10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2002

or

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from               to             

Commission File Number 000-28160

WESTERN WIRELESS CORPORATION

(Exact name of registrant as specified in its charter)

Washington	91-1638901
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
3650 131st Avenue S.E. Bellevue, Washington	98006
(Address of principal executive offices)	(Zip Code)

(425) 586-8700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
None

Securities registered pursuant to Section 12(g) of the Act:
Class A Common Stock

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [  ]

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes [X] No [  ]

     The aggregate market value of the voting stock held by nonaffiliates of the registrant, computed by reference to the closing sale price of the registrant’s common stock on June 30, 2002 as reported by the NASDAQ Stock Market was $252,813,853.

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

	Shares Outstanding as of
Title	March 21, 2003
Class A Common Stock, no par value	72,430,605
Class B Common Stock, no par value	6,799,724

DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the following documents are incorporated by reference into the indicated parts of this Form 10-K: Proxy Statement for its 2003 annual shareholders meeting to be filed with the United States Securities and Exchange Commission — Part III.

TABLE OF CONTENTS

PART I
	Item 1. BUSINESS
	Item 2. PROPERTIES
	Item 3. LEGAL PROCEEDINGS
	Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
EXECUTIVE OFFICERS OF THE REGISTRANT
PART II
	Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
	Item 6. SELECTED FINANCIAL DATA
	ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
	ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
	ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
	ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
PART III
	ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
	ITEM 11. EXECUTIVE COMPENSATION
	ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
	ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
	ITEM 14. CONTROLS AND PROCEDURES
PART IV
	ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K
SIGNATURES
CERTIFICATION
EXHIBIT 10.17
EXHIBIT 10.28
EXHIBIT 10.32
EXHIBIT 10.34
EXHIBIT 10.35
EXHIBIT 21.1
EXHIBIT 23.1

Western Wireless Corporation
Form 10-K
For The Fiscal Year Ended December 31, 2002

Table of Contents

		Page
PART I
ITEM 1.	BUSINESS	3
ITEM 2.	PROPERTIES	21
ITEM 3.	LEGAL PROCEEDINGS	21
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	21
EXECUTIVE OFFICERS OF THE REGISTRANT		22
PART II
ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	24
ITEM 6.	SELECTED FINANCIAL DATA	25
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	27
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	38
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	39
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	39
PART III
ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT	40
ITEM 11.	EXECUTIVE COMPENSATION	40
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	40
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	40
ITEM 14.	CONTROLS AND PROCEDURES	40
PART IV
ITEM 15.	EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K	41

2

     Cautionary statement for purposes of the “Safe Harbor” provisions of the Private Litigation Reform Act of 1995. This Annual Report on Form 10-K, including Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7, contains statements that are not based on historical fact, including without limitation statements containing the words “believes,” “may,” “will,” “estimate,” “continue,” “anticipates,” “intends,” “expects” and words of similar import, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions, nationally, internationally and in the regions and countries in which Western Wireless Corporation operates; demographic changes; technology changes; competition; changes in business strategy or development plans; the high leverage of the Company and our ability to access capital markets; the ability to attract and retain qualified personnel; existing governmental regulations and changes in, or the failure to comply with, governmental regulations; our ability to acquire and the cost of acquiring additional spectrum licenses; liability and other claims asserted against the Company; and other factors referenced in the section entitled “Risk Factors” included elsewhere in this report and in the Company’s public offering prospectuses and its periodic reports filed with the Securities and Exchange Commission.

     Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments.

     Unless the context requires otherwise, “Western Wireless,” “the Company,” “we,” “our” and “us” include us and our subsidiaries.

PART I

Item 1. BUSINESS

General

     We are one of the largest providers of rural wireless communications services in the United States. Our wireless operations are primarily in rural areas due to our belief that there are significant strategic advantages to operating in these areas. We believe rural markets provide growth opportunities greater than those that exist in more densely populated urban areas because these markets typically have lower current penetration rates and less competition.

     We provide wireless services, under the CellularONE ^® (“CellularONE”) and Western Wireless^® brand names, to approximately 1.2 million subscribers in the western United States using multiple digital and analog technologies. We operate in 88 Rural Service Areas (“RSAs”) and 18 Metropolitan Service Areas (“MSAs”) with a combined population of approximately 10 million people. Our network is one of the nation’s largest rural wireless communications systems, covering approximately 25% of the continental United States in 19 western states. We support our customers through our retail locations throughout our service area and through our call centers in Manhattan, Kansas, and Issaquah, Washington.

     In addition, through our subsidiary, Western Wireless International Holding Corporation (“WWI”), we are licensed to provide wireless communications services to over 75 million people in nine countries. As of December 31, 2002, WWI’s consolidated and unconsolidated subsidiaries served, in aggregate, approximately 2.1 million mobile subscribers. See “The Business of WWI,” for more information.

     Western Wireless was organized in 1994. Our principal corporate office is located at 3650 131st Avenue S.E., Suite 400, Bellevue, Washington 98006. Our phone number is (425) 586-8700. Our corporate website address is www.wwireless.com.

     We make available free of charge through our website our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to these reports, as soon as practicable after we have electronically filed such material with, or furnished such material to, the SEC.

Domestic Business and Strategy

     Our goal is to be the premier provider of high quality wireless communications services in our rural markets. We provide voice and data services to both businesses and consumers including our own subscribers and other companies’ subscribers who roam through our service areas. We believe that our 800 MHz licenses, utilizing multiple digital and analog technologies, give us a strategic advantage in our rural markets. We have also acquired certain 1900 MHz Personal Communication Services (“PCS”) licenses to supplement our coverage in a few markets. We believe there are inherent competitive advantages and growth opportunities unique to rural markets. The following are the key elements of our strategy:

• Expand and enhance our domestic wireless network to increase capacity, expand coverage and provide additional features

• Increase domestic subscriber growth, usage and services available to our subscribers

• Continue to provide high-quality and reliable telecommunications services to people in sparsely populated areas, with support from state and federal Universal Service Funds

• Remain the roaming partner of choice for national and other regional carriers, regardless of technology

• Continue to lower our operating costs, increase the use of more efficient channels of distribution and continue to deliver strong operating results

• Continue to consolidate wireless licenses that are contiguous with our existing markets, including possible trades, acquisitions or dispositions

3

Expand and enhance our domestic wireless network to increase capacity, expand coverage and provide additional features

     Our cellular network operates over radio frequencies licensed by the Federal Communications Commission (“FCC”). We operate 25 MHz of spectrum between 800 – 900 MHz using both analog and digital technologies. Analog technology assigns only one voice circuit per radio channel. However, digital technologies are more efficient as a single radio channel in a digital system can carry multiple transmissions simultaneously. Digital systems utilize Time Division Multiple Access (“TDMA”), Code Division Multiple Access (“CDMA”) or the Global System for Mobile Communications (“GSM”) transmission technologies, none of which are compatible with each other. However, most markets in the United States have at least one cellular/PCS operator offering each technology.

     We believe it is critical to continue to expand network coverage and increase capacity in our existing voice network to support both our subscribers and those subscribers of our roaming partners. We continue to offer analog technology in all of our markets. We have deployed digital TDMA in all our markets and in 2001 we began deploying CDMA in our markets. Our CDMA platform allows us to economically expand the minutes of use (“MOU”) available to our customers and introduce a wide range of wireless Internet-related services and other new features. As of December 31, 2002, CDMA was available to approximately 50% of the population covered by our domestic licenses. We will continue to offer TDMA digital services primarily for our roaming partners, but we believe that most wireless carriers in the United States will utilize GSM or CDMA based digital technology platforms as they migrate to the next generation of wireless technology. We believe our CDMA platform will support our wireless data strategy and attract additional roaming traffic not currently served by our existing analog and TDMA networks. As national carriers who are our roaming partners, such as AT&T Wireless Services, Inc. (“AT&T Wireless”) and Cingular Wireless (“Cingular”), develop and build their GSM digital technology platforms and accumulate significant subscribers who might roam into our coverage areas, we expect to add this third digital platform to accommodate roaming customers if we can enter economic business arrangements.

     We believe our cellular systems, which we generally own in large geographic clusters in predominately rural areas, provide us a strategic advantage in our markets. Cellular systems, which operate in the 800 MHz frequency band, are ideal for providing coverage to large geographic areas in sparsely populated areas. In addition, each of our cellular systems provides 25 MHz of spectrum, which enables us to deploy several digital technologies to meet the needs of both our own subscribers and our diverse roaming partners. Although we have acquired three 1900 MHz PCS licenses to supplement our network coverage, 1900 MHz systems are less efficient in rural areas due to the smaller range of coverage per cell site.

Increase domestic subscriber growth, usage and services available to our subscribers

     High Quality and Affordable Services — We offer our subscribers high quality communications services, as well as several custom calling services, such as call forwarding, call waiting, conference calling, enhanced directory assistance with hands-free dialing, voice message storage and retrieval, caller ID, wireless web, short messaging service, data services and no-answer transfer. The nature of the services offered varies depending upon the market. In addition, all subscribers can access local government emergency services from their cellular handsets (at no charge) by dialing 911. We have designed our pricing options to be simple and understandable, while still meeting the varied needs of our customer base. A majority of our rate plans consist of a fixed monthly access charge (with varying allotments of included minutes) plus variable charges per minute of additional use. In most cases, we separately charge for our custom calling services.

     We provide extended regional and national service to our subscribers through regional and national roaming arrangements, thereby enabling our subscribers to seamlessly make and receive calls while in other cellular service areas. New rate plans introduced in 2002 offer our subscribers regional calling plans and roaming packages that allow them to pay home usage rates while traveling within specified regional zones, both within and outside of our service areas. These rate plans also offer larger allotments of included minutes.

     Data Services — Our wireless Internet portal, MyCellOne.com, delivers a wide range of wireless Internet-related services including a personal e-mail service, access to external e-mail (for example, Yahoo^® and Hotmail^® accounts), Personal Information Management (“PIM”) services that include calendars, to-do lists and synchronization with personal computers, web browsing, games, a customizable home page and information alerts that are sent to the subscriber’s phone as short messages. In 2002, we expanded the services and capabilities of the portal to allow intercarrier messaging, e-mail to short message translation functionality and the downloading of ringtones and icons to handsets. We will continue to evaluate new products and services, such as data, that may be complementary to our wireless operations.

     In 2002, we began market testing next generation 1xRTT based high-speed packet data networks in Billings, Montana and Midland, Texas. These networks provide services at data speeds significantly faster than those currently available. Additionally, unlike most existing networks, the data devices on these high speed data networks communicate with the Internet, Intranets and other IP based networks through “always on” connections enabling faster, more immediate interactions and communications between users.

     Wireless Residential Services (“WRS”) — We utilize our existing network infrastructure and cellular licenses to provide wireless local voice and data services primarily to residential customers. These services involve the use of a wireless access unit at a customer’s residence. The wireless access unit provides the customer a dial tone and transmits the signal to the nearest cell site. We believe that WRS offers many customers a cost-effective and reliable alternative to local wireline carriers. In addition, WRS can be deployed in regions not currently served by local wireline carriers. For example, in November 2000, we began providing WRS to residents of the Pine Ridge Indian Reservation. Many of these residents did not previously have access to wireline services.

4

Continue to provide high-quality and reliable telecommunications services to people in sparsely populated areas, with support from state and federal Universal Service Funds

     We have been a strong proponent of regulatory neutrality between various communications technologies, especially with respect to sparsely populated rural areas. As part of this effort, we have filed applications with appropriate regulatory authorities to be designated an Eligible Telecommunications Carrier (“ETC”) in order to allow us to receive federal and state Universal Service Fund (“USF”) support. The USF was established to provide support to telecommunications carriers offering basic telephone service in rural, insular and high cost areas. As of December 31, 2002, we have been successful in obtaining full or partial ETC status in 14 states and the Pine Ridge Indian Reservation, and are providing services we believe are eligible for USF payments in 11 of those 14 states and the Pine Ridge Indian Reservation. In 2003, we plan to seek designation as an ETC qualified to receive USF funds in additional areas. Initially, on September 30, 2002 and again on December 31, 2002, we submitted our requests to receive funding for certain of our traditional mobile services customers that reside in areas in which we are eligible to receive federal universal service funding. We expect to submit similar requests on a quarterly basis throughout 2003 and believe it is likely that in 2003 we will receive most, if not all, of the requested funding. Depending on the amounts received, such funding could have a significant beneficial impact on our 2003 subscriber revenues, ARPU and cash flow.

Remain the roaming partner of choice for national and other regional carriers, regardless of technology

     We believe we are in a unique position to be the roaming partner of choice for national carriers whose customers roam throughout our service areas. We have made significant investments in our network which enable us to offer high quality and reliable service to our roaming partners. We believe the high costs of constructing PCS networks in our rural footprint presents a barrier to the national PCS carriers. In addition, our network supports the three largest leading technology platforms that national cellular and PCS carriers use currently. We expect to add the fourth platform, GSM, to our network as the number of national carriers’ customers that would use such platform in our service areas becomes significant enough to support this investment in GSM service if we can enter economic business arrangements.

     We have roaming agreements with most of the major wireless carriers in North America, including AT&T Wireless, Cingular and Verizon Wireless Corporation (“Verizon”). These agreements allow their customers to roam on our network and allow our subscribers to utilize those carriers’ networks. Similarly, these agreements provide attractive rates to us for our customers who roam in areas outside our wireless network. During 2002, approximately 59% or $136 million of our domestic roamer revenues were attributable to AT&T Wireless. In March 2002, we extended our roaming agreement with AT&T Wireless which remains in effect through June 15, 2006. Additionally, in 2002 we entered into new roaming agreements with Verizon and Cingular effective through March and April 2005, respectively.

Continue to lower our operating costs, increase the use of more efficient channels of distribution and continue to deliver strong operating results

     We believe that our success has been and will continue to be attributable in large part due to our low operating costs. In 2002, we lowered our costs of providing service. We have taken several significant steps to reduce our cost of providing service. We have entered into a national wholesale long distance contract with a leading long distance carrier that has lowered our cost of providing long distance service to our customers. We also have new roaming agreements with national wireless carriers that substantially lower the per minute costs we incur when our customers roam on their networks.

     In 2002, we launched an enterprise voice portal (“EVP”) throughout our call center operations. The EVP enables our customers to access their account and billing information over the phone without the intervention of a customer service representative. We also employ the use of the Internet as a customer care tool. The Internet allows our customers to obtain answers to routine inquiries and make payments. These actions would have formerly required the customer to speak to a customer care representative. In March 2003, we consolidated call center operations into two locations and closed our call center in McAllen, Texas. We continue to offer customer service in the English and Spanish languages.

     We have also focused on reducing the costs of acquiring subscribers. During 2002, we decreased our number of owned store locations and the headcount associated with running those locations. This decreased our fixed costs and shifted more of our sales and marketing emphasis to the variable cost of agent and indirect channels.

     Since the Company was established, we have focused on delivering consistent and strong operating results. In 2002, we increased annual domestic EBITDA (total revenues less total operating expenses exclusive of depreciation, amortization, asset dispositions and stock-based compensation) for the eighth consecutive year and generated unlevered free cash flow (EBITDA less capital expenditures) from domestic operations for the sixth consecutive year, more than doubling the amount of domestic free cash flow as compared to 2001. By continuing to lower our operating costs and maximizing the efficiency of our distribution channels, we believe we can improve our financial leverage and further increase our cash flow.

Continue to consolidate wireless licenses that are contiguous with our existing markets, including possible trades, acquisitions or dispositions

     It is part of our ongoing strategy to evaluate business opportunities including potential trades, acquisitions and dispositions to better consolidate our footprint. In June 2002, we were notified by the FCC that we were the successful bidder for the North Dakota 3 RSA license.

Marketing, Sales and Customer Service

     Our sales and marketing strategy is designed to generate continued net subscriber growth and increased subscriber revenues. We target a customer base we believe is likely to generate higher monthly service revenues, while attempting to achieve a low cost of adding new subscribers.

5

     Marketing — We market our products and services under the names CellularONE, the first national brand name in the cellular industry, and Western Wireless^®, both of which we own. We also license the CellularONE name to other wireless communications providers. The regional and national advertising campaigns conducted by the CellularONE Group have enhanced our advertising exposure at a lower cost than what could be achieved by us alone. In June 1999, we became a 50% partner in the CellularONE Group, and in July 2001, acquired the remaining 50% of the CellularONE Group. In 2003, the CellularONE Group advertising program will continue to focus on more regional advertising of direct benefit to CellularONE’s licensees.

     In 2002, we launched service in Amarillo, Texas under the name Western Wireless^®.

     Sales and Distribution — We sell our products and services through a combination of direct and indirect channels. We operate both stores and kiosks under the CellularONE and Western Wireless^® brand names and utilize a direct sales force trained to educate new customers on the features of our products. Sales commissions generally are linked both to subscriber revenue and subscriber retention, as well as activation levels. In 2002, we opened two retail outlets in Amarillo, Texas under the Western Wireless^® name.

     We believe that our local retail locations provide the physical presence in local markets necessary to position CellularONE and Western Wireless^® as a quality local service provider and give us greater control over both our costs and the sales process. In 2002, we focused on expanding our indirect network of national and local merchants and specialty retailers in order to reduce our fixed sales and marketing costs. However, we will continue to use a combination of direct and indirect sales channels, with the mix depending on the requirements of each particular market.

     We also act as a retail distributor of handsets and maintain inventories of handsets. Although subscribers generally are responsible for purchasing or otherwise obtaining their own handsets, we have historically sold handsets below cost and expect to continue to do so in the future.

     Customer Service — Providing high quality customer service is a significant element of our operating philosophy. We are committed to attracting and retaining subscribers by providing consistently superior customer service. We currently operate call centers in Manhattan, Kansas and Issaquah, Washington. Our call centers maintain highly sophisticated monitoring and control systems and well-trained customer service and technical staffs to handle both routine and complex questions as they arise, 24 hours a day, 365 days a year.

     We utilize credit check procedures at the time of sale and continuously monitor customer churn (the rate of subscriber attrition) and other events (such as service agreement expiration dates), which can impact customer churn. It is our belief that we can effectively manage customer churn through an outreach program staffed by our sales force and customer service personnel and through our efforts to predict more accurately the timing of potential customer churn. The outreach program is intended to not only enhance subscriber loyalty, but also to increase add-on sales and customer referrals. This program allows the sales staff to check customer satisfaction, as well as to offer additional calling features, such as voice mail, call waiting and call forwarding.

