AIRTHREAD ACQUISITION Operating Assumptions

Revenue Projections: 2008 2009 2010 2011 2012

Service Revenue 4,194.3 4,781.5 5,379.2 5,917.2 6,331.4
Service Revenue Growth 14.0% 14.0% 12.5% 10.0% 7.0%

Equipment Revenue 314.8 358.8 403.7 444.1 475.2

Equipment Revenue/Service Revenue (1) 7.5% 7.5% 7.5% 7.5% 7.5%
Total Revenue 4,509.1 5,140.4 5,782.9 6,361.2 6,806.5
Operating Expenses:
System Operating Expenses 838.9 956.3 1,075.8 1,183.4 1,266.3
System Operating Exp./Service Revenue 20.0% 20.0% 20.0% 20.0% 20.0%

Cost of Equipment Sold 755.5 861.2 968.9 1,065.8 1,140.4

Equipment COGS 240.0% 240.0% 240.0% 240.0% 240.0%

Selling, General & Administrative 1,803.6 2,056.2 2,313.2 2,544.5 2,722.6

SG&A/Total Revenue 40.0% 40.0% 40.0% 40.0% 40.0%

Depreciation & Amortization 705.2 804.0 867.4 922.4 952.9

Tax Rate 40.0% 40.0% 40.0% 40.0% 40.0%

Working Capital Assumptions (1):

Accounts Receivable 41.67 41.67 41.67 41.67 41.67
Accounts Receivable 521.93 595.00 669.37 736.31 787.85
Days Sales Equip. Rev. 154.36x 154.36x 154.36x 154.36x 154.36x
Days Sales Equip. Rev. 134.97 153.86 173.10 190.41 203.73
Prepaid Expenses 1.38% 1.38% 1.38% 1.38% 1.38%
Prepaid Expenses
Accounts Payable 35.54x 35.54x 35.54x 35.54x 35.54x
Deferred Serv. Revenue 14.01x 14.01x 14.01x 14.01x 14.01x
Accrued Liabilities 6.85x 6.85x 6.85x 6.85x 6.85x

Capital Expenditures (2):

Capital Expenditures 631.3 719.7 867.4 970.1 1,055.0
Cap-x/Total Revenue 14.0% 14.0% 15.0% 15.3% 15.5%
(1) Based on a 360-day year. Days Payable, Deferred Service Revenue, and Days Accrued Liabilities are
based on total cash operating expenses.
(2) Includes investments in property, plant & equipment, as well as licenses and customer lists.

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AIRTHREAD ACQUISITION Licensing Agreemts

Total Consolidated Markets:

Region Population Customers Penetration
Central US 65,096 3,846 5.9%
Mid-Atlantic 11,677 1,180 10.1%
New England 2,830 518 18.3%
Northwest 2,287 431 18.8%
New York 481 147 30.6%
Total 82,371 6,122 7.4%

Total Operating Markets:

Region Population Customers Penetration
Central US 32,497 3,846 11.8%
Mid-Atlantic 7,346 1,180 16.1%
New England 2,344 518 22.1%
Northwest 2,287 431 18.8%
New York 481 147 30.6%
Total 44,955 6,122 13.6%
Harvard Business Publishing
AIRTHREAD ACQUISITION Customer Operating Data

Customer Data: 2005 2006 2007

Net Customer Additions 301 310 477
Cost Per Customer Addition 372 385 487
Cost of New Customer Additions 111,972 119,350 232,299

Cost of Equipment Sold/Equipment Revenue 251.3% 219.9% 239.8%

Monthly Churn Rate 2.1% 2.1% 1.7%

Revenue Per Minute 2005 2006 2007

Monthly ARPU 45.24 47.23 51.13
Customer Minutes Per Month 625 704 859
Revenue Per Minute 0.0724 0.0671 0.0595
Harvard Business Publishing
AIRTHREAD ACQUISITION Income Statement
Historical Operating Results

