner Shares of class Shares of class
- ------------------------ --------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Sandy Britnell, Trustee of the William L.
Henning Grantor Retained Annuity Trust and the
Lena B. Henning Grantor Retained Annuity
Trust.......................................... -- -- 24,001,356(/1/) 35.1%
William L. Henning, Sr. ........................ -- -- 427,782(/2/) 0.6
William L. Henning, Jr. ........................ -- -- 5,560,563(/3/)(/4/) 8.1
John A. Henning................................. -- -- 5,265,696(/4/)(/5/) 7.7
Thomas G. Henning............................... -- -- 7,359,104(/6/) 10.7
Thomas D. Henning............................... -- -- 4,155,558 6.1
Robert W. Piper................................. -- -- 177,427(/7/) 0.3
Lawrence C. Tucker.............................. -- -- 10,038,417(/8/) 14.7
The 1818 Fund III, L.P. ........................ -- -- 10,038,417 14.7
Trust Company of the West(/9/).................. 1,003,842 39.2% -- --

All officers and directors as a group
(13 persons total, 6 with ownership interests).. -- -- 28,828,989 42.1
</TABLE>
- ---------------------
(/1/) Includes 12,000,681 shares held by the William L. Henning Grantor
Retained Annuity Trust and 12,000,675 shares held by the Lena B. Henning
Grantor Retained Annuity Trust. Ms. Britnell disclaims the beneficial
ownership of all shares held by these trusts.
(/2/) Includes 79,646 shares held by William L. Henning, Sr. as custodian
under the Uniform Gifts to Minors Act for the benefit of the minor
children of Thomas G. Henning, of which shares William L. Henning. Sr.
disclaims beneficial ownership. The remainder includes the community
property interest of Mrs. William L. Henning, Sr. Also includes William
L. Henning, Sr.'s proportionate interest in 177,427 shares held by a
general partnership comprised of Mr. and Mrs. William L. Henning, Sr.,
William L. Henning, Jr., John A. Henning and Thomas G. Henning, based on
his interest in that partnership.
(/3/) Excludes 84,208 shares held by Thomas G. Henning as custodian under the
Uniform Gifts to Minors Act for the benefit of the minor children of
William L. Henning, Jr.
(/4/) Excludes 620,996 shares held in each of two trusts for the benefit of
the minor children of William L. Henning, Jr. and John A. Henning,
respectively, of which shares each of them disclaims beneficial
ownership. Includes each of William L. Henning, Jr.'s and John A.
Henning's proportionate interest in

76
<PAGE>

177,427 shares held by a general partnership comprised of Mr. and Mrs.
William L. Henning, Sr., William L. Henning, Jr., John A. Henning and
Thomas G. Henning, based on each of their respective interests in that
partnership.
(/5/) Excludes 112,928 shares held by Thomas G. Henning as custodian under
the Uniform Gifts to Minors Act for the benefit of the minor children
of John A. Henning.
(/6/) Includes an aggregate of 197,136 shares held by Thomas G. Henning as
custodian under the Uniform Gifts to Minors Act for the benefit of the
minor children of John A. Henning and William L. Henning, Jr. (see
Notes (3) and (5) above), of all of which shares Thomas G. Henning
disclaims beneficial ownership. Excludes 79,646 shares held by William
L. Henning, Sr. as custodian under the Uniform Gifts to Minors Act for
the benefit of the minor children of Thomas G. Henning (see Note (2)
above). Includes 1,241,992 shares held by Thomas G. Henning as trustee
for the minor children of William L. Henning, Jr. and John A. Henning
(see Note (4) above), and 620,996 shares held by Thomas G. Henning as
trustee for his own minor children, and 15,224 shares held by Thomas G.
Henning as custodian under the Uniform Gifts to Minors Act for the
benefit of his minor children, of all of which shares he disclaims
beneficial ownership. Also includes Thomas G. Henning's proportionate
interest in 177,427 shares held by a general partnership comprised of
Mr. and Mrs. William L. Henning, Sr., William L. Henning, Jr., John A.
Henning and Thomas G. Henning, based on his interest in that
partnership.
(/7/) Includes the community property interest of Dr. Eileen Piper, the
spouse of Robert W. Piper.
(/8/) Mr. Tucker, a general partner of Brown Brothers Harriman & Co., which
is the general partner of The 1818 Fund, may be deemed to be the
beneficial owner of shares held of record by The 1818 Fund due to his
role as a co-manager of The 1818 Fund. Mr. Tucker disclaims beneficial
ownership of the shares beneficially owned by The 1818 Fund, except to
the extent of his pecuniary interest therein. The 1818 Fund designated
Mr. Tucker as a director.
(/9/) Represents shares held by the following affiliates of Trust Company of
the West: TCW/Crescent Mezzanine Partners II, L.P., TCW/Crescent
Mezzanine Trust II, TCW Shared Opportunity Fund II, L.P., TCW Shared
Opportunity Fund IIB, LLC, TCW Shared Opportunity Fund III, L.P., TCW
Leveraged Income Trust II, L.P., TCW Leveraged Income Trust, L.P. and
Brown University Third Century Fund.

Selling Stockholders

If the underwriters exercise their over-allotment option in full, the
following class B common stockholders will convert some of their class B
common shares into the number of class A common shares indicated below and
sell those class A common shares through the over-allotment exercise.
Immediately after the over-allotment exercise, they will beneficially own the
number of class B common shares indicated below:

<TABLE>
<CAPTION>
Class A Common
Class B Common Stock Stock to be sold
before over- through over- Class B Common Stock
allotment allotment after over-allotment
exercise(1) exercise(1) exercise(1)
-------------------- ----------------- --------------------
Number of Number of
shares Percent Percent shares Percent
beneficially of Number of of beneficially of
Name owned class shares Class owned Class
- ---- ------------ ------- --------- ------- ------------ -------
<S> <C> <C> <C> <C> <C> <C>
Thomas D. Henning....... 4,155,558 6.1% 352,800 3.0% 3,802,758 5.6%
Joyce Spates(/2/)....... 738,200 1.1 175,200 1.5 563,000 0.8
James D. Spates(/2/).... 3,369,730 4.9 175,200 1.5 3,194,530 4.8
Scobee Family
Partnership.......... 2,917,066 4.3 248,400 2.1 2,668,666 4.0
Henry R. Scobee(/3/).... 2,917,056 4.3 248,400 2.1 2,668,656 4.0
Total................... 14,097,610 20.7 1,200,000 10.2 12,897,610 19.2
</TABLE>
- --------------------
(1) Assumes the conversion of our preferred stock.
(2) Shares shown in the first and fifth columns for James D. Spates include
2,638,530 shares that he and Joyce Spates transferred to a limited
partnership of which each of them is a general partner. These shares are
included as beneficially owned by James D. Spates, and not by Joyce
Spates, because James D. Spates is the managing general partner of the
limited partnership and, as such, has the power to vote and dispose of the
partnership's shares. Neither Joyce Spates nor James D. Spates
acknowledges hereby the beneficial ownership of shares owned by the
partnership.
(3) Includes 639,648 shares held in trust for the benefit of Mr. Scobee's
children.

77
<PAGE>

CERTAIN INDEBTEDNESS

Senior Subordinated Discount Notes

On October 29, 1999, US Unwired issued in a private placement $400.0
million in aggregate principal amount of its 13 3/8% series A senior
subordinated discount notes due 2009. On April 4, 2000, the SEC declared
effective a registration statement on Form S-4 relating to a registered
exchange offer for the series A senior subordinated discount notes. All holders
of the series A notes have exchanged their notes for US Unwired's 13 3/8%
series B senior subordinated discount notes due 2009 in the registered exchange
offer. The following discussion applies to the series A senior subordinated
discount notes and the series B senior subordinated discount notes.

The notes are unsecured obligations of US Unwired. They are subordinated
in right of payment to US Unwired's existing and future senior debt and rank
equal in right of payment with US Unwired's future senior subordinated debt.

The notes are fully and unconditionally, jointly and severally guaranteed
by US Unwired's subsidiary guarantors. The guarantees are:

. unsecured obligations of the guarantors except for the limited security
provided by a pledge agreement from one of the guarantors.

. subordinated in right of payment to all existing and future senior debt
of the guarantors.

. equal in right of payment with any future senior subordinated debt of
the guarantor.

We may redeem some or all of the notes after November 1, 2004, and before
November 1, 2002 we may redeem a portion of the notes with the net proceeds of
an equity offering.

We issued the series A notes at a discount to their principal amount. The
notes accrete in value daily, compounded semi-annually, at a rate of 13 3/8%
per year until November 1, 2004, at which time their accreted value will equal
their principal amount. Interest will begin to accrue at this time at an annual
rate of 13 3/8% and will be payable semi-annually, beginning May 1, 2005. The
indenture relating to the notes contains covenants that limit our ability and
the ability of our subsidiaries to:

. incur additional debt or issue preferred stock.

. pay dividends, redeem capital stock or make other restricted payments
or investments.

. create liens on assets.

. merge, consolidate or dispose of assets.

. enter into transactions with affiliates.

. change lines of business.

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<PAGE>

These and other limitations in the indenture are subject to qualifications
described in full in the indenture, which has been filed as an exhibit to the
registration statement on Form S-4 described above.

If there is a change in the persons who control us, holders of the notes
have the right to require us to repurchase all or any part of their notes at
101% of the accreted value, if before November 1, 2004, or 101% of the
aggregate principal amount, if on or after November 1, 2004, together with
accrued and unpaid interest, subject to restrictions in US Unwired's senior
credit facility.

The indenture also contains customary events of default relating to the
notes including:

. failure to pay interest or principal on the notes when due.

. failure to perform covenants.

. acceleration of the maturity of other debt.

. events of bankruptcy.

. certain judgments against us.

. the occurrence of any event of default pursuant to our agreements with
Sprint PCS.

Senior Credit Facilities

Under a credit agreement dated as of October 1, 1999, US Unwired entered
into senior credit facilities for $130.0 million. The senior credit facilities
provide for an $80.0 million reducing revolving credit facility, which matures
on September 30, 2007, and a $50.0 million delay draw term loan, which matures
on September 30, 2007.

The reducing revolver will be permanently reduced in quarterly
installments beginning on June 30, 2000, in amounts which vary between $1.3
million and $6.0 million. The term loan will be amortized in quarterly
installments beginning on June 30, 2003. These quarterly amounts range between
$1.3 million and $3.7 million.

Interest on all loans made under the senior credit facilities bear
interest at variable rates tied to the prime rate, the federal funds rate or
the London Interbank Offering Rate.

The senior credit facilities require US Unwired to pay an annual
commitment fee of 1.5% of the unused commitment under the senior credit
facilities when the unused portion is greater than or equal to 66.67% of the
total amount of the senior credit facilities, reducing to 1.25% when the unused
portion is less than 66.67% but equal to or greater than 50% of the total
amount of the senior credit facilities, and reducing to 1.00% when the unused
portion is less than 50% of the total amount of the senior credit facilities.

All of US Unwired's obligations under the senior credit facilities are
guaranteed by:

. a fully secured guarantee from each of LA Unwired and Unwired Telecom.

. an unsecured partial guarantee from Lucent Technologies, Inc. in the
amount of up to $43.3 million available for principal, together with
one-third of accrued interest and other

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applicable fees (but excluding prepayment premiums). If US Unwired
(including the subsidiary guarantors and Texas Unwired) demonstrates a
defined total leverage ratio (including subordinated indebtedness) of
less than 6:1 for four consecutive quarters, Lucent will be released
from its guarantee.

The senior credit facilities are secured by:

. a first priority security interest in all tangible and intangible
assets of US Unwired (other than the corporate headquarters building),
LA Unwired and Unwired Telecom (including the owned PCS licenses, to
the extent legally permitted).

. a pledge by US Unwired and Cameron of 100% of the ownership interests
in LA Unwired, a pledge by US Unwired of its ownership interest in
Unwired Telecom and a pledge by LA Unwired of its ownership interest in
Texas Unwired.

. an assignment by LA Unwired of all Sprint PCS agreements and any
network contract (including software rights).

The agreement governing the senior credit facilities contains covenants
customary for facilities similar to the senior credit facilities, including
covenants that restrict the incurrence of indebtedness, liens or contingent
obligations, mergers and acquisitions, asset sales, investments, transactions
with affiliates other than at arm's length, management fees, dividends and
distributions, and covenants that require compliance with various financial
requirements, maintenance of existence, records, properties and insurance,
certain conduction of business, compliance with laws, reporting of regulatory,
litigation and other matters, rights of inspection and Year 2000 preparation,
in each case by US Unwired, LA Unwired, Unwired Telecom and Texas Unwired.

Other terms of the agreement include annual mandatory prepayments
beginning after December 31, 2002 of 50% of excess cash flow and limitations on
a change in control of US Unwired.

We will use borrowings under the senior credit facilities for working
capital requirements and capital expenditures for LA Unwired.

Other Credit

LEC Unwired loan agreements and US Unwired undertaking. On July 22, 1998,
LEC Unwired entered into a loan agreement for $15.0 million and a subordinated
loan agreement for $3.0 million with certain lenders. Under these agreements,
no more than two loans may be made to LEC Unwired in any calendar month. Each
loan must be of a minimum principal amount of $500,000. All loans made under
either of these agreements are represented by notes stated to mature on July 1,
2006. All loans made under the $15.0 million agreement bear interest at
variable rates tied to the defined Commercial Paper Rate, London Interbank
Offering Rate or U.S. Treasury securities rate, and all loans made under the
$3.0 million agreement bear interest at the U.S. Treasury securities rate plus
the defined applicable margin. Both loan agreements contain customary covenants
for similar facilities. Loans made under these agreements are available for LEC
Unwired to build, own and operate its competitive local exchange carrier
systems and for other costs.

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As required by these loan agreements, US Unwired agreed on March 31, 1999
to contribute cash of not more than $4.5 million to LEC Unwired if LEC Unwired
does not meet specified financial requirements in the loan agreements. These
include projected EBITDA and revenue requirements, specified company ratio
requirements and minimum cash availability requirements. On March 22, 2000, US
Unwired adopted a formal plan to sell its 59.8% ownership interest in LEC
Unwired.

Meretel credit agreement and US Unwired guarantee. On May 16, 1997,
Meretel entered into a credit agreement for a $57.0 million reducing revolving
senior credit facility which matures on July 1, 2007.

All loans made under the senior credit facility bear interest at variable
rates tied to the prime rate, the London Interbank Offering Rate or the U.S.
Treasury Rate. The credit agreement contains customary covenants for similar
facilities. Meretel uses these borrowings to construct its network and for
working capital.

As required by the credit agreement, US Unwired entered into a primary
guaranty agreement on May 16, 1997. The primary guarantors are the owners of
Meretel. The primary guarantors guarantee $19.0 million of Meretel's senior
credit facility. US Unwired's proportionate share of the guarantee is based on
its ownership percentage, which is 13.3% or approximately $2.5 million, as of
the date of this prospectus.

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DESCRIPTION OF CAPITAL STOCK

In this section the pronoun "we" or "us" means US Unwired Inc. and not
other members of its corporate family.

Immediately prior to this offering, assuming the conversion of our
preferred stock and a 5.3304 for 1 stock split, our capital stock consisted of
the following:

<TABLE>
<CAPTION>
Approximate
Class or Series of Stock Shares Authorized Shares Outstanding No. of Holders
------------------------ ----------------- ------------------ --------------
<S> <C> <C> <C>
Class A common stock.... 500,000,000 2,559,597 22
Class B common stock.... 300,000,000 68,449,634 38
Undesignated preferred
stock................ 200,000,000 0 0
</TABLE>

Common Stock

We have two classes of authorized common stock, class A and class B. The
class A common stock has one vote per share and the class B common stock has 10
votes per share. The two classes vote together in electing directors and
generally on all matters that require a vote of stockholders.

Our charter permits only qualified holders to own class B common shares.
If class B shares are transferred to other holders, the shares automatically
become an equal number of class A shares. Qualified holders are:

. our founders who are:

. the original holders of our class B shares, and

. any person or entity that receives class B shares in a distribution
from an entity that is a founder to the persons that hold its
equity interests.

. any descendant of a founder.

. any spouse or widow(er) of a qualified holder.

. any trustee or other fiduciary if:

. the trust is a charitable lead or remainder trust or similar entity
created by a founder, or

. the beneficiaries are qualified holders.

. any corporation, partnership or limited liability company whose equity
interests are held only by qualified holders.

. tax-exempt organizations that are described in section 501(c)(3) of the
Internal Revenue Code.

. The 1818 Fund III, L.P. and its affiliates.

. a person who ceases to be a qualified holder but is nevertheless named
a qualified holder by the remaining qualified holders.

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Except for these voting and ownership differences, the class A shares and
class B shares have the same rights.

Holders of common stock have no cumulative voting rights and no
preemptive, subscription or sinking fund rights. Subject to the preferences of
our preferred stock, holders of common stock are entitled to any dividends that
may be declared by our board of directors. If we liquidate or dissolve, holders
of our common stock are entitled to anything that is left after we have paid
all of our liabilities and the liquidation preference of our preferred stock.

Preferred Stock

Our charter allows our board of directors to issue our preferred stock in
different series and to establish by an amendment to our charter the dividend
rights and terms, conversion rights, voting rights, redemption rights and
terms, liquidation preferences and any other rights, preferences, privileges
and restrictions that apply to each series.

Shareholder Agreements

On September 24, 1999, we entered into an agreement with the holders of
our class B common stock, including several members of the Henning family. The
agreement prevents us from adopting additional restrictions on our class B
common stock. It also gives piggyback registration rights to the stockholders
who have signed it. The registration rights terminate on September 24, 2005,
and the other provisions terminate on September 24, 2024, unless otherwise
extended by the terms of the agreement.

On October 29, 1999 and February 15, 2000, we entered into agreements with
four members of the Henning family and the then holders of our preferred stock
who will hold our common stock upon completion of this offering. These
agreements:

. require the Henning family members to permit a former preferred holder
who holds at least 5% of our common stock to participate
proportionately in any sale by the family members of 20% or more of
their stock to a third party.

. require the Henning family members to vote with the former preferred
holders to elect up to two of our directors and to remove those
directors and elect their successors.

. prohibit us, the four Hennings and the former preferred holders from
taking any action, without specified stockholder approval, that would
make us ineligible to hold any of our FCC licenses.

As of May 17, 2000, we amended these agreements to omit the voting
agreements among the Henning family and the holders of our preferred stock. The
amendment still requires us to recommend for election by our stockholders up to
two directors nominated by our former preferred stockholders.

Certain Charter, By-Law and Statutory Provisions

The following sections describe certain provisions of our articles of
incorporation and by-laws, and of the Louisiana Business Corporation Law.

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Classified board of directors. Our articles of incorporation divide the
members of our board of directors into three classes, which are designated
Class I, Class II and Class III. The members of each class serve for a three-
year term. The terms are staggered, which means that each year the term of only
one of the classes expires. The Class I directors are John A. Henning, Thomas
G. Henning and Henry P. Hebert, Jr., whose terms expire in 2001. The Class II
directors are William L. Henning, Sr., Robert Piper and Charles T. Cannada,
whose terms expire in 2002. The Class III directors are William L. Henning,
Jr., Lawrence C. Tucker and Andrew C. Cowen, whose terms expire in 2003.
Staggering directors' terms makes it more difficult for a potential acquiror to
seize control of a target company through a proxy contest, even if the acquiror
controls a majority of the company's stock because only one-third of the
directors stand for election in any one year.

Special meetings of stockholders. Our articles of incorporation and by-
laws provide that any stockholder or stockholders holding at least 60% of our
total voting power may require us to hold a meeting of stockholders. In
addition, any stockholder or group of stockholders holding at least 60% of the
total voting power of any class or series of our stock may require us to hold a
meeting of stockholders of that class or series.

Advance notice requirements for director nominations. Our by-laws provide
that our board of directors may nominate candidates for election as directors
at a meeting of our stockholders. Our by-laws provide that these nominations
may also be made by any stockholder who is entitled to vote for the election of
directors at the meeting, but only if the stockholder has complied with
specified notice procedures contained in the by-laws.

Limitation of liability of directors and officers. Our articles of
incorporation provide that our directors and officers will not be liable to us
and our stockholders for monetary damages for breaches of their fiduciary
duties as directors or officers, except for:

. a breach of a director's or officer's duty of loyalty to us or our
stockholders.

. acts or omissions by directors or officers that are not in good faith
or that involve intentional misconduct or a knowing violation of law.

. liability for unlawful distributions of our assets to our stockholders,
or unlawful redemptions or repurchases of our shares from our
stockholders, to the extent provided in the Louisiana Business
Corporation Law.

. any transaction in which a director or officer receives an improper
personal benefit.

Indemnification of directors and officers. Our by-laws provide that we
must indemnify our directors and officers for claims made against them as our
directors or officers so long as they have acted in good faith and in a manner
they reasonably believed to be in, or not opposed to, our best interests. In
the case of a criminal proceeding they also must not have had a reasonable
cause to believe the conduct was unlawful.

Redemption of capital stock. Our articles of incorporation permit us to
purchase shares of our stock at fair market value from any stockholder whose
ownership of our stock:

. causes us to violate foreign ownership restrictions that apply to us as
a FCC licensee.

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. would prevent us from holding any governmental license or franchise
that is necessary to our business.

. would delay us in obtaining any necessary license or franchise.

. would materially increase our cost of obtaining or operating under any
necessary license or franchise.

Removal of directors. Our articles of incorporation provide that any
director may be removed, with or without cause, only by a vote of a majority of
the total voting power of the shares that would be entitled to elect the
successor to the removed director.

Adoption and amendment of by-laws. Our articles of incorporation and by-
laws provide that by-laws may be adopted by a majority vote of the board of
directors. The by-laws may be amended or repealed by a two-thirds vote of the
board of directors or, subject to limitations, by the affirmative vote of at
least two-thirds of the total voting power of our stock. Even though our
stockholders have the power to amend or repeal our by-laws, they do not have
the power to adopt new by-laws covering matters not expressly covered in the
by-laws prior to that adoption.