Markets and Systems

     We operate cellular systems in 18 MSAs and 88 RSAs. We have also acquired selected PCS licenses to supplement our coverage. At December 31, 2002, we owned 100% of each of our licenses. In aggregate our licenses cover a geographic population of more than ten million people. Several inherent attributes of RSAs and small MSAs make such markets attractive. Such attributes typically include:

• relative under-penetration as compared to more urban areas

• population bases of customers with substantial needs for wireless communications

• the ability to cover large geographic areas with fewer cell sites as compared to urban areas

• less intense competitive environments

• less vulnerability to PCS and other competition

• large distances between population centers resulting in a higher proportion of roaming revenues than in urban areas

6

     The following table sets forth the areas in which we hold licenses and the population covered by those licenses. The population data is estimated for 2003 based upon 2002 Claritas, Inc. (“Claritas”) estimates, and is adjusted by us by applying Claritas’ positive and negative growth factors:

Cellular
License Area		Population
Arizona
Mohave (AZ-1)(1)			5,000
Yuma (AZ-4)			197,000
Graham (AZ-6)			209,000
	Arizona Total		411,000
Arkansas
Hempstead (AR-11)			67,000
	Arkansas Total		67,000
California
Mono (CA-6)			32,000
Imperial (CA-7)			148,000
	California Total		180,000
Colorado
Pueblo			146,000
Fremont (CO-4)			95,000
Elbert (CO-5)			39,000
Saguache (CO-7)			55,000
Kiowa (CO-8)			49,000
Costilla (CO-9)			32,000
	Colorado Total		416,000
Idaho
Idaho (ID-2)			75,000
Idaho (ID-3) (2)			8,000
	Idaho Total		83,000
Iowa
Sioux City			123,000
Monona (IA-8)			56,000
	Iowa Total		179,000
Kansas
Jewell (KS-3)			52,000
Marshall (KS-4)			127,000
Ellsworth (KS-8)			132,000
Morris (KS-9)			59,000
Franklin (KS-10)			114,000
Reno (KS-14)			175,000
	Kansas Total		659,000
Minnesota
Kittson (MN-1)			49,000
Lake of the Woods (MN-2)			25,000
Chippewa (MN-7)			175,000
Lac qui Parle (MN-8)			67,000
Pipestone (MN-9)			134,000
	Minnesota Total		450,000

7

Cellular
License Area		Population
Missouri
Bates (MO-9)			84,000
	Missouri Total		84,000
Montana
Billings			130,000
Great Falls			78,000
Lincoln (MT-1)			159,000
Toole (MT-2)			36,000
Malta (MT-3)			12,000
Daniels (MT-4)			37,000
Mineral (MT-5)			206,000
Deer Lodge (MT-6)			64,000
Fergus (MT-7)			29,000
Beaverhead (MT-8)			104,000
Carbon (MT-9)			32,000
Prairie (MT-10)			18,000
	Montana Total		905,000
Nebraska
Lincoln			256,000
Cherry (NE-2)			28,000
Knox (NE-3)			115,000
Grant (NE-4)			35,000
Columbus (NE-5)			151,000
Keith (NE-6)			115,000
Hall (NE-7)			93,000
Chase (NE-8)			55,000
Adams (NE-9)			81,000
Cass (NE-10)			87,000
	Nebraska Total		1,016,000
Nevada
Humbolt (NV-1)			52,000
Lander (NV-2)			58,000
Mineral (NV-4)			46,000
White Pine (NV-5)			14,000
	Nevada Total		170,000
New Mexico
Colfax (NM-2) (3)			4,000
Lincoln (NM-6) (4)			246,000
	New Mexico Total		250,000

8

Cellular
License Area		Population
North Dakota
Bismarck			95,000
Fargo			177,000
Grand Forks			96,000
Divide (ND-1)			97,000
Bottineau (ND-2)			57,000
North Dakota Valley (ND-3)			85,000
McKenzie (ND-4)			58,000
Kidder (ND-5)			47,000
	North Dakota Total		712,000
Oklahoma
Cimarron (OK-1)			30,000
Nowata (OK-4)			213,000
Beckham (OK-7)			127,000
Jackson (OK-8)			91,000
	Oklahoma Total		461,000
South Dakota
Rapid City			113,000
Sioux Falls			152,000
Harding (SD-1)			34,000
Corson (SD-2)			24,000
McPherson (SD-3)			51,000
Marshall (SD-4)			68,000
Custer (SD-5)			28,000
Haakon (SD-6)			39,000
Suly (SD-7)			68,000
Kingsbury (SD-8)			73,000
Harrison (SD-9)			108,000
	South Dakota Total		758,000
Texas
Abilene			163,000
Brownsville-Harlingen			357,000
McAllen			625,000
Lubbock			249,000
Midland			117,000
Odessa			121,000
San Angelo			106,000
Dallas (TX-1)			56,000
Hansford (TX-2)			87,000
Parmer (TX-3)			137,000
Briscoe (TX-4)			43,000
Hardeman (TX-5)			78,000
Fannin (TX-7)			411,000
Gaines (TX-8)			135,000
Hudspeth (TX-12)			26,000
Reeves (TX-13)			30,000
Loving (TX-14)			40,000
	Texas Total		2,781,000

9

Cellular
License Area			Population
Utah
Juab (UT-3)				65,000
Beaver (UT-4)				140,000
Carbon (UT-5)				80,000
Piute (UT-6)				30,000
	Utah Total			315,000
Wyoming
Casper				66,000
Park (WY-1)				51,000
Sheridan (WY-2)				82,000
Lincoln (WY-3)(5)				1,000
Cheyenne, Laramie (WY-4)				138,000
Douglas (WY-5)				12,000
	Wyoming Total			350,000
		Sub-Total Cellular		10,247,000

PCS Cellular
License Area		Population(6)
Liberal, Kansas			36,000
Clovis, New Mexico			63,000
Amarillo, Texas			236,000
	Sub-Total PCS Cellular		335,000
	Total Population		10,582,000

(1)	We are the licensed A-2 carrier, servicing a portion of the Arizona 1 RSA.
(2)	The population for the Idaho 3 RSA represents those areas where we have construction permits to build cell sites under our Idaho 2 license.
(3)	We are the licensed A-2 carrier, servicing a portion of the New Mexico 2 RSA.
(4)	The population for New Mexico 6 includes 100 persons in the New Mexico 3 RSA where we are the licensed A-2 carrier, servicing a portion of the New Mexico 3 RSA.
(5)	We are the licensed A-2 carrier, servicing a portion of the Wyoming 3 RSA.
(6)	Represents incremental population as portions of the Basic Trading Areas overlap certain cellular licenses.

Competition

     Competition for subscribers among wireless communications providers is based principally upon the services and features offered, the technical quality of the wireless system, customer service, system coverage, capacity and price. Under current FCC rules, there may be up to six PCS licensees in each geographic area in addition to the two existing cellular licensees. Also, Specialized Mobile Radio (“SMR”) dispatch system operators have constructed digital mobile communications systems, referred to as Enhanced Specialized Mobile Radio (“ESMR”), in many cities throughout the United States, including some of the markets in which we operate. Due to the high cost of construction, we do not believe PCS systems will be built in most of our RSAs in the near future.

     Although we believe there are competitive advantages to operating in rural markets, we do operate in a competitive environment. Each of our cellular markets face one cellular competitor, such as Verizon, Alltel Corporation or Cingular. Additionally, we have PCS and ESMR competitors in most of our MSAs. Continuing industry consolidation has resulted in an increased presence of these regional and national wireless operators within our service areas. More recently, some national wireless operators have begun to build small networks in certain of the more densely populated or well-traveled portions of our service areas. The use of national advertising and promotional programs by national wireless operators run in our markets are a source of additional competitive and pricing pressures even though these operators may not provide service in these markets. We also compete with wireless Internet, paging, dispatch services, resellers and landline telephone

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service providers in some of our service areas. Increasingly, cellular service is becoming a viable alternative to landline voice services for certain customer segments, putting cellular licensees in direct competition with traditional landline telephone service providers. One or two-way paging 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. Potential users of cellular systems may find their communications needs satisfied by other current and developing technologies.

     In the future, we expect to face increased competition from entities providing similar services using other communications technologies. In addition, the auctioning and subsequent deployment of technology in additional spectrum and the disaggregation of spectrum could also generate new competition for us. While some of these technologies and services are currently operational, others are being developed or may be developed in the future. Continuing technological advances in the communications field make it difficult to predict the nature and extent of additional future competition.

Suppliers and Equipment Vendors

     We do not manufacture any of the handsets, cell site or switching equipment used in our operations. The high degree of compatibility among different manufacturers’ models of handsets with cell site and switching equipment allows us to design, supply and operate our systems without being dependent upon any single source of such equipment. The handsets and cell site equipment used in the operations are available for purchase from multiple sources. Manufacturers phased out the production of analog handsets during the fourth quarter of 2001, but new analog handsets remained available from various distribution channels through most of 2002. We believe that dual-mode and tri-mode handsets (handsets that contain both digital and analog capabilities) will continue to be available from multiple manufacturers in the foreseeable future. We currently offer handsets manufactured by Audiovox, Inc., Kyocera Wireless Corp., Motorola, Inc., and Nokia Telecommunications, Inc. (“Nokia”) and purchase cell site and switching equipment primarily from Lucent Technologies, Inc. and Nortel Networks, Inc.

Intellectual Property

     CellularONE is a service mark registered with the United States Patent and Trademark Office and owned by us.

     We hold a federal trademark registration of the mark “Western Wireless” and have registered or applied for various other trade and service marks with the United States Patent and Trademark Office.

Regulatory Environment

     The FCC regulates the licensing, construction, operation, acquisition, sale and resale of cellular systems in the United States, pursuant to the Communications Act of 1934, as amended (the “Communications Act”), and the rules, regulations and policies promulgated by the FCC thereunder. FCC regulations distinguish, in part, between “cellular” licenses which are for 800 MHz frequency, and PCS licenses, which are for 1900 MHz frequency. The Communications Act preempts state and local regulation of the entry of, or the rates charged by, any provider of commercial mobile radio service (“CMRS”), such as a cellular service provider. State governments, however, can regulate certain other terms and conditions of cellular service offerings and some states have imposed or are considering the imposition of consumer protection regulations on the wireless industry.

Licensing of Wireless Communications Systems

     A cellular communications system operates under a license granted by the FCC for a particular market or geographic area on one of two 25 MHz frequency blocks allocated for cellular radio service. Cellular authorizations are issued for a 10-year license term beginning on the date of the initial notification to the FCC of the completion of construction by a cellular carrier. Under FCC rules, the authorized service area of a cellular provider in each of its markets is referred to as the Cellular Geographic Service Area (“CGSA”).

     At the end of the 10-year initial term for cellular licenses, licensees must file applications for renewal of licenses. The FCC has adopted specific standards governing cellular license renewals. Under these standards, a cellular license will generally be renewed for additional 10 year terms if a cellular licensee has provided substantial service during its past license term and has substantially complied with applicable FCC rules and policies and the Communications Act.

     The Communications Act and FCC rules require the FCC’s prior approval of any assignments of cellular licenses, including construction permits, or transfers of control of cellular licensees. Non-controlling interests in an entity that holds a cellular license generally may be bought or sold without prior FCC approval. If the transaction is over a certain size, any acquisition or sale of cellular interests may also require the prior approval of the Federal Trade Commission and the Department of Justice as well as approval from any state or local regulatory authorities having competent jurisdiction.

     As of January 1, 2003, there is no longer a limit on the amount of CMRS spectrum (i.e., cellular, PCS, and SMR) that a carrier can hold in a market. However, there remains a cellular cross-interest rule that prohibits a carrier from owning an attributable interest in both cellular licenses in a single RSA market. Although the FCC retained the cellular cross-interest rule in RSAs, it will consider waivers of the rule for RSAs that exhibit market conditions under which cellular cross-interest may be permissible without significant likelihood of substantial competitive harm. Notwithstanding the removal of the spectrum cap and partial removal of the cross-interest restriction, the FCC has indicated that it will engage in a case by case review of any anticompetitive effects of CMRS spectrum acquisitions, although it is not clear what criteria the FCC will use in such review.

Regulatory Developments

     E911 Service — The FCC has adopted rules governing the provision of emergency 911 services by cellular, PCS and other mobile service providers, including enhanced 911 (“E911”) services that provide the caller’s telephone number, location, and other useful information. Cellular and PCS providers must be able to process and transmit 911 calls (without call validation), including those from callers with speech or hearing disabilities.

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     Under Phase I of the FCC’s E911 rules, if a Public Service Answering Point (“PSAP”) requests and is capable of processing the caller’s telephone number and location information, then cellular, PCS, and other mobile service providers must relay a caller’s automatic number identification and the location of the cell site or base station receiving a 911 call. Wireless carriers must transmit all 911 calls without regard to validation procedures intended to identify and intercept calls from non-subscribers. The FCC’s rules require that analog cellular phones include a separate capability for processing 911 calls that permit these calls to be handled, where necessary, by either cellular carrier in the area. This rule applies only to new analog cellular handsets and not to existing handsets or to PCS or SMR services.

     Under Phase II of the FCC’s E911 rules, CMRS carriers are allowed to choose a handset-based or network-based approach for identifying the location of an E911 caller. In areas where we have received valid requests for Phase II service, we will implement a handset-based approach which requires that the PSAP be able to identify the location of a 911 caller within 50 meters for 67% of all calls and within 150 meters for 95% of all calls. To date, we have received nine requests for Phase II service and are working with each PSAP to assess their readiness and schedule deployment plans to meet the FCC’s requirements. Under a waiver granted by the FCC, we were required to begin selling and activating handsets with automatic location identification capability by March 1, 2003. We have complied with this requirement. Additionally, under the waiver, we are required to meet the following benchmarks: (i) by May 31, 2003, 25% of new handset sales must be Phase II compliant; (ii) by November 30, 2003, 50% of new handset sales must be Phase II compliant; (iii) by May 31, 2004, 100% of new handset sales must be Phase II compliant. In addition, by December 31, 2005, 95% of all subscriber handsets must be Phase II compliant. Under the FCC rules, carriers must begin providing Phase II service within six months of the latter of receiving a valid request for service from a PSAP or March 1, 2003.

     Universal Service — In its implementation of the Communications Act, the FCC established new federal universal service rules, under which wireless service providers are eligible, for the first time, to receive universal service subsidies, and are also required to contribute to both federal and state USFs. For the first and second quarters of 2003, the FCC’s universal service contribution factor amounted to 7.3 percent and 9.1 percent, respectively, of a wireless service provider’s interstate and international telecommunications revenues. This contribution factor is subject to quarterly review and possible revision. Under the FCC rules, a wireless service provider may receive universal service support for providing telephone service in rural high-cost areas, provided that the wireless service provider has been designated as an ETC by a state commission or the FCC. Some states have conditioned ETC status on the service provider meeting certain consumer protection and service quality requirements. In an effort to maintain sufficient funding, the FCC adopted interim rules for determining the amount of interstate and international telecommunication revenues subject to the federal universal service contribution factor for wireless carriers. Under these new rules, wireless carriers can either use a proxy percentage to determine the amount of the carrier’s total subscriber revenue subject to the universal service contribution factor or calculate the amount of actual subscriber revenue which is interstate or international. The FCC increased the proxy percentage from 15 to 28.5 percent effective April 1, 2003. Many states have also established state USF programs that require all telecommunications carriers, including CMRS carriers, to contribute to the fund. Under some of these state USFs, CMRS carriers are also eligible to receive universal service support. Both federal and state USFs are subject to change based upon pending regulatory proceedings, court challenges, and marketplace conditions.

     Local Number Portability — The FCC has adopted rules on telephone number portability and number pooling in an effort to achieve more efficient number utilization. The FCC established November 24, 2003 as the extended deadline for CMRS carriers to implement service provider number portability in the top 100 Combined Metropolitan Service Areas (“CMSAs”). For markets outside of the top 100 CMSAs, the number portability requirement is triggered only upon receipt of a request by another carrier to port a customer’s telephone number. In such cases, carriers have six months to comply with these requests. Our McAllen, Texas MSA market falls within the top 100 CMSAs. We have filed a request with the FCC to waive the local number portability requirement as it applies to our McAllen MSA or, in the alternative, reinstate the prior rule that imposed number portability only in the top 100 MSAs (not CMSAs). In addition to our McAllen MSA market, we have 7 RSA markets which include counties, all or a portion of which have been designated as within the top 100 CMSAs. We have asked the FCC to rule that such markets not be considered within the top 100 CMSA markets and not be subject to local number portability requirements or, in the alternative, waive the number portability requirements for such markets. Both these requests are currently pending before the FCC. The number portability requirements are subject to change based upon regulatory proceedings and court challenges.

     Number Pooling — Wireless carriers are also subject to requirements governing number pooling, which provide for the assignment and use of available numbers. The FCC has imposed what is referred to as “thousand block pooling,” meaning carriers may only request and will only be assigned numbers in blocks of one thousand numbers rather than the previous blocks of ten thousand numbers. The number pooling requirements apply only to carriers operating within the top 100 CMSAs. Under the current rules, the implementation date for number pooling in most of these markets is June 10, 2003. We have filed a request with the FCC to waive the requirement to implement number pooling in our McAllen MSA and CMSA overlap markets, similar to our local number portability rules waiver request, which is currently pending. Implementation of the number portability and pooling requirements will cause significant network upgrade costs for all wireless carriers.

Employees and Labor Relations

     We consider our labor relations to be good and none of our employees are covered by a collective bargaining agreement. As of December 31, 2002, we employed domestically a total of 2,347 people in the following areas:

	Number of
Category	Employees
Sales and marketing		892
Engineering		247
General and administrative, including customer service		1,208

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The Business of WWI

Overview

     WWI, through its consolidated subsidiaries and other operating companies, is a provider of mobile communications services in Slovenia, Austria, Ireland, Bolivia, Ghana, Haiti, Côte d’Ivoire, Croatia and Georgia. These companies are licensed to provide wireless services to a geographic population of over 75 million people. At December 31, 2002, the Company owned approximately 98% of WWI and the balance was owned by Bradley Horwitz, Executive Vice President of the Company and President of WWI. In November 2002, WWI sold its ownership interest in its Icelandic subsidiary.

     The primary business of WWI is the delivery of mobile telecommunications services in markets outside of the United States. In certain markets, WWI’s operating companies also provide other telecommunications services, including fixed line services, wireless local loop, international long distance and Internet access. WWI’s largest non-mobile business is its fixed-line operations in Austria.

     In 2002, 82% of WWI’s consolidated service revenues were generated by its European subsidiaries in Ireland, Austria and Slovenia. Of these European service revenues, mobile telecommunications services accounted for approximately 77% of these revenues.

International Business and Strategy

     WWI’s strategy is to build a portfolio of wireless asset investments and opportunistically exit them as individual businesses mature and appropriate valuations can be realized. We believe the key elements in executing this strategy are:

• Low acquisition costs

• Potential for rapid growth

• An ability to partially fund operations by securing debt financing at the operating company level

     WWI provides management expertise to all of its operating companies, particularly in the early stages of development, and it exercises significant control over management decisions in all of its consolidated markets.

     WWI provides telecommunications services primarily in two types of markets. Historically, WWI focused investments in markets characterized by a substantial unmet demand for communications services offering the potential of rapid subscriber growth. Our markets that meet this profile include: Bolivia, Ghana, Haiti, Côte d’Ivoire, Croatia and Georgia. These markets are often characterized by inadequate local landline telephone service, which is unavailable to the majority of the population. WWI believes that wireless technology is a more economic medium to deliver telecommunications services in these markets. By introducing competition and providing customers with a high-quality alternative, WWI has succeeded in expanding the size and service offerings of the telecommunications sector in these markets. These markets tend to have limited competition in the wireless sector and generally have wireless penetration rates below 20%.

     In addition to investments in underserved markets, WWI has increasingly focused its investment in countries with more developed telecommunications infrastructure and substantial wireless competition, but where the entry costs are sufficiently low and the growth potential is sufficient to present an attractive investment opportunity. These markets generally have wireless penetration rates of 70% or higher and include Ireland, Austria and Slovenia.

     In 2002, WWI’s consolidated subsidiaries grew their mobile subscriber base by 51%.

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Markets and Operations

     Each of WWI’s operating companies operate cellular communications systems over radio frequencies licensed by the telecommunications regulatory body of its respective country.

     Each of WWI’s operating companies that provide wireless mobile services utilize GSM technology operating at the 900-MHz, 1800-MHz or 1900-MHz frequencies, with the exception of WWI’s operating company in Haiti, which utilizes TDMA technology at the 800-MHz frequency. GSM is the most widely used wireless technology in the world, serving over 800 million customers. GSM offers an open system architecture, is supported by a variety of vendors and allows operators to achieve cost economies in infrastructure and mobile terminal equipment. GSM also provides the benefit of a single phone number and transparent services on a global roaming basis. Further, GSM has high capacity, high voice quality and utilizes industry-leading encryption and authentication technology that provides customers with a high level of subscription and conversation privacy. GSM has always supported wireless data and currently supports high-speed packet-based data transmission. This allows GSM operators to provide customers with enhanced Internet and mobile data services.

     WWI’s operating company in Austria operates a 5,300-km fiber-optic network that provides fixed-line communications services to customers as well as backhaul transmission for its mobile network.

     The following table sets forth the countries in which WWI provides communications services, the populations of such country and the beneficial ownership of WWI in the operating entity providing such services. Population data related to WWI markets is included in the following table as of July 2002 as reported by the Central Intelligence Agency World Fact book.

			Beneficial
			Ownership
Markets	Population		Percentage
Slovenia		1,933,000		100.0	%
Austria		8,170,000		99.5	%
Ireland		3,883,000		81.0	%
Bolivia		8,445,000		71.5	%
Ghana		20,244,000		56.7	%
Haiti		7,064,000		51.0	%
Côte d’Ivoire		16,805,000		40.0	%
Croatia		4,391,000		19.0	%
Georgia		4,961,000		14.5	%
Total		75,896,000

     Those operating entities in which we have a beneficial ownership interest of greater than 50%, as noted in the table above, are consolidated as part of our financial results. Others are accounted for as an equity investment.