Operating Results: 2005 2006 2007

Service Revenue 2,827.0 3,214.4 3,679.2
Plus: Equipment Sales 203.7 258.7 267.0
Total Revenue 3,030.8 3,473.2 3,946.3
Less: System Operating Expenses 604.1 639.7 717.1
Less: Cost of Equipment Sold 511.9 568.9 640.2
Less: Selling, General & Administrative 1,217.7 1,399.6 1,555.6
EBITDA 697.0 865.0 1,033.3
Less: Depreciation & Amortization 490.1 555.5 582.3
EBIT 206.9 309.5 451.1
Less: Interest Expense 84.9 93.7 84.7
Plus: Equity in Earnings of Affiliates 66.7 93.1 90.0
Plus: Gains (Losses) on Investments 18.1 50.8 83.1
Plus: Other Income 54.5 (46.6) 7.0
EBT 261.3 313.1 546.5
Less: Taxes 95.9 120.6 216.7
Income Before Minority Interest 165.5 192.5 329.8
Less: Minority Interest 10.5 13.0 15.1
Net Income 155.0 179.5 314.7
Harvard Business Publishing
AIRTHREAD ACQUISITION Balance Sheet

Assets: 2005 2006 2007

Cash & Cash Equivalents 29.0 32.9 204.5
Marketable Securities 0.0 249.0 16.4
Accounts Receivable 362.4 407.4 435.5
Inventory 92.7 117.2 101.0
Prepaid Expenses 32.1 35.0 41.6
Deferred Taxes 8.2 0.0 18.6
Other Current Assets 15.5 13.4 16.2
Total Current Assets 539.9 854.9 833.8

Property, Plan & Equipment 2,553.0 2,628.8 2,595.1

Licenses 1,362.3 1,494.3 1,482.4
Customer Lists 47.6 26.2 15.4
Marketable Equity Securities 225.4 4.9 0.0
Investments in Affiliated Entities 172.1 150.3 157.7 Not a part of operations
Long Term Note Receivable 4.7 4.5 4.4
Goodwill 481.2 485.5 491.3
Other Long Term Assets 30.0 31.1 31.8
Total Assets 5,416.2 5,680.6 5,611.9

Liabilities & Owners' Equity:

Accounts Payable 254.1 254.9 260.8
Deferred Revenue & Deposits 111.4 123.3 143.4
Accrued Liabilities 42.9 47.8 59.2
Taxes Payable 36.7 26.9 43.1
Deferred Taxes 0.0 26.3 0.0
Note Payable 135.0 35.0 0.0
Forward Contract 0.0 159.9 0.0
Derivative Liability 0.0 88.8 0.0
Other Current Liabilities 82.6 93.7 97.7
Total Current Liabilities 662.7 856.7 604.2

Long Term Debt 1,001.4 1,001.8 1,002.3

Forward Contracts 159.9 0.0 0.0
Derivative Liability 25.8 0.0 0.0
Deferred Tax Liability 647.1 601.5 554.4
Asset Retirement Obligation 90.2 127.6 126.8
Other Deferred Liabilities 46.2 62.9 84.5

Minority Interest 41.9 36.7 43.4

Common Stock & Paid-In Capital 1,375.0 1,378.9 1,404.1
Retained Earnings 1,366.0 1,614.4 1,792.1
Total Liabilities & Owners' Equity 5,416.2 5,680.6 5,611.9
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AIRTHREAD ACQUISITION Amortization Schedule
Term Loan Amortization