Special stockholder voting requirements. Our articles of incorporation
provide for special stockholder voting requirements to approve any of the
following:

. our merger or consolidation with another entity.

. a share exchange of our shares for shares of another entity.

. a sale of all or substantially all of our assets.

. our dissolution.

. an amendment to our articles of incorporation.

The vote required for these actions is either:

. two-thirds of our total voting power, voting together, or

. if the action has been approved by at least three-fourths of the number
of directors who constitute the full board of directors, then the
stockholder vote required to approve the action is a majority of our
total voting power, voting together.

The Louisiana Business Corporation Law provides that if a proposed amendment to
our articles of incorporation would adversely affect, within the meaning of the
Louisiana Business Corporation Law, the shares of any class or series of our
stock, then the amendment must also be approved by holders of the shares of
that class or series. Under our articles of incorporation, that approval would
require the affirmative vote of the holders of a majority of the voting power
of that class or series present at a meeting of that class or series.

Written consents of stockholders instead of a meeting of stockholders. Our
articles of incorporation permit our stockholders in specified instances to act
by a written consent instead of a meeting of stockholders. The written consent
need only be signed by stockholders who hold the voting power required to
approve the proposed actions by a written consent.

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Louisiana Fair Price and Control Share Laws

Our charter provides that the following do not apply to us:

. Louisiana's fair price law, which provides that a buyer must pay a
price to all stockholders that is generally equal to the highest price
paid to any stockholder.

. Louisiana's control share law, which provides that persons who acquire
specified levels of voting stock may not exercise the vote unless the
remaining stockholders vote to allow it.

Henning Family Control

Except for our staggered board of directors, we have not adopted typical
anti-takeover provisions. However, as long as the Henning family controls a
substantial portion of our voting power, it would not be possible for an
unwelcomed buyer to purchase us. After this offering, the Henning family will
control about 61.3% of our voting power, or 62.3% if the underwriters exercise
their over-allotment in full. That is sufficient for the family to elect our
entire board of directors. If our board of directors takes action with which
the Henning family disagrees, the family would be able to remove any or all of
our directors by written consent, without a meeting of stockholders. In that
event, the Henning family could, by written consent, elect directors to
replace those that have been removed. Thus, the Henning family may choose not
to entertain offers to purchase us, even offers that are at a substantial
premium to the market price of our stock. Our stockholders may therefore be
deprived of opportunities to profit from a sale of control.

Transfer Agent and Registrar

The transfer agent and registrar for the class A common stock is The Bank
of New York.

Our class A common stock is listed for quotation on the Nasdaq National
Market under the symbol "UNWR."

SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no market for our common stock.
Future sales of substantial amounts of common stock in the public market, or
the perception that substantial sales may occur, could adversely affect
prevailing market prices of our common stock from time to time.

When we complete this offering (based on shares outstanding as of the
date of this prospectus, assuming the conversion of our convertible preferred
stock), we will have outstanding an aggregate of 79,009,231 shares of common
stock. This assumes that:

. we issue 8,000,000 shares of our class A common stock in this offering.

. no options are exercised after March 31, 2000. We have 5,810,136 in-
the-money options at March 31, 2000.

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<PAGE>

Of these outstanding shares, all of the 8,000,000 shares sold in this offering
will be freely transferable without restriction or further registration under
the Securities Act, except that any shares purchased by persons who may be
deemed to be our "affiliates," as that term is defined in Rule 144 under the
Securities Act, may generally only be sold in compliance with the limitations
of Rule 144 described below.

Sales of Restricted Shares

We, our members of senior management and directors and our existing
stockholders have signed "lock-up" agreements under which we and they have
agreed not to transfer or dispose of, directly or indirectly, any shares of
capital stock or any securities convertible into, or exercisable or
exchangeable for, that capital stock for a period of 180 days after the date of
this prospectus. Transfers can be made sooner with the prior written consent of
Donaldson, Lufkin & Jenrette Securities Corporation. Donaldson, Lufkin &
Jenrette may in its sole discretion, at any time without notice, release all or
any portion of the shares subject to the lock-up agreements. When the lock-up
agreements expire (assuming the underwriters do not exercise any of their over-
allotment option):

. 17,175,044 shares will become eligible for sale pursuant to Rule
144(k). If the lock-up agreements were released, these shares could be
immediately sold at that time.

. 52,830,345 shares will become eligible for sale under Rule 144. If the
lock-up agreements were released, these shares could be sold commencing
July 5, 2000 and subject to Rule 144 limitations applicable to shares
held by our affiliates.

. 775,440 shares as to which options become exercisable on July 19, 2000
will become eligible for sale under Rule 701. If the lock-up agreements
were released, these shares could be sold when the options become
exercisable, subject to Rule 144 limitations applicable to options held
by our affiliates.

In addition to the shares mentioned above, 110,206 shares will become
eligible for sale under Rule 701 (or under our planned Form S-8 registration
statement mentioned below) when options to purchase these shares become
exercisable on July 19, 2000. Options to purchase these shares are held by
persons who are not senior management, directors or existing stockholders and
who therefore will not be subject to the lock-up agreements. Additional shares
will become eligible for sale under Rule 701 (or under our planned Form S-8
registration statement) as additional options become exercisable.

After we complete of this offering, we intend to file a registration
statement on Form S-8 under the Securities Act to register all of the shares of
our class A common stock issued or reserved for future issuance under our 1999
Equity Incentive Plan. Based on the number of shares subject to outstanding
options as of the date of this offering and currently reserved for issuance
under this plan, this registration statement would cover approximately
12,259,920 shares. Shares registered under the registration statement will
generally be available for sale in the open market when the options to purchase
those shares become exercisable, subject to the effect of the lock-up
agreements for those option holders who have executed those agreements and
subject to Rule 144 volume limitations applicable to option holders who are our
affiliates.

Also beginning 180 days after the date of this offering, holders of
10,038,413 shares of our common stock will be entitled to require us to
register their shares for sale in the public market. In addition, holders of
68,893,780 shares of our common stock will be entitled to piggyback rights to

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include shares of common stock in any registration by us of shares of our
common stock for sale in the public market. Registration of shares under the
Securities Act will permit the shares to be freely transferable without
restriction under the Securities Act immediately upon effectiveness of the
registration statement.

Rule 144

All of the shares of our class A common stock sold in this offering will
be freely transferable under the Securities Act, unless purchased by our
affiliates. In general, under Rule 144 as currently in effect, a person, or
persons whose shares are aggregated, including an affiliate, who has
beneficially owned restricted stock for at least one year is entitled to sell,
within any three-month period, a number of shares of stock that does not exceed
the greater of:

. 1% of the number of shares of our class A common stock then outstanding
(which will equal approximately 105,596 shares immediately after this
offering, assuming the underwriters do not exercise any of their over-
allotment option), or

. the average weekly trading volume in our class A common stock during
the four calendar weeks preceding the date on which notice of that sale
is filed.

Sales under Rule 144 are generally subject to restrictions relating to:

. the manner of sale.

. notice.

. the availability of current public information about US Unwired.

Rule 144(k)

Under Rule 144(k), a person who is not deemed to be an affiliate and is
not deemed to have been our affiliate for at least three months prior to a sale
and who has beneficially owned shares of restricted stock for at least two
years may resell those shares without having to comply with the foregoing
requirements of Rule 144. In meeting the one and two year holding periods
described above, a holder of restricted stock can include the holding periods
of prior owners who were not an affiliate. Therefore, unless otherwise
restricted, shares eligible for sale under Rule 144(k) may be sold immediately
upon the completion of this offering.

Rule 701

Rule 701 in effect permits any of our employees, directors, officers,
consultants or advisors who purchases shares from us in connection with a
compensatory stock or option plan or other written agreement before the
effective date of this offering to sell those shares on and after July 5, 2000,
subject to restrictions imposed by the lock-up agreements on those persons who
have given them. They may rely on the exemption from registration provided by
Rule 144, but they need not comply with the holding period and notice filing
requirements of Rule 144 and, in the case of non-affiliates, with the public
information, volume limitation or notice filing provisions of Rule 144.

The SEC has indicated that Rule 701 will apply to typical stock options
granted by an issuer before it becomes subject to the reporting requirements of
the Securities Exchange Act of 1934, and to the shares acquired when the
options are exercised (including exercises after the date of this prospectus).

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IMPORTANT UNITED STATES FEDERAL TAX CONSEQUENCES
OF OUR COMMON STOCK TO NON-U.S. HOLDERS

This is a general discussion of United States federal tax consequences of
the acquisition, ownership, and disposition of our common stock by a holder
that, for U.S. federal income tax purposes, is not a U.S. person as we define
that term below. A holder of our common stock who is not a U.S. person is a
non-U.S. holder. We assume in the discussion that you will hold our common
stock issued pursuant to the offering as a capital asset, which generally is
property held for investment. We do not discuss all aspects of U.S. federal
taxation that may be important to your individual investment circumstances,
like special tax rules that would apply to you, for example, if you are a
dealer in securities, financial institution, bank, insurance company, tax-
exempt organization, partnership or owner of more than 5% of our common stock.
We base our discussion on current provisions of the Internal Revenue Code of
1986, Treasury regulations, judicial opinions, published positions of the IRS
and other applicable authorities, all as in effect on the date of this
prospectus and all of which are subject to differing interpretations or change,
possibly with retroactive effect. We have not sought, and shall not seek, any
ruling from the IRS with respect to the tax consequences discussed in this
prospectus. We cannot assure that the IRS will not take a position contrary to
the tax consequences discussed below or that any position taken by the IRS
would not be sustained. We urge you to consult your tax advisor about the U.S.
federal tax consequences of acquiring, holding, and disposing of our common
stock, as well as any tax consequences that may arise under the laws of any
foreign, state, local, or other taxing jurisdiction.

For purposes of this discussion, a U.S. person means any one of the
following:

. a citizen or resident of the U.S.

. a corporation, partnership, or other entity created or organized in the
U.S. or under the laws of the U.S. or of any political subdivision of
the U.S.

. an estate, the income of which is includable in gross income for U.S.
federal income tax purposes regardless of its source.

. a trust, the administration of which is subject to the primary
supervision of a U.S. court and that has one or more U.S. persons who
have the authority to control all substantial decisions of the trust.

Dividends

Dividends paid to a non-U.S. holder will generally be subject to
withholding of U.S. federal income tax at the rate of 30%. If, however, the
dividend is effectively connected with the conduct of a trade or business in
the U.S. by the non-U.S. holder, the dividend will be subject to U.S. federal
income tax imposed on net income on the same basis that applies to U.S. persons
generally and, for corporate holders under certain circumstances, the branch
profits tax. Non-U.S. holders should consult any applicable income tax treaties
that may provide for a reduction of, or exemption from, withholding taxes. For
purposes of determining whether tax is to be withheld at a reduced rate as
specified by a treaty, we generally will presume that dividends we pay on or
before December 31, 2001, to an address in a foreign country are paid to a
resident of that country.

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Under recently finalized Treasury regulations, which in general apply to
dividends that we pay after December 31, 2001, to obtain a reduced rate of
withholding under a treaty, a non-U.S. holder generally will be required to
provide certification as to that non-U.S. holder's entitlement to treaty
benefits. These regulations also provide special rules to determine whether,
for purposes of applying a treaty, dividends that we pay to a non-U.S. holder
that is an entity should be treated as paid to holders of interests in that
entity.

Gain on Disposition

A non-U.S. holder will generally not be subject to U.S. federal income
tax, including by way of withholding, on gain recognized on a sale or other
disposition of our common stock unless any one of the following is true:

. the gain is effectively connected with the conduct of a trade or
business in the U.S. by the non-U.S. holder.

. the non-U.S. holder is a nonresident alien individual present in the
U.S. for 183 or more days in the taxable year of the disposition and
other requirements are met.

. the non-U.S. holder is subject to tax pursuant to provisions of the
U.S. federal income tax law applicable to certain U.S. expatriates.

. we are or have been during certain periods a "United States real
property holding corporation" for U.S. federal income tax purposes.

If we are or have been a United States real property holding corporation,
a non-U.S. holder will generally not be subject to U.S. federal income tax on
gain recognized on a sale or other disposition of our common stock provided
that:

. the non-U.S. holder does not hold, and has not held during certain
periods, directly or indirectly, more than 5% of our outstanding common
stock.

. our common stock is and continues to be traded regularly on an
established securities market for U.S. federal income tax purposes.

We believe that our common stock will be traded on an established
securities market for this purpose in any quarter during which it is included
for quotation on the Nasdaq National Market.

If we are or have been during certain periods a U.S. real property holding
corporation and the above exception does not apply, a non-U.S. holder will be
subject to U.S. federal income tax with respect to gain realized on any sale or
other disposition of our common stock. A non-U.S. holder will also be subject
to a withholding tax, generally at a rate of 10% of the proceeds if our common
stock is not traded regularly on an established securities market. Any amount
withheld pursuant to a withholding tax will be creditable against a non-U.S.
holder's federal income tax liability.

Gain that is effectively connected with the conduct of a trade or business
in the U.S. by the non-U.S. holder will be subject to the U.S. federal income
tax imposed on net income on the same basis that applies to U.S. persons
generally and, for corporate holders under certain circumstances, the branch
profits tax, but will generally not be subject to withholding. Non-U.S. holders
should consult any applicable income tax treaties that may provide for
different rules.

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U.S. Federal Estate Taxes

Our common stock that is owned or treated as owned by an individual who is
not a citizen or resident of the U.S., as specially defined for U.S. federal
estate tax purposes, on the date of that person's death will be included in his
or her estate for U.S. federal estate tax purposes, unless an applicable estate
tax treaty provides otherwise.

Information Reporting and Backup Withholding

Generally, we must report annually to the IRS and to each non-U.S. holder
the amount of dividends that we paid to a holder and the amount of tax that we
withheld on those dividends. This information may also be made available to the
tax authorities of a country in which the non-U.S. holder resides.

Under current Treasury regulations, U.S. information reporting
requirements and backup withholding tax will generally not apply to dividends
that we pay on our common stock to a non-U.S. holder at an address outside the
U.S. Payments of the proceeds of a sale or other taxable disposition of our
common stock by a U.S. office or a broker are subject to both backup
withholding at a rate of 31% and information reporting, unless the holder
certifies as to its non-reporting requirements. Information reporting, but not
backup withholding tax, will also apply to payments of the proceeds of a sale
or other taxable disposition of our common stock by foreign offices of U.S.
brokers or foreign brokers with certain types of relationships to the U.S.,
unless the broker has documentary evidence in its records that the holder is a
non-U.S. holder and certain other conditions are met or the holder otherwise
established an exemption.

Backup withholding is not an additional tax. Any amounts that we withhold
under the backup withholding rules will be refunded or credited against the
non-U.S. holder's U.S. federal income tax liability if certain required
information is furnished to the IRS.

The U.S. Treasury Department has promulgated final regulations regarding
the withholding and information reporting rules discussed above. In general,
those regulations do not significantly alter the substantive withholding and
information reporting requirements but unify current certification procedures
and forms and clarify reliance standards. The final regulations are generally
effective for payments made after December 31, 2001, subject to transition
rules.

91
<PAGE>

UNDERWRITING

US Unwired and the underwriters named below have entered into an
underwriting agreement dated May 17, 2000 concerning the shares being offered
in this offering. Subject to the terms of this agreement, these underwriters,
who are represented by Donaldson, Lufkin & Jenrette Securities Corporation,
Credit Suisse First Boston Corporation, First Union Securities, Inc. and
DLJdirect Inc., have severally agreed to purchase from us the number of shares
of our class A common stock set forth opposite their names below:

<TABLE>
<CAPTION>
Number
Underwriters: of Shares
------------- ---------
<S> <C>
Donaldson, Lufkin & Jenrette Securities Corporation.............. 2,472,000
Credit Suisse First Boston Corporation........................... 2,472,000
First Union Securities, Inc...................................... 1,236,000
DLJdirect Inc.................................................... 100,000
Allen & Company Incorporated..................................... 80,000
Chase Securities Inc............................................. 80,000
Deutsche Bank Securities Inc..................................... 80,000
A.G. Edwards & Sons, Inc......................................... 80,000
Lehman Brothers Inc.............................................. 80,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated............... 80,000
Morgan Stanley & Co. Incorporated................................ 80,000
Prudential Securities Incorporated............................... 80,000
Salomon Smith Barney Inc......................................... 80,000
Advest, Inc...................................................... 40,000
Robert W. Baird & Co. Incorporated............................... 40,000
George K. Baum & Company......................................... 40,000
J.C. Bradford & Co............................................... 40,000
The Chapman Company.............................................. 40,000
Fahnestock & Co. Inc............................................. 40,000
First Albany Corporation......................................... 40,000
Gabelli & Company, Inc........................................... 40,000
Gerard Klauer Mattison & Co., Inc................................ 40,000
Gruntal & Co., L.L.C............................................. 40,000
Hoak Breedlove Wesneski & Co..................................... 40,000
Johnston, Lemon & Co. Incorporated............................... 40,000
EDWARD D. JONES & CO., L.P....................................... 40,000
Kaufman Bros., L.P............................................... 40,000
C.L. King & Associates, Inc...................................... 40,000
Lebenthal & Co., Inc............................................. 40,000
Legg Mason Wood Walker, Incorporated............................. 40,000
Ormes Capital Markets, Inc....................................... 40,000
Raymond James & Associates, Inc.................................. 40,000
Sanders Morris Harris............................................ 40,000
Sands Brothers & Co., Ltd........................................ 40,000
Santander Securities............................................. 40,000
Stephens Inc..................................................... 40,000
C.E. Unterberg, Towbin........................................... 40,000
Wachovia Securities, Inc......................................... 40,000
---------
Total.......................................................... 8,000,000
</TABLE>

92
<PAGE>

The underwriting agreement provides that the obligations of the several
underwriters to purchase and accept delivery of the shares of common stock
included in this offering are subject to the approval of legal matters by their
counsel and to customary conditions, including:

. the effectiveness of the registration statement.

. the continuing correctness of our representations.

. the receipt of a "comfort letter" from our accountants.

. the listing of the class A common stock for quotation on the Nasdaq
National Market.

. no occurrence of an event that would have a material adverse effect on
US Unwired.

The underwriters must purchase and accept delivery of all the shares of
our class A common stock, other than those shares covered by the over-allotment
option described below, if they purchase any of the shares of common stock.

The underwriters propose to offer initially some of the shares of our
class A common stock directly to the public at the initial offering price
stated on the cover page of this prospectus and some of the shares of our class
A common stock to dealers (including the underwriters) at the initial public
offering price less a discount not in excess of $0.46 per share. The
underwriters may allow, and such dealers may re-allow, a discount not in excess
of $0.10 per share on sales to other dealers. After the initial offering of the
class A common stock to the public, the representatives of the underwriters may
change the public offering price and these discounts. The underwriters do not
intend to confirm sales to any accounts over which they exercise discretionary
authority.

An electronic prospectus will be available on the web site maintained by
DLJdirect Inc., an affiliate of Donaldson, Lufkin & Jenrette Securities
Corporation. The information on this web site relating to the offering is not
part of this prospectus and has not been approved or endorsed by US Unwired or
the underwriters, and should not be relied on by prospective investors.

The following table shows the underwriting fees that we will pay to the
underwriters in this offering. These amounts are shown assuming both no
exercise and full exercise of the underwriters' option to purchase additional
shares of our class A common stock.
<TABLE>
<CAPTION>
No Full
Exercise Exercise
---------- ----------
<S> <C> <C>
US Unwired:
Per share.......................................... $ 0.77 $ 0.77
Total.............................................. $6,160,000 $6,160,000
Selling Stockholders:
Per share.......................................... $ 0.77 $ 0.77
Total.............................................. $ 0 $ 924,000
</TABLE>

The selling stockholders have granted to the underwriters an option to
purchase up to 1,200,000 additional shares of class A common stock at the
initial public offering price less the underwriting fees. The underwriters may
exercise this option for 30 days after the date of the underwriting agreement.
The underwriters may exercise this option only to cover over-allotments, if
any, made in connection with this offering. If the underwriters exercise this
option, each underwriter will become obligated to purchase a number of
additional shares approximately proportionate to that

93
<PAGE>

underwriter's initial purchase commitment as shown in the table above. We
estimate expenses relating to this offering (other than underwriting discounts
and commissions) will be $800,000.

The underwriters, the selling stockholders and US Unwired have agreed to
indemnify each other against liabilities, including liabilities under the
Securities Act.

Our executive officers and directors and some of our stockholders have
agreed that from the date of this prospectus until November 13, 2000, they will
not without the prior written consent of Donaldson, Lufkin & Jenrette
Securities Corporation:

. dispose of or hedge, directly or indirectly, any shares of common stock
or any securities convertible into or exercisable or exchangeable for
common stock.

. enter into any swap or other arrangement that transfers all or a
portion of the economic consequences associated with the ownership of
any common stock.

We have also agreed to these restrictions for a period commencing on the
date of this prospectus and ending 180 days after the date of this prospectus.
There are some exceptions to these restrictions.

The foregoing transfer restrictions will apply whether a covered
transaction is to be settled by the delivery of common stock or other
securities, in cash or otherwise. In addition, during this period and subject
to some exceptions, we have agreed not to file any registration statement with
respect to, and each of our executive officers and directors and the selling
stockholders, has agreed not to make any demand for, or exercise any right with
respect to, the registration of any shares of common stock or any securities
convertible into or exercisable for common stock without the prior written
consent of Donaldson, Lufkin & Jenrette Securities Corporation.

At our request, the underwriters have reserved up to five percent of the
shares offered by this prospectus for sale at the initial public offering price
to our employees, officers and directors and other individuals associated with
us and members of their families. We will reduce the number of shares of our
class A common stock available for sale to the general public by the amount of
reserved shares that these individuals purchase or confirm for purchase orally
or in writing. The underwriters will offer to the general public any reserved
shares not purchased or confirmed for purchase on the same basis as the other
shares offered by this prospectus.