     Slovenia — WWI’s operating company in Slovenia, Western Wireless International d.o.o. (“WWI d.o.o.”), provides GSM mobile communications services in the 1800-MHz band. WWI d.o.o. launched commercial services in December 2001, under the brand name Vega.

     Austria — WWI’s operating company in Austria, tele.ring Telekom Services GmbH (“tele.ring”), provides GSM mobile communications, fixed-line and Internet services. tele.ring launched commercial GSM mobile services in the 1800-MHz band in May 2000. In addition, an affiliate of tele.ring owns a third generation license. It is anticipated we will begin limited build-out of a third generation network in 2003. We acquired tele.ring at the end of June 2001.

     Ireland — WWI’s operating company in Ireland, Meteor Mobile Communications Limited (“Meteor”), provides GSM mobile communications services in the 900-MHz and 1800-MHz bands. Meteor’s dual-band network launched commercial services in February 2001.

     Bolivia — WWI’s operating company in Bolivia, NuevaTel S.A. (“NuevaTel”), provides GSM mobile communications services in the 1900-MHz band. NuevaTel launched commercial services in November 2000 under the brand name Viva. In 2002, Viva also began operating a long distance business.

     Ghana — WWI’s operating company in Ghana, Western Telesystems (Ghana), Ltd. (“Westel”), is licensed to provide fixed and wireless telecommunications services, including basic phone service, cellular, paging, international long distance, pay phones, data communications, private networks and satellite communications. Westel has operated a wireless local loop network and international gateway since February 1998.

     Haiti — WWI’s operating company in Haiti, Communication Cellulaire d’Haiti S.A. (“COMCEL”), provides TDMA mobile communications services in the 800-MHz band. Additionally, COMCEL carries international long distance traffic to and from Haiti. COMCEL launched commercial mobile services in September 1999.

     Côte d’Ivoire — WWI’s operating company in Côte d’Ivoire, Cora de Comstar S.A. (“Comstar”), provides GSM mobile communications services in the 900-MHz band. After WWI’s acquisition of its interest in Comstar, Comstar relaunched commercial services under the new brand name CORA de Comstar (“Cora”) in September 2000. Since September 2002, Côte d’Ivoire has undergone sustained political instability, including an attempted coup and continued rioting. Although Cora continues to operate, its revenues and cash flows have been severely impacted. As a result, we have fully written off our investment in Cora.

     Croatia — WWI’s operating company in Croatia, VIP-Net d.o.o. (“VIP-Net”) provides GSM mobile communications services in Croatia in the 900-MHz band. VIP-Net launched commercial service in July 1999.

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     Georgia — WWI’s operating company in the Republic of Georgia, MagtiCom GSM, Ltd. (“MagtiCom”), provides GSM mobile communications services in the 900-MHz band. MagtiCom launched commercial services in September 1997.

Products and Services

     Basic Services — WWI’s operating companies provide a variety of wireless products and services designed to match a range of needs for business and personal use. Calling features that WWI’s operating companies provide include short message services (“SMS”), voicemail, message alert, caller ID, call waiting, call hold and conference calling. WWI’s operating companies offer services to WWI’s customers through both “postpaid” and “prepaid” payment plans. Postpaid contracts consist of a fixed monthly charge (with varying allotments of included minutes) plus variable charges for additional use. Prepaid plans require advance payment for airtime in specific currency denominations. Once the available airtime is consumed, the customer must “replenish” or prepay for additional airtime in order to continue using the service. At the end of 2002, 68% of our customers were on prepaid plans and 32% were on postpaid plans.

     Roaming — Customers of WWI’s European operations are able to roam throughout Europe and worldwide, either on other GSM-based networks utilizing the same spectrum band or through the use of multi-band handsets that can be used on GSM systems utilizing a different spectrum band. Additionally, WWI’s European operations generate revenues by allowing customers of other GSM operators to roam on their networks.

     Data Services — WWI’s operating companies offer a variety of data services that enable users to access information, send and receive e-mail, play games, and download ringtones and icons to their handsets. In Austria, WWI operates a GPRS-enabled (General Packet Radio Service) network that provides for a high capacity, “always-on” Internet connection, and services that include color web browsing, e-mail, information services, and location-based services. In Ireland and Slovenia, WWI offers an array of data services that are delivered over a SMS-based platform. These data services enable users to access information (i.e.: news, sports, weather, stocks, and film times) and receive customized information alerts, as well as participate in interactive games.

     Fixed-Line Services — WWI’s Austrian operating company offers three distinct fixed communications services: residential voice service, dial-up Internet access, and high-speed data access for corporate clients. It also provides value-added and carrier services, leased line services and data services such as intranet and VPN.

Marketing, Sales and Customer Service

     WWI’s sales and marketing strategy is to seek to generate rapid net subscriber growth and increased subscriber revenues in each of its markets.

     Marketing — Each of WWI’s operating companies markets its products and services under its own brand name and develops its own marketing strategy to address the local market conditions. The focus of each operating company’s marketing efforts is dependent upon a number of factors, including overall market penetration, number of competitors and network coverage.

     Sales — WWI’s operating companies sell their products and services through a distribution network including company-owned stores, exclusive and non-exclusive dealers, national and local retailers, and direct sales forces targeting corporate accounts. Each operating company uses a combination of direct and indirect sales channels, the mix of which is dependent on the local conditions of the market. The retail channel (including retail stores, mini-stores, and kiosks) uses personnel that are trained to educate new customers on products and services and to provide basic customer service. WWI believes this channel provides the physical presence in local markets necessary to position each operating company as a quality local service provider, while providing greater control over both costs and the sales process. The indirect channel consists of extensive dealer networks of national and local merchants, specialty retailers, and alternative direct-marketing firms.

     WWI’s operating companies also act as retail distributors of handsets and maintain inventories of handsets. Although customers generally are responsible for purchasing or otherwise obtaining their own handsets, WWI’s operating companies have historically sold handsets below cost to respond to competition for new subscribers. We expect these handset subsidies to remain common industry practice for the foreseeable future.

     Customer Service — WWI considers customer service a key element of its operating philosophy and is committed to attracting and retaining subscribers by seeking to provide consistently superior customer care. Each of WWI’s European operating companies operates full-service, 24-hour call centers, where customer inquiries are addressed by well-trained customer service personnel and technical staff using sophisticated monitoring and control systems.

Competition

     In each of the markets where WWI’s operating companies operate, they compete with other communications services providers including landline telephone companies and other wireless communications companies. In each European market, WWI generally competes with two or three other GSM operators. Most of these competitors are well-established companies or subsidiaries of well-established companies such as Vodafone plc, Telekom Austria, T-Mobile and mm02. Such companies have substantially greater financial and marketing resources, larger subscriber bases, better name recognition and in some cases, larger coverage areas than those of WWI’s operating companies.

     In the future, we expect to face new competition from entities licensed to provide similar services using other communications technologies, including so-called “third generation” technology. In WWI’s European markets, existing wireless operators as well as new entrants have been awarded third generation licenses and in some cases they have announced their intention to launch third generation services in 2003.

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Suppliers and Equipment Vendors

     WWI’s operating companies do not manufacture any of the handsets, cell site or switching equipment used in their operations. The high degree of compatibility among different manufacturers’ models of handsets with cell site and switching equipment allows WWI’s operating companies to design, supply and operate their systems without being dependent upon any single source of such equipment. The handsets and cell site equipment used in our operations are available for purchase from multiple sources. The largest handset manufacturers of WWI’s European operations are Nokia and Siemens AG. WWI purchases cell site and switching equipment primarily from Alcatel, Lucent Technologies, Inc. and Siemens AG.

Governmental Regulation

     The licensing, construction, operation and ownership of communications systems, and the granting and renewal of applicable licenses and radio frequency allocations, are regulated by governmental entities in each of the countries in which WWI’s operating companies conduct business. In Europe, the licenses which allow WWI’s operating companies to provide wireless licenses were initially granted for terms of 15 or 20 years and in some cases there are not explicit provisions in the licenses which allow for renewal.

     Under the terms of the Ghana license, Westel was required to meet certain customer levels and build-out requirements by February 2002. Westel was unable to meet the required customer levels due to the inability of the regulator to provide spectrum and enforce interconnection with the incumbent telephone company and all development has been stifled. The National Communication Authority of Ghana (“NCA”) has assessed a penalty claim of $71 million for not meeting these build-out requirements. Westel has contested this fine on the basis that the government and the NCA failed to deliver the key commitments of spectrum and interconnection and does not believe the enforcement of these penalties is probable.

Employees and Labor Relations

     WWI considers its labor relations to be good. As of December 31, 2002, WWI’s consolidated operating companies employed a total of 1,497 people in the following areas:

	Number of
Category	Employees
Sales and marketing		354
Engineering		387
General and administrative, including customer service		756

RISK FACTORS

We have a significant amount of debt, which may limit our ability to raise additional capital to meet our future funding and debt service requirements

     As of December 31, 2002, our total long-term indebtedness was $2.5 billion, including a current portion of $144 million. Of such indebtedness, $1.8 billion was outstanding under our $2.1 billion Credit Facility (the “Credit Facility”) and $383 million was outstanding under our Senior Subordinated Notes due 2006 and 2007 (the “Senior Subordinated Notes”). Effective March 31, 2003, we begin making principal payments under the Credit Facility. The amount of required principal payments in 2003 is $106 million based on outstanding borrowings at December 31, 2002 under the Credit Facility. Indebtedness under the Credit Facility matures on September 30, 2008. Substantially all our domestic assets are pledged as security for the indebtedness under the Credit Facility. The Credit Facility and the Indentures for our Senior Subordinated Notes contain, and any additional financing agreements may contain, certain restrictive covenants. The restrictions in the Credit Facility and the Senior Subordinated Notes affect, and in some cases significantly limit or prohibit, among other things, our ability to incur indebtedness, sell assets, make investments and acquisitions, pay dividends, and engage in mergers and consolidations. Additionally, the Credit Facility and the Senior Subordinated Notes require us to comply with certain financial and operational performance covenants, and, while we expect to remain in compliance with such covenants, there can be no assurance to that effect. An event of default under the Credit Facility or the Senior Subordinated Notes would allow the lenders to accelerate the maturity of the indebtedness thereunder. In such event, it is likely that all of our indebtedness would become immediately due and payable.

     The continued growth and operation of our business will require additional funding for working capital, debt service, the enhancement and upgrade of our network, the build-out of infrastructure to expand our coverage and possible acquisitions of spectrum licenses. The current levels of our debt could limit our ability to obtain future debt or equity financing on terms favorable to us or at all. Our sources of additional capital may include public or private equity and debt financings, including vendor financing. The availability of additional financing is dependent upon the condition of the capital markets and the extent of the additional financing that we may require will depend on the success of our operations. In addition, we must use a substantial portion of our cash flows from operations to make payments of principal and interest on our debt, thereby reducing funds that could be available for working capital, the enhancement and upgrade of our network, the buildout of infrastructure to expand our coverage and possible acquisitions. Additionally, competitive factors, future declines in the U.S. economy, unforeseen construction delays, cost overruns, regulatory changes, engineering and technological changes and other factors may result in funding requirements in excess of current estimates or an inability to generate sufficient cash flow to service our debt. The unavailability of such funding could cause us to delay or abandon some of our planned growth and development or to seek to sell assets to raise additional funds, either of which could have a material adverse effect on our business, strategy, operations and financial condition. Given that a substantial portion of our assets consists of intangible assets, principally licenses granted by the FCC, the value of which will depend upon a variety of factors (including the success of our business and the wireless communications industry in general), there can be no assurance that our assets could be sold quickly enough, or for sufficient amounts, to enable us to meet our obligations.

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     Additionally, a number of our consolidated international subsidiaries and other international operating companies have credit facilities to finance their operations. At December 31, 2002, the total long-term indebtedness of our consolidated international subsidiaries to third parties was $278 million. At December 31, 2002, our Slovenian entity had borrowed $71.4 million under its credit facility (the “Slovenian Credit Facility”). At December 31, 2002, our Bolivian subsidiary had a bridge loan of $34.7 million, which is due on March 31, 2003. An extension of the bridge loan, as well as the terms of a refinancing of the loan, is currently being negotiated. In January 2003, the Overseas Private Investment Corporation approved a $50 million loan guarantee for the refinancing. There can be no assurance that such an extension will be granted or that the refinancing of such loan can be obtained on terms acceptable to us, if at all.

     The debt facilities of our international operating companies contain certain restrictive covenants and financial covenants. The Slovenian Credit Facility contains certain borrowing conditions and restrictive covenants, including: minimum subscribers; population coverage; certain cash flow requirements; minimum contributed capital and debt service coverage. Western Wireless International Corporation (“WWIC”), a subsidiary of WWI, has guaranteed the Slovenian Credit Facility under certain circumstances. Additionally, WWIC has agreed not to sell or dispose of any majority owned subsidiary without the approval of the Slovenian lenders. Based on current operating conditions, Vega believes that it is necessary to amend certain terms and conditions of the Slovenian Credit Facility in 2003 in order to avoid future revenue shortfalls or other covenant breaches, some of which cannot be remedied. In March 2003, WWI met with the lead arranger bank of the Slovenian Credit Facility and believes that an agreement can be reached amending the Slovenian Credit Facility and that no further borrowings will be permitted. We believe no action will be taken to accelerate the loan during the pending negotiations to finalize the amendment. We can offer no assurance that the participating banks will grant an amendment. In the event that Vega breaches one of the covenants that cannot be cured, measured each June 30 and December 31, and does not obtain the amendment, the outstanding balance under the Slovenian Credit Facility could become payable upon demand.

     If we do not achieve planned domestic operating cash flow targets, we may be required to curtail capital spending, reduce expenses, or otherwise modify our planned operations or seek additional debt or equity at the domestic or international level or restructure our existing financing arrangements. There can be no assurance that such funds or refinancing will be available to us on acceptable terms, if at all.

We have substantial losses from continuing operations and we may not become profitable in the future

     We sustained losses from continuing operations of approximately $215.3 million in fiscal 2002 and $143.6 million in 2001 and had income from continuing operations of $65.4 million in fiscal 2000. At December 31, 2002, we had an accumulated deficit of $1.1 billion and a net capital deficiency of $486.4 million. We may continue to incur significant losses during the next several years, and there can be no assurance that we will be able to service our debt requirements and other financial needs.

We face substantial competition in all aspects of our business

     We operate in highly competitive markets and there is substantial and increasing competition in all aspects of the wireless communication business. Competition for subscribers among wireless communications providers is based principally upon the services and features offered, the technical quality of the wireless system, customer service, system coverage, capacity and price.

     Many of our competitors operate in the national market and provide services comparable to ours and have the advantages of greater geographical coverage and more customers and the ability to offer no or low cost roaming and toll calls in wider areas. If the wireless communications industry continues to consolidate and we do not participate in that consolidation, even stronger competitors may be created. Effective January 1, 2003, the FCC eliminated the spectrum cap and the cellular cross-interest restriction in the larger, urban cellular markets which also may facilitate the creation of larger and more formidable competitors. Several of our competitors also operate in multiple segments of the industry. In the future, we expect to face increased competition from entities providing similar services using other communications technologies. The auctioning and subsequent deployment of technology in additional spectrum and the disaggregation of spectrum could also generate new competition for us. While some of these technologies and services are currently operational, others are being developed or may be developed in the future. With so many companies targeting many of the same customers, we may not be able to successfully attract and retain customers and grow our customer base and revenues, and as a result, our profit margins may decrease.

A significant portion of our revenues are derived from roaming and our failure to maintain favorable roaming arrangements could materially adversely affect our future operating results

     Roaming revenues accounted for approximately 22% of our total revenues for the fiscal year ended December 31, 2002. We have roaming agreements with most of the wireless carriers in North America, including AT&T Wireless, Cingular, and Verizon. When these agreements expire or are terminated, we may be unable to renegotiate these roaming agreements or to obtain roaming agreements with other wireless providers upon acceptable terms. Further, some competitors may be able to obtain roaming rates and terms that are more favorable than those obtained by us. AT&T Wireless, our largest roaming partner, and Cingular have announced their intention to transition their customer bases to a GSM platform. If we are not able to add a GSM platform to our network, maintain and expand our roaming footprint or maintain favorable roaming arrangements with other wireless carriers, our coverage area or pricing we offer relative to our competitors may not be as attractive. Such inability would have a material adverse affect on our business, operations and financial condition.

     While our roaming agreements generally require other carriers’ customers to use our network when roaming, our roaming agreements generally do not prevent our roaming partners from acquiring licenses to provide competing services in our markets. Further, our roaming partners could negotiate a roaming agreement in all or portions of our markets with another wireless carrier. If any of our roaming partners were to acquire the required licenses and build networks in our markets or enter into roaming agreements with other wireless carriers that provide competing services in our markets and permit our roaming partners to roam on that other carrier’s network, we could lose a substantial portion of our roaming revenues in those markets, which could have a material adverse effect on our business, operations and financial condition.

Failure to develop future business opportunities, such as wireless data services and to improve network coverage, quality and capacity within the markets that we currently serve may limit our ability to compete effectively and grow our business

     An important element of our strategy is to bring new telecommunications services, such as wireless data services, to rural America. In general, the development of new services in our industry requires us to anticipate and respond to varied and rapidly changing customer demand. In order to compete successfully against the other participants in the United States wireless industry, we will need to commercialize and introduce new services on a timely basis. The ability to deploy and deliver these services relies, in many instances, on new and unproven technology that will demand substantial capital outlays and spectrum capacity. Our available capital and spectrum may not be sufficient to support these services. We cannot guarantee that devices for such new services or applications for such devices will be commercially available or accepted in the marketplace, and we cannot assure that we will be able to offer these new services profitably. In addition, there could be legal or regulatory restraints on wireless data services as the applicable laws and rules evolve. If these services are not successful or if costs associated with implementation and completion of the introduction of these services materially exceed those currently estimated, our ability to retain and attract customers and our operations and financial condition could be materially adversely affected.

     We essentially completed the network build-out of the markets for which we hold licenses, and are now primarily focused on improving network coverage, quality and capacity within and around the markets we currently serve and completing the expansion of digital CDMA technology throughout our markets. We cannot guarantee that we will be able to do so in a time frame that will permit us to remain competitive at the cost we expect or at all. Failure or delay in improving network coverage, quality and capacity on a timely basis or at all, or increased costs to accomplish such improvement, could have a material adverse effect on our business, strategy, operations and financial condition.

Our FCC licenses are subject to renewal and potential revocation in the event that we violate applicable laws. The loss of any of such licenses could materially and adversely affect our ability to service our customers

     Our licenses are subject to renewal upon the expiration of the ten-year period for which they are granted. Although the FCC has routinely renewed wireless licenses in the past, we cannot provide assurance that no challenges will be brought against our licenses in the future. Violations of the Communications Act or the

17

FCC’s rules could result in license revocations, forfeitures, fines or non-renewal of licenses. We have five cellular licenses that are subject to the renewal process over the next three years. While we believe that each of our cellular licenses will be renewed, there can be no assurance that all of the licenses will be renewed. If any of our licenses are forfeited, revoked or not renewed, we would not be able to provide service in that area unless we contract to resell wireless services of another provider or enter into roaming agreements.

Government regulations determine how we operate, which could increase our costs and limit our growth, revenue and strategy plans

     The FCC regulates the licensing, construction, operation, acquisition and sale of our business, and we are subject to laws and regulations of other federal, state and local government bodies. Future changes in regulation or legislation could impose significant additional costs on us, either in the form of direct out of pocket costs or additional compliance obligations, or subject us to sanctions, which may have a material adverse effect on our business. Additionally, Congress’ and the FCC’s continued allocation of additional spectrum for CMRS, which includes cellular and personal communication services and specialized mobile radio, could significantly increase competition.