Annual Amortization Annual Amortization

Payment Interest Principal Balance Period Payment Interest Principal Balance Period
Date: 41 5.50% 3,758 120 Date: 41 5.50% 2,698 84
1/31/2008 41 17 24 3,734 1 6/30/2011 41 12 28 2,669 42
2/28/2008 41 17 24 3,710 2 7/31/2011 41 12 29 2,641 43 2008 2009
3/31/2008 41 17 24 3,687 3 8/31/2011 41 12 29 2,612 44 Principal Payment per Annum 289.95 306.35
4/30/2008 41 17 24 3,663 4 9/30/2011 41 12 29 2,583 45 Interest 198.10 181.60
5/31/2008 41 17 24 3,639 5 10/31/2011 41 12 29 2,554 46 Tax Shield 79.24 72.64
6/30/2008 41 17 24 3,615 6 11/30/2011 41 12 29 2,525 47 After Tax Interest Expense 118.86 108.96
7/31/2008 41 17 24 3,590 7 12/31/2011 41 12 29 2,496 48
8/31/2008 41 17 24 3,566 8 1/31/2012 41 11 29 2,467 49
9/30/2008 41 16 24 3,542 9 2/28/2012 41 11 29 2,437 50
10/31/2008 41 16 25 3,517 10 3/31/2012 41 11 30 2,408 51
11/30/2008 41 16 25 3,492 11 4/30/2012 41 11 30 2,378 52
12/31/2008 41 16 25 3,468 12 5/31/2012 41 11 30 2,348 53
1/31/2009 41 16 25 3,443 13 6/30/2012 41 11 30 2,318 54
2/28/2009 41 16 25 3,418 14 7/31/2012 41 11 30 2,288 55
3/31/2009 41 16 25 3,393 15 8/31/2012 41 11 30 2,257 56
4/30/2009 41 16 25 3,367 16 9/30/2012 41 10 30 2,227 57
5/31/2009 41 15 25 3,342 17 10/31/2012 41 10 31 2,196 58
6/30/2009 41 15 25 3,317 18 11/30/2012 41 10 31 2,166 59
7/31/2009 41 15 26 3,291 19 12/31/2012 2,176 10 2,166 0 60
8/31/2009 41 15 26 3,265 20
9/30/2009 41 15 26 3,239 21
10/31/2009 41 15 26 3,214 22
11/30/2009 41 15 26 3,187 23
12/31/2009 41 15 26 3,161 24
1/31/2010 41 15 26 3,135 25
2/28/2010 41 14 26 3,109 26
3/31/2010 41 14 27 3,082 27
4/30/2010 41 14 27 3,055 28
5/31/2010 41 14 27 3,029 29
6/30/2010 41 14 27 3,002 30
7/31/2010 41 14 27 2,975 31
8/31/2010 41 14 27 2,948 32
9/30/2010 41 14 27 2,920 33
10/31/2010 41 13 27 2,893 34
11/30/2010 41 13 27 2,865 35
12/31/2010 41 13 28 2,838 36
1/31/2011 41 13 28 2,810 37
2/28/2011 41 13 28 2,782 38
3/31/2011 41 13 28 2,754 39
4/30/2011 41 13 28 2,726 40
5/31/2011 41 13 28 2,698 41

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Harvard Business Publishing
 2010 2011 2012
323.55 341.75 2496.00
164.30 133.60 116.80
65.72 53.44 46.72
98.58 80.16 70.08
AIRTHREAD ACQUISITION Wireless Compa

marginal tax rate = 40%

debt beta = 0
Market Risk Premium = 5%
risk free rate = 4.25%
cost of debt = 5.50%

Average Industry EBIT 5531.63

Average Industry P/E 105,571
Equity Net Debt/ Debt/ Equity Net Equity/
Comparable Companies:
Market Value Debt Value Equity Beta Revenue EBITEBITDA Income Value
Universal Mobile 118,497 69,130 36.8% 58.3% 0.86 43,882 ### 16,949 3,794 63.2%
Neuberger Wireless 189,470 79,351 29.5% 41.9% 0.89 42,684 7,020 14,099 4,103 70.5%
Agile Connections 21,079 5,080 19.4% 24.1% 1.17 34,698 1,631 9,914 (30) 80.6%
Big Country Communicat 26,285 8,335 24.1% 31.7% 0.97 38,896 6,702 12,614 3,384 75.9%
Rocky Mountain Wireless 7,360 3,268 30.7% 44.4% 1.13 4,064 510 1,028 240 69.3%
Average 72,538 33,033 28.1% 40.1% 1.00 71.9%