Our class A common stock is listed for quotation on the Nasdaq National
Market under the symbol "UNWR."

Other than in the United States, neither we, the selling stockholders nor
the underwriters have taken any action that would permit a public offering of
the shares of class A common stock included in this offering in any
jurisdiction where action for that purpose is required. The shares of class A
common stock included in this offering may not be offered or sold, directly or
indirectly, nor may this prospectus or any other offering material or
advertisement in connection with the offer and sale of any shares of class A
common stock be distributed or published in any jurisdiction, except in
compliance with the applicable rules and regulations of that jurisdiction.
Persons who receive this prospectus should inform themselves about, and observe
any restrictions relating to, this offering of

94
<PAGE>

our class A common stock and distribution of this prospectus. This prospectus
is not an offer to sell or a solicitation of an offer to buy any shares of our
class A common stock included in this offering in any jurisdiction where that
would not be permitted or legal.

Donaldson, Lufkin & Jenrette Securities Corporation or its affiliates have
provided and may in the future provide investment banking or other financial
advisory services to us and our affiliates in the ordinary course of business,
for which they have received and are expected to receive customary fees and
expenses. Donaldson, Lufkin & Jenrette Securities Corporation and First Union
Securities, Inc. were initial purchasers of the series A senior subordinated
discount notes issued by us in October 1999. See "Certain Indebtedness--Senior
Subordinated Discount Notes." First Union Securities, Inc. is the
administrative agent and an arranger, and First Union National Bank, an
affiliate of First Union Securities, Inc., is a lender, under our senior credit
facilities and, in such capacities, each receives customary fees for such
services. See "Certain Indebtedness--Senior Credit Facilities."

Stabilization

In connection with this offering, any of the underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
class A common stock. Specifically, the underwriters may overallot this
offering, which creates a syndicate short position. The underwriters may bid
for and purchase shares of our class A common stock in the open market to cover
such syndicate short position or to stabilize the price of the class A common
stock. In addition, the underwriting syndicate may reclaim selling concessions
from syndicate members and selected dealers if Donaldson, Lufkin & Jenrette
Securities Corporation:

. repurchases previously distributed class A common stock in syndicate
covering transactions, in stabilization transactions or otherwise.

. receives a report that indicates that the clients of these syndicate
members have "flipped" the class A common stock.

These activities may stabilize or maintain the market price of the class A
common stock above independent market levels. The underwriters are not required
to engage in these activities, and may stop any of these activities at any
time.

Pricing of this Offering

Prior to this offering, there has been no established market for our
common stock. We and representatives of the underwriters together determined
the initial public offering price for the shares of our class A common stock
offered by this prospectus. We based the determination on several factors,
including:

. the history of, and the prospects for, the industry in which we
compete.

. our past and present operations.

. our historical results of operations.

. our prospects for future earnings.

. the recent market prices of securities of generally comparable
companies.

. the general conditions of the securities market at the time of this
offering.

95
<PAGE>

LEGAL MATTERS

Correro Fishman Haygood Phelps Walmsley & Casteix, L.L.P., New Orleans,
Louisiana, will give an opinion that under the Louisiana Business Corporation
Law the shares offered have been duly authorized and that, upon their issuance
and sale in accordance with the terms of this prospectus, they will be validly
issued, fully paid and non-assessable. Latham & Watkins, Los Angeles,
California, will pass upon particular legal matters for the underwriters.

AVAILABLE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the
Securities Act for the securities offered by this prospectus. This prospectus
is a part of that registration statement. The SEC does not require the
prospectus to have all of the information included in the registration
statement or the exhibits to the registration statement. You will find
additional information about us and the common stock in the registration
statement. You may inspect and copy our registration statement and related
exhibits at the SEC's public reference rooms located at its principal office,
450 Fifth Street, NW, Washington, DC 20549, and at its regional offices at 7
World Trade Center, 13th Floor, New York, New York 10048 and the Northwest
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511. Please call 1-800-SEC-0330 for further information on the public
reference rooms. The SEC also maintains a site on the World Wide Web
(http://www.sec.gov) that contains reports, proxy and information statements
and other information about companies that file electronically with the SEC.
Statements made in this prospectus about legal documents may not necessarily be
complete, and you should read the documents which are filed as exhibits or
schedules to the registration statement or otherwise filed with the SEC.

We are subject to the information and periodic reporting requirements of
Section 15(d) of the Exchange Act of 1934, which requires us to file annual,
quarterly and current reports, proxy and information statements and other
information with the SEC. You may inspect and copy these reports, proxy and
information statements and other information at the addresses set forth above.
This information will be available also on the SEC's website.

EXPERTS

Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements of US Unwired Inc. at December 31, 1999 and 1998, and for
each of the three years in the period ended December 31, 1999, the financial
statements of Louisiana Unwired, LLC at December 31, 1999 and 1998 and for the
year ended December 31, 1999 and for the period from January 8, 1998
(inception) through December 31, 1998, and the financial statements of Meretel
Communications, L.P. at December 31, 1999 and 1998, and for each of the three
years in the period ended December 31, 1999, as set forth in their reports. We
have included our financial statements in the prospectus and elsewhere in the
registration statement in reliance on Ernst & Young LLP's reports, given on
their authority as experts in accounting and auditing.

96
<PAGE>

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
Page
<S> <C>
US UNWIRED INC. AND SUBSIDIARIES
Report of Independent Auditors........................................... F-2
Consolidated Balance Sheets.............................................. F-3
Consolidated Statements of Operations.................................... F-4
Consolidated Statements of Stockholders' Equity.......................... F-5
Consolidated Statements of Cash Flows.................................... F-6
Notes to Consolidated Financial Statements............................... F-7

LOUISIANA UNWIRED, LLC
Report of Independent Auditors........................................... F-31
Balance Sheets........................................................... F-32
Statements of Operations................................................. F-33
Statements of Members' Equity............................................ F-34
Statements of Cash Flows................................................. F-35
Notes to Financial Statements............................................ F-36

MERETEL COMMUNICATIONS, L.P.
Report of Independent Auditors........................................... F-44
Balance Sheets........................................................... F-45
Statements of Operations................................................. F-46
Statements of Partners' Deficit.......................................... F-47
Statements of Cash Flows................................................. F-48
Notes to Financial Statements............................................ F-49
</TABLE>

F-1
<PAGE>

REPORT OF INDEPENDENT AUDITORS

Board of Directors
US Unwired Inc.

We have audited the accompanying consolidated balance sheets of US Unwired
Inc., as of December 31, 1999 and 1998, and the related consolidated statements
of operations, stockholders' equity, and cash flows for each of the three years
in the period ended December 31, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of US Unwired Inc., at December 31, 1999 and 1998, and the consolidated results
of its operations and its cash flows for each of the three years in the period
ended December 31, 1999 in conformity with accounting principles generally
accepted in the United States.

/s/ Ernst & Young LLP

Houston, Texas
February 9, 2000, except for the third paragraph
of Note 1 as to which the date is March 22, 2000 and for the second paragraph
of Note 15 as towhich the date is April 11, 2000

F-2
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

<TABLE>
<CAPTION>
Year ended
December 31, March 31,
----------------- -----------
ASSETS 1999 1998 2000
------ -------- ------- -----------
(unaudited)
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents....................... $ 14,695 $32,475 $ 16,053
Subscriber receivables, net of allowance for
doubtful accounts of $184, $217 and $219....... 6,036 4,419 6,256
Other receivables............................... 1,055 27 2,921
Inventory....................................... 6,021 2,541 4,244
Prepaid expenses................................ 1,146 331 3,426
Income taxes receivable......................... 10,296 5,524 10,035
Receivables from related parties................ 654 197 330
Receivables from officers....................... 110 92 111
-------- ------- --------
Total current assets.............................. 40,013 45,606 43,376
Marketable securities............................. 141,453 -- 109,010
Property and equipment, net....................... 106,067 22,565 138,599
Deferred financing costs, net of accumulated
amortization of $184, $-0- and $424.............. 12,279 -- 12,245
Licenses, net of accumulated amortization of
$1,326, $-0- and $1,480.......................... 10,462 -- 10,559
Restricted cash in escrow......................... 5,402 5,164 5,448
Investments in and advances to unconsolidated
affiliates....................................... (1,860) 11,052 (730)
Net assets of discontinued operations ............ -- 1,761 --
Note receivable from unconsolidated affiliate..... 1,582 -- 1,601
Other assets...................................... 1,712 1,481 12,170
-------- ------- --------
Total assets...................................... $317,110 $87,629 $332,278
======== ======= ========
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<S> <C> <C> <C>
Current liabilities:
Accounts payable................................ $ 14,618 $ 2,972 $ 15,622
Accrued expenses................................ 2,048 1,188 6,341
Current maturities of long term debt............ 188 1,341 677
Net liabilities of discontinued operations...... 573 -- 559
-------- ------- --------
Total current liabilities......................... 17,427 5,501 23,199
Long term debt, net of current maturities......... 215,892 27,726 232,740
Net liabilities of discontinued operations........ 1,341 -- 546
Deferred income taxes............................. 2,407 2,923 2,091
Minority interest................................. 1,458 -- 2,706
Mandatory redeemable preferred stock, authorized
200,000,000 shares; issued and outstanding
500,000 shares................................... 50,000 -- 55,000
Commitments and contingencies
Stockholders' equity:
Common stock, $0.01 par value:
Class A: Authorized 500,000,000 shares; none
issued or outstanding........................ -- -- --
Class B: Authorized 300,000,000 shares; issued
and outstanding 59,967,000 shares............ 600 600 600
Additional paid-in capital........................ 2,147 1,348 8,856
Accumulated other comprehensive income............ 474 -- 617
Retained earnings................................. 25,364 49,531 5,923
-------- ------- --------
Total stockholders' equity........................ 28,585 51,479 15,996
-------- ------- --------
Total liabilities and stockholders' equity........ $317,110 $87,629 $332,278
======== ======= ========
</TABLE>

See accompanying notes.

F-3
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands)

<TABLE>
<CAPTION>
Three Months
Years Ended December 31, Ended March 31,
--------------------------- -----------------
1999 1998 1997 2000 1999
-------- -------- ------- -------- -------
(unaudited)
<S> <C> <C> <C> <C> <C>
Revenues:
Service revenues:
Subscriber................... $ 39,734 $ 48,723 $53,255 $ 13,765 $ 9,329
Roaming...................... 10,867 11,914 16,079 4,336 1,813
Merchandise sales............ 5,371 3,915 2,685 3,054 1,250
Management fees.............. 2,365 4,455 1,376 896 476
Other revenue................ 295 2,704 1,273 240 61
-------- -------- ------- -------- -------
Total revenue.............. 58,632 71,711 74,668 22,291 12,929
-------- -------- ------- -------- -------
Operating expenses:
Cost of services............. 19,593 18,586 20,111 7,385 3,710
Merchandise cost of sales.... 11,998 10,777 8,943 6,128 2,637
General and administrative... 20,076 17,156 12,682 9,551 3,906
Sales and marketing.......... 12,793 10,886 10,893 5,685 2,172
Depreciation and
amortization.............. 19,430 9,831 12,478 7,771 3,785
-------- -------- ------- -------- -------
Total operating expenses... 83,890 67,236 65,107 36,520 16,210
-------- -------- ------- -------- -------
Operating (loss) income........ (25,258) 4,475 9,561 (14,229) (3,281)
Other (expense) income:
Interest expense............. (11,225) (6,157) (8,580) (7,844) (1,240)
Interest income.............. 2,949 1,778 1,690 2,188 420
Other income (expense)....... 587 -- (1,082) -- --
Loss on sale of assets....... -- (114) -- -- --
Gain on sale of certain
markets................... 819 57,364 -- 4,820 --
-------- -------- ------- -------- -------
Total other (expense)
income.................. (6,870) 52,871 (7,972) (836) (820)
-------- -------- ------- -------- -------
(Loss) income before income
taxes, extraordinary item,
minority interest, and
equity in losses of
affiliates.................. (32,128) 57,346 1,589 (15,065) (4,101)
Income tax (benefit) expense... (9,014) 16,812 95 -- (617)
-------- -------- ------- -------- -------
(Loss) income before
extraordinary item, minority
interest and equity in
income (losses) of
affiliates.................. (23,114) 40,534 1,494 (15,065) (3,484)
Minority interest in losses of
subsidiaries................ 10,350 -- 134 655 3,104
Equity in losses of
affiliates.................. (4,870) (11,738) (3,137) 207 (1,012)
-------- -------- ------- -------- -------
(Loss) income from continuing
operations.................. (17,634) 28,796 (1,509) (14,203) (1,392)
Loss from discontinued
operations, net of income
tax benefit of $1,472 in
1999........................ (3,541) (1,246) -- -- (666)
Extraordinary item--early
extinguishment of debt, net
of income tax benefit of
$884 in 1999................ (2,992) -- -- (238) --
-------- -------- ------- -------- -------
Net (loss) income ............. (24,167) 27,550 (1,509) (14,441) (2,058)
Preferred stock dividends...... -- -- -- (5,000) --
-------- -------- ------- -------- -------
Net (loss) income available to
common shareholders......... $(24,167) $ 27,550 $(1,509) $(19,441) $(2,058)
======== ======== ======= ======== =======
Basic and diluted (loss)
earnings per common share:
Continuing operations........ $ (0.29) $ 0.48 $ (0.03) $ (0.32) $ (0.02)
Discontinued operations, net
of applicable taxes ...... (0.06) (0.02) -- -- (0.01)
Extraordinary loss, net of
applicable taxes.......... (0.05) -- -- -- --
-------- -------- ------- -------- -------
Net (loss) earnings per
common share............ $ (0.40) $ 0.46 $ (0.03) $ (0.32) $ (0.03)
======== ======== ======= ======== =======
Weighted average outstanding
common shares............... 59,967 59,967 59,967 59,967 59,967
======== ======== ======= ======== =======
</TABLE>

See accompanying notes.

F-4
<PAGE>

US Unwired Inc. and Subsidiaries

Consolidated Statements of Stockholders' Equity

(In thousands)

<TABLE>
<CAPTION>
Class Class Accumulated
A B Additional Other
Common Common Paid-in Comprehensive Retained
Stock Stock Capital Income Earnings Total
------ ------ ---------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Balance at December 31,
1996................. -- $600 $1,348 $ -- $ 23,490 $ 25,438
Net loss................ -- -- -- -- (1,509) (1,509)
--- ---- ------ ---- -------- --------
Balance at December 31,
1997................. -- 600 1,348 -- 21,981 23,929
Net income.............. -- -- -- -- 27,550 27,550
--- ---- ------ ---- -------- --------
Balance at December 31,
1998................. -- 600 1,348 -- 49,531 51,479
Stock Compensation...... -- -- 799 -- -- 799
Unrealized gain on
marketable
securities, net of
tax $316............. -- -- -- 474 -- 474
Net loss................ -- -- -- -- (24,167) (24,167)
--------
Comprehensive income.... (23,693)
--- ---- ------ ---- -------- --------
Balance at December 31,
1999................. -- $600 $2,147 $474 $ 25,364 $ 28,585
Stock Compensation...... -- -- 1,709 -- -- 1,709
Preferred Dividends..... 5,000 -- (5,000) --
Realized gain on
marketable
securities........... -- -- -- (474) -- (474)
Unrealized gain on
marketable
securities........... -- -- -- 617 -- 617
Net loss................ -- -- -- -- (14,441) (14,441)
--------
Comprehensive income.... -- -- -- -- (14,298)
--- ---- ------ ---- -------- --------
Balance at March 31,
2000................. $-- $600 $8,856 $617 $ 5,923 $ 15,996
=== ==== ====== ==== ======== ========
</TABLE>

See accompanying notes.

F-5
<PAGE>

US Unwired Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)

<TABLE>
<CAPTION>
Three Months
Years ended December 31, Ended March 31,
------------------------------ ------------------
1999 1998 1997 2000 1999
--------- --------- -------- -------- --------
(unaudited)
<S> <C> <C> <C> <C> <C>
Cash flows from operating
activities
Net income (loss).......... $ (24,167) $ 27,550 $ (1,509) $(14,441) $ (2,058)
Adjustments to reconcile
net income (loss) to net
cash provided by (used in)
operating activities:
Extinguishment of debt.... 3,876 -- -- 238 --
Depreciation and
amortization............. 19,430 9,831 12,478 7,771 3,785
Accretion of debt
discount................. 4,822 -- -- 7,001 --
Minority interest......... (10,350) -- (134) 655 (3,104)
Unrealized gain on
marketable securities.... (316) -- -- 316 --
Provision for bad debts... 139 744 3,521 -- --
Deferred tax expense
(benefit)................ (516) 3,687 (83) (316) --
Unearned revenue.......... -- (105) (136) -- --
(Gain) loss on sale of
assets................... -- (57,250) -- (4,820) --
Equity in losses of
affiliates............... 4,870 11,738 3,137 (207) 1,012
Non-cash compensation..... 799 -- -- 1,709 --
Interest income on
restricted cash in
escrow................... (238) (164) -- (46) (39)
Discontinued operations -
noncash charges and
changes in operating
assets and liabilities... 177 1,246 -- (1,030) 559
Changes in operating assets
and liabilities, net of
acquisitions, disposals
and discontinued
operations:
Subscriber receivables.... (1,517) (351) (4,123) 79 111
Other receivables......... (1,028) 1,623 (458) (1,859) (311)
Inventory................. (3,131) (1,082) 922 2,388 (245)
Prepaid expenses.......... (570) (4,264) (1,095) (2,179) (363)
Receivables from related
parties.................. 1,228 (2,450) -- (520) 1,620
Other assets.............. (277) (298) (606) (19) 174
Accounts payable.......... 4,004 (4,417) 2,333 (7,354) 2,635
Accrued expenses.......... 131 (704) (2,208) 3,917 (50)
Prepaid income taxes...... (4,772) -- -- 261 (1,060)
--------- --------- -------- -------- --------
Net cash provided by (used
in) operating activities.. (7,406) (14,666) 12,039 (8,456) 2,666
--------- --------- -------- -------- --------
Cash flows from investing
activities
Purchases of property and
equipment................. (49,894) (20,575) (12,559) (15,870) (12,408)
Distributions from
unconsolidated
affiliates................ 421 813 -- 310 125
Investments in
unconsolidated
affiliates................ (1,204) (15,416) (5,040) (381) (1,204)
Purchase of marketable
securities................ (140,663) -- -- (12,098) --
Sale of marketable
securities................ -- -- -- 44,368 --
Proceeds from sale of
certain markets........... -- 154,877 -- -- --
Cash contributions from
minority shareholder...... 2,500 -- -- -- --
Loan to unconsolidated
affiliate................. (1,582) -- -- (19) --
Purchase of licenses &
subscriber base........... (1,063) (6,514) -- (250) --
Cash acquired from
consolidation of previous
unconsolidated
affiliates................ 1,350 -- -- -- 1,350
Discontinued operations.... (8,219) -- -- (1,406) (3,049)
--------- --------- -------- -------- --------
Net cash provided by (used
in) investing activities.. (198,354) 113,185 (17,599) 14,654 (15,186)
--------- --------- -------- -------- --------
Cash flows from financing
activities
Proceeds from long-term
debt...................... 240,183 29,724 6,770 2,555 6,771
Principal payments on long-
term debt................. (98,350) (100,723) (2,604) (13,831) (11)
Debt issuance cost......... (15,693) -- (225) (126) (300)
Proceeds from issuance of
preferred stock........... 50,000 -- -- 5,000 --
Discontinued operations -
principal payments on
long-term debt............ 11,840 -- -- 1,562 2,300
--------- --------- -------- -------- --------
Net cash provided by (used
in) financing activities.. 187,980 (70,999) 3,941 (4,840) 8,760
--------- --------- -------- -------- --------
Net increase (decrease) in
cash and cash
equivalents............... (17,780) 27,520 (1,619) 1,358 (3,760)
Cash and cash equivalents
at beginning of year...... 32,475 4,955 6,574 14,695 32,475
--------- --------- -------- -------- --------
Cash and cash equivalents
at end of year............ $ 14,695 $ 32,475 $ 4,955 $ 16,053 $ 28,715
========= ========= ======== ======== ========
Supplemental cash flow
disclosures
Cash paid for interest..... $ 8,390 $ 5,008 $ 9,410 $ 580 $ 1,386
========= ========= ======== ======== ========
Cash paid for income
taxes..................... $ 778 $ 17,488 $ 1,248 $ -- $ --
========= ========= ======== ======== ========
Non-cash activities
Property purchases in
accounts payable.......... $ 9,522 $ 974 $ 5,495 $ 17,807 $ 13,040
========= ========= ======== ======== ========
Distribution receivable
from affiliate............ $ -- $ 120 $ -- $ -- $ --
========= ========= ======== ======== ========
</TABLE>

See accompanying notes.

F-6
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 1999

1. Description of Business and Summary of Significant Accounting Policies

Description of Organization

US Unwired Inc. (the "Company") is principally engaged in the ownership
and operation of wireless communications systems in Southwest Louisiana and
Southeast Texas. At December 31, 1999, the Company owns and operates PCS,
cellular, and paging communications systems. The Company was incorporated as
Mercury, Inc. in 1967 by the principal shareholders of Cameron Communications
Corporation ("Cameron") to provide complementary services to Cameron's local
and line telephone service.

On September 27, 1999, the Company completed a reorganization by which the
shareholders of "old" US Unwired Inc. exchanged all of their shares of common
stock for an equal number of shares with the same rights and privileges in
"new" US Unwired (the Holding Company) and "old" US Unwired changed its name to
Unwired Telecom Corp. All outstanding stock options were exchanged for stock
options of the Holding Company at the same exchange ratio. As a result, Unwired
Telecom Corp is now a wholly-owned subsidiary of the Holding Company. This
reorganization has been accounted for at historical cost in a manner similar to
that in pooling of interests accounting.