     The rapid growth and penetration of wireless services has prompted the interest of the FCC, state legislatures and state public utility commissions (“PUC”) to oversee certain practices by the wireless industry. These practices are generally in the form of efforts to regulate customer billing, termination of service arrangements, advertising, filing of “informational” tariffs, certification of operation, and other areas. While the Communications Act generally preempts state and local governments from regulating the entry of, or the rates charged by, wireless carriers, a state has authority to regulate “other terms and conditions” of service offerings by CMRS providers. They may also petition the FCC to allow it to regulate the rates of CMRS providers. No state has yet petitioned the FCC, but such action by the states in the future cannot be precluded. Several states have also proposed or imposed consumer protection regulations on CMRS providers. For example, the California PUC has proposed extensive consumer protection and privacy regulations for all telecommunications carriers. If adopted, the rules will significantly alter our business practices in California with respect to nearly every aspect of the carrier-customer relationship, including solicitations, marketing, activations, billing and customer care. The California PUC is also contemplating rules to address other service quality issues, including service repair, service outages and toll operator answering time that could apply to CMRS providers. At the local level, wireless facilities typically are subject to zoning and land use regulation, and may be subject to fees for use of public rights of way. Although local and state governments cannot categorically prohibit the construction of wireless facilities in any community, or take actions that have the effect of prohibiting construction, securing state and local government approvals for new tower sites may become a more difficult and lengthy process. Such regulations, if approved, could expose carriers to increased legal responsibility for state’s varying standards of service quality and may materially impact our operating costs.

     Cellular licensees are subject to certain Federal Aviation Administration (“FAA”) regulations regarding the location, marking/lighting, and construction of towers. Each tower requiring FAA notification also requires tower registration with the FCC. In addition, our facilities may be subject to regulation by the Environmental Protection Agency (“EPA”) and the environmental regulations of the FCC under the National Environmental Policy Act and of certain states and localities. State or local zoning and land use regulations may also apply to our activities.

     The FCC does not presently specify the rates CMRS carriers may charge for their services, nor does it require the filing of tariffs for wireless operations. However, the FCC has the authority to regulate the rates, terms and conditions under which wireless carriers provide service because CMRS carriers are statutorily considered to be common carriers and thus are required to charge just and reasonable rates and are not allowed to engage in unreasonable discrimination. The FCC has adopted rules governing charges for long distance service (e.g., rate integration) and use of customer proprietary network information, but these rules have been vacated by the courts and are now subject to further FCC review. Additionally, the FCC has adopted rules governing billing practices and access to wireless services by the disabled. While none of these existing requirements have a material impact on our operations, there is no assurance that future regulatory changes may not materially impact us. The FCC has determined that the Communications Act does not preempt state damage claims as a matter of law, but whether a specific damage award is prohibited would depend upon the facts of a particular case. This ruling may affect the number of class action suits brought against CMRS providers and the amount of damages awarded by courts.

Concerns about health and safety risks may discourage use of wireless services, result in liability issues and materially adversely affect our business

     Media reports have suggested that radio frequency emissions from wireless handsets may be linked to various health concerns, including cancer, and may interfere with various electronic medical devices, including hearing aids and pacemakers. Concerns over radio frequency emissions may have the effect of discouraging the use of wireless handsets, and thus decrease demand for wireless products and services. In recent years, the FCC and foreign regulatory agencies have updated the guidelines and methods they use for evaluating radio frequency emissions from radio equipment, including wireless handsets. In addition, interest groups have requested that the FCC investigate claims that wireless technologies pose health concerns and cause interference with airbags, hearing aids and medical devices. The FDA has issued guidelines for the use of wireless phones by pacemaker wearers. Safety concerns have also been raised with respect to the use of wireless handsets while driving. Federal, state and local legislation has been proposed in response to these concerns. The FCC’s safety limits for human exposure to radio frequency emissions went into effect September 1, 2000. After September 1, 2000 if any facility, operation or device is found to be non-compliant with radio frequency emissions guidelines, and if any required environmental assessment has not been filed, penalties ranging from fines to license forfeiture may be imposed. Several lawsuits have been filed against us, other wireless carriers and other participants in the wireless industry, asserting product liability, breach of warranty, adverse health effects and other claims relating to radio frequency transmissions to and from handsets and wireless data devices. Some of these lawsuits allege other related claims, including negligence, strict liability, conspiracy and the misrepresentation of or failure to disclose these alleged health risks. The complaints seek substantial monetary damages as well as injunctive relief. The defense of these lawsuits may divert our management’s attention, we may incur significant expenses in defending these lawsuits, and we may be required to pay significant awards or settlements.

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     Additional studies of health effects of wireless services are ongoing and new studies are anticipated. If such further research establishes any link between the use of handsets and health problems, such as brain cancer, then usage of, and demand for our services may be significantly reduced, and we could be required to pay significant expenses in defending lawsuits and significant awards or settlements, any or all of which could have a material adverse effect on our business, operations and financial condition.

     We may also be subject to potential litigation relating to the use of handsets and wireless data devices while driving. Some studies have indicated that using these devices while driving may impair drivers’ attention. Legislation has been proposed in the United States Congress and many state and local legislative bodies to restrict or prohibit the use of wireless phones while driving motor vehicles. To date, New York State and some localities in the United States have passed laws restricting the use of handsets, and similar laws have been enacted in other countries. Additionally, some jurisdictions have passed laws restricting the use of handsets by persons such as school bus drivers and novice drivers. These laws or, if passed, other laws prohibiting or restricting the use of wireless handsets while driving, could reduce sales, usage and revenues, any or all of which could have a material adverse effect on our operations and financial condition.

     Finally, we cannot be certain that we or the wireless industry in general may not be subject to litigation should a situation arise in which damage or harm occurs as a result of interference between a CMRS carrier such as us and a public safety licensee, such as a “911” emergency operator, or any failure of any such “911” emergency call while using our network.

Control by management may discourage potential acquisitions of our business and may have a depressive effect on the market price for our Class A Common Stock

     Holders of our Class A Common Stock are entitled to one vote per share and holders of our Class B Common Stock are entitled to ten votes per share. Each share of Class B Common Stock is convertible at any time into one share of Class A Common Stock. John W. Stanton and Theresa E. Gillespie, our Chairman and Chief Executive Officer and our Vice Chairman, respectively, are husband and wife and beneficially represent 47.1% of the combined voting power of Common Stock. Such voting control by such holders and certain provisions of Washington law affecting acquisitions and business combinations, which we have incorporated into our articles of incorporation, may discourage certain transactions involving an actual or potential change of control of the Company, including transactions in which the holders of Class A Common Stock might receive a premium for their shares over the then-prevailing market price, and may have a depressive effect on the market price for Class A Common Stock.

WWI operates in certain countries with significant political, social and economic uncertainties which could have a material adverse effect on its operations in these countries

     We operate in countries in Eastern Europe, a republic of the former Soviet Union, Africa, the Caribbean and South America. These countries face significant political, social and/or economic uncertainties which could have a material adverse effect on our operations in these areas. These uncertainties include:

• possible internal military conflicts and/or civil unrest fueled by economic and social crises in those countries,

• political instability and bureaucratic infighting between government agencies with unclear and overlapping jurisdictions,

• pervasive regulatory control of the state over the telecommunications industry, and

• the failure by government entities to meet their outstanding foreign debt repayment obligations.

     We cannot assure you that the pursuit of economic reforms by the governments of any of these countries will continue or prove to be ultimately effective, especially in the event of a change in leadership, social or political disruption or other circumstances affecting economic, political or social conditions.

WWI encounters enhanced economic, legal and physical risks by operating abroad

     WWI runs a number of risks by investing in foreign countries including:

• loss of revenue, property and equipment from expropriation, nationalization, war, insurrection, terrorism and other political risks,

• involuntary changes to the licenses issued by foreign governments,

• changes in foreign and domestic laws and policies that govern operations of overseas-based companies,

• amendments to, or different interpretations or implementations of, foreign tax laws and regulations that could adversely affect the profitability after tax of our joint ventures and subsidiaries,

• criminal organizations in certain of the countries in which we operate that could threaten and intimidate our businesses, and

• high levels of corruption and non-compliance with the law exist in many of the countries in which we operate businesses.

Certain of the government licenses on which WWI depends could be canceled or revoked, impairing the development of WWI’s operations in these countries, and making WWI liable for substantial penalties

     The licensing, construction, operation and ownership of communications systems, and the granting and renewal of applicable licenses and radio frequency allocations, are regulated by governmental entities in each of the countries in which WWI’s operating companies conduct business. Our failure or inability to renew these licenses may have a material adverse effect on our operations. In Europe, the licenses which allow WWI’s operating companies to provide wireless licenses were initially granted for terms of 15 or 20 years and in some cases there are not explicit provisions in the licenses which allow for renewal. Under the terms of the Ghana license, WWI’s operating company was required to meet certain customer levels and build-out requirements by February 2002. This company was unable to meet the required customer levels due to the inability of the regulator to provide spectrum and enforce interconnection with the incumbent telephone company and the National Communication Authority of Ghana (“NCA”) has assessed a penalty claim of $71 million for not meeting these build-out requirements. WWI has contested this fine on the basis that the government and the NCA failed to deliver the key commitments of spectrum and interconnection and does not believe the enforcement of these penalties is probable, although there can be no assurance as to what actions the government may take.

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WWI’s operating results will be impacted by foreign currency fluctuations

     WWI is exposed to risk from fluctuations in international economic conditions and foreign currency rate fluctuations which could have a material impact on its results of operations and financial condition.

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Item 2. PROPERTIES

     In addition to the direct and attributable interests in cellular licenses, paging licenses and other similar assets discussed previously, we lease our principal executive offices located in Bellevue, Washington. Our domestic subsidiaries also lease and own locations for inventory storage, microwave, cell site and switching equipment and local sales and administrative offices. We currently lease our domestic customer call center in Issaquah, Washington and own our domestic call center in Manhattan, Kansas. We consider our domestic owned and leased facilities to be suitable and adequate for business operations.

     Our international operations typically lease their headquarters, customer call centers, warehouses and cell sites and switching equipment sites. We consider our international leased facilities to be suitable and adequate for business operations.

Item 3. LEGAL PROCEEDINGS

     There are no material, pending legal proceedings to which the Company or any of its subsidiaries is a party or to which any of their property is subject which, if adversely decided, would have a material adverse effect on the Company or any of its subsidiaries or affiliates.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

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EXECUTIVE OFFICERS OF THE REGISTRANT

     The names, ages and positions of our executive officers and key personnel are listed below along with their business experience during the past five years. The business address of all officers of the Company is 3650 131st Avenue SE, Bellevue, Washington 98006. All of these individuals are citizens of the United States. Executive officers of the Company are appointed by the Board of Directors. As Vice President and Controller, Mr. Soley, although not an executive officer, is a key employee and our chief accounting officer. No family relationships exist among any of the executive officers or key personnel of the Company, except for Mr. Stanton and Ms. Gillespie, who are married to each other.

Name	Age		Position
John W. Stanton		47	Chairman, Director and Chief Executive Officer
Donald Guthrie		47	Vice Chairman
Theresa E. Gillespie		50	Vice Chairman and Director
Mikal J. Thomsen		46	President and Director
Eric Hertz		48	Chief Operating Officer
M. Wayne Wisehart		57	Executive Vice President and Chief Financial Officer
Bradley J. Horwitz		47	Executive Vice President and President, Western Wireless International
Gerald J. “Jerry” Baker		56	Senior Vice President
Jeffrey A. Christianson		46	Senior Vice President, General Counsel and Secretary
Thorpe M. “Chip” Kelly, Jr.		40	Senior Vice President
Scott A. Soley		40	Vice President and Controller (Chief Accounting Officer)

     John W. Stanton has been Chairman of the Board, a Director and Chief Executive Officer of the Company and its predecessors since 1992. Mr. Stanton has been Chairman and a Director of T-Mobile USA, formerly VoiceStream Wireless Corporation (“VoiceStream”), a former subsidiary of the Company, since 1994, and was Chief Executive Officer of VoiceStream and T-Mobile USA from February 1998 to March 2003. Mr. Stanton served as a director of McCaw Cellular Communications Corporation (“McCaw Cellular”) from 1986 to 1994, and as a director of LIN Broadcasting from 1990 to 1994, during which time it was a publicly traded company. From 1983 to 1991, Mr. Stanton served in various capacities with McCaw Cellular, serving as Vice Chairman of the Board of McCaw Cellular from 1988 to September 1991 and as Chief Operating Officer of McCaw Cellular from 1985 to 1988. Mr. Stanton is a member of the board of directors of Advanced Digital Information Corporation, and Columbia Sportswear, Inc., and a trustee of Whitman College, a private college.

     Donald Guthrie has been Vice Chairman of the Company since November 1995. Mr. Guthrie also served as Chief Financial Officer of the Company from February 1997 to May 1999. Mr. Guthrie served as Vice Chairman of T-Mobile USA, a former subsidiary of the Company, from 1995 through 2002. From 1986 to 1995, he served as Senior Vice President and Treasurer of McCaw Cellular and, from 1990 to 1995, he served as Senior Vice President — Finance of LIN Broadcasting.

     Theresa E. Gillespie has been Vice Chairman of the Company since February 2003 and has been Director of the Company since October 2000. Prior to being elected Vice Chairman, Ms. Gillespie served as Executive Vice President of the Company from May 1999 until February 2003, Senior Vice President of the Company from May 1997 until May 1999, and Chief Financial Officer of the Company and one of its predecessors from 1991 to 1997. Ms. Gillespie was Chief Financial Officer of certain entities controlled by Mr. Stanton and Ms. Gillespie since 1988. From 1986 to 1987, Ms. Gillespie was Senior Vice President and Controller of McCaw Cellular. From 1976 to 1986 she was employed by a national public accounting firm.

     Mikal J. Thomsen has been President of the Company since May 1999 and was Chief Operating Officer of the Company and one of its predecessors from 1991 to May 2002. In his capacity as Chief Operating Officer, Mr. Thomsen was responsible for all domestic cellular operations. He has served as Director since October 2000. He was also a director of its predecessor from 1991 until the Company was formed in 1994. From 1983 to 1991, Mr. Thomsen held various positions at McCaw Cellular, serving as General Manager of its International Division from 1990 to 1991 and as General Manager of its West Florida Region from 1987 to 1990.

     Eric Hertz has been Chief Operating Officer for the Company since May 2002. Before joining the Company, Mr. Hertz served as Regional President for the Wireless Digital Broadband division of AT&T Wireless from May 2001 through April 2002. From 1991 through December 2000, Mr. Hertz held various domestic and international positions with BellSouth Corporation, serving as General Manager – Wisconsin and Northern Illinois for BellSouth Cellular from 1991 through 1995; Regional Vice President – Wisconsin and Northern Illinois from 1995 through 1997; President and General Manager – Ecuador for BellSouth International from July 1997 through August 2000; and Regional COO – Central America and Panama from August 2000 through December 2000. From 1989 to 1991, Mr. Hertz was a Regional Manager for McCaw Cellular Communications. Mr. Hertz has worked in the telecommunications industry for 25 years in local and long distance, as well as fixed and mobile wireless.

     M. Wayne Wisehart has been Executive Vice President and Chief Financial Officer for the Company since January 2003. Before joining the Company, Mr. Wisehart served as Chief Financial Officer for iNNERHOST, Inc., a Web hosting services company, from October 2000 through February 2002, and President and CEO for Teledirect International, Inc., a marketing automation software company, from February 1999 through October 2000. From April 1998 through August 1998, Mr. Wisehart served as President and CEO of Price Communications Wireless, Inc. From June 1982 through April 1998, Mr. Wisehart served as Chief Financial Officer for Palmer Communications, Inc. and its subsidiary, Palmer Wireless, Inc., and subsequently for Price Communications Wireless, Inc. after it acquired Palmer Wireless, Inc. in 1997.

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     Bradley J. Horwitz has been Executive Vice President of the Company since March 2000, and President of Western Wireless International Holding Corporation (“WWI”), a subsidiary of the Company, since 1995. Mr. Horwitz was Vice President — International of the Company from 1995 to March 2000, and held various positions at McCaw Cellular, serving as Vice President — International Operations from 1992 to 1995, Director — Business Development from 1990 to 1992 and Director of Paging Operations from 1986 to 1990.

     Gerald J. “Jerry” Baker has been Senior Vice President of Engineering and Technical Operations for the Company since January 2001, after spending almost four years as Vice President of Engineering and Technology for WWI. Prior to joining WWI in 1997, Mr. Baker was Chief Technical Officer for GTE Mobilnet’s California operations for three years. Between 1988 and 1994, he spent six years in various senior technical management positions with US West Cellular. Mr. Baker held senior technical management positions at McCaw Cellular between 1984 and 1988.

     Jeffrey A. Christianson has been Senior Vice President and General Counsel of the Company since February 2000 and Corporate Secretary since July 2000. From 1996 to January 2000, Mr. Christianson served as Senior Vice President, Business Development, General Counsel and Corporate Secretary of Wizards of the Coast, Inc., a game and software company. From 1993 to 1996, Mr. Christianson served as General Counsel and Corporate Secretary of Heart Technology, Inc., a medical device company. Mr. Christianson is a member of the board of directors of the Northwest Children’s Fund, a Seattle-based non-profit community foundation.

     Thorpe M. “Chip” Kelly, Jr. has been Senior Vice President for the Company since September 2000. Prior to being elected Senior Vice President, Mr. Kelly served as Vice President of Sales from April 1999 and Executive Director of Sales from 1998. Mr. Kelly has worked with the Company and its predecessors since 1989 in a variety of field and corporate sales management positions.

     Scott A. Soley has been Vice President and Controller of the Company since July 2001, and has been a key employee as the chief accounting officer since August 1999. From 1995 to 1999, Mr. Soley held various accounting positions with the Company. Prior to 1995, Mr. Soley held various accounting positions with Egghead Software, Inc. and gained two years of experience at a local public accounting firm in the Seattle area.

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PART II

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     We commenced our initial public offering on May 22, 1996, at a price to the public of $23.50 per share. Since that date, our Class A Common Stock has been traded on the NASDAQ Stock Market under the symbol WWCA. There currently is no established public trading market for our Class B Common Stock; however, such shares generally convert automatically into shares of Class A Common Stock on a share-for-share basis immediately upon any transfer of the Class B Common Stock. The following table sets forth the quarterly high and low bid quotations for the Class A Common Stock on the NASDAQ Stock Market. These quotations reflect the inter-dealer prices, without retail mark-up, markdown or commission and may not necessarily represent actual transactions.

		High		Low
2001
	First quarter	$	49.75	$	34.56
	Second quarter	$	46.00	$	35.88
	Third quarter	$	43.06	$	28.07
	Fourth quarter	$	35.00	$	23.00
2002
	First quarter	$	28.84	$	6.92
	Second quarter	$	10.84	$	2.42
	Third quarter	$	4.50	$	1.23
	Fourth quarter	$	7.42	$	2.14

     We have never declared or paid dividends on our Common Stock and we do not anticipate paying dividends in the foreseeable future. In addition, certain provisions of the Senior Secured Facilities (as described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Consolidated Liquidity and Capital Resources”) and the indentures of our senior notes contain restrictions on our ability to declare and pay dividends on our Common Stock.

     As of March 21, 2003 there were approximately 199 and 45 shareholders of record of our Class A and Class B Common Stock, respectively.

     There were no sales of unregistered securities made by the Company in 2002.

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Item 6. SELECTED FINANCIAL DATA

     The following table sets forth certain selected financial and operating data for us as of and for each of the five years in the period ended December 31, 2002, which was derived from our consolidated financial statements and notes thereto that have been audited. All of the data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and notes thereto.