Market Risk Premium 5.00%

Risk Free Rate 4.25% Debt/ Equity/ Asset Equity Cost of Cost ofWACC
Tax Rate 40% Value Value beta Beta Equity Debt
0.0% 100.0% 0.82 0.816 8.33% 5.50% 8.33%
Airthread
28.1% 71.9% 0.82 1.134 9.92% 5.50% 8.06%

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 Wireless Comparables

Asset
beta
0.64
0.71
1.02
0.81
0.89
0.82

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Revenue Projections ( All figures in $Mn)
2005 2006 2007 2008 2009 2010 2011 2012
Service Revenue 2827.0 3214.4 3679.2 4194.3 4781.5 5379.2 5917.2 6331.4
Equipment Sales 203.7 258.7 267.0 314.8 358.8 403.7 444.1 475.2
Total Revenues 3030.7 3473.1 3946.2 4509.1 5140.4 5782.9 6361.2 6806.5

Operating Expenses:
System Operating Expenses 604.09 639.68 717.08 838.87 956.31 1075.85 1183.43 1266.27
Cost of Equipment Sold 511.94 568.90 640.23 755.46 861.22 968.87 1065.76 1140.36
Selling, General & Administrative 1217.71 1399.56 1555.64 1803.64 2056.15 2313.17 2544.49 2722.60
EBITDA 696.96 864.95 1033.26 1111.14 1266.70 1425.04 1567.54 1677.27
Depreciation & Amortization 490.09 555.53 582.27 705.23 803.96 867.44 922.38 952.91
EBIT 206.87 309.43 450.99 405.91 462.74 557.60 645.16 724.36
Taxes @ 40% 95.9 120.6 216.7 162.36 185.10 223.04 258.07 289.74
EBIT (1-t) = NOPAT 155 179.5 314.7 243.55 277.64 334.56 387.10 434.62

Capital Expenditures 631.3 719.7 867.4 970.1 1,055.0

Interest Expense 199.40 183.00 165.80 147.60 128.20
Annual Interest Tax Shield 79.76 73.20 66.32 59.04 51.28
PV of Intermediate Tax Shields 5.50% 75.60 65.77 56.48 47.66 39.24 284.74

Assets
Cash & Cash Equivalents 29.0 32.9 204.5 86.59 12.72 -95.77 -204.70 -2458.98 0.96% 0.95%

Working Capital 2005 2006 2007 2008 2009 2010 2011 2012
Plus:Accounts Receivable 362.4 407.4 435.5 521.93 595.00 669.37 736.31 787.85
Plus:Days Sales Equipment Rev. 92.7 117.2 101.0 134.97 153.86 173.10 190.41 203.73 45.53% 45.30%
Plus:Prepaid Expenses 32.1 35.0 41.6 46.91 53.48 60.17 66.19 70.82
Less:Accounts Payable 254.1 254.9 260.8 335.45 382.42 430.22 473.24 506.37
Less:Deferred Revenue & Deposit 111.4 123.3 143.4 163.23 186.08 209.34 230.28 246.40
Less:Accrued Liabilities 42.9 47.8 59.2 64.66 73.71 82.92 91.21 97.60
Net Working Capital 78.8 133.5 114.6 140.47 160.14 180.16 198.17 212.04
Changes in Working Capital 54.74 -18.91 25.86 19.67 20.02 18.02 13.87

Unlevered FCF 291.64 342.29 314.54 321.37 318.65

PV of FCF @ WACC 8.33% 269.22 291.68 247.43 233.37 213.60 1255.32
8.06% 269.89 293.12 249.27 235.69 216.26 1264.23

Unlevered FCF 291.64 342.29 314.54 321.37 318.65

Less: After-Tax Interest Expsnse 119.64 109.80 99.48 88.56 76.92
Less: Scheduled Principal Payments 289.95 306.35 323.55 341.75 2496.00
Changes in Cash -117.95 -73.87 -108.49 -108.94 -2254.27