On March 22, 2000, the Company's Board of Directors adopted a plan to sell
its ownership interest in LEC Unwired, the Company's local exchange carrier
operating segment. The Company expects to complete the sale by the end of the
third quarter of 2000. The accompanying consolidated financial statements have
been restated to reflect the LEC Unwired business as discontinued operations in
compliance with APB 30. The Company does not expect a loss from the disposal of
LEC Unwired when taking into consideration the expected gain on the disposal
and the loss from operations during the disposal period. Therefore, the current
year operating losses are presented as loss from discontinued operations.
Revenues from LEC Unwired were $5.3 million for the year ended December 31,
1999. Prior to 1999, LEC Unwired was accounted for as an equity investment, and
there were no revenues recorded by the Company for LEC Unwired. The loss from
discontinued operations in 1998 represents the Company's minority interest in
LEC Unwired's losses for the year. There were no operations of LEC Unwired in
1997.

Consolidation Policy

The consolidated financial statements include the accounts of US Unwired
Inc. and its majority-owned subsidiaries. All significant intercompany balances
and transactions are eliminated in consolidation. Losses of subsidiaries
attributable to minority stockholders in excess of the minority interest in the
equity capital of the subsidiary are not eliminated in consolidation.

During 1999, the Company made a series of capital contributions (including
contributions made by Unwired Telecom) to Louisiana Unwired, LLC ("LA Unwired")
and LEC Unwired, L.L.C. ("LEC Unwired") which increased its ownership
percentages in LA Unwired and LEC Unwired to

F-7
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

93.66% and 56.67%, respectively. As a result, the Company's financial
statements for the year ended December 31, 1999 include the financial position
and results of operations of LA Unwired and LEC Unwired on a consolidated
basis.

Cash Equivalents

The Company considers all highly liquid investments with original
maturities of three months or less when purchased to be cash equivalents.

Marketable Securities

The Company accounts for marketable securities in accordance with SFAS No.
115, Accounting for Certain Investments in Debt and Equity Securities. The
Company determines the appropriate classification of all marketable securities
as held-to-maturity, available-for-sale, or trading at the time of purchase and
re-evaluates such classification as of each balance sheet date. At December 31,
1999, all of the Company's investments in marketable securities are classified
as available-for-sale, and as a result, are reported at fair value. Unrealized
gains and losses, net of tax, are reported as a component of accumulated other
comprehensive income in stockholders' equity. The cost of investments sold is
based on the average cost method, and realized gains and losses are included in
other income (expense).

Inventory

Inventory consists of analog and digital telephones, pagers and related
accessories and is carried at cost. Cost is determined by the moving average
method, which approximates the first-in, first-out method.

Property and Equipment

Property and equipment is stated at cost and depreciated on a straight-
line basis over the estimated useful lives of the assets as follows:

<TABLE>
<CAPTION>
Years
------
<S> <C>
Buildings.......................................................... 39
Leasehold improvements............................................. 3 to 5
Facilities and equipment........................................... 5
Furniture and fixtures............................................. 5 to 7
Vehicles........................................................... 5
</TABLE>

Licenses

Licenses consist primarily of costs incurred in connection with the
Company's acquisition of PCS licenses and systems. These assets are recorded at
cost and amortized using the straight-line method over an estimated useful life
of 20 years. Amortization expense charged to operations for licenses in 1999,
1998 and 1997 was $341,000, $-0- and $4,064,000, respectively.

F-8
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Deferred Financing Costs

Deferred financing costs include costs incurred in connection with the
issuance of the Company's long-term debt which are capitalized and amortized
over the terms of the related debt using the interest method. Amortization
expense charged to operations in 1999, 1998 and 1997 was $450,000, $49,000 and
$153,000, respectively.

Impairment of Long-Lived Assets

The Company assesses long-lived assets for impairment under Statement of
Financial Accounting Standards ("SFAS") 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of. SFAS 121
requires that long-lived assets and certain identifiable intangibles to be held
and used or disposed of by an entity be reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount of an asset may
not be recoverable. The Company periodically evaluates the recoverability of
the carrying amounts of its licenses and property and equipment in each market,
as well as the depreciation and amortization periods based on estimated
undiscounted future cash flows and other factors to determine whether current
events or circumstances warrant reduction of the carrying amounts or
acceleration of the related amortization period. If such assets are considered
to be impaired, the impairment to be recognized is measured by the amount by
which the carrying amount of the assets exceeds the fair value of the assets.
Assets to be disposed of are reported at the lower of the carrying amount or
fair value less costs to sell.

Investments in Unconsolidated Affiliates

The Company's investments in less than majority-owned affiliated companies
are accounted for using the equity method and equity in earnings (losses) are
reported as equity in losses of affiliates.

Revenue Recognition

The Company earns revenue by providing access to and usage of its
cellular, PCS and paging networks and sales of cellular, PCS and paging
merchandise. Service revenues include revenues for charges to subscribers for
both access to and usage of the Company's cellular, PCS and paging networks.
These revenues are recognized as they are earned by the Company. Revenues from
the sales of merchandise are recognized when the merchandise is provided to the
customer.

Advertising Costs

Advertising costs are charged to expenses as incurred. For the years ended
December 31, 1999, 1998, and 1997, approximately $5,160,000, $3,658,000, and
$2,203,000, respectively, of advertising costs were incurred.

F-9
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Commissions

Commissions are paid to sales agents for customer activations and are
expensed in the month the customer is activated within the cellular system.

Income Taxes

The Company accounts for deferred income taxes using the asset and
liability method, under which deferred tax assets and liabilities are
recognized for the differences between the financial statement carrying amounts
of assets and liabilities and their respective tax bases. Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected
to be recovered or settled.

Earnings per Share

Earnings per share is calculated by dividing net income by the weighted
average number of shares outstanding during the period. The options and
preferred stock were not included in the computation of diluted earnings per
share in 1999 because the Company is in a net loss position and, therefore, the
effect would have been antidilutive.

Stock Compensation Arrangements

The Company accounts for its stock compensation arrangements under the
provisions of APB 25, Accounting for Stock Issued to Employees.

Use of Estimates

The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Concentrations of Credit Risk

Financial instruments which potentially expose the Company to
concentrations of credit risk consist primarily of cash and accounts
receivable. The Company places its cash and temporary cash investments with
high credit quality financial services companies. Collectibility of subscriber
receivables is impacted by economic trends in each of the Company's markets and
the Company has provided an allowance which it believes is adequate to absorb
losses from uncollectible accounts.

Reclassifications

Certain reclassifications have been made to the 1997 and 1998 financial
statements to conform to the 1999 presentation.

F-10
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Unaudited Interim Information

The financial information for the three months ended March 31, 1999 and
2000 has been prepared without audit. Certain information and footnote
disclosures normally included in the financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted from the unaudited interim financial information. In the opinion of
management of the Company, the unaudited interim financial information includes
all adjustments, consisting only of normal recurring adjustments, necessary for
a fair presentation. Results of operations for the interim periods are not
necessarily indicative of the results of operations for the respective full
years.

2. Marketable Securities

As of December 31, 1999, the Company's investments in marketable
securities consist of debt securities with maturities ranging from 60 days to
90 days from the date of purchase. These marketable securities have been
classified as non-current as the Company intends to use these securities to
fund the purchase and development of its PCS network. The following is a
summary of the Company's available-for-sale marketable securities as of
December 31, 1999:

<TABLE>
<CAPTION>
(In thousands)
-----------------------------------------
Gross Gross Estimated
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Commercial paper...................... $ 98,769 $790 $-- $ 99,559
Fixed income mutual funds............. 41,894 -- -- 41,894
-------- ---- --- --------
$140,663 $790 $-- $141,453
======== ==== === ========
</TABLE>

For the years ended December 31, 1999 and 1998, there were no net realized
gains and losses on sales of available-for-sale marketable securities.

3. Acquisitions and Dispositions of Markets

Effective July 1, 1998, the Company sold substantially all of the assets
related to its Kansas, Mississippi and Alabama markets, as well as its majority
ownership interest in MS 34 for approximately $161,500,000, subject to purchase
price adjustments as defined in the sale agreement. Approximately $5,000,000
was placed in escrow for two years from closing date to settle any adjustments
to the purchase price. The cash in escrow and related interest income has been
recorded as restricted cash in escrow in the accompanying consolidated balance
sheet.

In late 1997, the Company began marketing PCS, which is a new generation
of wireless communications offering customers advanced, secure, two-way digital
wireless services and applications. Effective August 1, 1998, the Company sold
certain PCS subscribers and related assets to Meretel Communications, L.P.
("Meretel") for $4.3 million in cash and $1.5 million in additional

F-11
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

ownership interest in Meretel. In connection with this transaction, the excess
of the consideration received above the costs of the assets sold of
approximately $2.3 million has been reflected in the accompanying consolidated
balance sheet as a reduction in investments in and advances to unconsolidated
affiliates.

On September 30, 1998, the Company acquired substantially all assets and
assumed certain liabilities of Maas.net, LLC, ("Maas.net"), a related party.
Maas.net is a provider of Internet access services. As consideration, the
Company assumed $620,000 of the indebtedness of Maas.net. On October 1, 1998,
the Company contributed these assets, with a fair value of $506,000, to LEC
Unwired, LLC (LEC Unwired), an unconsolidated affiliate.

4. Property and Equipment

Major categories of property and equipment were as follows:

<TABLE>
<CAPTION>
December 31, March 31,
---------------- -----------
1999 1998 2000
-------- ------- -----------
(In thousands) (unaudited)
<S> <C> <C> <C>
Land............................................... $ 1,061 $ 1,061 $ 1,061
Buildings.......................................... 2,011 1,946 4,766
Leasehold improvements............................. 1,198 961 1,463
Facilities and equipment........................... 127,587 34,680 143,144
Furniture and fixtures............................. 1,769 1,477 12,254
Vehicles........................................... 417 240 566
Construction in progress........................... 12,729 1,328 22,668
-------- ------- --------
146,772 41,693 185,922
Less accumulated depreciation...................... 40,705 19,128 47,323
-------- ------- --------
$106,067
$22,565 $138,599
======== ======= ========
</TABLE>

The Company recorded depreciation expense of, $20,563,000, $6,444,000 and
$5,867,000, during the years ended December 31, 1999, 1998 and 1997,
respectively.

F-12
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

5. Investments in Unconsolidated Affiliates

Investments in unconsolidated affiliates consists of the following:

<TABLE>
<CAPTION>
Percentage
Ownership
------------
December
31, December 31, March 31,
------------ March 31, ---------------- -----------
1999 1998 2000 1999 1998 2000
----- ----- --------- ------- ------- -----------
(in thousands) (unaudited)
<S> <C> <C> <C> <C> <C> <C>
Meretel.................. 24.33% 24.33% 13.28% $(3,908) $ 1,007 $(2,523)
Command Connect, LLC
("Command Connect")... 50.00% 50.00% 50.00% 1,081 1,361 1,040
GTE Mobilnet of Texas RSA
#21 Limited
Partnership ("GTE
#21")................. 25.00% 25.00% 25.00% 761 688 707
LA Unwired............... 93.66% 50.00% 93.66% -- 7,996 --
Wireless Management
Corporation........... 33.33% -- 20.00% 206 -- 46
------- ------- -------
$(1,860) $11,052 $ (730)
======= ======= =======
</TABLE>

Prior to June 1998, Meretel was the owner and operator of PCS licenses in
Lafayette, Louisiana; Baton Rouge, Louisiana; and Beaumont, Texas. On June 8,
1998, Meretel entered into an agreement with Sprint PCS in which Meretel agreed
to manage Sprint's PCS networks within each Basic Trading Area in which Meretel
operates. Pursuant to this agreement, Sprint PCS pays Meretel 92% of collected
revenues, as defined, from customers in these markets. The agreement requires
that Meretel build out the PCS networks in accordance with FCC requirements and
deadlines. Meretel and Sprint PCS will share equally the costs for any
necessary relocation of microwave sources that interfere with Sprint's PCS
spectrum. In conjunction with this agreement, Meretel elected to participate in
the FCC's amnesty program whereby Meretel surrendered its licenses in exchange
for extinguishment of all outstanding debt and related accrued interest due to
the FCC.

Command Connect and LA Unwired either own PCS licenses, or have rights to
use licenses owned by Sprint PCS under management agreements, in Louisiana,
Texas, Arkansas, Mississippi, and Oklahoma. As with Meretel, Sprint PCS pays
92% of collected revenues, as defined, from customers in these service areas.
Command Connect originally purchased the owned licenses, and holds the licenses
until such time as LA Unwired builds out the network for these licenses. At
that time, the license is transferred from Command Connect to LA Unwired, who
commences operations.

GTE #21 operates a cellular network in Texas RSA #21.

F-13
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

As discussed in Note 1, the Company increased its ownership in LA Unwired
and LEC Unwired during 1999. As a result, LA Unwired is presented on a
consolidated basis in 1999. Summary financial information for the above-
mentioned unconsolidated affiliates is as follows:

<TABLE>
<CAPTION>
December 31,
----------------------------
1999 1998 1997
-------- -------- --------
(In thousands)
<S> <C> <C> <C>
Meretel:
Total assets.................................... $ 63,195 $ 52,552 $115,218
Total liabilities............................... 93,317 64,951 99,913
-------- -------- --------
Partners' capital............................... $(30,122) $(12,399) $ 15,305
======== ======== ========
Revenue......................................... $ 23,691 $ 8,353 $ 173
======== ======== ========
Operating expenses.............................. $ 39,876 $ 30,056 $ 8,772
======== ======== ========
Net loss........................................ $(20,535) $(29,704) $(12,707)
======== ======== ========
Command Connect:
Total assets.................................... $ 3,790 $ 5,178 $ 14,402
Total liabilities............................... $ 1,582 $ 2,456 $ 9,337
-------- -------- --------
Members' capital................................ $ 2,208 $ 2,722 $ 5,065
======== ======== ========
Revenue......................................... $ -- $ 11 $ --
======== ======== ========
Operating expenses.............................. $ 10 $ 463 $ 469
======== ======== ========
Net loss........................................ $ (563) $ (452) $ (860)
======== ======== ========
GTE #21:
Total assets.................................... $ 3,105 $ 3,285 $ 2,646
Total liabilities............................... $ 54 $ 51 $ 51
-------- -------- --------
Members' capital................................ $ 3,051 $ 3,234 $ 2,595
======== ======== ========
Revenue......................................... $ 2,913 $ 2,572 $ 2,877
======== ======== ========
Operating expenses.............................. $ 962 $ 798 $ 782
======== ======== ========
Net income...................................... $ 1,981 $ 1,808 $ 2,137
======== ======== ========
LA Unwired:
Total assets.................................... $ -- $ 67,248 $ --
Total liabilities............................... -- 51,256 --
-------- -------- --------
Members' capital................................ $ -- $ 15,992 $ --
======== ======== ========
Revenue......................................... $ -- $ 1,509 $ --
======== ======== ========
Operating expenses.............................. $ -- $ 9,633 $ --
======== ======== ========
Net loss........................................ $ -- $ (9,474) $ --
======== ======== ========
Wireless Management Corporation:
Total assets.................................... $ -- $ -- $ --
Total liabilities............................... 17 -- --
-------- -------- --------
Members' capital................................ $ (17) $ -- $ --
======== ======== ========
Revenue......................................... $ -- $ -- $ --
======== ======== ========
Operating expenses.............................. $ 2 $ -- $ --
======== ======== ========
Net loss........................................ $ (258) $ -- $ --
======== ======== ========
</TABLE>

F-14
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

6. Accrued Expenses

Accrued expenses consisted of the following:

<TABLE>
<CAPTION>
December 31, March 31,
------------- -----------
1999 1998 2000
------ ------ -----------
(In
thousands) (unaudited)
<S> <C> <C> <C>
Accrued taxes, other than income...................... $ 555 $ 586 $3,493
Accrued payroll....................................... 450 121 905
Unearned revenue and customer deposits................ 305 56 346
Accrued interest expense.............................. 21 121 123
Other................................................. 717 304 1,474
------ ------ ------
$2,048 $1,188 $6,341
====== ====== ======
</TABLE>

7. Long-Term Debt

Long-term debt consisted of the following:

<TABLE>
<CAPTION>
December 31, March 31,
---------------- -----------
1999 1998 2000
-------- ------- -----------
(In thousands) (unaudited)
<S> <C> <C> <C>
Debt outstanding under credit facilities:
Senior subordinated discount notes............. $214,045 $ -- $221,046
FCC debt....................................... 1,509 -- 1,475
Vendor financing............................... 526 567 514
Bank credit facility........................... -- 28,500 2,276
Capital leases................................. -- -- 8,106
-------- ------- --------
Total long-term debt............................. 216,080 29,067 233,417
Less current maturities.......................... 188 1,341 677
-------- ------- --------
Long-term obligations, excluding current
maturities.................................... $215,892 $27,726 $232,740
======== ======= ========
</TABLE>

On October 29, 1999, US Unwired issued $400 million of 13 3/8% Senior
Subordinated Discount Notes due November 1, 2009 ("the Notes"). The Notes were
issued at a substantial discount such that the Company received gross proceeds
of approximately $209.2 million. Interest on the Notes will not begin to accrue
until November 1, 2004. Prior to that time, in lieu of interest, the Notes will
increase in value daily, compounded on each May 1 and November 1, at the rate
of 13 3/8% per year. The value of the Notes on November 1, 2004 will be equal
to the face amount of the Notes. On that date, the Notes will accrue interest
at the rate of 13 3/8% per year and the Company will be required to pay the
accrued interest beginning May 1, 2005, and on each November 1 and May 1
thereafter.

The Notes are fully, unconditionally, and joint and severally guaranteed
by one wholly owned and one non-wholly owned subsidiary (collectively
"Guarantor Subsidiaries" and individually "Guarantor"). Each of the guarantees
is a general unsecured obligation of the Guarantor and will rank equally in
right of payment to all of our existing and future senior subordinated
indebtedness and senior in right of payment of existing and future obligations
that are expressly subordinated in

F-15
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

right to payment to the Notes. The Notes will rank junior to all existing and
future senior debt. See Note 14 for the condensed consolidating balance sheets
as of December 31, 1999 and 1998 and the related condensed consolidating
statements of operations and cash flows for each of the three years in the
period ended December 31, 1999 related to the Guarantor and non-Guarantor
Subsidiaries.

In connection with the issuance of the above mentioned Notes, LA Unwired's
existing $130 million senior credit facilities and US Unwired's existing bank
credit facility were extinguished. As a result, the unamortized debt issuance
costs related to these existing credit facilities, totaling $3,262,000, were
written off, net of tax of $749,000, as an extraordinary item.

Effective October 1, 1999, US Unwired entered into senior credit
facilities for $130 million. The senior credit facilities provide for an $80
million reducing revolving credit facility, which matures on September 30,
2007, and a $50 million delay draw term loan, which matures on September 30,
2007. The reducing revolver will be permanently reduced in quarterly
installments beginning on June 30, 2000, in amounts which vary between $1.3
million and $6.0 million. The term loan will be amortized in quarterly
installments beginning on June 30, 2003, in quarterly amounts which vary
between $1.3 million and $3.7 million. Interest on all loans made under the
senior credit facilities bear interest at variable rates tied to the prime
rate, the federal funds rate or the LIBOR. At December 31, 1999, there are no
amounts outstanding under these senior credit facilities.

These senior credit facilities require US Unwired to pay an annual
commitment fee ranging from 1.5% to 1% of the unused commitment under the
senior credit facilities. The senior credit facilities are secured by a first
priority security interest in all tangible and intangible assets of US Unwired
(other than the corporate headquarters building), LA Unwired and Unwired
Telecom (including the owned PCS licenses, to the extent legally permitted); a
pledge by US Unwired and Cameron of 100% of the ownership interest in LA
Unwired, a pledge by US Unwired of its ownership interest in Unwired Telecom;
and an assignment by LA Unwired of all Sprint PCS agreements and any network
contract (including software rights). Additionally, the senior credit
facilities are subject to certain restrictive covenants. At December 31, 1999,
the Company was not in compliance with certain of these restrictive covenants.
The Company has obtained a waiver from the lender for such covenant violations.

In July 1998, LEC Unwired entered into a financing arrangement with a
financial institution. The credit facility provides for borrowings up to $18
million ($15 million in senior secured debt and $3 million in subordinated
debt) to be used for the construction of various telecommunications networks.
The arrangement includes several fixed and variable interest rate options. The
drawdown period of the facility is twenty-four months from closing. Repayment
of principal begins three years after closing and ends eight years after
closing, with interest payable on a quarterly basis. At December 31, 1999, the
effective interest rate for this debt was 10.8% and the total unfunded
commitment was approximately $6.2 million. The financing arrangement is
collateralized by

F-16
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

substantially all of the assets of LEC Unwired. Additionally, the debt is
subject to certain restrictive covenants. At December 31, 1999, LEC Unwired was
not in compliance with certain of these restrictive covenants. LEC Unwired has
obtained a waiver from the lender for such covenant violations. See Note 1 for
further information.

In December 1999, Command Connect contributed various PCS licenses to LA
Unwired. As part of this contribution, LA Unwired assumed the related debt of
$2,252,000 with the FCC. This debt bears interest at 8.75% and provides for
quarterly principal and interest payments of approximately $68,000 through
April 30, 2007. The contributed assets and assumed liabilities have been
recorded at their historical costs.

The notes outstanding under the bank credit facility provided for
quarterly interest payments with quarterly amortization of principal beginning
in June 1999 through June 2005. The notes outstanding under the vendor credit
facility provide for quarterly interest payments only through September 1997
when quarterly amortization of principal commenced with final maturity in
January 2003. Interest rates are comprised of a combination of fixed rates over
the term of the note or variable rates based on either a variable lending rate
established by a commercial bank plus a margin ranging up to 1% or the average
offering rate for three-month commercial paper of major corporations.