Consolidated Financial Data⁽¹⁾

				Year Ended December 31,
				2002			2001			2000			1999			1998
							(Dollars in thousands, except per share data)
Consolidated Statements of Operations Data:
Revenues				$	1,186,610		$	1,037,959		$	834,954		$	626,777		$	460,567
Operating expenses					(1,135,409	)		(1,020,017	)		(666,076	)		(565,848	)		(379,287	)
Gain on sale of Latvian joint venture											57,412
Other expense					(151,659	)		(180,473	)		(162,942	)		(110,660	)		(95,118	)
Minority interests in consolidated subsidiaries					8,408			18,967			2,058			1,610			479
Income (loss) from continuing operations before provision for income taxes and cumulative change in accounting principle					(92,050	)		(143,564	)		65,406			(48,121	)		(13,359	)
Provision for income taxes					(123,270	)
Total discontinued operations					29,639			(5,933	)					(100,652	)		(210,710	)
Cumulative change in accounting principle								(5,580	)
		Net income (loss)		$	(185,681	)	$	(155,077	)	$	65,406		$	(148,773	)	$	(224,069	)
Share data(2):
		Basic income (loss) per share
			Continuing operations before cumulative change in accounting principle	$	(2.73	)	$	(1.82	)	$	0.84		$	(0.63	)	$	(0.17	)
			Discontinued operations		0.38			(0.08	)					(1.31	)		(2.78	)
		Cumulative change in accounting principle						(0.07	)
	Basic income (loss) per share			$	(2.35	)	$	(1.97	)	$	0.84		$	(1.94	)	$	(2.95	)
Share data(2):
		Diluted income (loss) per share
			Continuing operations before cumulative change in accounting principle	$	(2.73	)	$	(1.82	)	$	0.81		$	(0.63	)	$	(0.17	)
			Discontinued operations		0.38			(0.08	)					(1.31	)		(2.78	)
		Cumulative change in accounting principle						(0.07	)
	Diluted income (loss) per share			$	(2.35	)	$	(1.97	)	$	0.81		$	(1.94	)	$	(2.95	)
Weighted average shares outstanding
		Basic			78,955,000			78,625,000			77,899,000			76,775,000			75,863,000
		Diluted			78,955,000			78,625,000			80,303,000			76,775,000			75,863,000
Consolidated Balance Sheets Data:
Total assets				$	2,398,976		$	2,370,420		$	1,996,469		$	1,352,590		$	1,221,300
Total long-term debt, net of current portion				$	2,321,955		$	2,215,557		$	1,926,393		$	1,450,000		$	1,045,000
Consolidated Cash Flows Provided By (Used In):
Operating activities				$	145,860		$	72,930		$	166,971		$	95,712		$	66,669
Investing activities				$	(304,326	)	$	(432,869	)	$	(644,251	)	$	(467,141	)	$	(29,678	)
Financing activities				$	171,726		$	381,744		$	457,823		$	411,972		$	(49,921	)
Other Data:
EBITDA(3)				$	308,870		$	230,175		$	314,036		$	242,165		$	155,682
Ending domestic subscribers(4)					1,197,800			1,176,500			1,049,500			834,700			660,400
Ending consolidated international subscribers(5)					741,300			491,100			85,500			N.M			N.M.

(1)	Certain amounts in 2002 and 2001 consolidated financial data have been reclassified to properly reflect the discontinued operations of TAL, our Icelandic subsidiary. Certain amounts in 1999 and 1998 consolidated financial data have been reclassified to properly reflect the discontinued operations of T-Mobile USA, formerly VoiceStream.
(2)	Earnings per share and the number of shares outstanding have been calculated based on the requirements of Statement of Financial Accounting Standards No. 128. For the loss years presented, all options outstanding are anti-dilutive, thus basic and diluted loss per share are equal.

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(3)	EBITDA represents total revenues less total operating expenses exclusive of depreciation, amortization, asset dispositions and stock-based compensation for our operations. We believe EBITDA provides meaningful additional information on our performance and on our ability to service our long-term debt and other fixed obligations, and to fund our continued growth. EBITDA is considered by many financial analysts to be a meaningful indicator of an entity’s ability to meet its future financial obligations, and growth in EBITDA is considered to be an indicator of future profitability, especially in a capital-intensive industry such as wireless telecommunications. EBITDA should not be construed as an alternative to operating income (loss), as determined in accordance with United States generally accepted accounting principles (“GAAP”), as an alternate to cash flows from operating activities (as determined in accordance with GAAP) or as a measure of liquidity. Since all companies do not calculate EBITDA in the same manner, our presentation may not be comparable to other similarly titled measures of other companies.
(4)	Domestic subscribers include postpaid and reseller subscribers, and exclude prepaid subscribers.
(5)	International consolidated subscribers include prepaid and postpaid mobile subscribers, and exclude fixed lines.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     Unless the context requires otherwise, “Western Wireless,” “the Company,” “we,” “our” and “us” include us and our subsidiaries.

Overview

     We provide cellular communications services in 19 western states under the CellularONE^® (“CellularONE”) and Western Wireless^® brand names principally through the ownership and operation of cellular wireless systems. The operations are primarily in rural areas due to our belief that there are certain strategic advantages to operating in these areas. We provide wireless services in 18 Metropolitan Service Areas (“MSA”) and 88 Rural Service Areas (“RSA”). Additionally, we own 10 MHz personal communication services (“PCS”) licenses for three Basic Trading Areas (“BTAs”).

     Historically, we have provided analog service to our customers and had deployed TDMA digital voice channels throughout our network to support our roaming partners. During 2001 we began deploying Code Division Multiple Access (“CDMA”) throughout our network, which allows us to economically expand the minutes of use (“MOU”) available to our customers and introduce a wide range of consumer-based wireless internet-related services. At December 31, 2002, we covered approximately 50% of our licensed population with CDMA digital technology.

     We own approximately 98% of Western Wireless International Holding Corporation (“WWI”). The balance is owned by Bradley Horwitz, Executive Vice President of the Company and President of WWI. WWI, through its consolidated subsidiaries and equity investments, is a provider of wireless communications services in nine countries. WWI owns controlling interests in six of these countries: Slovenia, Austria, Ireland, Bolivia, Haiti and Ghana. These six entities are consolidated into our financial results. Operations in Côte d’Ivoire, Croatia and Georgia are accounted for using the equity method. In the fourth quarter of 2002, WWI sold its majority ownership interest in its Icelandic subsidiary and wrote off its investment in Côte d’Ivoire.

     U.S. headquarter functions of WWI and majority owned European, South American and Caribbean consolidated subsidiaries are recorded as of the date of the financial statements. Our consolidated Ghanaian entity and entities accounted for using the equity method are presented on a one-quarter lag.

     Revenues consist primarily of subscriber revenues, roamer revenues, fixed-line revenues and equipment sales. The majority of revenues are derived from subscriber revenues. Subscriber revenues include monthly access charges, charges for airtime used in excess of plan minutes, Universal Service Fund (“USF”) subsidy revenues, long distance revenues derived from calls placed by our customers, international prepaid revenues, international interconnect revenues and other charges, such as: activations, voice mail, call waiting and call forwarding.

     Roamer revenues result from providing service to subscribers of other wireless carriers when those subscribers “roam” into our markets and use our systems to carry their calls. Roaming revenues have historically yielded higher average per minute rates and higher margins than subscriber revenues. The per minute rate paid by a roamer is established by an agreement between us and the roamer’s wireless provider.

     Fixed line revenues represent non-wireless revenues mainly from our fixed-line business in Austria.

     “Service revenues” include subscriber, roamer, fixed-line and other revenue. Other revenues consist primarily of revenue related to international long distance and revenue from the licensees of the CellularONE Group name.

     Equipment sales consist of wireless handset and accessory sales to customers. We sell both digital and analog handsets below cost and regard these losses as a cost of building our subscriber base.

     Cost of service consists mainly of the cost of: (i) providing access to local exchange and long distance carrier facilities; (ii) maintaining the wireless network; and (iii) off-network roaming costs.

     Cost of equipment sales consists of the costs related to handset and accessory sales to customers. Cost of equipment sales also includes the cost of handsets related to migrating customers to digital service on a free or discounted basis and the cost of handsets associated with customer retention that occurs with the signing of an extended service agreement.

     General and administrative expenses are principally variable costs. General and administrative costs include administrative costs associated with maintaining subscribers, including: customer service and other centralized support functions. General and administrative expenses also include billing costs, subscriber bad debt, insurance and property taxes.

     Sales and marketing costs include costs associated with acquiring a subscriber, including: direct and indirect sales commissions, salaries, all costs of retail locations and advertising and promotional expenses. Sales and marketing costs do not include the revenue or costs of handset sales. However, when sales and marketing costs per gross addition are discussed, the revenue and costs from handset sales are included because such measure is commonly used in the wireless industry.

     Depreciation and amortization expense primarily includes depreciation expense associated with the property and equipment in service and amortization associated with our international wireless licenses.

     Interest and financing expense includes interest on our consolidated debt. Intercompany interest has been eliminated for consolidation purposes.

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     EBITDA represents total revenues less total operating expenses exclusive of depreciation, amortization, asset dispositions and stock-based compensation for our operations. We believe EBITDA provides meaningful additional information on our performance and on our ability to service our long-term debt and other fixed obligations, and to fund our continued growth. EBITDA is considered by many financial analysts to be a meaningful indicator of an entity’s ability to meet its future financial obligations, and growth in EBITDA is considered to be an indicator of future profitability, especially in a capital-intensive industry such as wireless telecommunications. EBITDA should not be construed as an alternative to operating income (loss), as determined in accordance with United States generally accepted accounting principles (“GAAP”), as an alternate to cash flows from operating activities (as determined in accordance with GAAP) or as a measure of liquidity. Since all companies do not calculate EBITDA in the same manner, our presentation may not be comparable to other similarly titled measures of other companies.

Critical Accounting Policies and Estimates

     Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. On an on-going basis, we evaluate our estimates. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

     We have multiple billing cycles all of which span our year-end. This requires management to estimate the amount of subscriber revenue associated with a portion of each bill cycle up to the end of the year. We follow this method since reasonably dependable estimates of the revenue can be made. Actual bill cycle results and related revenue may vary, depending on subscriber usage and rate plan mix, from the results estimated at the end of the year.

     Roamer revenues and incollect cost information is provided to us primarily through a third party centralized clearinghouse. We receive data from a clearinghouse the middle of each month. This requires management to estimate roamer revenue and incollect expense up to the end of the year. Management analyzes the most recently available information from the clearinghouse and historical trends to determine the revenue and expense estimates. We follow this method since reasonably dependable estimates of the roamer revenue and incollect cost can be made. Actual clearinghouse results and the associated roamer revenue and incollect costs may vary, depending on usage, from the results estimated at the end of the year.

     We are invoiced for our access to and usage of local exchange and long distance carrier facilities on multiple billing cycles, which span our year-end. This requires management to estimate the expenses associated with a portion of each bill cycle up to the end of the year. We use this method since reasonably dependable estimates of these costs can be made. Actual local and long distance expenses may vary, depending on customer usage, from those estimated at the end of the year.

     We must make estimates of the collectability of our subscriber accounts receivable. Management analyzes historical write-offs, changes in our internal credit policies and customer concentrations when evaluating the adequacy of our allowance for doubtful accounts. Differences may result in the amount and timing of expenses for any period if management made different judgments or utilized different estimates or if actual experience differs from estimates.

     We assess the impairment of our long-lived assets whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Factors we consider which could trigger an impairment review include significant underperformance relative to anticipated minimum future operating results and a significant change in the manner of use of the assets or the strategy for our overall business. When we determine that the carrying value of certain long-lived assets may not be recoverable based upon the existence of one or more of the above indicators of impairment, we then measure any impairment based on a projected discounted cash flow method using a discount rate determined by us to be commensurate with the risk inherent in our current business model.

     Upon adoption of Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets” (“SFAS No. 142”), on January 1, 2002, we ceased amortization of our domestic licenses as we determined that these assets meet the definition of indefinite life intangible assets. The fair value of our domestic licenses was estimated using the discounted present value of expected future cash flows. This assessment is performed by combining our individual domestic licenses as a single unit as they are operated in aggregate in such a manner that represents their highest and best use. In addition, it is unlikely that a significant portion of our individual RSAs or MSAs would be sold on a stand-alone basis. The determination of fair value is a complex consideration that involves significant assumptions and estimates. Assumptions and estimates made by us were based on our best judgments and included among other things: (i) an assessment of market and economic conditions including discount rates; (ii) future operating strategy and performance; (iii) competition and market share; and (iv) the nature and cost of technology utilized. Under SFAS No. 142, impairment must be assessed at least annually, or when indications of impairment exist, on our domestic licenses.

     We have investments in consolidated subsidiaries and unconsolidated equity investments that are in foreign countries. These investments are subject to the laws and regulations governing telecommunications services in effect in each of the countries in which they operate. These laws and regulations can have a significant influence on the results of operations and the value of our investment in these affiliates. Laws and regulations are subject to change by the responsible governmental agencies. We cannot predict what future laws and regulations might be passed that could have a material effect on our results of operations. Further, certain of the countries in which we have investments have experienced or may experience political instability. We assess the impact of significant changes in laws, regulations and political stability on a regular basis and update the assumptions and estimates used to prepare our financial statements when deemed necessary. In addition, we assess the impairment of our investments whenever major events or changes in circumstances indicate that the carrying value of the investment may not be recoverable. Factors we consider which could trigger an impairment review include significant under performance relative to expected operating results, a significant change in the strategy for our overall business or the impact of future laws and regulations of foreign government agencies.

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     Our subsidiary, WWI, has a Stock Appreciation Rights Plan (the “SAR Plan”). Under the SAR Plan, selected key employees and agents of WWI may receive performance units, which are “rights” to receive an amount based upon 7% of the fair market value of WWI. Fair market value is based upon management’s estimates at the time, considering various factors and is approved by the board of WWI. Differences may result in the amount and timing of related SAR Plan expenses if management made different judgments or utilized different estimates.

     As part of the process of preparing our consolidated financial statements, we are required to estimate our income taxes in each of the countries in which we operate. This process involves estimating our current tax exposure together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities. We must then assess the likelihood that our deferred tax assets will be recovered from future taxable income, and, to the extent we believe that recovery is not likely, we must establish a valuation allowance. Significant management judgment is required in determining our provision for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We believe that, based on a number of factors, there is uncertainty regarding the realization of our domestic and foreign net operating loss (“NOL”) carryforwards.

     In the ordinary course of business, we are subject to litigation and contingencies. We must use our best judgment and estimates of probable outcomes when determining the impact to us and our financial results. We assess the impact of claims and litigation on a regular basis and update the assumptions and estimates used to prepare our financial statements when deemed necessary.

Recently Issued Accounting Standards

     In January 2003, the Financial Accounting Standards Board (“FASB”) issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (“FIN No. 46”), which clarifies the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements”, relating to consolidation of certain entities. First, FIN No. 46 will require identification of our participation in variable interests entities (“VIE”), which are defined as entities with a level of invested equity that is not sufficient to fund future activities to permit them to operate on a standalone basis, or whose equity holders lack certain characteristics of a controlling financial interest. Then, for entities identified as VIE, FIN No. 46 sets forth a model to evaluate potential consolidation based on an assessment of which party to the VIE, if any, bears a majority of the exposure to its expected losses, or stands to gain from a majority of its expected returns. FIN No. 46 also sets forth certain disclosures regarding interests in VIE that are deemed significant, even if consolidation is not required. We are currently evaluating the impact this statement will have on our future consolidated financial results.

     In December 2002, the FASB issued SFAS No. 148, “Accounting for Stock-Based Compensation - Transition and Disclosure” (“SFAS No. 148”), which amends SFAS No. 123, “Accounting for Stock-Based Compensation” (“SFAS No. 123”). SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation (under the fair value based method, compensation cost for stock options is measured when options are issued.) In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require more prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The transition guidance and annual disclosure provisions of SFAS No. 148 are effective for us starting with the year ended December 31, 2002. We intend to continue to account for stock-based employee compensation under Accounting Principles Board Opinion No. 25, “Accounting for Stock Issues to Employees,” and will provide the additional SFAS No. 123 disclosures required under SFAS No. 148. The interim disclosure provisions are effective for us starting with the quarter ending March 31, 2003.

     In November 2002, the FASB issued Interpretation No. 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness to Others” (“FIN No. 45”). FIN No. 45 requires the disclosure by the guarantor of certain guarantees that it has issued. FIN No. 45 also clarifies that a guarantor is required to recognize at the inception of the guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee. FIN No. 45 does not prescribe a specific approach for subsequently measuring the guarantor’s recognized liability over the term of the related guarantee. FIN No. 45 incorporates, without change, the guidance in FASB Interpretation No. 34, “Disclosure of Indirect Guarantees of Indebtedness of Others,” which is being superceded. FIN No. 45 is to be applied prospectively to guarantees issued or modified after December 31, 2002. We do not anticipate the adoption of FIN No. 45 will have a material effect on our financial position or results of operations.

     In November 2002, the Emerging Issues Task Force (“EITF”) reached a consensus on Issue No. 02-16, “Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor” (“EITF No. 02-16”), addressing the accounting for cash consideration received by a customer from a vendor, including vendor rebates and refunds. The consensus reached states that consideration received should be presumed to be a reduction of the prices of the vendor’s products or services and should therefore be shown as a reduction of cost of sales in the income statement of the customer. The provisions of this consensus are applied prospectively and are consistent with our existing accounting policy.

     In October 2002, the FASB reached a consensus on EITF Issue No. 00-21, “Revenue Arrangements with Multiple Deliverables” (“EITF No. 00-21”). EITF No. 00-21 addresses arrangements with multiple deliverables specifying how the arrangement consideration should be measured, whether the arrangement should be divided into separate units of accounting and how the arrangement should be allocated among the separate units of accounting. EITF No. 00-21 is applicable to an arrangement in which some, but not all of its deliverables are within the scope of other existing higher-level authoritative literature that does not provide guidance with respect to determining separate units of accounting. EITF No. 00-21 indicates a need for Staff Accounting Bulletin (“SAB”) No 101, “Revenue Recognition in Financial Statements” (“SAB No. 101”), to be modified. EITF No. 00-21 is effective for revenue arrangements entered into in fiscal periods beginning after June 15, 2003. We are currently evaluating the impact this statement, along with any changes to SAB No. 101, will have on our future consolidated financial results.

     In July 2002, the FASB issued SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities” (SFAS No. 146”). SFAS No. 146 requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. SFAS No. 146 supersedes EITF Issue No. 94-3, “Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring).” SFAS No. 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002.

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     In April 2002, the FASB issued SFAS No. 145, “Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections” (“SFAS No. 145”). SFAS No. 145 requires that gains and losses from the extinguishment of debt be classified as extraordinary items only if they meet the criteria in Accounting Principles Board (“APB”) Opinion No. 30, (“Opinion No. 30”). Applying the provisions of Opinion No. 30 distinguishes transactions that are part of an entity’s recurring operations from those that are unusual and infrequent that meet criteria for classification as an extraordinary item. We adopted the provisions of SFAS No. 145 during the second quarter of 2002 and recognized a gain of $1.3 million in other income on the repurchase of approximately $17 million of our 10 1/2% Senior Subordinated Notes due in 2006 and 2007. The extraordinary loss of $12.4 million on early extinguishment of debt in 2000 has been reclassified to other income to conform with SFAS No. 145.

     In June 2001, the FASB issued SFAS No. 143, “Accounting for Asset Retirement Obligations” (“SFAS No. 143”). This statement deals with the costs of closing facilities and removing assets. SFAS No. 143 requires entities to record the fair value of a legal liability for an asset retirement obligation in the period it is incurred if a reasonable estimate of fair value can be made. This cost is initially capitalized and amortized over the remaining life of the underlying asset. Once the obligation is ultimately settled, any difference between the final cost and the recorded liability is recognized as a gain or loss on disposition. SFAS No. 143 is effective for us beginning January 1, 2003. We do not anticipate that the adoption of SFAS No. 143 will have a material effect on our financial position or results of operations.

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Results of Domestic Operations for the Years Ended December 31, 2002, 2001 and 2000

     We had 1,197,800 domestic subscribers at December 31, 2002, a 1.8% increase during 2002. We had 1,176,500 domestic subscribers at December 31, 2001, a 12.1% increase during 2001. We had 1,049,500 domestic subscribers at December 31, 2000, a 25.7% increase in 2000. The net number of domestic subscribers added through system acquisitions was approximately 30,000 in 2000.

     The following table sets forth certain financial data as it relates to our 2002, 2001 and 2000 domestic operations:

			Year Ended December 31,
			2002		2001		2000
			(Dollars in thousands)
Revenues:
	Subscriber revenues		$	609,406	$	619,214	$	548,202
	Roamer revenues			228,878		244,538		228,694
	Equipment sales			41,937		38,738		30,272
	Other revenues			3,483		10,981		5,372
		Total revenues	$	883,704	$	913,471	$	812,540
Operating expenses:
	Cost of service		$	176,584	$	193,363	$	171,803
	Cost of equipment sales			79,162		80,008		43,175
	General and administrative			144,666		166,712		151,611
	Sales and marketing			115,678		128,378		125,542
	Depreciation and amortization			194,003		190,601		120,826
	Asset dispositions			21,304
	Stock-based compensation			1,328		4,183		9,334
		Total operating expenses	$	732,725	$	763,245	$	622,291
EBITDA			$	367,614	$	345,010	$	320,409

Domestic Revenues

     The decrease in subscriber revenues for the year ended December 31, 2002 compared to the same period in 2001 was primarily due to a decrease in monthly average revenue per subscriber (“ARPU”) partially offset by growth in the average number of subscribers. The increase in subscriber revenues for the year ended December 31, 2001 compared to the same period in 2000 was primarily due to growth in the average number of subscribers partially offset by a decrease in ARPU. ARPU was $42.78 in 2002, a 7.7% decline from $46.36 in 2001, which was a 4.4% decline from $48.49 in 2000. The decline in ARPU in both years was the result of several factors including: (i) the increase in popularity of rate plans that have larger allotments of included minutes; (ii) larger home calling areas; (iii) more rate plans that include long distance at no additional charge; and (iv) an increase in the number of rate plans that share minutes with an existing plan at a lower access rate. We continue to focus on attracting and retaining customers with rate plans that provide more features and included minutes at a higher average recurring access charge. New rate plans offered in 2002 have slowed the decline in ARPU and we expect that trend to continue.