Closing Balance Cash 86.59 12.72 -95.77 -204.70 -2,458.98

Assets
Property, Plan & Equipment 2,553.0 2,628.8 2,595.1 2,521.14 2,436.83 2,436.83 2,484.54 2,586.64
Licenses 1,362.3 1,494.3 1,482.4 1,482.45 1,482.45 1,482.45 1,482.45 1,482.45
Customer Lists 47.6 26.2 15.4 15.38 15.38 15.38 15.38 15.38
Marketable Equity Securities 225.4 4.9 0.0
Investments in Affiliated Entities 172.1 150.3 157.7
Long Term Note Receivable 4.7 4.5 4.4
Goodwill 481.2 485.5 491.3
Other Long Term Assets 30.0 31.1 31.8

Liabilities & Owners Equity

Long Term Debt 1001.4 1001.8 1002.3 3467.59 3161.24 2933.46 2700.70 2458.98
Deferred Tax Liability 647.09 601.54 554.41 554.41 554.41 554.41 554.41 554.41
Asset Retirement Obligation 90.22 127.64 126.84 126.84 126.84 126.84 126.84 126.84
Other Deferred Liabilities 46.23 62.91 84.53 84.53 84.53 84.53 84.53 84.53
Minority Interest 41.87 36.70 43.40 43.40 43.40 43.40 43.40 43.40
Common Stock & Paid-In Capital 1375.02 1378.88 1404.09 1404.09 1404.09 1404.09 1404.09 1404.09
Retained Earnings 1366.02 1614.40 1792.06 1792.06 1792.06 1792.06 1792.06 1792.06
 5.18% 2.36% Cash as ratio of Sales

41.67 From Exhibit 1

37.82% 42.88% Inventory as ratio of Equipment Sales
1.38% From Exhibit 1
35.54 From Exhibit 1
14.01 From Exhibit 1
6.85 From Exhibit 1

D/V = 0.0%
D/V = 28.1%

PPE(08) = PPE(07) - DEP(08) + CapEx(08)

From Exhibit 6 & Negative cash balance, if any

Assuming Contant Equity
Un-Levered Free Cash Flows 2008 2009 2010 2011 2012

NOPAT 243.55 277.64 334.56 387.10 434.62

Plus : Depreciation & Amortization 705.23 803.96 867.44 922.38 952.91
Less: Changes in Working Capital 25.86 19.67 20.02 18.02 13.87
Less: Capital Expenditures 631.27 719.65 867.44 970.09 1055.01

Unlevered FCF 291.64 342.29 314.54 321.37 318.65

PV of FCF @ 8.33% 269.22 291.68 247.43 233.37 213.60 1255.32 D/V = 0.0%
8.06% 269.89 293.12 249.27 235.69 216.26 1264.23 D/V = 28.1%

Interest Tax Shields 79.76 73.2 66.32 59.04 51.28

PV of Intermediate Tax Shields 5.50% 75.60 65.77 56.48 47.66 39.24 284.74

Total Intermediate Terminal Value D/V of 0% 1540.06

D/V of 28.1% 1548.97

Terminal Value Growth Rate 2.07%

TV WACC Cash Flow D/V = 0.0% 3482.08 2334.22 D/V of 0%
D/V = 28.1% 3682.30 2499.07

Value of operating assets 3874.28 D/V = 0.0%

Value of operating assets 4048.05 D/V = 28.1%
Value of Non-Operating Assets 9504873.84

Total Value of Firm 9508748.12 D/V = 0.0%

9508921.89 D/V = 28.1%
 Long term Growth Rat 2012
NOPAT 434.62
Invested Capital 5611.74
D/V = 28.1% ROC 7.74% Payout Ratio

Net Reinvestment 115.97

NOPAT 434.62
Reinvestment Rate 26.68% Plowback Ratio

Estimate Growth rate 2.07%