On June 23, 1999, LA Unwired entered into senior credit facilities for
$130 million with certain lenders. The senior credit facilities provided for an
$80 million reducing revolving credit facility, which was to mature on
September 30, 2007, and a $50 million delay draw term loan, which was to mature
on September 30, 2007. All loans made under the senior credit facilities bear
interest at variable rates tied to the prime rate, the federal funds rate or
the London Interbank Offering Rate ("LIBOR").

A portion of the proceeds from this new credit facility were used to
extinguish LA Unwired's existing credit facility. As a result, the unamortized
debt issuance costs related to this existing credit facility, totaling
$614,000, were written off, net of tax of $135,000, as an extraordinary item.

Maturities of long-term debt for the five years succeeding December 31,
1999 are as follows:

<TABLE>
<CAPTION>
(In thousands)
--------------
<S> <C>
2000....................................................... $ 188
2001....................................................... 204
2002....................................................... 222
2003....................................................... 241
2004....................................................... 262
</TABLE>

F-17
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

8. Income Taxes

Income tax expense (benefit) for the years ended December 31, 1999, 1998
and 1997 is as follows:

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- ----
(In thousands)
<S> <C> <C> <C>
Federal:
Current........................................ $(11,024) $ 11,287 $ --
Deferred....................................... (319) 3,243 (70)
-------- -------- ----
(11,343) 14,530 (70)
State:
Current........................................ 170 1,838 178
Deferred....................................... (197) 444 (13)
-------- -------- ----
(27) 2,282 165
-------- -------- ----
$(11,370) $ 16,812 $ 95
======== ======== ====
</TABLE>

Income tax expense differs from the amounts computed by applying
applicable U.S. federal income tax rate to income (loss) before income taxes,
minority interest and equity in losses of affiliates as a result of the
following:

<TABLE>
<CAPTION>
1999 1998 1997
-------- ------- -------
(In thousands)
<S> <C> <C> <C>
Computed "expected" tax expense............. $(13,552) $19,498 $ 540
Equity in loss of affiliates................ (1,705) (4,549) (1,066)
Minority interest........................... 4,176 -- --
Extraordinary item.......................... (884) -- --
Surtax...................................... -- 636 --
Permanent differences....................... 190 -- --
Change in valuation allowance............... -- -- 652
State income taxes, net of Federal income
taxes.................................... (27) 1,852 165
Other, net.................................. 432 (625) (196)
-------- ------- -------
$(11,370) $16,812 $ 95
======== ======= =======
</TABLE>

During 1998, the Company utilized all net operating losses that were
carried forward from 1997. The benefit realized from net operating loss carry
forwards totaled approximately $1,586,000.

F-18
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

The tax effects of temporary differences that give rise to the significant
components of deferred tax assets and deferred tax liabilities at December 31,
are presented below:

<TABLE>
<CAPTION>
1999 1998
------- -------
(In thousands)
<S> <C> <C>
Deferred tax assets:
State net operating losses............................. $ 2,026 $ --
Interest on Notes...................................... 1,911 --
Stock compensation..................................... 320 --
Allowance for doubtful accounts........................ 54 90
Inventory reserve...................................... 136 64
Unearned revenue....................................... -- 40
Investment in unconsolidated affiliates................ -- 389
Intangible assets...................................... -- 240
Other.................................................. 23 209
------- -------
Deferred tax assets.................................... 4,470 1,032
Less valuation allowance .............................. 2,026 --
------- -------
2,444 1,032
------- -------
Deferred tax liabilities:
Fixed assets........................................... 1,992 2,927
Deferred gains......................................... -- 1,028
Unrealized gain on marketable securities............... 316 --
Interest on related party debt......................... 126 --
Investment in unconsolidated affiliates................ 2,417 --
------- -------
4,851 3,955
------- -------
Net deferred tax liability............................... $ 2,407 $ 2,923
======= =======
</TABLE>

In assessing the realizability of deferred tax assets at December 31,
1999, the Company considered whether it was more likely than not that some
portion or all of the deferred tax assets will not be realized. The ultimate
realization of deferred tax assets is dependent upon the generation of future
taxable income during the periods in which those temporary differences become
deductible. The Company considers the scheduled reversal of deferred tax
liabilities, projected future taxable income and tax planning strategies in
making this assessment. Based upon these considerations, the Company provided a
valuation allowance to reduce the carrying value of deferred tax assets related
to certain state net operating losses. These state net operating loss
carryforwards approximate $40,520,000 and begin to expire in 2013.

9. Stockholder's Equity

The Company is authorized by its Articles of Incorporation to issue
200,000,000 shares of preferred stock upon the authorization of the Company's
Board of Directors. The Board of Directors is authorized to fix the dividend
rights and terms, conversion and voting rights, redemption rights and other
privileges and restrictions applicable to the stock.

F-19
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

The Company has two classes of authorized common stock, Class A Common
Stock and Class B Common Stock. Other than as to voting rights and transfer
restrictions applicable to the Class B shares, the Class A and Class B shares
have identical rights.

Class A shares have one vote per share and Class B shares have ten votes
per share. Shares of Class B Common Stock generally convert automatically into
shares of Class A Common Stock on a share-for-share basis upon the transfer of
the Class B shares to other than a "qualified holder," generally the original
holders of Class B shares. Class B shares are also subject to other transfer
restrictions.

In 1997, the Company withdrew from an initial public offering of its
common stock. As a result, costs totaling $1,082,000 which were previously
deferred were expensed and are included in other expenses.

Contemporaneously with the issuance of the Notes discussed in Note 7, the
Company issued 500,000 shares of Series A preferred stock for $50 million. The
present holder of the Series A preferred and any of its affiliates who become
holders may convert the preferred stock into Class B common stock, at any time,
at a price of $4.98 per share, and such holders have voting rights of Class B
common shareholders on an as-converted basis. Upon a sale or transfer of the
preferred stock by such holders to a nonaffiliate of such holders, the
preferred stock becomes convertible into Class A common stock and the
transferee holders will have voting rights of Class A common shareholders on an
as-converted basis. The Series A preferred stock has a mandatory redemption at
its stated value 91 days after the maturity of the Notes.

Additionally, the holders of the Series A preferred stock have demand
registration rights and are entitled to any dividends paid on our common stock,
as if the preferred had converted into common stock and are entitled to block
the Company from certain specified actions. The Company may force the holders
of Series A preferred stock to convert their preferred stock after an initial
public offering of the Company's common stock if such holders would receive an
internal rate of return of at least 20% per year based on the price of our
common stock. Further, if a certain holder of the Series A preferred stock
holds 50% or more of our common stock issued or issuable upon conversion of the
Series A preferred stock, it may elect two persons to our board of directors;
if such certain holder holds less than 50% but more than 25% of our common
stock issued or issuable upon conversion of the Series A preferred stock, it
may elect one person to our board of directors. Under specified circumstances,
the holders of the Series A preferred stock are entitled to a put option at the
undiscounted fair market value of the underlying Class B common stock at the
time of the put. If such put option cannot be performed due to contractual or
statutory restrictions, the holders of the Series A preferred stock are
entitled to special compensation in the form of warrants.

See Note 15 for additional information.

10. Stock Option Plan

During 1999, the Board of Directors amended and modified the 1998 Equity
Plan to the US Unwired Inc. 1999 Equity Incentive Plan (the "1999 Equity
Plan"). As part of this amendment, the

F-20
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

maximum aggregate amount of Common Stock with respect to which options or other
awards may be granted was increased from 8,528,640 to 12,259,920 shares. As of
December 31, 1998, the Company had not granted any options or other awards
under the 1998 Equity Plan. On July 16, 1999, the Company granted stock options
for a total of 3,542,584 shares under the 1999 Equity Plan. These options have
a ten year term and vest over a four year period and have an exercise price of
$1.13 per share, except for 888,045 options which have an exercise price of
$4.98 per share. All of the options were outstanding at December 31, 1999 and
none were exercisable. Additionally, another 2,267,552 shares were granted on
January 1, 2000 with an exercise price of $4.98 per share.

As allowed by SFAS No. 123, the Company has elected to continue to follow
APB Opinion No. 25, Accounting for Stock Issued to Employees, which does not
provide for compensation expense on the issuance of stock options if the option
terms are fixed and the exercise price equals the fair value of the underlying
stock on the grant date.

In connection with the above mentioned grant of options to purchase
2,654,539 shares of the Company's common stock at an exercise price of $1.13
per share, the Company has total deferred stock compensation of $6,972,000, of
which $799,000 has been recognized as stock compensation expense for the year
ended December 31, 1999, as the exercise price of these options is less than
the estimated fair value of the Company's stock at the grant date.

As required by SFAS No. 123, the Company has determined the pro forma
information as if the Company had accounted for stock options granted under the
fair value method of SFAS No. 123. The minimum value option pricing model was
used with the following weighted-average assumptions, respectively: risk-free
interest rates of 6%; dividend yield of 0%; and a weighted-average expected
life of the options of five years. The weighted-average fair value of options
granted with $1.13 and $4.98 exercise prices were $1.04 and $0.06 per share,
respectively.

Had compensation expense been recorded based on the fair values of the
stock option grants, the Company's 1999 pro forma net loss would have been
$24,224,000.

11. Commitments and Contingencies

Employees of the Company participate in a 401(k) retirement plan (the
"401(k) plan") sponsored by a related party. Employees are eligible to
participate in the 401(k) plan when the employee has completed six months of
service. Under the 401(k) plan, participating employees may defer a portion of
their pretax earnings up to certain limits prescribed by the Internal Revenue
Service. The Company contributes a discretionary match equal to a percentage of
the deferred by the employee and a discretionary amount determined by the
Company from current or accumulated net profits. The Company's contributions
are fully vested upon the completion of 5 years of service. Contribution
expense related to the 401(k) plan was approximately $283,000, $340,000 and
$264,000 for the years ended December 31, 1999, 1998 and 1997, respectively.

F-21
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

The Company is a party to various noncancellable operating leases for
facilities and equipment. Future minimum lease payments due under
noncancellable operating leases with terms in excess of one year are as
follows:

<TABLE>
<CAPTION>
(In thousands)
Year ending December 31, -------------
<S> <C>
2000.................................................... 3,276
2001.................................................... 2,963
2002.................................................... 2,446
2003.................................................... 2,245
2004.................................................... 1,907
Thereafter.............................................. 6,320
------
19,157
</TABLE>

Rental expense was $2,859,000, $1,567,000 and $777,000 for the years ended
December 31, 1999, 1998 and 1997, respectively.

The Company is involved in, various claims and legal actions arising in
the ordinary course of business. In the opinion of management, the ultimate
disposition of these matters will not have a material adverse effect on the
Company's consolidated financial position, results of operations or liquidity.

The Company has agreed to guarantee repayment of up to $3,824,000, plus
interest and fees thereon, pursuant to a loan agreement dated May 16, 1997,
related to bank financing obtained by Meretel which matures in 2007.

On March 31, 1999, the Company entered into an undertaking agreement as
required by LEC Unwired's loan agreements entered into in July 1998. This
undertaking agreement obligates the Company to provide cash capital
contributions, not to exceed $4.5 million, to LEC Unwired if LEC Unwired is not
in compliance with specified financial covenants in its loan agreements. The
amount of cash that the Company is required to provide depends on the covenant
with which LEC Unwired has failed to comply.

12. Disclosure About Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, subscriber receivables,
accrued interest and other receivables, and accounts payable and accrued
expenses approximate fair value because of the short term nature of these
items. The estimated fair value of the Company's long-term debt at December 31,
1999 and 1998 was $234,078,000 and $29,040,000, compared to its carrying value
of $216,080,000 and $29,067,000. The fair value of long-term debt is valued at
future cash flows discounted using the current borrowing rate for loans of a
comparable maturity.

Fair value estimates are subject to inherent limitations. Estimates of
fair value are made at a specific point in time, based on relevant market
information and information about the financial

F-22
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

instrument. The estimated fair values of financial instruments presented above
are not necessarily indicative of amounts the Company might realize in actual
market transactions. Estimates of fair value are subjective in nature and
involve uncertainties and matters of significant judgment and therefore cannot
be determined with precision. Changes in assumptions could significantly affect
the estimates.

13. Related Party Transactions

During the years ended December 31, 1999, 1998 and 1997, the Company paid
$10,000, $290,000 and $318,000, respectively, to a company owned by certain of
the Company's principal stockholders for voice mail services which the Company
uses in its business and also resells to its cellular subscribers.

The Company contracts with Unibill, Inc. ("Unibill"), a subsidiary of
Cameron, for all subscriber billing. The aggregate amounts paid to Cameron for
such services during 1999, 1998 and 1997 totaled $2,784,000, $2,923,000 and
$2,674,000, respectively.

From October 1997 through July 1998, the Company purchased PCS wholesale
minutes from Meretel pursuant to an oral agreement and resold the minutes to
the Company's customers. The aggregate amounts paid to Meretel for these
minutes during the years ended December 31, 1999, 1998 and 1997 totaled $0,
$1,222,000 and $105,000, respectively.

The Company also purchases long distance services from Cameron pursuant to
an oral agreement and resells the service to the Company's customers. The
aggregate amounts paid to Cameron for such services during the years ended
December 31, 1999, 1998 and 1997, totaled $1,494,000, $764,000 and $951,000,
respectively.

The Company has entered into management agreements with several affiliated
entities. During 1999, 1998 and 1997, the Company recorded $2,366,000,
$4,455,000 and $1,375,000, respectively, in management fee revenues pursuant to
these agreements. During 1997, the Company entered into an agreement with
Meretel whereby the Company receives a commission for each customer activated
for Meretel. Commissions received under this agreement totaled approximately
$1,900,000 in 1998 and $1,200,000 in 1997.

In October 1999, the Company entered into consulting agreements with
William L. Henning, Sr. and John A. Henning, both of whom serve on the
Company's board of directors. The Company paid $250,000 to William L. Henning,
Sr. and $150,000 to John A. Henning for consulting services related to securing
certain bank financing and the senior subordinated discount notes.

F-23
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

14. Guarantor and Non-Guarantor Financial Information

As discussed in Note 7, the following condensed consolidating balance
sheets, statements of operations and cash flows set forth certain financial
information regarding the Guarantor and Non-Guarantor Subsidiaries:

Condensed Consolidating Balance Sheet

<TABLE>
<CAPTION>
Year ended December 31, 1999
---------------------------------------------------------------------
Guarantor
Subsidiaries
----------------
Unwired LA Non-
US Telecom Unwired, Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ ------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents........... $ -- $12,851 $ 1,844 $ -- $ -- $ 14,695
Subscriber receivables,
net................... -- 4,780 1,256 -- -- 6,036
Other accounts
receivable............ 641 83 810 -- (479) 1,055
Inventory.............. -- 3,832 2,189 -- -- 6,021
Prepaid expenses....... 97 195 854 -- -- 1,146
Income taxes
receivable............ 3,520 6,776 -- -- -- 10,296
Receivables from
related parties....... (4,160) 4,294 665 -- (145) 654
Receivables from
officers.............. -- 110 -- -- -- 110
-------- ------- -------- ------ --------- --------
Total current assets... $ 98 $32,921 7,618 -- (624) $ 40,013
Marketable securities... 26,599 -- 114,854 -- -- 141,453
Property and equipment,
net.................... -- 20,762 85,305 -- -- 106,067
Deferred financing
costs, net............. 12,279 -- -- -- -- 12,279
Licenses, net........... -- -- 10,462 -- -- 10,462
Restricted cash escrow.. -- 5,402 -- -- -- 5,402
Investments in
subsidiaries........... 189,824 12,833 -- -- (204,517) (1,860)
Note receivable from
unconsolidated
affiliate.............. -- 1,582 -- -- -- 1,582
Other assets............ 30,332 27 46 -- (28,693) 1,712
-------- ------- -------- ------ --------- --------
Total assets........... $259,132 $73,527 $218,285 $ -- $(233,834) $317,110
======== ======= ======== ====== ========= ========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable....... $ 172 $ 5,434 $ 9,012 $ -- $ -- $ 14,618
Accrued expenses....... -- 1,040 1,568 -- (560) 2,048
Current maturities of
long term debt........ -- 48 140 -- -- 188
Net liabilities of
discontinued
operations............ -- -- -- 635 (62) 573
-------- ------- -------- ------ --------- --------
Total current
liabilities........... 172 6,522 10,720 635 (622) 17,427
Long term debt, net of
current maturities..... 214,045 29,171 1,369 -- (28,693) 215,892
Net liabilities of
discontinued
operations............. -- -- -- 1,341 -- 1,341
Deferred income taxes... (320) 2,411 -- -- 316 2,407
Minority Interest....... -- -- -- -- 1,458 1,458
Mandatory redeemable
preferred stock........ 50,000 -- -- -- -- 50,000
Stockholders' equity:
Common stock........... 600 600 -- -- (600) 600
Additional paid-in
capital............... 799 1,348 -- -- -- 2,147
Accumulated other
comprehensive income.. 81 -- 709 -- (316) 474
Partners' Capital...... -- -- 251,561 7,582 (259,143) --
Retained earnings
(deficit)............. (6,245) 33,475 (46,074) (9,558) 53,766 25,364
-------- ------- -------- ------ --------- --------
Total stockholders'
equity (deficit)...... (4,765) 35,423 206,196 (1,976) (206,293) 28,585
-------- ------- -------- ------ --------- --------
Total liabilities and
stockholders' equity
(deficit)............. $259,132 $73,527 $218,285 $ -- $(233,834) $317,110
======== ======= ======== ====== ========= ========
</TABLE>

F-24
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Balance Sheet

<TABLE>
<CAPTION>
Year ended December 31, 1998
---------------------------------------------------------------------
Guarantor
Subsidiaries
----------------
Unwired LA Non-
US Telecom Unwired, Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ ------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents........... $ -- $32,475 $ 1,350 $ -- $ (1,350) $32,475
Subscriber receivables,
net................... -- 4,419 362 -- (362) 4,419
Other receivables...... -- 27 -- -- -- 27
Inventory.............. -- 2,541 350 -- (350) 2,541
Prepaid expenses....... -- 331 244 -- (244) 331
Income taxes
receivable............ -- 5,524 -- -- -- 5,524
Receivables from
related parties....... -- 197 872 -- (872) 197
Receivables from
officers.............. -- 92 -- -- -- 92
---- ------- ------- ------ -------- -------
Total current assets... -- 45,606 3,178 -- (3,178) 45,606
Property and equipment,
net.................... -- 22,565 57,581 -- (57,581) 22,565
Net assets of
discontinued
operations............. -- 1,761 -- 4,701 (4,701) 1,761
Licenses, net........... -- -- 5,684 -- (5,684) --
Restricted cash escrow.. -- 5,164 -- -- -- 5,164
Investments in
subsidiaries........... 600 11,052 -- -- (600) 11,052
Other assets............ -- 1,481 805 -- (805) 1,481
---- ------- ------- ------ -------- -------
Total assets........... $600 $87,629 $67,248 $4,701 $(72,549) $87,629
==== ======= ======= ====== ======== =======
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable....... $ -- $ 2,972 $12,414 $ -- $(12,414) $ 2,972
Accrued expenses....... -- 1,188 712 -- (712) 1,188
Current maturities of
long term debt........ -- 1,341 -- -- -- 1,341
Net liabilities of
discontinued
operations............ -- -- -- 1,686 (1,686) --
---- ------- ------- ------ -------- -------
Total current
liabilities........... -- 5,501 13,126 1,686 (14,812) 5,501
Long term debt, net of
current maturities..... -- 27,726 38,130 -- (38,130) 27,726
Deferred income taxes... -- 2,923 -- -- -- 2,923
Stockholders' equity:
Common stock........... 600 600 -- -- (600) 600
Additional paid-in
capital............... -- 1,348 -- -- -- 1,348
Members' capital....... -- -- 25,466 5,506 (30,972) --
Retained earnings
(deficit)............. -- 49,531 (9,474) (2,491) 11,965 49,531
---- ------- ------- ------ -------- -------
Total stockholders'
equity................ 600 51,479 15,992 3,015 (19,607) 51,479
---- ------- ------- ------ -------- -------
Total liabilities and
stockholders' equity.. $600 $87,629 $67,248 $4,701 $(72,549) $87,629
==== ======= ======= ====== ======== =======
</TABLE>

F-25
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Balance Sheet

<TABLE>
<CAPTION>
Three Months ended March 31, 2000 (Unaudited)
----------------------------------------------------------------------
Guarantor
Subsidiaries
-----------------
Unwired LA Non-
US Telecom Unwired, Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ ------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents........... $ 890 $12,121 $ 3,042 $ -- $ -- $ 16,053
Subscriber receivables,
net................... -- 4,435 1,821 -- -- 6,256
Other accounts
receivable............ 1,282 551 1,180 -- (92) 2,921
Inventory.............. -- 1,700 2,544 -- -- 4,244
Prepaid expenses....... 224 479 2,723 -- -- 3,426
Income taxes
receivable............ 3,520 6,515 -- -- -- 10,035
Receivables from
related parties....... -- 4,421 (336) -- (3,755) 330
Receivables from
officers.............. -- 111 -- -- -- 111
-------- ------- -------- -------- --------- --------
Total current assets... $ 5,916 $30,333 $ 10,974 $ -- $ (3,847) $ 43,376
Marketable securities.. 33,654 -- 75,232 124 109,010
Property and equipment,
net.................... 9,594 13,270 115,735 -- -- 138,599
Deferred financing
costs, net............. 12,245 -- -- -- 12,245
Licenses, net........... -- -- 10,559 -- -- 10,559
Restricted cash escrow.. -- 5,448 -- -- -- 5,448
Investments in
subsidiaries........... 195,026 (6,168) -- -- (189,588) (730)
Note receivable from
unconsolidated
affiliate.............. -- 1,601 -- -- -- 1,601
Other assets............ 1,645 14 10,511 -- -- 12,170
-------- ------- -------- -------- --------- --------
Total assets........... $258,080 $44,498 $223,011 $ -- $(193,311) $332,278
======== ======= ======== ======== ========= ========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable....... $ 663 $ 4,185 $ 10,798 $ -- $ (24) $ 15,622
Accrued expenses....... 632 594 3,115 -- 2,000 6,341
Current maturities of
long term debt........ -- 165 512 -- -- 677
Net liabilities of
discontinued
operations............ -- -- -- 450 109 559
-------- ------- -------- -------- --------- --------
Total current
liabilities........... 1,295 4,944 14,425 450 2,085 23,199
Long term debt, net of
current maturities..... 223,322 349 9,069 -- -- 232,740
Net liabilities of
discontinued
operations............. -- -- -- 1,271 (725) 546
Deferred income taxes... (320) 2,411 -- -- -- 2,091
Minority Interest....... -- -- 927 -- 1,779 2,706
Mandatory redeemable
preferred stock........ 55,000 -- -- -- -- 55,000
Stockholders' equity:
Common stock........... 600 600 -- -- (600) 600
Additional paid-in
capital............... 7,508 1,348 -- -- -- 8,856
Accumulated other
comprehensive income.. 109 -- 508 -- -- 617
Partners' capital...... -- -- 253,752 9,301 (263,053) --
Retained earnings
(deficit)............. (29,434) 34,846 (55,670) (11,022) 67,203 5,923
-------- ------- -------- -------- --------- --------
Total stockholders'
equity (deficit)...... (21,217) 36,794 198,590 (1,721) (196,450) 15,996
-------- ------- -------- -------- --------- --------
Total liabilities and
stockholders' equity.. $258,080 $44,498 $223,011 $ -- $(193,311) $332,278
======== ======= ======== ======== ========= ========
</TABLE>