     We currently receive federal universal service funding as an Eligible Telecommunications Carrier (“ETC”) for our wireless residential service (“WRS”) customers in a number of states. On September 30, 2002, and again on December 31, 2002, we submitted our requests to receive funding for certain of our traditional mobile services customers that reside in areas in which we are eligible to receive federal universal service funding. We expect to submit similar requests on a quarterly basis throughout 2003 and we believe it is likely that in 2003 we will receive most, if not all, of the requested funding, which could exceed $30 million. However, no long-term assurances can be given that federal universal service funding will continue at the current level or at all.

     The decrease in roamer revenues for the year ended December 31, 2002 compared to the same period in 2001 was primarily due to a decrease in the rates charged between carriers partially offset by an increase in roaming traffic on our network. The increase in roamer revenues for the year ended December 31, 2001 compared to the same period in 2000 was the result of an increase in roaming traffic on our network, partially offset by a decrease in the rates charged between carriers. All years presented have shown growth in roamer minutes as a result of our strategy to become the roaming partner of choice for other carriers. On June 1, 2001, we signed an extension of our roaming agreement, through June 15, 2002, with AT&T Wireless Services, Inc. (“AT&T Wireless”) our largest roaming partner, at a lower per minute rate than the prior agreement. In March 2002, we extended our existing roaming agreement with AT&T Wireless. The latest extension became effective June 16, 2002 and remains in effect until June 15, 2006. In the first year, the extended agreement provides for lower per minute rates compared to the contractual rates that expired June 15, 2002. The extended agreement also provides for slight rate decreases charged to AT&T Wireless in both the second and third year of the agreement. Additionally, in April 2002, we signed new roaming agreements with Verizon Wireless Corporation (“Verizon”) and Cingular Wireless (“Cingular”) effective through March and April 2005, respectively. We expect roamer minutes to increase on a year-over-year basis accompanied by a decrease in contractual per minute rates resulting in roamer revenues remaining relatively flat in 2003 compared to 2002.

     In January 2002, AT&T Wireless and Cingular announced a joint venture to build a 1900 MHz GSM system that overlays certain interstate highway portions of our footprint. We believe that this joint venture will not have a material impact on our roamer revenues in 2003.

     Equipment sales have increased over the past two years. The increase for the year ended December 31, 2002 compared to the same period in 2001 was due primarily to an increase in the average revenue per handset sold partially offset by a decrease in the number of handsets sold. The increase in the average revenue

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per handset was due to an increase in the number of digital, dual-mode and tri-mode handsets sold. For the year ended December 31, 2001 compared to the same period in 2000 the increase was due primarily to an increase in the volume of handsets sold partially offset by a decrease in the average revenue per handset sold. As the cost of digital handsets continues to decline, we expect to pass these savings on to our customers; however, we expect to continue to sell these handsets at higher prices than we historically sold analog handsets.

Domestic Operating Expenses

     The decrease in cost of service for the year ended December 31, 2002 compared to the same period in 2001 was primarily attributable to decreased off-network roaming costs for our customers as a result of lower contractual rates contained in our new roaming agreements with AT&T Wireless, Cingular and Verizon. This decrease was partially offset by increased costs associated with supporting growth in the number of subscriber and roamer MOUs. The increase in cost of service for the year ended December 31, 2001 compared to the same period in 2000 was mainly attributable to the increased costs of maintaining our expanding domestic wireless network to support an increase in network usage by subscribers and roamers. Domestic cost of service per MOU decreased to $0.03 per MOU for 2002 from $0.04 per MOU and $0.06 per MOU for 2001 and 2000, respectively. The decrease in domestic cost of service per MOU during 2002 was due mainly to the decrease in off-network roaming costs discussed above. In addition, for all periods presented, we continue to see the fixed cost components of cost of service increasing at a slower rate than variable costs on a per minute basis. We expect cost of service dollars to increase in future periods as a result of: (i) a growing subscriber base; (ii) the increase in other carriers’ customers roaming on our network; and (iii) the increase in rate plans that include larger home calling areas. Domestic cost of service per MOU is expected to continue to gradually decline as economies of scale continue to be realized.

     Cost of equipment sales decreased for the year ended December 31, 2002 compared to the same period in 2001. The slight decrease was the result of a decrease in the volume of handsets sold offset by an increase in the average per unit cost of handsets sold due to a greater proportion of digital handsets in the overall handsets sold mix. The increase in cost of equipment sales for the year ended December 31, 2001 compared to the same period in 2000, resulted from three main factors: (i) an increase in the number of handsets sold along with an increase in the average cost of handsets sold; (ii) free and discounted handsets associated with the migration of existing customers to our new CDMA technology platform; and (iii) discounted or free handsets associated with the extension of existing service contracts. In 2003, we expect that regulatory and technological requirements, along with demand for feature rich handsets, will increase our per unit cost of handsets. Although subscribers generally are responsible for purchasing or otherwise obtaining their own handsets, we have historically sold handsets below cost to respond to competition and general industry practice and expect to continue to do so in the future.

     The decrease in general and administrative costs for the year ended December 31, 2002 compared to the same period in 2001 was primarily the result of our efforts during 2002 to reduce our operating costs. The increase in general and administrative costs for the year ended December 31, 2001 compared to the same period in 2000 was due mainly to a growth in the subscriber base at our previous cost structure. Our domestic general and administrative monthly cost per average subscriber decreased to $10.15 in 2002 compared to $12.48 in 2001 and $13.41 in 2000. The decrease on a per average subscriber basis in 2002 compared to 2001 was primarily due to our efforts to reduce costs in 2002, as previously discussed. The decrease on a per average subscriber basis from 2001 compared to 2000 was primarily due to cost efficiencies related to a growing subscriber base. We anticipate monthly cost per average subscriber to remain relatively constant in 2003 as compared to 2002.

     The decrease in sales and marketing costs for the year ended December 31, 2002 compared to the same period in 2001, was primarily the result of a decrease in the fixed cost components of sales and marketing partially offset by an increase in variable cost components as we execute our strategy to shift to a more variable cost structure. During 2002, we decreased our number of owned store locations and the headcount associated with running those locations. This has decreased our fixed costs for 2002 compared to 2001 and has shifted more of our sales and marketing emphasis to the agent and indirect channel which typically has a larger variable cost structure. Sales and marketing costs increased slightly from 2000 to 2001. In 2002, sales and marketing cost per gross subscriber added, including the loss on equipment sales, increased to $424 compared to $369 in 2001 and $320 in 2000. The increase in the average cost per gross subscriber addition in 2002 resulted mainly from fixed sales and marketing costs, including costs of retaining existing subscribers, being spread over fewer gross subscriber additions. The increase from 2000 to 2001 was the result of an increase in equipment loss related to offering a greater mix of digital versus analog handsets to new customers. Further, we invested in migrating existing subscribers via free or reduced cost handsets to our new digital network in 2001. The costs of these handsets were included in the cost of equipment sales. Sales and marketing cost per gross subscriber added, including the loss on equipment sales, is expected to decrease in 2003 compared to 2002 as we continue to shift to a more variable cost structure.

     The increase in depreciation and amortization expense for 2002 as compared to 2001 was mainly attributable to the growth of domestic wireless communication system assets partially offset by a decrease in amortization expense associated with the discontinuance of license amortization with the adoption on January 1, 2002 of SFAS No. 142. The increase in depreciation and amortization expense for 2001 as compared to 2000 was mainly attributable to the growth of domestic wireless communication system assets. As we continue to add wireless infrastructure to service our growing domestic subscriber base, we anticipate depreciation and amortization expense to increase in future periods.

     The asset dispositions loss results from recording a $15 million impairment charge related to the exploration of a sale of one of our RSAs and from the implementation of our strategy to dispose of certain minor domestic non-core assets. Early indications of market values for this RSA reflected that future cash flows upon sale would not exceed the carrying value of the license.

Domestic EBITDA

     Domestic EBITDA increased for 2002 compared to 2001 primarily as the result of decreases in operating and selling costs partially offset by decreases in subscriber and roamer revenues. Domestic EBITDA increased for 2001 compared to 2000 due mainly to increased subscriber and roamer revenues and cost efficiencies related to the increased subscriber base partially offset by an increase in loss on equipment sales. Operating margin (domestic EBITDA as a percentage of service revenues) increased to 43.7% in 2002 compared to 39.4% in 2001 and 41.0% in 2000. We expect domestic EBITDA to increase at a moderate pace in 2003.

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Results of International Operations for the Years Ended December 31, 2002, 2001 and 2000

     The following discussions include, where meaningful, the results of WWI for the years ended December 31, 2002, 2001 and 2000. Operating revenues and expenses and subscriber information exclude the operations of WWI’s Icelandic business, TAL. The sale of TAL was completed in November 2002. Since TAL represented a component of our business with distinguishable cash flows and operations, it is presented in the accompanying consolidated financial statements as discontinued operations. Our 2001 statements of operations and balance sheet were reclassified accordingly. Our 2000 statement of operations was not reclassified because we did not acquire a controlling interest in TAL until the third quarter of 2000. The consolidated accounts associated with TAL in 2000 are not significant.

     Our international consolidated operations offer postpaid and prepaid mobile services in Slovenia, Austria, Ireland, Bolivia and Haiti and fixed line service mainly in Austria. We had 741,300 consolidated international subscribers at December 31, 2002, a 51% increase during 2002. We had 491,100 subscribers at December 31, 2001, an increase in excess of 1,000% in 2001. The 2001 increase was primarily due to 268,700 net additions and 187,200 subscribers acquired in the acquisition of tele.ring Telekom Services GmbH (“tele.ring”) at the end of June 2001. As of December 31, 2002 and 2001, approximately 68% and 67%, respectively, of our consolidated international subscribers were prepaid customers. As of December 31, 2002, we had 175,900 fixed lines.

			Year Ended December 31,
			2002			2001			2000
			(Dollars in thousands)
Revenues:
	Subscriber revenues		$	201,280		$	74,562		$	12,989
	Roamer revenues			29,057			7,976			543
	Fixed line revenues			55,751			29,198			2,351
	Equipment sales			11,695			8,200			1,414
	Other revenues			5,123			4,552			5,117
		Total revenues	$	302,906		$	124,488		$	22,414
Operating expenses:
	Cost of service		$	184,107		$	94,448		$	8,433
	Cost of equipment sales			39,487			23,344			1,409
	General and administrative			72,182			55,798			15,756
	Sales and marketing			65,874			65,733			3,189
	Depreciation and amortization			46,484			19,325			4,235
	Stock-based compensation			(5,450	)		(1,876	)		10,763
		Total operating expenses	$	402,684		$	256,772		$	43,785
EBITDA			$	(58,744	)	$	(114,835	)	$	(6,373	)

International Revenues

     The increase in subscriber revenues for the year ended December 31, 2002 compared to the same period in 2001 was primarily due to an increase in the number of subscribers across all of our markets and the inclusion of twelve months of subscriber revenues generated by tele.ring, which was acquired at the end of June 2001. The increase in subscriber revenues in 2001 from 2000 was mainly due to the inclusion of six months of subscriber revenue generated by tele.ring and the launch of operations in Ireland and Bolivia in February 2001 and November 2000, respectively. Management anticipates continued growth in subscriber revenues as we add international subscribers and focus on growing ARPU in 2003.

     The increase in roamer revenues for the year ended December 31, 2002 compared to the same period in 2001 was primarily due to expanded coverage in key tourist areas in Austria and throughout Ireland along with the inclusion of twelve months of roamer revenue generated by tele.ring. The increase in roamer revenues from 2000 to 2001 was mainly due to the inclusion of roamer revenue generated by tele.ring since its acquisition and the launch of operations in Ireland in February 2001. Management expects roamer revenues to increase in 2003 as WWI expands its European coverage.

     The increase in fixed line revenues in each consecutive year was primarily due to the inclusion of fixed line revenue generated by tele.ring since its acquisition. In 2003, management expects that fixed line revenue will increase slightly.

     Equipment sales increased for the year ended December 31, 2002 compared to the same period in 2001 primarily due to an increase in gross international subscriber additions as a result of the launch of service in Slovenia in December 2001 and the reduction of subsidies offered in the Irish market. The increase in equipment sales for the year ended December 31, 2001 as compared to the same period in 2000 was due mainly to an increase in gross international subscriber additions as a result of the launch of our operations in Ireland in February 2001 and in Bolivia in November 2000. We anticipate modest continued growth in international equipment sales in 2003 primarily as a result of increases in mobile subscriber additions.

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International Operating Expenses

     Operating expenses represent the expenses incurred by our consolidated international markets and headquarters’ administration in the United States.

     None of our international operating markets were consolidated and/or operational for the entire year ended December 31, 2000. Since 2000, our international markets in Ireland, Bolivia and Slovenia became operational and we acquired tele.ring at the end of June 2001. Accordingly, operating expenses increased substantially for the year ended December 31, 2001 compared to the same period in 2000, and comparisons are not meaningful.

     Total cost of service increased for the year ended December 31, 2002 over the same period in 2001. This was due primarily to the acquisition of tele.ring at the end of June 2001 and the launch of our international operations in Slovenia in December 2001. On a per average international subscriber basis, monthly cost of service decreased to $24.90 for the year ended December 31, 2002 from $30.14 for the year ended December 31, 2001. Management expects cost of service dollars to increase in future periods as a result of a growing subscriber base, but continue to decline on a per average international subscriber basis due to increased cost efficiencies. The per international subscriber basis decrease in 2003 is not anticipated to be as significant as the rate decrease from 2001 to 2002.

     Cost of equipment sales increased for the year ended December 31, 2002 over the same period in 2001 primarily due to our acquisition of tele.ring at the end of June 2001 and the launch of operations in Slovenia in December 2001. Although subscribers generally are responsible for purchasing or otherwise obtaining their own handsets, WWI has historically sold handsets below cost to respond to competition and general industry practice and expects to continue to do so in the future.

     General and administrative expenses increased for the year ended December 31, 2002 over the same period in 2001, primarily due to the acquisition of tele.ring at the end of June 2001 and the launch of our international operations in Slovenia in December 2001, offset by cost reductions in our Austrian operations. General and administrative monthly cost per average international subscriber decreased to $9.76 in 2002 as compared to $17.81 in 2001 due to increased cost efficiencies as a result of the growing subscriber base. Management expects general and administrative dollars to increase on a year-over-year basis in 2003 as a result of a growing subscriber base, but decline on a per international subscriber basis due to increased cost efficiencies. The cost per international subscriber decrease in 2003 is not anticipated to be as significant as the rate decrease from 2001 to 2002.

     Sales and marketing expense excluding equipment subsidies remained relatively consistent on a year-over-year basis. International cost per gross addition including equipment subsidies declined to $179 in 2002 from $232 in 2001 primarily due to reduced sales costs in Austria and Ireland partially offset by higher international consolidated equipment subsidies. Management expects sales and marketing costs to increase in 2003 compared to 2002 due to increased growth in subscriber additions and expects cost per gross add to increase due to slightly higher equipment subsidies.

     Depreciation and amortization expense increased for the year ended December 31, 2002 compared to the same period in 2001 due primarily to network expansion in our European markets. Slovenia was launched in December 2001. As WWI continues to add wireless infrastructure to service its growing international subscriber base, management anticipates depreciation and amortization expense will increase in future periods.

     The decrease in stock-based compensation each year is primarily a result of a revaluation of WWI’s stock appreciation rights (“SARs”) based on current market conditions.

International EBITDA

     International EBITDA for our international consolidated subsidiaries improved for the year ended December 31, 2002 compared to the same period in 2001 due to the inclusion of tele.ring’s results of operations from acquisition in June 2001 and the launch of operations in Bolivia, Ireland and Slovenia in the fourth quarter of 2000, the first quarter of 2001 and the fourth quarter of 2001, respectively. International EBITDA for our international consolidated subsidiaries declined for the year ended December 31, 2001 compared to the same period in 2000 due to the inclusion of tele.ring’s results of operations and the launch of operations in Bolivia and Ireland in the fourth quarter of 2000 and the first quarter of 2001, respectively. We expect international EBITDA to improve throughout 2003 as a result of continued subscriber growth and cost efficiencies in existing markets.

     Because WWI has operations in three countries in Europe in which the functional currency is the euro or is linked to the euro, fluctuations in exchange rates may have a significant impact on its financial results of operations. Such fluctuations have less effect on local operating results, however, because WWI offers service within the countries in which they operate. Management cannot predict future fluctuations in currency exchange rates, and accordingly cannot predict the potential impact of any such fluctuations on WWI’s results of operations.

Consolidated Other Income (Expense)

     Interest and financing expense decreased to $156.7 million in 2002 from $161.9 million in 2001. The decrease was due to a reduction in our weighted average interest rate partially offset by an increase in our average long-term debt. Interest and financing expense increased to $161.9 million in 2001 from $152.2 million in 2000. The increase was due to an increase in the average long-term debt partially offset by a decrease in our weighted average interest rate. Long-term debt was incurred primarily to fund our capital expenditures, acquisition of wireless properties and international projects through WWI. The weighted average domestic interest rate paid to third parties was 6.6%, 8.0% and 9.3% in 2002, 2001 and 2000, respectively. The consolidated international weighted average interest rate paid to third parties was 5.8%, 7.6% and 7.6% in 2002, 2001 and 2000, respectively.

     Subsequent to December 31, 2002, we entered into interest rate swaps on our bonds with a notional amount of $296 million (the “Bond Swaps”). The Bond Swaps effectively convert $296 million of our outstanding fixed rate debt at 10 1/2% under the 2006 Notes and the 2007 Notes to variable rate debt. The terms of the Bond Swaps set interest at LIBOR plus 7.45% to 7.75%. In order to maintain compliance under the Credit Facility, we also entered into a three year $300 million

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notional amount fixed rate collar that limits our interest rate exposure on LIBOR to: between 1.3% and 6.0% for the first year; between 2.0% and 6.0% for the second year; and between 2.85% and 6.0% for the third year.

     In 2000, we recognized a $57.4 million gain related to the sale of WWI’s investment in Baltcom GSM (“Baltcom”) in Latvia. The Company’s proceeds were $66.6 million.

Provision for Income Taxes

     In connection with the adoption of SFAS No. 142, we have incurred a deferred income tax provision of approximately $120.7 million for the year ended December 31, 2002 mainly to increase the valuation allowance related to our NOL carryforwards. This charge included $96.9 million as the initial effect as of January 1, 2002. We have significant deferred tax liabilities related to our domestic licenses. Historically, we did not need a valuation allowance for the portion of our NOL carryforward equal to the amount of license amortization expected to occur during the NOL carryforward period. Since we ceased amortizing domestic licenses on January 1, 2002 for book purposes and we can no longer estimate the amount, if any, of deferred tax liabilities related to our domestic licenses, which will reverse during the NOL carryforward period, we have increased the valuation allowance accordingly. Subsequent to January 1, 2002 we continue to amortize our domestic licenses for federal income tax purposes, but as previously discussed, domestic license costs are no longer amortized for book purposes. The ongoing difference between book and tax amortization resulted in an additional deferred income tax provision of approximately $23.8 million for the year ended December 31, 2002. The continuing deferred income tax provision results from growth in our deferred tax liability that cannot be estimated to reverse during our NOL carryforward period. This adjustment reflects tax accounting requirements and is not based on any changes to our business model, future prospects, the value of our licenses or our assessment of the likelihood of utilizing the tax NOL carryforwards on a cash tax basis in the future. Deferred income taxes represent a non-cash charge and are not currently paid or payable and accordingly there is no impact on interim cash flows from operating, investing or financing activities. We will continue to evaluate the need for this valuation allowance for accounting purposes to determine if we should reverse all or part of the allowance in the future.

     Income tax expense for the year ended December 31, 2002, was comprised of domestic deferred income tax of $120.7 million and foreign taxes currently payable of $2.6 million.

Consolidated Net Income (Loss) from Continuing Operations Before Cumulative Change in Accounting Principle

     The increase in the net loss from continuing operations for the year ended December 31, 2002 compared to the year ended December 31, 2001 was primarily the result of the domestic provision for income taxes, as discussed above, along with an increase in depreciation and amortization. The increase in depreciation and amortization was primarily in our international operations. These items were offset by improvements in both international and domestic EBITDA, as discussed above. The change from net income from continuing operations in 2000 to net loss from continuing operations in 2001 was the result of several factors, including: (i) the acquisition, launch of operations and consolidation of WWI markets during late 2000 and throughout 2001; (ii) an increase in domestic equipment loss due to increases in the number of handsets sold, in particular, free and discounted handsets associated with the migration of existing customers to our new CDMA technology platform; (iii) an increase in depreciation and amortization expense; and (iv) a $57.4 million gain recorded on the sale of out Latvian joint venture in 2000.

Total Discontinued Operations

     Total discontinued operations for 2002 represented the gain on sale of $23.9 million and net income of $5.7 million from TAL, our Icelandic subsidiary. TAL was sold by us in November 2002. Total discontinued operations for 2001 represents the portion of net loss attributable to TAL. Such amounts were insignificant for 2000. Our proceeds were $28.9 million.

Net Income (Loss)

     The increase in net loss for 2002 as compared to 2001 was primarily the result of the increase in net loss from continuing operations before cumulative change in accounting principle, as discussed above. This was partially offset by income from discontinued operations and the gain on the sale of TAL in November 2002. The change from net income in 2000 to net loss in 2001 was the result of the items discussed above in relation to consolidated net income (loss) from continuing operations before cumulative change in accounting principle, along with the $5.9 million in 2001 loss from discontinued operations of TAL, and the $5.6 million cumulative change in accounting principle related to the adoption of SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities.”

Consolidated Net Operating Loss Carryforwards

     We had no domestic tax liability for the current period due to NOL carryforwards from prior years. At December 31, 2002, federal NOL carryforwards amounting to approximately $674 million were available. We also have NOLs related to consolidated subsidiaries in foreign jurisdictions of approximately $251 million, which are reported at foreign statutory rates. The federal NOL carryforwards will expire between 2006 and 2022. We may be limited in our ability to use these carryforwards in any one year due to ownership changes that preceded the business combination that formed us in July 1994 and due to changes in shareholdings that occurred during 1999. We believe that, based on a number of factors, there is uncertainty regarding the realization of our NOL carryforwards.

Consolidated Liquidity and Capital Resources

     We have a $2.1 billion credit facility with a consortium of lenders (the “Credit Facility”). The Credit Facility provides for $1.0 billion in revolving loans and $1.1 billion in term loans. As of December 31, 2002, $1.8 billion was outstanding under the Credit Facility, which includes $0.7 billion outstanding in revolving loans and $1.1 billion outstanding in term loans. Based on the December 31, 2002 covenant analysis, we had $300 million available to borrow under the revolving loan portion of the Credit Facility. Substantially all the domestic assets of the Company are pledged as collateral for such indebtedness. The terms of the Credit Facility contain certain quarterly covenants which impose limitations on our operations and activities, including, among other things, limitations on the

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incurrence of indebtedness, the sale of assets, investments and acquisitions, distribution of dividends or other distributions and loans. Failure to comply with covenants would result in an event of default and would allow the lenders to accelerate the maturity. Effective March 31, 2003, we must begin making principal payments on the Credit Facility. The amount of required principal payments in 2003 is $106 million based on outstanding borrowings at December 31, 2002. Further, the amount available under the revolving loans decreases each quarter beginning with the quarter ending March 31, 2003. Such reductions decrease borrowing capacity under the revolving loan portion of the Credit Facility by a cumulative amount of $50 million by December 31, 2003.

     We have issued $200 million principal amount of 10 1/2% Senior Subordinated Notes Due 2006 (the “2006 Notes”) at par and $200 million principal amount of 10 1/2% Senior Subordinated Notes Due 2007 (the “2007 Notes”) at par. Indebtedness under the 2006 Notes and 2007 Notes matures on June 1, 2006, and February 1, 2007, respectively. The 2006 Notes and 2007 Notes contain certain restrictive covenants which impose limitations on the operations and activities of us and certain of our subsidiaries, including the issuance of other indebtedness, the creation of liens, the sale of assets, issuance of preferred stock of subsidiaries and the making of restricted payments, investments and acquisitions. During 2002, we repurchased $13.0 million face value of the 2006 Notes and $4.0 million face value of the 2007 Notes in open market transactions.

     In June 2001, under the terms of the transaction to acquire tele.ring from a subsidiary of Vodafone Group Plc (“Vodafone”), an affiliate of Vodafone agreed to make available to tele.ring financing of 250 million euro (the “tele.ring Term Loan”) for purposes of funding anticipated working capital and system expansion needs. Under the initial terms of the tele.ring Term Loan, the amount available at inception was approximately 75 million euro increasing quarterly to up to 250 million euro on April 1, 2002. In January 2003, the tele.ring Term Loan was amended. The amendment decreased the aggregate availability to 185 million euro and extended the availability period through June 2004. Under the amended terms of the tele.ring Term Loan, repayment terms were extended, such that all outstanding principal and accrued interest shall be repaid based on predetermined percentages on each of July 1, 2004, 2005, 2006 and in December 2006. At December 31, 2002, tele.ring had drawn approximately $152 million. Subsequent to December 31, 2002, tele.ring drew an additional $16.3 million, leaving 25 million euro undrawn and available under the tele.ring facility. We expect the tele.ring Term Loan, as amended, to sustain tele.ring until it becomes free cash flow positive.

     In April 2002, Vega entered into a credit facility agreement (the “Slovenian Credit Facility”) with a consortium of banks to provide funding for the implementation and expansion of Vega’s network in Slovenia. The total amount available under the Slovenian Credit Facility was 116 million euro. Under the terms of the Slovenian Credit Facility, all outstanding principal is required to be repaid in predetermined semi-annual installments beginning on May 30, 2004 and ending on November 30, 2009. Interest is accrued primarily at EURIBOR plus an applicable margin, ranging from 0.40% to 2.50%, based on Vega’s financial and technical performance. Further, the Slovenian Credit Facility requires Vega to enter into interest rate hedge agreements on a predetermined schedule to manage the interest rate exposure.

     The Slovenian Credit Facility contains certain borrowing conditions and restrictive covenants, including: minimum subscribers; population coverage; certain cash flow requirements; minimum contributed capital and debt service coverage. Western Wireless International Corporation (“WWIC”), a subsidiary of WWI, has guaranteed the Slovenian Credit Facility under the following circumstances: failure to meet specified network construction milestones, the subsidiary’s insolvency, forfeiture of the licenses, or abandonment of the project. Additionally, WWIC has agreed not to sell or dispose of any majority owned subsidiary without the approval of the Slovenian lenders. Further, WWIC has made a commitment that is collateralized by cash to contribute up to a maximum of 16 million euro in additional capital to provide for revenue or operating cash flow shortfalls and cash balance deficiencies, if any. In October 2002, certain covenants under the Slovenian Credit Facility were amended for which WWI made an additional equity contribution to Vega of $9.1 million.

     As provided for under the Slovenian Credit Facility, WWI contributed an additional $1.3 million and committed $0.7 million, paid in February 2003, to Vega as a result of Vega’s revenue shortfalls during the year ended December 31, 2002. Based on current operating conditions, Vega believes that it is necessary to amend certain terms and conditions of the Slovenian Credit Facility in 2003 in order to avoid future revenue shortfalls or other covenant breaches, some of which cannot be remedied. In March 2003, WWI met with the lead arranger bank of the Slovenian Credit Facility and believes that an agreement can be reached amending the Slovenian Credit Facility and that no further borrowing will be permitted. We believe no action will be taken to accelerate the loan during the pending negotiations to finalize the amendment. We can offer no assurance that the participating banks will grant an amendment. In the event that Vega breaches one of the covenants that cannot be cured, measured each June 30 and December 31, and does not obtain the amendment, the outstanding balance under the Slovenian Credit Facility could become payable upon demand. As of December 31, 2002, Vega had drawn $71.4 million under the Slovenian Credit Facility and drew an additional $5.6 million subsequent to year-end.

     In October 2000, NuevaTel, S.A. (“NuevaTel”), a subsidiary of WWI, entered into a bridge loan facility (“the Bolivian Bridge Loan”) to provide funding for the build-out and implementation of NuevaTel’s network in Bolivia. At December 31, 2002, the outstanding amount under the Bolivian Bridge Loan was $34.7 million and the facility was fully drawn. The loan was originally scheduled to mature in its entirety in October 2002. In October 2002, the maturity date of the Bolivian Bridge Loan was extended to March 31, 2003. In January 2003, the Overseas Private Investment Corporation (“OPIC”) approved a $50 million loan guarantee for the refinancing of the Bolivian Bridge Loan (“the Bolivian Refinancing”). The final terms of the Bolivian Refinancing are still being negotiated with prospective lenders. We expect, but there can be no assurance that the Bolivian Bridge Loan will be refinanced in the second quarter of 2003. Until the Bolivian Refinancing is finalized, we intend to obtain additional extensions of the Bolivian Bridge Loan maturity date, but there can be no assurance that any necessary extension will be granted.

     The maturities of our aggregate long-term debt, including that due within one year and classified as current are:

													There-
	Total		2003		2004		2005		2006		2007		after
					(Dollars in millions)
Domestic	$	2,188.4	$	106.1	$	156.1	$	256.1	$	518.1	$	502.0	$	650.0
International		277.8		38.1		6.4		62.0		115.6		15.6		40.1
Total	$	2,466.2	$	144.2	$	162.5	$	318.1	$	633.7	$	517.6	$	690.1

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     None of our international loan facilities have recourse to Western Wireless Corporation. As previously discussed, WWI and certain of its subsidiaries have severally guaranteed the Bolivian Bridge Loan and the Slovenian Credit Facility.

     Our domestic business plans include capital expenditures during 2003. In 2003, if we attain our subscriber growth projections, we anticipate spending approximately $150 million in capital expenditures for the continued improvements to our domestic network and back office infrastructure.

     For 2003, WWI’s business plans include funding for capital expenditures and operating losses. Current 2003 business plans estimate that WWI entities will spend approximately $80 million for capital expenditures. WWI plans to fund these needs through local foreign borrowings, including the tele.ring Term Loan, the Bolivian Refinancing, and contributions and advances from Western Wireless. It is anticipated that the net contributions and advances from Western Wireless in 2003 will be approximately $30 million to $40 million.

     We believe that domestic operating cash flow and available international loan facilities will be adequate to fund our projected 2003 domestic and international capital expenditures and Credit Facility principal repayments. During 2003, our domestic business plans do not indicate a need to borrow under the Credit Facility, even though borrowing capacity is expected to exist. Future borrowing capacity under the Slovenian Credit Facility is expected to be cancelled. However, if we do not achieve planned domestic operating cash flow targets, quarterly covenants and borrowing limitations contained in the Credit Facility and the 2006 Notes and 2007 Notes may be triggered that would limit the available borrowing capacity under the Credit Facility. Our operating cash flow is dependent upon, among other things: (i) the amount of revenue we are able to generate from our customers; (ii) the amount of operating expenses required to provide our services; (iii) the cost of acquiring and retaining customers; and (iv) our ability to grow our customer base. In order to comply with debt covenants or in the event that the borrowing capacity under the Credit Facility is limited or an amendment is not granted to us under the Slovenian Credit Facility, or we are unable to complete the Bolivian Refinancing, we may be required to curtail capital spending, reduce expenses, or otherwise modify our planned operations and/or seek additional debt or equity at the domestic or international level and/or restructure or refinance our existing financing arrangements. Our ability to raise additional capital, if necessary, is subject to a variety of factors, including: (i) the commercial success of our operations; (ii) the volatility and demand of the capital markets, conditions in the economy generally and the telecommunications industry specifically; and (iii) other factors we cannot presently predict with certainty. There can be no assurance that such funds will be available to us or if such funding will be available on acceptable terms, if at all.

     On May 3, 1999, we distributed to our shareholders our entire interest in VoiceStream, now T-Mobile USA (the “Spin-off”). Prior to the Spin-off, we had received a ruling from the Internal Revenue Service to the effect that the Spin-off would not result in the recognition of income or gain by us or our shareholders. Notwithstanding the ruling, however, we would recognize a gain as a result of the Spin-off if the Spin-off were part of a “prohibited plan,” that is, a plan or series of related transactions pursuant to which one or more persons acquired, directly or indirectly, 50 percent or more of our or VoiceStream’s stock. Because acquisitions totaling 50 percent or more of VoiceStream’s stock occurred during the four-year period beginning two years before the Spin-off, a rebuttable presumption exists that the Spin-off was part of a prohibited plan. Although the issue is not free from doubt, we believe that the Spin-off was not part of a prohibited plan and that the presumption can be rebutted.

     In conjunction with the Spin-off, VoiceStream agreed to indemnify us on an after-tax basis for any taxes imposed on us if an acquisition of VoiceStream’s stock causes the Spin-off to be part of a prohibited plan. As a result, if the presumption that the Spin-off was part of a prohibited plan is not successfully rebutted, we believe that VoiceStream would be responsible for our resulting tax liability arising from the Spin-off. Even if it is ultimately determined that the Spin-off was part of a prohibited plan, we believe that T-Mobile is capable of funding its resulting indemnity obligation to us.

     Net cash provided by operating activities was $145.9 million for the year ended December 31, 2002. Adjustments to the $185.7 million net loss to reconcile to net cash provided by operating activities included: (i) $244.2 million of depreciation and amortization; (ii) $120.7 million in deferred income taxes; (iii) $21.3 million loss on asset dispositions; (iv) $29.6 million related to the discontinued operations and sale of our Icelandic subsidiary; (v) $8.4 million minority interests in net losses of consolidated subsidiaries; and (vi) $4.2 million equity in net income of unconsolidated affiliates. Net cash provided by operating activities was $72.9 and $167.0 million for the years ended December 31, 2001 and 2000, respectively.

     Net cash used in investing activities was $304.3 million for the year ended December 31, 2002. Investing activities for the year consisted primarily of $300.4 million in purchases of property and equipment, of which $139.8 million was related to WWI. Net cash used in investing activities was $432.9 million and $644.3 million for the years ended December 31, 2001 and 2000, respectively.

     Net cash provided by financing activities was $171.7 million for the year ended December 31, 2002. Financing activities for the year consisted primarily of $222.8 million in additions to long-term debt for the continued expansion of our cellular infrastructure and to fund international consolidated subsidiaries through WWI and $52.0 million in repayment of long-term debt. Net cash provided by financing activities was $381.7 million and $457.8 million for the years ended December 31, 2001 and 2000, respectively.

     In the ordinary course of business, we continue to evaluate business opportunities, joint ventures and other potential business transactions. These opportunities, joint ventures and business transactions may be material, and require us to seek additional sources of funding through the issuance of additional debt and/or additional equity at the parent or subsidiary level. There can be no assurance that such funds will be available to us on acceptable or favorable terms, if at all.

Seasonality

     We, and the wireless communications industry in general, have historically experienced significant subscriber growth during the fourth calendar quarter. Accordingly, during such quarter we experience greater losses on equipment sales and increases in sales and marketing expenses. We have historically experienced highest usage and revenue per subscriber during the summer months. We expect these trends to continue.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk Management

     We are exposed to various market financial risks, including changes in interest rates and foreign currency rates. As part of our risk management program, we utilize interest rate caps, swaps and collars to hedge a portion of our variable rate interest risk.

Interest Rate Risk

     Our domestic operations have variable rate debt that at December 31, 2002 and 2001 had outstanding balances of $1.8 billion and $1.7 billion, respectively. The fair value of such debt approximates the carrying value at December 31, 2002. Of this variable rate debt, $720 million was hedged using interest rate caps, swaps and collars which fixed interest rates between 4.91% and 7.75% during both years. These caps, swaps and collars expire at various dates between March 2003 and August 2005. Based on our domestic unhedged variable rate obligations outstanding at December 31, 2002 and 2001 a hypothetical increase or decrease of 10% in the weighted average variable interest rate would have, respectively, increased or decreased our domestic annual interest expense by approximately $1.6 and $2.4 million, respectively, for such years.

     Our international operations also have variable rate debt that, at December 31, 2002 and 2001, had an outstanding balance of approximately $0.3 billion and $0.1 billion, respectively. The fair value of such debt approximates the carrying value at December 31, 2002. Of this variable rate debt, $40.9 million is hedged at December 31, 2002 using an interest rate swap, which fixes the interest rate at 4.94% through November 2009. Based on WWI’s unhedged variable rate obligations outstanding at December 31, 2002 and 2001 a hypothetical increase or decrease of 10% in the weighted average variable interest rate would have, respectively, increased or decreased our international annual interest expense by approximately $0.8 and $0.4 million, respectively, for such years.

     The potential increases or decreases discussed above are based on certain simplifying assumptions, including a constant level of variable rate debt for all maturities and an immediate, across-the-board increase or decrease in the level of interest rates with no other subsequent changes for the remainder of the period.

Foreign Currency Risk

     Currently, 17% of our total international revenues are denominated in U.S. dollars. Certain of our international subsidiaries have functional currencies other than the U.S. dollar and their assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at the average exchange rates prevailing during the period. A 10% appreciation in the U.S. dollar would have resulted in an approximately $9.5 million and $10.0 million decrease in loss from continuing operations before provision for income taxes and cumulative change in accounting principle during the years ended December 31, 2002 and 2001, respectively. A change in such loss would have resulted from applying a different exchange rate to translate and revalue the financial statements of our international subsidiaries with functional currencies other than the U.S. dollars.

     At December 31, 2002, our Slovenian operations, whose functional currency is the Slovenian Tolar, had variable rate debt of approximately $65.4 million denominated and repayable in euros and our Austrian operations, whose functional currency is the euro, had variable rate debt, including accrued interest of approximately $161.2 million denominated and repayable in euros. A 10% appreciation in the euro as compared to the Slovenia Tolar would have resulted in an approximately $6.3 million increase in loss from continuing operations before provision for income taxes and cumulative change in accounting principle during the year ended December 31, 2002. A change in such loss would have been the result of an unrealized foreign exchange loss. A 10% appreciation in the euro and Slovenian Tolar as compared to the U.S. dollar would have resulted in an approximately $26.0 million increase in debt outstanding at December 31, 2002, and an approximately $9.0 million increase in debt outstanding at December 31, 2001, with an offsetting currency translation adjustment.

38

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The financial statements required by this item are set forth on pages F-1 through F-27 and the related financial statement schedules are set forth on pages S-1 through S-5.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     None

39

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information on directors of the registrant required by this Item is incorporated by reference to the section entitled “Election of Directors and Management Information” in our Proxy Statement for our 2003 annual shareholders meeting to be filed with the United States Securities and Exchange Commission (“Proxy Statement”). The information on executive officers of the registrant called for by this Item is included herein under Part I in the section entitled “Executive Officers of the Registrant”.

ITEM 11. EXECUTIVE COMPENSATION

     The information required by this Item is incorporated by reference to the section entitled “Executive Compensation” in our Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by this Item is incorporated by reference to the section entitled “Security Ownership of Certain Beneficial Owners and Management” in our Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by this Item is incorporated by reference to the section entitled “Certain Relationships and Related Transactions” in our Proxy Statement.

ITEM 14. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

     Within the 90 days prior to the date of this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chairman and Chief Executive Officer along with our Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, our Chairman and Chief Executive Officer and Executive Vice President and Chief Financial Officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information relating to us (including our consolidated subsidiaries) required to be included in our periodic SEC filings.

(b) Changes in Internal Controls

     There have been no significant changes in our internal controls or in other factors which could significantly affect these controls subsequent to the date of their evaluation.

40

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

A) Financial Statements and Schedule

     The financial statements and schedules that are filed with this Form 10-K are set forth in the Index to Consolidated Financial Statements and Schedules at page F-1, which immediately precedes such documents.