F-26
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Operations

<TABLE>
<CAPTION>
Year ended December 31, 1999
-----------------------------------------------------------------------
Guarantor
Subsidiaries
------------------
Unwired LA Non-
US Telecom Unwired, Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ -------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Revenues................ $ -- $ 46,158 $ 18,108 $ -- $(5,634) $ 58,632
Operating expenses...... 914 40,478 47,658 -- (5,160) 83,890
------- -------- -------- ------- ------- --------
Operating income
(loss)................ (914) 5,680 (29,550) -- (474) (25,258)
Other income (expense):
Interest expense....... (5,157) (2,331) (4,297) -- 560 (11,225)
Interest income........ 1,444 1,717 348 -- (560) 2,949
Other income........... -- -- 587 -- -- 587
Gain on sale of
assets............... -- 819 -- -- -- 819
------- -------- -------- ------- ------- --------
(Loss) income before
income taxes,
extraordinary items,
minority interest, and
equity in losses of
affiliates............ (4,627) 5,885 (32,912) -- (474) (32,128)
Income tax (benefit)
expense................ (3,840) (7,530) -- -- 2,356 (9,014)
------- -------- -------- ------- ------- --------
(Loss) income before
extraordinary items,
minority interest and
equity in losses of
affiliates............. (787) 13,415 (32,912) -- (2,830) (23,114)
Minority interest in
losses of affiliates.. -- -- -- -- 10,350 10,350
Equity in losses of
affiliates............ (5,458) (29,283) -- -- 29,871 (4,870)
------- -------- -------- ------- ------- --------
Income (loss) from
continuing operations
...................... (6,245) (15,868) (32,912) -- 37,391 (17,634)
Loss from discontinued
operations............ -- -- -- (7,067) 3,526 (3,541)
Extraordinary item-early
extinguishment of
debt.................. -- (188) (3,688) -- 884 (2,992)
------- -------- -------- ------- ------- --------
Net loss................ $(6,245) $(16,056) $(36,600) $(7,067) $41,801 $(24,167)
======= ======== ======== ======= ======= ========
<CAPTION>
Year ended December 31, 1998
-----------------------------------------------------------------------
Guarantor
Subsidiaries
------------------
Unwired LA Non-
US Telecom Unwired, Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ -------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Revenues................ $ -- $ 67,735 $ 1,509 $ 3,976 $(1,509) $ 71,711
Operating expenses...... -- 63,704 9,633 3,532 (9,633) 67,236
------- -------- -------- ------- ------- --------
Operating income
(loss)................ -- 4,031 (8,124) 444 8,124 4,475
Interest expense....... -- (5,455) (1,580) (702) 1,580 (6,157)
Interest income........ -- 1,754 230 24 (230) 1,778
Loss on sale of
assets............... -- (114) -- -- -- (114)
Gain on sale of certain
markets.............. -- 57,364 -- -- -- 57,364
------- -------- -------- ------- ------- --------
Income (loss) before
income taxes and
equity in losses of
affiliates............ -- 57,580 (9,474) (234) 9,474 57,346
Income tax expense...... -- 16,812 -- -- -- 16,812
------- -------- -------- ------- ------- --------
Income (loss) before
equity in losses of
affiliates............. -- 40,768 (9,474) (234) 9,474 40,534
Equity in losses of
affiliates............. -- (11,738) -- -- -- (11,738)
------- -------- -------- ------- ------- --------
Income (loss) from
continuing operations.. -- 29,030 (9,474) (234) 9,474 28,796
Loss from discontinued
operations............. -- (1,246) -- (2,491) 2,491 (1,246)
------- -------- -------- ------- ------- --------
Net income (loss)....... $ -- $ 27,784 $ (9,474) $(2,725) $11,965 $ 27,550
======= ======== ======== ======= ======= ========
</TABLE>

F-27
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Operations

<TABLE>
<CAPTION>
Year ended December 31, 1997
----------------------------------------------------------------
Guarantor
Subsidiaries
------------
Unwired Non-
US Telecom Guarantor
Unwired Inc. Corp. Subsidiaries Eliminations Consolidated
------------ ------------ ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C>
Revenues................ $ -- $49,618 $36,632 $(11,582) $74,668
Operating expenses...... -- 42,151 34,538 (11,582) 65,107
----- ------- ------- -------- -------
Operating income........ -- 7,467 2,094 -- 9,561
Interest expense....... -- (2,110) (6,470) -- (8,580)
Interest income........ -- 247 1,443 -- 1,690
Other expenses......... -- (1,082) -- -- (1,082)
----- ------- ------- -------- -------
Income (loss) before
income taxes, minority
interest, and equity
in losses of
affiliates............ -- 4,522 (2,933) -- 1,589
Income tax (benefit)
expense................ -- 730 (635) -- 95
----- ------- ------- -------- -------
Income (loss) before
minority interest and
equity in losses of
affiliates............. -- 3,792 (2,298) -- 1,494
Minority interest in
losses of subsidiary... -- -- -- 134 134
Equity in losses of
affiliates............. -- (2,894) -- (243) (3,137)
----- ------- ------- -------- -------
Net income (loss)....... $ -- $ 898 $(2,298) $ (109) $(1,509)
===== ======= ======= ======== =======
</TABLE>

F-28
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Operations

F-29
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Operations

<TABLE>
<CAPTION>
Three Months ended March 31, 1999 (Unaudited)
---------------------------------------------------------------------
Guarantor
Subsidiaries
----------------
Unwired LA Non-
US Telecom Unwired Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ ------- ------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Revenues................ $ -- $10,851 $ 2,673 $ -- $ (595) $12,929
Operating expenses...... -- 9,285 7,383 -- (458) 16,210
------ ------- ------- ------- ------ -------
Operating income
(loss)................ -- 1,566 (4,710) -- (137) (3,281)
Interest expense....... -- (615) (625) -- -- (1,240)
Interest income........ -- 399 21 -- -- 420
Other expense.......... -- -- -- -- -- --
Gain on sale of
assets............... -- -- -- -- -- --
------ ------- ------- ------- ------ -------
(Loss) income before
income taxes,
extraordinary items,
minority interest, and
equity in losses of
affiliates............ -- 1,350 (5,314) -- (137) (4,101)
Income tax (benefit)
expense................ -- (1,061) -- -- 444 (617)
------ ------- ------- ------- ------ -------
(Loss) income before
extraordinary items,
minority interest and
equity in losses of
affiliates............. -- 2,411 (5,314) -- (581) (3,484)
Minority interest in
losses of affiliates... -- -- -- -- 3,104 3,104
Equity in losses
(income) of
affiliates............. -- (4,459) -- -- 3,447 (1,012)
------ ------- ------- ------- ------ -------
Income (loss) from
continuing
operations............ -- (2,048) (5,314) -- 5,970 (1,392)
Loss from discontinued
operations............ -- -- -- (1,247) 581 (666)
Extraordinary item--
early extinguishment
of debt............... -- -- -- -- -- --
------ ------- ------- ------- ------ -------
Net loss................ $ -- $(2,048) $(5,314) $(1,247) $6,551 $(2,058)
====== ======= ======= ======= ====== =======
</TABLE>

F-30
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Cash Flows

<TABLE>
<CAPTION>
Year ended December 31, 1999
----------------------------------------------------------------------
Guarantor
Subsidiaries
-----------------
Unwired LA Non-
US Telecom Unwired, Guarantor
Unwired Inc. Corp. LLC Subsidiaries Eliminations Consolidated
------------ ------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Net cash provided by
(used in) operating
activities............ $ (2,406) $16,134 $(21,222) $(5,373) $ 5,461 $ (7,406)
Cash flows from
investing activities:
Purchases of property
and equipment........ -- (4,129) (45,765) -- -- (49,894)
Distributions from
unconsolidated
affiliates........... -- 421 -- -- -- 421
Investments in
affiliates........... (189,224) (30,554) -- -- 218,574 (1,204)
Purchase of marketable
securities........... (26,518) -- (114,145) -- -- (140,663)
Cash contributions from
minority
shareholder.......... -- -- -- -- 2,500 2,500
Loan to unconsolidated
affiliate............ -- (1,582) -- -- -- (1,582)
Loan to consolidated
affiliate............ (28,693) -- -- -- 28,693 --
Purchase of licenses
and subscriber base.. -- -- (1,063) -- -- (1,063)
Cash acquired from
consolidation of
previous
unconsolidated
affiliate............ -- -- -- -- 1,350 1,350
Discontinued
operations........... -- -- -- (8,219) -- (8,219)
-------- ------- -------- ------- --------- --------
Net cash provided by
(used in) investing
activities............ (244,435) (35,844) (160,973) (8,219) 251,117 (198,354)
Cash flows from
financing activities:
Capital contributions.. -- -- 224,783 -- (224,783) --
Proceeds from long-term
debt................. 209,224 28,693 30,959 -- (28,693) 240,183
Principal payments on
long-term debt....... -- (28,542) (69,808) -- -- (98,350)
Debt issuance cost..... (12,383) (65) (3,245) -- -- (15,693)
Proceeds from issuance
of preferred stock... 50,000 -- -- -- -- 50,000
Discontinued
operations--principal
payments on long-term
debt................. -- -- -- 13,592 (1,752) 11,840
-------- ------- -------- ------- --------- --------
Net cash provided by
(used in) financing
activities............ 246,841 86 182,689 13,592 (255,228) 187,980
-------- ------- -------- ------- --------- --------
Net increase (decrease)
in cash and cash
equivalents........... -- (19,624) 494 -- 1,350 (17,780)
Cash and cash
equivalents at
beginning of year..... -- 32,475 1,350 -- (1,350) 32,475
-------- ------- -------- ------- --------- --------
Cash and cash
equivalents at end of
year.................. $ -- $12,851 $ 1,844 $ -- $ -- $ 14,695
======== ======= ======== ======= ========= ========
</TABLE>

F-31
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Cash Flows

<TABLE>
<CAPTION>
Year ended December 31, 1998
------------------------------------------------------------------------
Guarantor
Subsidiaries
-------------------
Unwired LA Non-
US Telecom Unwired, Guarantor
Unwired Inc. Corp. LLC Subsidiaries Eliminations Consolidated
------------ -------- --------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Net cash provided by
(used in) operating
activities............ $ -- $(13,480) $ (9,866) $ (3,962) $ 12,642 $ (14,666)
Cash flows from
investing activities:
Purchases of property
and equipment........ -- (20,380) (44,749) (2,074) 46,628 (20,575)
Distributions from
unconsolidated
affiliates........... -- 813 -- -- -- 813
Payments for microwave
relocation costs..... -- -- (755) -- 755 --
Investments in
unconsolidated
affiliates........... -- (15,416) -- -- -- (15,416)
Net proceeds from sale
of certain markets... -- 154,944 -- (67) -- 154,877
Purchase of licenses... -- (6,514) -- -- -- (6,514)
----- -------- -------- -------- -------- ---------
Net cash provided by
(used in) investing
activities............ -- 113,447 (45,504) (2,141) 47,383 113,185
Cash flows from
financing activities:
Capital contributions.. -- (9,894) 23,303 14,894 (28,303) --
Proceeds from long-term
debt................. -- 29,724 38,131 -- (38,131) 29,724
Principal payments on
long-term debt....... -- (91,156) (4,302) (9,567) 4,302 (100,723)
Other.................. -- -- (412) (345) 757 --
----- -------- -------- -------- -------- ---------
Net cash provided by
(used in) financing
activities............ -- (71,326) 56,720 4,982 (61,375) (70,999)
----- -------- -------- -------- -------- ---------
Net increase (decrease)
in cash............... -- 28,641 1,350 (1,121) (1,350) 27,520
Cash at beginning of
year.................. -- 3,834 -- 1,121 -- 4,955
----- -------- -------- -------- -------- ---------
Cash at end of year..... $ -- $ 32,475 $ 1,350 $ -- $ (1,350) $ 32,475
===== ======== ======== ======== ======== =========
<CAPTION>
Year ended December 31, 1997
------------------------------------------------------------------------
Guarantor
Subsidiaries
-------------------
Unwired Mercury Non-
US Telecom Cellular, Guarantor
Unwired Inc. Corp. Inc. Subsidiaries Eliminations Consolidated
------------ -------- --------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Net cash provided by
(used in) operating
activities............ $ -- $ 18,791 $ -- $ (6,752) $ -- $ 12,039
Cash flows from
investing activities:
Purchases of property
and equipment........ -- (179) -- (12,380) -- (12,559)
Investments in
unconsolidated
affiliates........... -- (5,040) -- -- -- (5,040)
----- -------- -------- -------- -------- ---------
Net cash used in
investing activities.. -- (5,219) -- (12,380) -- (17,599)
Cash flows from
financing activities:
Proceeds from long-term
debt................. -- (11,903) -- 18,673 -- 6,770
Principal payments on
long-term debt....... -- (2,410) -- (194) -- (2,604)
Debt issuance cost..... -- 416 -- (641) -- (225)
----- -------- -------- -------- -------- ---------
Net cash provided by
(used in) financing
activities............ -- (13,897) -- 17,838 -- 3,941
----- -------- -------- -------- -------- ---------
Net decrease in cash.... -- (325) -- (1,294) -- (1,619)
Cash at beginning of
year.................. -- 4,159 -- 2,415 -- 6,574
----- -------- -------- -------- -------- ---------
Cash at end of year..... $ -- $ 3,834 $ -- $ 1,121 $ -- $ 4,955
===== ======== ======== ======== ======== =========
</TABLE>

F-32
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Cash Flows

F-33
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Condensed Consolidating Statement of Cash Flows

<TABLE>
<CAPTION>
Three Months ended March 31, 1999 (Unaudited)
-----------------------------------------------------------------------
Guarantor
Subsidiaries
------------------
Unwired LA Non-
US Telecom Unwired Guarantor Consolidated
Unwired Inc. Corp. LLC Subsidiaries Eliminations Total
------------ -------- -------- ------------ ------------ ------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Net cash (used in)
operating activities.. $ -- $ 13,631 $(10,714) $ (251) $ -- $ 2,666
Cash flows from
investing activities:
Purchases of property
and equipment........ -- (11,822) (586) -- -- (12,408)
Distributions from
unconsolidated
affiliates........... -- 125 -- -- -- 125
Investments in
affiliates........... -- (6,233) -- -- 5,029 (1,204)
Purchase of marketable
securities........... -- -- -- -- -- --
Sale of marketable
securities........... -- -- -- -- -- --
Loan to unconsolidated
affiliate............ -- -- -- -- -- --
Purchase of licenses
and subscriber base.. -- -- -- -- -- --
Cash acquired from
consolidation of
previous
unconsolidated
affiliate............ -- -- -- -- 1,350 1,350
Discontinued
operations........... -- -- -- (3,049) -- (3,049)
------ -------- -------- ------- ------- --------
Net cash provided by
(used in) investing
activities............ -- (17,930) (586) (3,049) 6,379 (15,186)
Cash flows from
financing activities:
Capital contributions.. -- -- 4,029 -- (4,029) --
Proceeds from long-term
debt................. -- -- 6,771 -- -- 6,771
Principal payments on
long-term debt....... -- (11) -- -- -- (11)
Debt issuance cost..... -- -- (300) -- -- (300)
Proceeds from issuance
of preferred stock... -- -- -- -- -- --
Discontinued
operations........... -- -- -- 3,300 (1,000) 2,300
------ -------- -------- ------- ------- --------
Net cash provided by
(used in) financing
activities............ -- (11) 10,500 3,300 (5,029) 8,760
------ -------- -------- ------- ------- --------
Net increase (decrease)
in cash and cash
equivalents........... -- (4,310) (800) -- 1,350 (3,760)
Cash and cash
equivalents at
beginning of year..... -- 32,475 1,350 -- (1,350) 32,475
------ -------- -------- ------- ------- --------
Cash and cash
equivalents at end of
year.................. $ -- $ 28,165 $ 550 $ -- $ -- $ 28,715
====== ======== ======== ======= ======= ========
</TABLE>

F-34
<PAGE>

US UNWIRED INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

December 31, 1999

15. Subsequent Events

Effective January 1, 2000, the Company executed an agreement with Meretel
to receive an 80% interest in each of the Beaumont and Lufkin BTA markets in
exchange for a reduction in the Company's ownership interest in Meretel from
24.33% to 13.28%. The Company contributed these net assets to a new
partnership, Texas Unwired, for which the Company received an 80% ownership
interest. The contributed net assets were recorded at fair value. Additionally,
this transaction will result in a similar reduction in the Company's guarantee
of Meretel's debt.

On April 11, 2000, the Company increased its authorized shares for its
common and preferred stock and effected a 5.3304-for-1 stock split for its
outstanding common shares. All stockholders' equity balances and disclosures in
the accompanying financial statements have been retroactively restated for such
increase in authorized shares and the stock split. The effect of the stock
split was to transfer an amount equal to the par value of the new shares issued
from additional paid-in capital to common stock.

Tax Assessment (unaudited)

In April 2000, the Company received an assessment for approximately $4.0
million related to certain sales and use taxes resulting from a routine audit.
Although management is continuing to evaluate and discuss this assessment with
the local tax authorities, management believes that any additional sales and
use taxes that may result from this assessment have been adequately provided
for in the accompanying financial statements.

F-35
<PAGE>

REPORT OF INDEPENDENT AUDITORS

The Partners
Louisiana Unwired, LLC

We have audited the accompanying balance sheets of Louisiana Unwired, LLC
as of December 31, 1999 and 1998, and the related statements of operations,
members' equity, and cash flows for the year ended December 31, 1999 and for
the period from January 8, 1998 (inception) through December 31, 1998. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Louisiana Unwired, LLC at
December 31, 1999 and 1998, and the results of its operations and its cash
flows for the year ended December 31, 1999 and for the period from January 8,
1998 (inception) through December 31, 1998, in conformity with accounting
principles generally accepted in the United States.

/s/ Ernst & Young LLP

Houston, Texas
February 9, 2000

F-36
<PAGE>

LOUISIANA UNWIRED, LLC

BALANCE SHEETS

(In thousands)

<TABLE>
<CAPTION>
December 31, March 31,
----------------- -----------
1999 1998 2000
-------- ------- -----------
(unaudited)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents..................... $ 1,844 $ 1,350 $ 3,042
Accounts receivable, net of allowance for
doubtful accounts of $48, $-0- and $44..... 1,256 362 1,821
Other receivables............................. 810 -- 1,180
Inventories................................... 2,189 350 2,544
Prepaid expenses.............................. 854 244 2,723
Due from members.............................. -- 217 940
Due from affiliates........................... 788 655 --
-------- ------- --------
Total current assets........................ 7,741 3,178 12,250
Marketable securities........................... 114,854 -- 75,232
Property and equipment, net..................... 85,305 57,581 115,735
Licenses, net of accumulated amortization of
$1,326, $448 and $1,480...................... 10,462 5,684 10,559
Deferred financing costs, net of accumulated
amortization of $87 in 1998 ................. -- 692 --
Other assets, net of accumulated amortization of
$678 at March 31, 2000....................... 46 113 10,511
-------- ------- --------
Total assets................................ $218,408 $67,248 $224,287
======== ======= ========
LIABILITIES AND MEMBERS' EQUITY
Current liabilities:
Accounts payable.............................. $ 9,012 $12,414 $ 10,798
Due to members................................ 123 -- --
Due to affiliate.............................. -- -- 1,276
Accrued expenses and other liabilities........ 1,568 712 3,115
Current maturities of long-term debt.......... 140 -- 512
-------- ------- --------
Total current liabilities................... 10,843 13,126 15,701
Long-term debt.................................. 1,369 38,130 9,069
Minority interests.............................. -- -- 927
Commitments and contingencies
Members' equity:
Members' capital.............................. 251,561 25,466 253,752
Accumulated other comprehensive income........ 709 -- 508
Accumulated deficit........................... (46,074) (9,474) (55,670)
-------- ------- --------
Total members' equity....................... 206,196 15,992 198,590
-------- ------- --------
Total liabilities and members' equity....... $218,408 $67,248 $224,287
======== ======= ========
</TABLE>

See accompanying notes.

F-37
<PAGE>

LOUISIANA UNWIRED, LLC

STATEMENTS OF OPERATIONS

(In thousands)

<TABLE>
<CAPTION>
Period from
January 8,
1998
(inception) Three Months
Year ended through Ended March 31,
December 31, December 31, ----------------
1999 1998 2000 1999
------------ ------------ ------- -------
(unaudited)
<S> <C> <C> <C> <C>
Revenues:
Subscriber revenue.............. $ 10,311 $ 444 $ 7,522 $ 1,546
Roaming revenues................ 3,631 343 2,350 265
Merchandise sales revenue....... 4,032 722 2,759 863
Other revenue................... 134 -- 94 --
-------- ------- ------- -------
Total revenues................ 18,108 1,509 12,725 2,674
Operating expenses:
Cost of service................. 10,252 1,912 5,268 1,356
Merchandise cost of sales....... 9,163 1,422 5,252 1,915
Administrative expenses......... 14,745 3,045 7,414 1,758
Depreciation and amortization... 13,498 3,254 5,910 2,353
-------- ------- ------- -------
Total operating expenses...... 47,658 9,633 23,844 7,382
-------- ------- ------- -------
Operating loss.................... (29,550) (8,124) (11,119) (4,708)
Other income (expense):
Interest expense................ (4,297) (1,580) (280) (625)
Interest income................. 348 230 1,596 19
Other income.................... 587 -- -- --
-------- ------- ------- -------
Total other expense........... (3,362) (1,350) 1,316 (606)
-------- ------- ------- -------
Loss before extraordinary item.... (32,912) (9,474) (9,803) (5,314)
Extraordinary item-early
extinguishments of debt........ (3,688) -- (238) --
Minority interests in losses of
subsidiaries................... -- -- 445 --
-------- ------- ------- -------
Net loss.......................... $(36,600) $(9,474) $(9,596) $(5,314)
======== ======= ======= =======
</TABLE>

See accompanying notes.

F-38
<PAGE>

LOUISIANA UNWIRED, LLC

STATEMENTS OF MEMBERS' EQUITY

<TABLE>
<CAPTION>
Accumulated
US Unwired Cameron Other
Unwired Telecom Communications Command Comprehensive
Inc. Corp. Corporation Connect Income Total
-------- ------- -------------- ------- ------------- --------
<S> <C> <C> <C> <C> <C> <C>
Capital contributions... $ -- $12,733 $12,733 $ -- -- $ 25,466
Net loss................ -- (4,737) (4,737) -- -- (9,474)
-------- ------- ------- ------ ------ --------
Balance at December 31,
1998................. -- 7,996 7,996 -- -- 15,992
Capital contributions... 194,683 27,600 2,500 1,312 -- 226,095
Unrealized gain on
marketable
securities........... 709 709
Net loss................ (5,459) (20,792) (10,334) (15) -- (36,600)
--------
Comprehensive loss...... (35,891)
-------- ------- ------- ------ ------ --------
Balance at December 31,
1999................. $189,224 $14,804 $ 162 $1,297 $ 709 $206,196
Capital contributions... 2,191 -- -- -- -- 2,191
Realized gain on
marketable
securities........... -- -- -- -- (709) (709)
Unrealized gain on
marketable
securities........... -- -- -- -- 508 508
Net loss................ (8,965) -- (582) (49) -- (9,596)
--------
Comprehensive loss...... -- -- -- -- -- (9,797)
-------- ------- ------- ------ ------ --------
Balance at March 31,
2000................. $182,450 $14,804 $ (420) $1,248 $ 508 $198,590
======== ======= ======= ====== ====== ========
</TABLE>

See accompanying notes.

F-39
<PAGE>

LOUISIANA UNWIRED, LLC

STATEMENTS OF CASH FLOWS

(In thousands)

<TABLE>
<CAPTION>
Period from
January 8,
1998
(inception) Three Months
Year ended through Ended March 31,
December 31, December 31, -----------------
1999 1998 2000 1999
------------ ------------ ------- --------
(unaudited)
<S> <C> <C> <C> <C>
Cash flows from operating
activities
Net loss......................... $ (36,600) $ (9,474) $(9,596) $ (5,314)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Extraordinary item............. 3,688 -- 238 --
Minority interests............. 445 --
Depreciation and amortization.. 13,498 3,254 5,910 2,353
Changes in operating assets and
liabilities:
Accounts receivable.......... (894) (362) (267) (417)
Other receivables............ (810) -- (363)
Inventories.................. (1,839) (350) 256 (144)
Prepaid expenses............. (610) (242) (1,768) (281)
Due to/from members.......... 340 (281) (2,641) 410
Due from affiliates.......... (133) (2,225) 912 1,039
Accounts payable............. 1,231 (514) (3,994) (8,357)
Accrued expenses and other
liabilities............... 840 440 1,171 (50)
Other assets................. 67 (112) 69 47
--------- -------- ------- --------
Net cash used in operating
activities.................... (21,222) (9,866) (9,628) (10,714)
Cash flows from investing
activities
Purchase of marketable
securities.................... (114,145) -- (1,579) --
Sale of marketable securities.... -- -- 41,000 --
Payments for microwave relocation
costs......................... (1,063) (755) (250) --
Payments for the purchase of
equipment..................... (45,765) (44,749) (14,805) (586)
--------- -------- ------- --------
Net cash used in investing
activities.................... (160,973) (45,504) 24,366 (586)
Cash flows from financing
activities
Capital contributions from
members....................... 224,783 23,303 -- 4,029
Proceeds from long-term debt..... 30,959 38,131 260 6,771
Principal payments of long-term
debt.......................... (69,808) (4,302) (13,800) --
Payments for financing costs..... (3,245) (412) -- (300)
--------- -------- ------- --------
Net cash provided by financing
activities.................... 182,689 56,720 (13,540) 10,500
--------- -------- ------- --------
Net increase in cash and cash
equivalents................... 494 1,350 1,198 (800)
Cash and cash equivalents at
beginning of year............. 1,350 -- 1,844 1,350
--------- -------- ------- --------
Cash and cash equivalents at end
of year....................... $ 1,844 $ 1,350 $ 3,042 $ 550
========= ======== ======= ========
Supplemental cash flow
disclosures:
Cash paid for interest......... $ 2,694 $ 1,617 $ 33 $ 797
========= ======== ======= ========
Noncash transactions:
Purchases of equipment in
accounts payable............ $ 7,215 $ 12,348 $12,919 $ 9,271
========= ======== ======= ========
Contributions of net assets by
members..................... $ 1,312 $ 2,163 $ 2,191 $ 1,071
========= ======== ======= ========
</TABLE>

See accompanying notes.

F-40
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS

December 31, 1999

1. Description of Business and Summary of Significant Accounting Policies

Description of Organization

Louisiana Unwired, LLC (the "Company"), is principally engaged in
providing access to and usage of its personal communications service ("PCS")
networks in Louisiana. PCS is a new generation of wireless communications,
offering customers advanced, secure, two-way digital wireless services and
applications. As of December 31, 1999, the Company has been primarily engaged
in the build-out of its networks.

In April 1998, the Company's members contributed PCS licenses in four
Louisiana markets to the Company from an affiliated company with common
ownership. Additionally, certain related assets and liabilities, including debt
used to finance the purchase of these four licenses, were also contributed.
These contributed assets and liabilities were recorded at their historical
costs. The Company commenced operations in one of these markets in April 1998
and in three of these markets in September 1998. The Company is currently in
the process of building out PCS networks in other markets for which its members
hold licenses through the above mentioned affiliated company. At the point
these networks become operational, the Company's members plan to contribute the
applicable license to the Company prior to commencement of operations.

Additionally, during 1998, the Company entered into an agreement with
Sprint PCS in which the Company has agreed to manage Sprint PCS's network in
BTAs for which the Company does not have a PCS license. In consideration for
managing Sprint PCS's network, Sprint PCS has agreed to pay 92% of collected
revenues, as defined, to the Company. The agreement requires that the Company
build out the PCS network in accordance with FCC requirements and deadlines.
The Company and Sprint PCS will share equally the costs for any necessary
future relocation of microwave sources that interfere with Sprint PCS's
spectrum.

At December 31,1999, the Company is 77.39% owned by US Unwired Inc. ("US
Unwired"), 16.03% owned by Unwired Telecom Corp. ("Unwired Telecom"), 0.52%
owned by Command Connect ("Command Connect"), and 6.06% by Cameron
Communications Corporation ("Cameron").

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.

Marketable Securities

F-41
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

at the time of purchase and re-evaluates such classification as of each balance
sheet date. At December 31, 1999, all of the Company's investments in
marketable securities are classified as available-for-sale, and as a result,
are reported at fair value. Unrealized gains and losses are reported as a
component of accumulated other comprehensive income in stockholders' equity.
The cost of investments sold is based on the average cost method, and realized
gains and losses are included in other income (expense).

Inventory

Inventory consists of PCS telephones and related accessories and is
carried at cost. Cost is determined by the average cost method, which
approximates the first-in, first-out method.

Property and Equipment

Property and equipment is stated at cost and depreciation is provided on a
straight-line basis over the estimated useful lives of the assets as follows:

<TABLE>
<CAPTION>
Year
------
<S> <C>
Facilities and equipment............................................ 5
Office equipment and fixtures....................................... 5 to 7
Vehicles............................................................ 5
Leasehold improvements.............................................. 3 to 5
</TABLE>

Licenses

Licenses consist primarily of costs incurred in connection with the
acquisition of PCS licenses. These assets are recorded at cost and amortized
using the straight-line method over an estimated useful life of 20 years.
Amortization expense charged to operations in 1999 and 1998 was $341,000 and
$270,000, respectively.

Long-Lived Assets

The Company assesses long-lived assets for impairment under Statement of
Financial Accounting Standards ("SFAS") 121, Accounting for Impairment of Long-
Lived Assets and for Long-Lived Assets to be Disposed Of. SFAS 121 requires
that long-lived assets and certain identifiable intangibles to be held or
disposed of by an entity be reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. The Company periodically evaluates the recoverability of the
carrying amounts of its licenses and property and equipment in each market, as
well as the depreciation and amortization periods, based on estimated
undiscounted future cash flows and other factors to determine whether current
events or circumstances warrant reduction of the carrying amounts or
acceleration of the related amortization period. If such assets are considered
to be impaired, the impairment to be recognized is measured by the amount by
which the carrying amount of the assets exceeds the fair value of the assets.
Assets to be disposed of are reported at the lower of the carrying amount or
fair value less costs to sell.

F-42
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Deferred Financing Costs

Deferred financing costs include costs incurred in connection with the
issuance of the Company's long-term debt which are amortized over the term of
the related debt. Amortization expense charged to operations in 1999 and 1998
was $249,000 and $87,000, respectively.

Revenue Recognition

The Company earns revenue by providing access to and usage of its PCS
networks and sales of PCS merchandise. Service revenues include revenues for
charges to subscribers for both access to and usage of the Company's networks.
These revenues are recognized as they are earned by the Company. Revenues from
the sales of merchandise are recognized when the merchandise is delivered.

Advertising Cost

Advertising costs are expensed as incurred. For the year ended December
31, 1999 and for the period from January 8, 1998 (inception) through December
31, 1998, approximately $3,361,000 and $935,000 of advertising costs were
incurred, respectively.

Use of Estimates

Income Taxes

No provision for income taxes is provided as the Company's federal and
state income and/or loss is included in the income tax returns of its members.

Concentrations of Credit Risk

Financial instruments which potentially expose the Company to
concentrations of credit risk consist primarily of cash and accounts
receivable. The Company places its cash and temporary cash investments with
high credit quality financial services companies. Collectibility of receivables
is impacted by economic trends in the Company's markets.

Disclosure About Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, accounts receivables,
other receivables, and accounts payable and accrued expenses approximate fair
value because of the short term nature of these items. The estimated fair value
of the Company's long-term debt at December 31, 1999 and

F-43
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

1998 was $1,566,000 and $38,130,000, compared to its carrying value of
$1,509,000 and $38,130,000. The fair value of long-term debt is valued at
future cash flows discounted using the current borrowing rate for loans of a
comparable maturity.

Fair value estimates are subject to inherent limitations. Estimates of
fair value are made at a specific point in time, based on relevant market
information and information about the financial instrument. The estimated fair
values of financial instruments presented above are not necessarily indicative
of amounts the Company might realize in actual market transactions. Estimates
of fair value are subjective in nature and involve uncertainties and matters of
significant judgment and therefore cannot be determined with precision. Changes
in assumptions could significantly affect the estimates.

Unaudited Interim Information

2. Marketable Securities

<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------- ---------- ---------- ---------
(In thousands)
<S> <C> <C> <C> <C>
Commercial paper................ $ 88,892 $709 $-- $ 89,601
Fixed income mutual funds....... 25,253 -- -- 25,253
-------- ---- --- --------
$114,145 $709 $-- $114,854
======== ==== === ========
</TABLE>

For the years ended December 31, 1999 and 1998, there were no net realized
gains and losses on sales of available-for-sale marketable securities.

F-44
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

3. Property and Equipment

The major categories of property and equipment at December 31, 1999 and
1998 were as follows:

<TABLE>
<CAPTION>
December 31,
---------------
1999 1998
------- -------
(In thousands)
<S> <C> <C>
Facilities and equipment.................................. $86,438 $43,352
Office equipment and fixtures............................. 1,645 145
Vehicles.................................................. 140 32
Leasehold improvements.................................... 350 39
Construction in progress.................................. 12,537 16,910
------- -------
101,110 60,478
Less accumulated depreciation............................. 15,805 2,897
------- -------
$85,305 $57,581
======= =======
</TABLE>

The Company recorded depreciation expense of $12,908,000 and $2,897,000
for the year ended December 31, 1999 and the period from January 8, 1998
(inception) through December 31, 1998.

4. Long-Term Debt

In May 1998, the Company executed a $48,600,000 bank credit facility. The
notes outstanding under this bank credit facility provided for quarterly
interest only payments through December 2001 with quarterly principal and
interest payments commencing March 2002 through December 2006. Interest rates
were comprised of a combination of variable rates based on either a variable
lending rate established by a commercial bank plus a margin ranging up to .375%
or London Interbank Offering Rate ("LIBOR") plus a margin ranging up to 2.375%.
At December 31, 1998, the effective interest rate for these notes was 7.55% and
the total unfunded commitment was approximately $10,470,000. Substantially all
of the assets of the Company were pledged to secure the Company's obligation
including a security interest in all property and equipment, and pledge
agreements for all membership interests in the Company. Additionally, the
members guaranteed a portion of the credit facility. The debt was subject to
certain restrictive covenants including maintaining certain financial ratios,
reaching defined subscriber growth goals, and limiting annual capital
expenditures. At December 31, 1998, the Company was not in compliance with the
restrictive covenants related to the number of subscribers and capital
expenditures. The Company obtained a waiver from the lender for such covenant
violations.

On June 23, 1999, the Company entered into senior credit facilities for
$130 million with certain lenders. The senior credit facilities provided for an
$80 million reducing revolving credit facility, which was to mature on
September 30, 2007, and a $50 million delay draw term loan, which was to mature
on September 30, 2007. All loans made under the senior credit facilities bear
interest

F-45
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

at variable rates tied to the prime rate, the federal funds rate or the LIBOR.
The senior credit facilities were secured by a first priority security interest
in all tangible and intangible assets of the Company and its subsidiaries
(including the owned PCS licenses, if legally permitted); a pledge by US
Unwired and Cameron of 100% of the ownership interests in the Company; a pledge
by the Company of its ownership interest in any of the Company's present and
future subsidiaries; and an assignment of all Sprint PCS agreements and any
network contract (including software rights).

A portion of the proceeds from this new credit facility were used to
extinguish the Company's May 1998 credit facility. As a result, the unamortized
debt issuance costs related to the May 1998 credit facility, totaling $614,000,
were written off as an extraordinary item.

During the fourth quarter of 1999, US Unwired contributed approximately
$194.7 million to the Company and the Company used a portion of these
contributions to extinguish the June 1999 senior credit facilities. As a
result, the unamortized debt issuance costs related to the June 1999 senior
credit facilities, totaling $3,074,000, were written off as an extraordinary
item.

In December 1999, Command Connect contributed various PCS licenses to the
Company. As part of this contribution, the Company assumed the related debt of
$2,252,000 with the FCC. This debt bears interest at 8.75% and provides for
quarterly principal and interest payments of approximately $68,000 through
April 30, 2007. The contributed assets and assumed liabilities have been
rewarded at their historical costs.

Maturities of long-term debt for the five years succeeding December 31,
1999 are as follows:

<TABLE>
<CAPTION>
(In thousands)
--------------
<S> <C>
2000........................................................ $140
2001........................................................ 153
2002........................................................ 167
2003........................................................ 182
2004........................................................ 198
</TABLE>

During 1998, the Company entered into an interest rate swap agreement with
a commercial bank to reduce the impact of changes in interest rates on its May
1998 bank credit facility floating rate debt. As the notional amount in the
swap agreement corresponded to the principal amount outstanding on the debt and
the variable rates in the swap and the debt use the same index, this agreement
effectively changed the Company's interest rate exposure on $16 million of
floating rate notes to a fixed 8.37%. During 1999, the Company extinguished the
bank credit facility that this interest rate swap was hedging. As a result, the
Company recorded this interest rate swap at its fair market value. In December
1999, the Company settled this obligation for $587,000 which is included in
other income in the statement of operations.

F-46
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

5. Commitments and Contingencies

The Company's PCS licenses are subject to a requirement that the Company
construct network facilities that offer coverage to at least one-third of the
population in each of its Basic Trading Areas ("BTAs") within five years from
the grant of the licenses and to at least two-thirds of the population within
10 years from the grant of the licenses. Should the Company fail to meet these
coverage requirements, it may be subject to forfeiture of its licenses or the
imposition of fines by the FCC. The PCS buildout in each BTA is subject to the
successful completion of the network design, site and facility acquisitions,
the purchase and installation of the network equipment, network testing, and
the satisfactory accommodation of microwave users currently using the spectrum.

On October 29, 1999, US Unwired issued $400 million of 13 3/8% Senior
Subordinated Notes due November 1, 2009 ("the Notes"). The Notes are fully and
unconditionally guaranteed by the Company.

The Company has open purchase orders totaling approximately $15,240,632
outstanding at December 31, 1999. These purchase orders are primarily
commitments to purchase fixed assets.

The Company is a party to various operating leases for facilities and
equipment. Rent expense for the year ended December 31, 1999 and 1998 was
$1,641,000 and $713,000, respectively. Future minimum annual lease payments due
under noncancelable operating leases with terms in excess of one year are as
follows:

<TABLE>
<CAPTION>
(In thousands)
--------------
<S> <C>
2000........................................................ $ 2,331
2001........................................................ 2,324
2002........................................................ 2,345
2003........................................................ 2,318
2004........................................................ 2,019
Thereafter.................................................. 6,720
-------
$18,057
=======
</TABLE>

A PCS licensee, such as the Company, is required to share a portion of its
spectrum with existing licensees that operate certain fixed microwave systems
within each of its BTAs. These licensees will initially have priority use of
their portion of the spectrum. To secure sufficient amount of unencumbered
spectrum to operate its PCS network efficiently, the Company has negotiated
agreements to pay for the microwave relocation of many of these existing
licensees, which costs have been capitalized. The Company also may be required
to contribute to the costs of relocation under agreements reached with other
PCS licenses if such relocation benefits the Company's license areas. Depending
on the terms of such agreements, the Company's ability to operate its PCS
network profitably could be adversely affected.

Employees of the Company participate in a 401(k) retirement plan (the
"401(k) plan") sponsored by a related party. Employees are eligible to
participate in the 401(k) plan when the

F-47
<PAGE>

LOUISIANA UNWIRED, LLC

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

employee has completed six months of service. Under the 401(k) plan,
participating employees may defer a portion of their pretax earnings up to
certain limits prescribed by the Internal Revenue Service. The Company
contributes a discretionary match equal to a percentage of the amount deferred
by the employee and a discretionary amount determined by the Company from
current or accumulated net profits. The Company's contributions are fully
vested upon the completion of 5 years of service. Contribution expense related
to the 401(k) plan was approximately $19,000 and $1,300 for the year ended
December 31, 1999 and for the period from January 8, 1998 (inception) through
December 31, 1998, respectively.

6. Supplemental Cash Flow Disclosure

During 1999, Command Connect contributed various PCS licenses to the
Company. In connection with this contribution, the following assets were
received and liabilities assumed:

<TABLE>
<CAPTION>
(In thousands)
--------------
<S> <C>
Licenses.................................................... $3,556
Accrued expenses............................................ 17
Long-term debt.............................................. 2,227
------
Contribution of net assets by a member...................... $1,312
======
</TABLE>

7. Related Party Transactions

During the year ended December 31, 1998, the Company incurred management
fees of $960,000 and $240,000 to Unwired Telecom and Cameron, respectively.
During the year ended December 31, 1999, the Company incurred management fees
of $4,772,000 to Unwired Telecom.

The Company contracts with UniBill, Inc. ("UniBill"), a subsidiary of
Cameron, for all subscriber billing and accounts receivable data processing.
UniBill charges a $2.50 fee per bill processed. Billing expenses totaled
approximately $515,000 and $22,000 in 1999 and 1998, respectively, of which
$3,000 is included in accounts payable at December 31, 1999.

F-48
<PAGE>

REPORT OF INDEPENDENT AUDITORS

The Partners
Meretel Communications, L.P.

We have audited the accompanying balance sheets of Meretel Communications,
L.P. as of December 31, 1999 and 1998, and the related statements of
operations, partners' deficit, and cash flows for each of the three years in
the period ended December 31, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Meretel Communications,
L.P. at December 31, 1999 and 1998, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 1999 in
conformity with accounting principles generally accepted in the United States.

/s/ ERNST & YOUNG LLP

Houston, Texas
February 9, 2000

F-49
<PAGE>

MERETEL COMMUNICATIONS, L.P.

BALANCE SHEETS

<TABLE>
<CAPTION>
December 31,
--------------------------
ASSETS 1999 1998
------ ------------ ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents......................... $ 605,757 $ 1,104,577
Trade accounts receivable, net of allowance for
doubtful accounts of $37,595 in 1999 and $35,391
in 1998.......................................... 1,424,118 137,805
Other accounts receivables........................ 142,627 200,738
Inventories....................................... 3,724,247 372,566
Receivable from partners.......................... 45,494 640,383
Prepaid expenses.................................. 284,378 214,171
------------ ------------
Total current assets................................ 6,226,621 2,670,240

Property and equipment, net......................... 36,417,782 46,154,521
Facilities and equipment under capital lease, net of
accumulated depreciation of $480,679 in 1999....... 17,719,321 --
Other assets, net of accumulated amortization of
$256,065 in 1999 and $259,857 in 1998.............. 1,150,906 985,737
Subscriber base, net of accumulated amortization of
$1,503,597 in 1999 and $442,234 in 1998............ 1,680,490 2,741,853
------------ ------------
Total assets........................................ $ 63,195,120 $ 52,552,351
============ ============
<CAPTION>
LIABILITIES AND PARTNERS' DEFICIT
---------------------------------
<S> <C> <C>
Current liabilities:
Accounts payable.................................. $ 4,358,460 $ 5,673,373
Accrued expenses.................................. 1,854,249 2,031,883
Due to partners................................... 7,747,441 5,428,443
Due to affiliates................................. 55,221 85,897
Current portion of long-term debt................. -- 650,482
Current portion of capital lease obligations...... 815,041 --
------------ ------------
Total current liabilities........................... 14,830,412 13,870,078

Deferred gain....................................... 11,280,694 --
Long-term debt...................................... 50,095,476 51,081,061
Capital lease obligations, less current portion..... 17,110,799 --

Commitments and contingencies

Partners' deficit:
General partner................................... (423,751) (88,113)
Limited partners.................................. (20,948,511) (4,310,676)
Amounts due from limited partner.................. (8,749,999) (7,999,999)
------------ ------------
(30,122,261) (12,398,788)
------------ ------------
Total liabilities and partners' deficit............. $ 63,195,120 $ 52,552,351
============ ============
</TABLE>

See accompanying notes.

F-50
<PAGE>

MERETEL COMMUNICATIONS, L.P.

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
Years ended December 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
Revenues:
Service revenues.................. $ 20,235,491 $ 6,907,266 $ 160,523
Merchandise sales revenues........ 3,343,935 1,419,526 --
Other revenues.................... 111,299 26,359 12,225
------------ ------------ ------------
Total revenues...................... 23,690,725 8,353,151 172,748

Operating expenses:
Cost of service................... 9,777,750 4,128,073 2,370,560
Merchandise cost of sales......... 6,626,346 3,411,213 --
Administrative expenses........... 4,691,939 3,059,439 2,796,903
Sales and marketing expenses...... 7,691,801 8,944,064 --
Depreciation and amortization..... 11,087,877 10,513,148 3,604,694
------------ ------------ ------------
Total operating expenses............ 39,875,713 30,055,937 8,772,157
------------ ------------ ------------
Operating loss...................... (16,184,988) (21,702,786) (8,599,409)

Other income (expense):
Interest expenses................. (5,009,962) (4,921,515) (4,403,733)
Interest income................... 357,612 381,777 296,157
Gain on sale of assets............ 302,820 -- --
------------ ------------ ------------
Total other income (expense)........ 4,349,530 (4,539,738) (4,107,576)
------------ ------------ ------------
Loss before extraordinary item...... (20,534,518) (26,242,524) (12,706,985)

Extraordinary item--loss on
extinguishment of debt............. -- (3,461,696) --
------------ ------------ ------------
Net loss............................ $(20,534,518) $(29,704,220) $(12,706,985)
============ ============ ============
</TABLE>

See accompanying notes.

F-51
<PAGE>

MERETEL COMMUNICATIONS, L.P.

STATEMENTS OF PARTNERS' DEFICIT

<TABLE>
<CAPTION>
General Limited
Partner Partners Total
--------- ------------ ------------
<S> <C> <C> <C>
Balance at December 31, 1996............. $ 335,248 $ 12,339,669 $ 12,674,917
Capital contributions.................. 374,862 20,062,637 20,437,499
Net loss............................... (254,140) (12,452,845) (12,706,985)
Amount due from partner................ -- (5,099,999) (5,099,999)
--------- ------------ ------------
Balance at December 31, 1997............. 455,970 14,849,462 15,305,432
Capital contributions.................. 50,001 2,449,999 2,500,000
Net loss............................... (594,084) (29,110,136) (29,704,220)
Amount due from partner................ -- (500,000) (500,000)
--------- ------------ ------------
Balance at December 31, 1998............. (88,113) (12,310,675) (12,398,788)
Capital contributions.................. 75,000 3,486,045 3,561,045
Net loss............................... (410,638) (20,123,880) (20,534,518)
Amount due from partner................ -- (750,000) (750,000)
--------- ------------ ------------
Balance at December 31, 1999............. $(423,751) $(29,698,510) $(30,122,261)
========= ============ ============
</TABLE>

See accompanying notes.

F-52
<PAGE>

MERETEL COMMUNICATIONS, L.P.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
Years ended December 31,
----------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss........................... $(20,534,518) $(29,704,220) $(12,706,985)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Depreciation and amortization..... 11,087,877 10,513,148 3,604,694
Extraordinary loss on
extinguishment of debt........... -- 3,461,696 --
Gain on sale-leaseback
transaction...................... (302,431) -- --
Provision for losses on accounts
receivable....................... 2,204 12,680 22,711
Changes in operating assets and
liabilities:
Trade accounts receivable....... (1,288,515) (144,502) (28,694)
Other accounts receivable....... 58,111 (200,738) --
Inventories..................... (3,351,681) (372,566) --
Prepaid expenses and other
assets......................... (253,645) (251,328) (993,642)
Accounts payable................ 1,246,279 (804,402) 1,863,471
Accrued expenses................ (177,634) 3,269,481 2,862,647
Due to partners................. 6,430,145 834,249 1,087,250
Due to related parties.......... (76,170) 85,897 --
Deferred gain on sale-lease back
transaction.................... 11,583,125 -- --
------------ ------------ ------------
Net cash provided by (used in)
operating activities................ 4,423,147 (13,300,605) (4,288,548)

Cash flows from investing activities:
Acquisition of property and
equipment......................... (5,744,810) (14,408,816) (35,753,734)
Acquisition of licenses............ -- -- (2,724,669)
(Increase) decrease in cash held by
partner........................... -- 7,773,020 (841,093)
Increase in due from partners...... -- (590,039) (50,344)
(Increase) decrease in due from
related parties................... -- 1,570,037 (1,570,037)
------------ ------------ ------------
Net cash used in investing
activities.......................... (5,744,810) (5,655,798) (40,939,877)
Cash flows from financing activities:
Net borrowing under line of
credit............................ (1,636,067) 18,786,008 30,000,000
Proceeds from capital contributions
by partners....................... 2,811,045 2,000,000 15,337,500
Payments made on capital lease
obligation........................ (274,160) -- --
Payments on long-term debt......... -- (1,235,200) --
Cash paid for debt acquisition
costs............................. (77,975) -- --
------------ ------------ ------------
Net cash provided by financing
activities.......................... 822,843 19,550,808 45,337,500
------------ ------------ ------------
Net (decrease) increase in cash and
cash equivalents.................... (498,820) 594,405 109,075

Cash and cash equivalents at
beginning of year................... 1,104,577 510,172 401,097
------------ ------------ ------------
Cash and cash equivalents at end of
year................................ $ 605,757 $ 1,104,577 $ 510,172
============ ============ ============
Supplemental cash flow disclosures:
Cash paid for interest............. $ 1,847,239 $ 3,115,910 $ 1,789,939
============ ============ ============

Supplemental disclosure of non-cash
activities:
Acquisition of licenses and related
costs with long term debt......... $ -- $ -- $ 4,180,735
============ ============ ============
Purchase of property and equipment
financed by accounts.............. $ 2,052,279 $ 4,613,986 $ 4,382,425
============ ============ ============
Purchase of property and equipment
under capital lease............... $ 18,200,000 $ -- $ --
============ ============ ============
Purchase of assets financed by due
to partner........................ $ -- $ 3,470,764 $ --
============ ============ ============
Debt and accrued interest
forgiven.......................... $ -- $ 59,599,876 $ --
============ ============ ============
Relinquishment of assets for
forgiveness of debt............... $ -- $ 63,061,572 $ --
============ ============ ============
</TABLE>

See accompanying notes.

F-53
<PAGE>

MERETEL COMMUNICATIONS. L.P.

NOTES TO FINANCIAL STATEMENTS

December 31, 1999

1. Description of Business and Summary of Significant Accounting Policies

Description of Organization

Meretel Communications, L.P. (the "Partnership"), is a Louisiana limited
partnership in commendam which was formed on July 27, 1995, and was in the
development stage through December 31, 1997. Prior to August 1, 1998, the
Partnership was primarily engaged in providing wholesale Personal
Communications Services ("PCS") minutes of use ("MOUs") in southern Louisiana
and eastern Texas to US Unwired, Inc. ("US Unwired"), and EATELCORP, Inc.
("EATEL"), two of its limited partners and operating managers. PCS is a new
generation of wireless communications, offering customers advanced, secure,
two-way digital wireless services and applications.

Effective August 1, 1998, the Partnership purchased all of US Unwired's
PCS subscribers. Effective December 8, 1999, EATEL contributed all of its PCS
subscribers to the Partnership. As a result of these transactions, the
Partnership no longer provides wholesale MOUs to US Unwired and EATEL; the
Partnership now services those customers directly.

The Partnership is economically dependent on the continued funding of its
operations by certain of its partners and such partners have committed to
provide such funding.

Cash Equivalents

The Partnership considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.

Inventory

Inventory consists of PCS telephones and related accessories and is
carried at cost. Cost is determined by the moving average method, which
approximates the first-in, first-out method.

Property and Equipment

Property and equipment is stated at cost and depreciation is provided on a
straight-line basis over the estimated useful lives of the assets as follows:

<TABLE>
<CAPTION>
Years
-----
<S> <C>
Facilities and equipment............................................... 5
Computer equipment..................................................... 5
Computer software...................................................... 5
Furniture and fixtures................................................. 7
</TABLE>

F-54
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Licenses

The Partnership relinquished all of its licenses during 1998 under the
Federal Communications Commission's ("FCC's") amnesty program in exchange for
forgiveness of debt used to finance the purchases of the licenses. See Note 2.

Other Assets

Other assets primarily include deferred financing costs incurred in
connection with the issuance of the Partnership's long-term debt which are
capitalized and amortized over the terms of the related debt.

Long-Lived Assets

The Partnership assesses long-term assets for impairment under Statement
of Financial Accounting Standards ("SFAS") No. 121, Accounting of the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of.
SFAS No. 121 requires that long-lived assets and certain identifiable
intangibles to be held and used or disposed of by an entity be reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. The Partnership
periodically evaluates the recoverability of the carrying amounts of property
and equipment and other related assets in each market, as well as the
depreciation and amortization periods, based on estimated undiscounted future
cash flows and other factors to determine whether current events or
circumstances warrant reduction to the carrying amounts or acceleration of the
related amortization period. If such assets are considered to be impaired, the
impairment to be recognized is measured by the amount by which the carrying
amount of the assets exceeds the fair value of the assets. Assets to be
disposed of are reported at the lower of the carrying amount or fair value less
costs to sell.

Revenue Recognition

The Partnership earns revenue by providing wholesale PCS minutes of use,
by providing access to and usage of its PCS network directly to subscribers,
and by sales of PCS merchandise. Wholesale usage revenues and service revenues
for access to and usage of the Partnership's PCS network by subscribers are
recognized as they are earned. Revenues from the sales of merchandise are
recognized when the merchandise is delivered.

Use of Estimates

F-55
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

Concentrations of Credit Risk

Financial instruments which potentially expose the Partnership to
concentrations of credit risk consist primarily of cash and accounts
receivable. The Partnership places its cash and temporary cash investments with
high credit quality financial services companies. Collectibility of reseller
and subscriber receivables is impacted by economic trends in the Partnership's
markets. The Partnership has provided an allowance, which it believes is
adequate, to absorb losses from uncollectible accounts.

Income Taxes

No provision for income taxes is provided as the Partnership's taxable
income or loss is included in the income tax returns of its partners.

Advertising Costs

Advertising costs are charged to expense as incurred. For the years ended
December 31, 1999, 1998 and 1997, approximately $2,700,000, $1,602,000 and $-0-
, respectively, of advertising costs were incurred.

Reclassifications

Certain reclassifications have been made to the 1998 and 1997 financial
statements to conform to the 1999 presentation.

2. Management Agreement

On June 8, 1998, the Partnership entered into an agreement with Sprint PCS
in which the Partnership agreed to manage Sprint PCS's PCS network within each
BTA for which the partnership originally held a PCS license prior to the return
of the licenses to the FCC. In consideration for managing Sprint PCS's network,
Sprint PCS agreed to pay 92% of collected revenues, as defined, to the
Partnership. The agreement requires that the Partnership build out the PCS
network in accordance with FCC requirements and deadlines. The Partnership and
Sprint PCS will share equally the costs for any necessary future relocation of
microwave sources that interfere with Sprint PCS's spectrum. In conjunction
with this agreement, the Partnership entered into an agreement with the FCC to
surrender its current licenses in exchange for the forgiveness of all
outstanding debt and accrued interest due to the FCC.

F-56
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

3. Property and Equipment

The major categories of property and equipment at December 31 were as
follows:

<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Facilities and equipment............................ $46,156,353 $50,555,693
Computer equipment.................................. 145,079 71,443
Computer software................................... 2,918 928
Furniture and fixtures.............................. 378,626 59,302
Construction in progress............................ 6,402,234 4,392,739
Vehicles............................................ 61,820 --
----------- -----------
53,147,030 55,080,105
Less accumulated depreciation and amortization...... 16,729,248 8,925,584
----------- -----------
$36,417,782 $46,154,521
=========== ===========
</TABLE>

Depreciation expense, which includes amortization of assets recorded under
capital leases for the years ended December 31, 1999, 1998 and 1997, was
$9,450,000, $8,521,000 and $385,000, respectively.

4. Accrued Expenses

Accrued expenses consisted of the following at December 31:

<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <C> <C>
Accrued taxes, other than income...................... $ 211,525 $ 350,437
Accrued payroll....................................... 77,822 68,013
Unearned revenue...................................... 308,047 62,730
Accrued interest expense.............................. 298,178 149,000
Accrued commission.................................... 162,916 862,650
Other................................................. 795,761 539,053
---------- ----------
$1,854,249 $2,031,883
========== ==========
</TABLE>

5. Long-Term Debt

Long-term debt consisted of the following at December 31:

<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Debt outstanding under credit facilities:
Bank financing.................................... $47,149,941 $48,786,008
Microwave relocation obligations.................... 2,945,535 2,945,535
----------- -----------
50,095,476 51,731,543
Less current portion................................ -- 650,482
----------- -----------
$50,095,476 $51,081,061
=========== ===========
</TABLE>

F-57
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

In June 1998, the Partnership relinquished its licenses in exchange for
forgiveness of the related debt of approximately $55,100,000 under the FCC's
amnesty program. This transaction resulted in an extraordinary loss of
$3,461,696.

In November 1996, the Partnership executed a $57,000,000 bank credit
facility. The notes outstanding under this bank credit facility provide for
quarterly interest only payments through March 2001 and quarterly principal
payments ranging from $1,220,000 to $2,440,000 plus interest commencing June
2001 through March 2007. Interest rates are comprised of a combination of fixed
rates over the term of the note or variable rates based on either a variable
lending rate established by a commercial bank plus a margin ranging up to 1% or
the average offering rate for three-month commercial paper of major
corporations. At December 31, 1999, the effective interest rate for these notes
was 8.57% and the total unfunded commitment was approximately $196,000.
Substantially all of the assets of the Partnership are pledged to secure the
Partnership's obligation, including a security interest in all property, plant
and equipment, and pledge agreements for all partnership interests in the
Partnership. Additionally, the limited partners have guaranteed a portion of
the credit facility.

Certain agreements for microwave relocation costs provide for financing
arrangements with interest at 6.5% per annum. These financing arrangements
required principal payments totaling approximately $650,000 in 1999, interest
only payments totaling approximately $149,000 due annually thereafter through
2003, annual payments of approximately $574,000 plus interest due beginning
2004 through 2007. As a result of the relinquishment of the Partnership's FCC
licenses in June 1998, the Partnership is of the opinion that it is no longer
obligated to fund these microwave relocation costs. At December 31, 1999, the
Partnership is working to obtain a formal release of these obligations.

Maturities of long-term obligations for the five succeeding years are as
follows:

6. Leases

In July 1999, the Partnership entered into a sale transaction for 73 of
its cell sites for approximately $19,000,000, subject to certain adjustments as
defined by the sales agreement. These proceeds were used to reduce the
Partnership's outstanding indebtedness. In connection with the sale, the
Partnership entered into lease agreements to leaseback a portion of these cell
sites for approximately $2,000 per month for an initial lease term of 15 years.
These transactions have been accounted for as sale-leaseback transaction. As a
result, the gain on the sale of cell site,

F-58
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

approximately $11,600,000, has been deferred and will be amortized over the
term of the related leases, 15 years. As of December 31, 1999, the Partnership
had executed the sale and leaseback of 70 of 73 towers. The sale and leaseback
of the remaining towers is expected to occur during the first quarter of 2000.

The Partnership also leases certain facilities and equipment under
noncancelable operating leases. Rent expense for the years ended December 31,
1999, 1998 and 1997 was approximately $1,428,000, $660,000 and $167,000,
respectively. Future minimum annual lease payments due under capital leases and
noncancelable operating leases with initial terms in excess of one year
consisted of the following at December 31, 1999:

<TABLE>
<CAPTION>
Capital Operating
Leases Leases
----------- ----------
<S> <C> <C>
2000............................................ $ 1,680,000 $ 658,000
2001............................................ 1,680,000 633,000
2002............................................ 1,680,000 503,000
2003............................................ 1,680,000 405,000
2004............................................ 1,680,000 146,000
Thereafter...................................... 17,001,884 423,000
----------- ----------
25,401,884 $2,768,000
==========
Amounts representing interest................... (7,476,044)
-----------
Present value of minimum lease payments
(including current portion of $815,041....... $17,925,840
===========
</TABLE>

7. Related Party Transactions

On August 1, 1996, the Partnership executed management and construction
service agreements with US Unwired and EATEL, two of its partners. Management
fees to EATEL were $756,000, $1,137,000 and $1,080,000 for the years ended
December 31, 1999, 1998 and 1997, respectively. Management fees to US Unwired
were $2,245,000, $1,354,000 and $1,080,000 for the years ended December 31,
1999, 1998, and 1997, respectively. These fees are presented in the
accompanying statements of operations as general and administrative expenses.

During 1997 the Partnership provided an incentive program to US Unwired
and EATEL related to the acquisition of customers for the Partnership's PCS
system. The Partnership incurred obligations and expenses under this incentive
program to US Unwired and EATEL totaling $217,000, $5,651,000 and $2,038,000
for the years ended December 31, 1999, 1998 and 1997, respectively, which is
included in costs of sales in the accompanying statements of operations. As of
December 31, 1999 and 1998, the unpaid portion of these obligations was $3,000
and $608,000, respectively.

From October 1997 through July 1998, the Partnership sold PCS minutes to
US Unwired pursuant to an oral agreement. The aggregate amounts received from
US Unwired for these minutes during the years ended December 31, 1998 and 1997
totaled $1,222,000 and $105,000, respectively.

F-59
<PAGE>

MERETEL COMMUNICATIONS, L.P.

NOTES TO FINANCIAL STATEMENTS--(Continued)

December 31, 1999

During the years ended December 31, 1999, 1998 and 1997, the Partnership sold
PCS wholesale minutes to EATEL pursuant to an oral agreement. The aggregate
amounts received from EATEL for these minutes during the years ended December
31, 1999, 1998 and 1997 totaled $3,153,000, $2,248,000 and $33,000,
respectively. As of December 31, 1999, EATEL owes the Partnership $74,000 for
these minutes.

Effective August 1, 1998, the Partnership purchased certain of US
Unwired's PCS subscribers, property and equipment, and inventory for cash of
approximately $4,300,000 and an additional ownership interest in the
Partnership of approximately 3.9%. Of the total cash purchase price, $3,184,000
has been allocated to the PCS subscriber base and is being amortized over its
estimated useful life of three years. The issuance of the additional ownership
is contingent upon the occurrence of certain future events.

The Partnership contracts with Unibill, Inc. ("Unibill"), a subsidiary of
Cameron Communications Corporation ("Cameron"), for all subscriber billing. The
aggregate amounts paid to Cameron for such services during 1999 and 1998
totaled $774,000 and $352,000 respectively.

8. Subsequent Event

Effective January 1, 2000, the Partnership distributed all of the assets
and related liabilities of its Beaumont and Lufkin BTA markets to certain
limited partners in exchange for a reduction in these limited partners'
ownership interests in the Partnership.

F-60
<PAGE>

[photographs showing Sprint PCS(R) stores, phones and subscribers]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

May 17, 2000

[LOGO OF US UNWIRED APPEARS HERE]

8,000,000 Shares of Class A Common Stock

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

PROSPECTUS

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

Donaldson, Lufkin & Jenrette
Credit Suisse First Boston
First Union Securities, Inc.
DLJdirect Inc.

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

We have not authorized any dealer, salesperson or other person to give you
written information other than this prospectus or to make representations as to
matters not stated in this prospectus. You must not rely on any unauthorized
information or representations. This prospectus is not an offer to sell these
securities or our solicitation of your offer to buy the securities in any
jurisdiction where that would not be permitted or legal. Neither the delivery
of this prospectus nor any sales made hereunder after the date of this
prospectus should create an implication that the information contained in this
prospectus or the affairs of US Unwired have not changed since the date of this
prospectus.

Until June 11, 2000 (25 days after the date of this prospectus), all dealers,
whether or not participating in this offering, that effect transactions in
these securities may be required to deliver a prospectus. This is in addition
to the dealer's obligation to deliver a prospectus when acting as an
underwriter in this offering and when selling previously unsold allotments or
subscriptions.
- --------------------------------------------------------------------------------