B) Reports on Form 8-K

     A Form 8-K was filed on November 14, 2002, which included as exhibits the certifications of John W. Stanton, Chairman and Chief Executive Officer and Theresa E. Gillespie, Executive Vice President of the Company furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

C) Exhibits

Exhibit
Number	Exhibit Title
3.1(A)	Amended and Restated Articles of Incorporation.
3.2(A)	Bylaws of the Registrant.
4.1(B)	Indenture between Western Wireless Corporation and Harris Trust Company of California, dated May 22, 1996, relating to the 10 1/2% Senior Subordinated Notes Due 2006.
4.2(C)	Indenture between Western Wireless Corporation and Harris Trust Company of California, dated October 24, 1996, relating to the 10 1/2% Senior Subordinated Notes Due 2007.
4.3(D)	Supplemental Indenture dated April 8, 1998, between Western Wireless Corporation and Harris Trust Company of California, relating to the 10 1/2% Senior Subordinated Notes Due 2007.
4.4(D)	Supplemental Indenture dated April 8, 1998, between Western Wireless Corporation and Harris Trust Company of California, relating to the 10 1/2% Senior Subordinated Notes Due 2006.
10.1(H)	Master Purchase Agreement between Western Wireless Corporation and Nortel Networks, Inc. dated March 10, 2000.
10.2	Amendment Number 1 to Master Purchase Agreement between Western Wireless Corporation and Nortel Networks, Inc. effective January 1, 2001.
10.3(I)	Amended and Restated General Agreement for Purchase of Cellular Systems between Lucent Technologies, Inc. and Western Wireless Corporation dated October 1, 1999.
10.4(F)	License and Services Agreement between Western Wireless Corporation and AMDOCS (UK) Limited dated August 23, 1999.
10.6(L)	Stock Purchase Agreement by and between Western Wireless International Corporation and Bradley J. Horwitz dated April 12, 2001.
10.7(A)	Voting Agreement by and among Western Wireless Corporation and certain of its shareholders, dated May 13, 1996.
10.8(A)	Employment Agreement by and between John W. Stanton and Western Wireless Corporation dated March 12, 1996.
10.9(A)	Employment Agreement by and between Mikal J. Thomsen and Western Wireless Corporation dated March 12, 1996.
10.10(A)	Employment Agreement by and between Theresa E. Gillespie and Western Wireless Corporation dated March 12, 1996.
10.11(E)	Employment Agreement by and between Donald Guthrie and Western Wireless Corporation dated March 12, 1996.
10.12(K)	Employment Agreement by and between Bradley J. Horwitz and Western Wireless Corporation dated March 20, 1996.
10.14(G)	Employment Agreement by and between Jeffrey A. Christianson and Western Wireless Corporation dated December 17, 1999.
10.15(L)	Employment Agreement by and between Gerald J. Baker and Western Wireless Corporation dated January 22, 2001.
10.16(N)	Employment Agreement by and between Eric Hertz and Western Wireless Corporation dated May 7, 2002.
10.17(O)	Employment Agreement by and between M. Wayne Wisehart and Western Wireless Corporation dated January 3, 2003.
10.18(L)	Form of Indemnification Agreement between Western Wireless Corporation and its Directors and Executive Officers.
10.19(K)	Subscription and Put and Call Agreement with respect to Shares of Common Stock of Western Wireless International Corporation between Western Wireless International Corporation, Western Wireless Corporation, WWC Holding Co., Inc., and Bradley J. Horwitz, as amended through second amendment.
10.20(L)	Third Amendment to the Subscription and Put and Call Agreement with respect to Share of Common Stock of Western Wireless International Corporation by and between Western Wireless International Corporation, Western Wireless Corporation, WWC Holding Co., Inc. and Bradley J. Horwitz dated February 28, 2001.
10.21(L)	Fourth Amendment to the Subscription and Put and Call Agreement with respect to Share of Common Stock of Western Wireless International Corporation by and between Western Wireless International Corporation, Western Wireless Corporation, WWC Holding Co., Inc. and Bradley J. Horwitz dated March 31, 2001.
10.22(L)	Fifth Amendment to the Subscription and Put and Call Agreement with respect to Share of Common Stock of Western Wireless International Corporation by and between Western Wireless International Corporation, Western Wireless Corporation, WWC Holding Co., Inc. and Bradley J. Horwitz dated April 12, 2001.

41

Exhibit
Number	Exhibit Title
10.23(N)	Western Wireless Corporation 1994 Management Incentive Stock Option Plan, as amended through February 3, 2000.
10.24	Western Wireless Corporation 1996 Employee Stock Purchase Plan, as amended through November 2001.
10.25(C)	Western Wireless Corporation 1997 Executive Restricted Stock Plan.
10.26(J)	Agreement and Plan of Distribution between Western Wireless Corporation and VoiceStream Wireless Corporation dated April 9, 1999.
10.27(H)	Loan Agreement among Western Wireless Corporation, as Borrower, TD Securities (USA) Inc., as Arranger, Bank of America, N.A., The Chase Manhattan Bank, and Barclays Bank PLC, as Co-Documentation Agents and Co-Syndication Agents, Dresdner Bank, AG, New York and Grand Cayman Branches, First Union National Bank, Fleet National Bank, Goldman Sachs Credit Partners LP, Cooperative Centrale-Raiffeisen Boerenleenbank B.A. “Rabobank International”, New York Branch, and Union Bank of California, N.A., as Managing Agents, Skandinaviska Enskilda Banken AB and U.S. Bank National Association, as Co-Agents, and Toronto Dominion (Texas) Inc., as Administrative Agent, dated as of April 25, 2000.
10.28(P)	Western Wireless International Holding Corporation Amended and Restated 1998 Stock Appreciation Plan.
10.29(M)	Agreement dated May 4, 2001 by and among Mannesmann Eurokom GmbH, EKOM Telecommunications Holding Ag and EHG Einkaufs-und Handels GmbH for the Sale and Purchase of 100% of the Shares in tele.ring Telekom Service GmbH, 100% of the Partnership Interest in tele.ring Telekom Service GmbH & Co KEG and for the Call-Option regarding the Sale and Purchase of 100% of the shares in Mannesmann 3G Mobilfunk GmbH 2.2.
10.30(M)	Term Loan Agreement dated June 29, 2001 by and between tele.ring TeleKom Service GmbH, as Borrower, and EKOM Telecommunications Holding AG, as Lender.
10.31(N)	Letter Agreement dated April 5, 2002 by and among tele.ring Telekom Service GmbH, EHG Einkaufs-und Handels GmbH, Vodafone AG (as universal successor of Mannesmann Eurokom GmbH) and EKOM Telecommunications Holding AG.
10.32(P)	Amendment No. 1 to Term Loan Agreement, dated January 30, 2003 to Term Loan Agreement dated June 29, 2001, by and between tele.ring Telekom GmbH, as Borrower, and EKOM Telecommunications AG, as Lender.
10.33(O)	Amendment No. 1 to the Amended and Restated General Agreement for Purchase of Cellular Systems between Western Wireless Corporation and Lucent Technologies, Inc. dated September 17, 2002.
10.34(P)	Facility Agreement dated April 30, 2002 by and between Western Wireless International d.o.o., as Borrower and IKB Deutsche Industrielbank AG, as Lead Arranger, Off Shore Security Agent, Off Shore Facility Agent and Original Euro Facility Bank and Others.
10.35(P)	First Amendment Agreement relating to the Facility Agreement dated 30 April 2002 by and between Western Wireless International d.o.o., as borrower and IKB Deutsche Industrielbank AG, as Lead Arranger, Off Shore Security Agent, Off Shore Facility Agent and original Euro Facility Bank and Others.
21.1(P)	Subsidiaries of the Registrant.
23.1	Consent of PricewaterhouseCoopers LLP.

(A)	Incorporated by reference to the exhibit filed with our Registration Statement on Form S-1 (Commission File No. 333-2432).
(B)	Incorporated by reference to the exhibit filed with our Registration Statement on Form S-1 (Commission File No. 333-2688).
(C)	Incorporated by reference to the exhibit filed with our Registration Statement on Form S-4 (Commission File No. 333-14859).
(D)	Incorporated by reference to the exhibit filed with Amendment Number 2 to our Registration Statement on Form S-3 (Commission File No. 333-49555).
(E)	Incorporated by reference to the exhibit filed with our Form 10-K for the year ended 12/31/96.
(F)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 9/30/99.
(G)	Incorporated by reference to the exhibit filed with our Form 10-K for the year ended 12/31/99.
(H)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 3/31/00.
(I)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 6/30/00.
(J)	Incorporated by reference to the exhibit filed with the VoiceStream Wireless Corporation Form 10 (Commission File No. 000-25441) filed with the SEC on February 26, 1999.
(K)	Incorporated by reference to the exhibit filed with our Form 10-K for the year ended 12/31/00.
(L)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 3/31/01.
(M)	Incorporated by reference to the exhibit filed with our Form 8-K on July 16, 2001.

42

(N)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 6/30/02.
(O)	Incorporated by reference to the exhibit filed with our Form 10-Q for the quarter ended 9/30/02.
(P)	Exhibit filed with our Form 10-K for the year ended 12/31/02.

43

WESTERN WIRELESS CORPORATION
FORM 10-K
For The Year Ended December 31, 2002

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES

	Page
REPORT OF INDEPENDENT ACCOUNTANTS FOR 2002 AND 2001	F-2
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS FOR 2000	F-3
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2002 AND 2001	F-4
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) FOR THE YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000	F-5
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT) FOR THE YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000	F-6
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000	F-7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	F-8
SCHEDULE I – PARENT COMPANY ONLY FINANCIAL STATEMENTS	S-1
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS	S-5

F-1

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders of
Western Wireless Corporation:

     In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations and comprehensive income (loss) of shareholders’ equity (deficit) and of cash flows present fairly, in all material respects, the financial position of Western Wireless Corporation and its subsidiaries at December 31, 2002 and 2001, and the results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules at December 31, 2002 and 2001 and for the years then ended present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company’s management; our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. The consolidated financial statements and financial statement schedules of Western Wireless Corporation as of December 31, 2000 and for the year then ended, were audited by other independent accountants who have ceased operations. Those independent accountants expressed an unqualified opinion on those financial statements, before the revisions described in Notes 6 and 2 to the consolidated financial statements, in their report dated February 15, 2001.

     As discussed above, the consolidated financial statements of Western Wireless Corporation as of December 31, 2000, and for the year then ended, were audited by other independent accountants who have ceased operations. As described in Note 6, these financial statements have been revised to include the transitional disclosures required by Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets”, which was adopted by the Company as of January 1, 2002. We audited the transitional disclosures described in Note 6. As described in Note 2, these financial statements have been revised to reclassify the loss on early extinguishment of debt from an extraordinary item to income before extraordinary items as required by Statement of Financial Accounting Standards No. 145, “Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections”, which was adopted by the Company as of April 1, 2002. We audited the reclassifications described in Note 2 that were applied to revise the 2000 financial statements. In our opinion, the transitional disclosures for 2000 in Note 6 are appropriate and the reclassifications described in Note 2 are appropriate and have been properly applied. However, we were not engaged to audit, review, or apply any procedures to the 2000 financial statements of the Company other than with respect to such disclosures and reclassifications and, accordingly, we do not express an opinion or any other form of assurance on the 2000 financial statements taken as a whole.

     As described in Note 6 to the consolidated financial statements, effective January 1, 2002, the Company changed its method of accounting for intangible assets as required by Statement of Financial Accounting Standards No. 142, “Goodwill and Intangible Assets”.

     As described in Note 2 to the consolidated financial statements, effective January 1, 2001, the Company changed its method of accounting for derivative instruments and hedging activities as required by Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities”.

PRICEWATERHOUSECOOPERS LLP

Seattle, Washington
February 25, 2003

F-2

     THE FOLLOWING REPORT IS A COPY OF A REPORT PREVIOUSLY ISSUED BY ARTHUR ANDERSEN LLP AND HAS NOT BEEN REISSUED BY ARTHUR ANDERSEN LLP.

     As described in Note 6, these financial statements have been revised to include the transitional disclosures required by Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets,” which was adopted by us as of January 1, 2002. As described in Note 2, these financial statements have been revised to reclassify the loss on early extinguishment of debt from an extraordinary item to income before extraordinary items as required by Statement of Financial Accounting Standards No. 145, “Recession of FASB Statement No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections,” which was adopted by us as of April 1, 2002. Arthur Andersen LLP did not participate in the preparation of the reclassification and transitional disclosures and accordingly this report does not extend to those modifications. These modifications were audited by PricewaterhouseCoopers LLP.

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Shareholders of
Western Wireless Corporation:

     We have audited the accompanying consolidated balance sheet of Western Wireless Corporation and subsidiaries as of December 31, 2000, and the related consolidated statements of operations and comprehensive income (loss) shareholders’ equity and cash flows for each of the two years in the period ended December 31, 2000. These financial statements and the schedules referred to below are the responsibility of Western Wireless management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

     We conducted our audits in accordance with accounting 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 us, 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 financial statements referred to above present fairly, in all material respects, the financial position of Western Wireless Corporation and subsidiaries as of December 31, 2000, and the results of their operations and their cash flows for each of the two years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the United States.

     Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The schedules listed in the index of consolidated financial statements are presented for purposes of complying with the Securities and Exchange Commission rules and are not a required part of the basic financial statements. These schedules have been subjected to the auditing procedures applied in our audits of the basic financial statements for the periods noted above and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.

ARTHUR ANDERSEN LLP

Seattle, Washington
February 15, 2001

F-3

WESTERN WIRELESS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)

					As of December 31,
					2002			2001
				ASSETS
Current assets:
	Cash and cash equivalents				$	62,429		$	45,083
	Accounts receivable, net of allowance for doubtful accounts of $22,059 and $20,407, respectively					159,976			147,287
	Inventory					24,461			33,793
	Marketable securities					10,270			21,016
	Prepaid expenses and other current assets					43,078			49,357
			Total current assets			300,214			296,536
Property and equipment, net of accumulated depreciation of $739,437 and $521,660, respectively						855,595			822,956
Licensing costs and other intangible assets, net of accumulated amortization of $23,838 and $14,219, respectively						1,163,399			1,176,124
Investments in and advances to unconsolidated affiliates						41,284			32,752
Assets held for sale									29,482
Other assets						38,484			12,570
					$	2,398,976		$	2,370,420
				LIABILITIES AND NET CAPITAL DEFICIENCY
Current liabilities:
	Accounts payable				$	59,363		$	80,878
	Accrued liabilities and other					185,920			172,735
	Construction accounts payable					30,543			93,497
	Current portion of long-term debt					144,196			51,723
			Total current liabilities			420,022			398,833
Liabilities held for sale									30,240
Long-term debt, net of current portion						2,321,955			2,215,557
Deferred income taxes						120,687
			Total liabilities			2,862,664			2,644,630
Minority interests in consolidated subsidiaries						22,749			25,089
Commitments and contingencies (Note 10)
Net capital deficiency:
	Preferred stock, no par value, 50,000,000 shares authorized; no shares issued and outstanding
	Common stock, no par value, 300,000,000 shares authorized;
		Class A, 72,229,605 and 71,881,603 shares issued and outstanding, respectively, and;
		Class B, 6,774,724 and 6,981,072 shares issued and outstanding, respectively				669,072			668,158
	Deferred compensation					(39	)
	Accumulated other comprehensive loss					(26,513	)		(24,181	)
	Deficit					(1,128,957	)		(943,276	)
			Total net capital deficiency			(486,437	)		(299,299	)
					$	2,398,976		$	2,370,420

See accompanying notes to consolidated financial statements.

F-4

WESTERN WIRELESS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS)
(Dollars in thousands, except per share data)

				For the Years Ended December 31,
				2002			2001			2000
Revenues:
	Subscriber revenues			$	810,686		$	693,776		$	561,191
	Roamer revenues				257,935			252,514			229,237
	Fixed line revenues				55,751			29,198			2,351
	Equipment sales				53,632			46,938			31,686
	Other revenues				8,606			15,533			10,489
			Total revenues		1,186,610			1,037,959			834,954
Operating expenses:
	Cost of service (exclusive of depreciation included below and stock-based compensation of $0, $151 and $382, respectively)				360,691			287,811			180,236
	Cost of equipment sales				118,649			103,352			44,584
	General and administrative (exclusive of stock-based compensation of ($4,122), $1,875 and $18,876, respectively)				216,848			222,510			167,367
	Sales and marketing (exclusive of stock-based compensation of $0, $281 and $839, respectively)				181,552			194,111			128,731
	Depreciation and amortization				240,487			209,926			125,061
	Asset dispositions				21,304
	Stock-based compensation, net				(4,122	)		2,307			20,097
			Total operating expenses		1,135,409			1,020,017			666,076
Other income (expense):
	Interest and financing expense, net				(156,691	)		(161,853	)		(152,229	)
	Equity in net income (loss) of unconsolidated affiliates, net of tax				4,219			(7,772	)		658
	Gain on sale of Latvian joint venture										57,412
	Other, net				813			(10,848	)		(11,371	)
			Total other expense		(151,659	)		(180,473	)		(105,530	)
Minority interests in net loss of consolidated subsidiaries					8,408			18,967			2,058
Income (loss) from continuing operations before provision for income taxes and cumulative change in accounting principle					(92,050	)		(143,564	)		65,406
Provision for income taxes					(123,270	)
Income (loss) from continuing operations before cumulative change in accounting principle					(215,320	)		(143,564	)		65,406
Discontinued operations:
	Income (loss) from discontinued operations				5,736			(5,933	)
	Gain on sale of discontinued operations				23,903
			Total discontinued operations		29,639			(5,933	)
Income (loss) before cumulative change in accounting principle					(185,681	)		(149,497	)		65,406
Cumulative change in accounting principle								(5,580	)
			Net income (loss)	$	(185,681	)	$	(155,077	)	$	65,406
Basic income (loss) per share:
	Continuing operations before cumulative change in accounting principle			$	(2.73	)	$	(1.82	)	$	0.84
	Discontinued operations				0.38			(0.08	)
	Cumulative change in accounting principle							(0.07	)
Basic income (loss) per share				$	(2.35	)	$	(1.97	)	$	0.84
Diluted income (loss) per share:
	Continuing operations before cumulative change in accounting principle			$	(2.73	)	$	(1.82	)	$	0.81
	Discontinued operations				0.38			(0.08	)
	Cumulative change in accounting principle							(0.07	)
Diluted income (loss) per share				$	(2.35	)	$	(1.97	)	$	0.81
Weighted average shares outstanding:
	Basic				78,955,000			78,625,000			77,899,000
	Diluted				78,955,000			78,625,000			80,303,000
Comprehensive income (loss):
	Net income (loss)			$	(185,681	)	$	(155,077	)	$	65,406
	Unrealized gain (loss) on marketable securities:
			Reclassification adjustment		223			(1,984	)
			Unrealized holding gain (loss)		(8,777	)		(3,067	)		7,108
		Net unrealized gain (loss)			(8,554	)		(5,051	)		7,108
	Foreign currency translation				12,078			(1,173	)		(12,339	)
	Unrealized loss on hedges				(5,856	)		(8,082	)
Total comprehensive income (loss)				$	(188,013	)	$	(169,383	)	$	60,175

See accompanying notes to consolidated financial statements.

F-5

WESTERN WIRELESS CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)
(Dollars in thousands)

		Common Stock											Accumulated
													Other						Total Net
		Class A		Class B			Paid-in			Deferred			Comprehensive						Capital
		Shares		Shares			Capital			Compensation			Income (Loss)			Deficit			Deficiency
BALANCE AS OF JANUARY 1, 2000			70,431,554		7,177,302		$	690,953		$	(17,389	)	$	(4,644	)	$	(853,605	)	$	(184,685	)
Shares issued:
	Upon exercise of stock options		506,180					2,358												2,358
	Class B shares exchanged for Class A shares		117,243		(117,243	)
Deferred compensation								(2,388	)		11,686									9,298
Minority interest contributions								(1,339	)											(1,339	)
Consideration for net operating losses from VoiceStream Wireless								(24,500	)											(24,500	)
Foreign currency translation adjustment														(12,339	)					(12,339	)
Unrealized gain on securities														7,108						7,108
Net income																	65,406			65,406
BALANCE AS OF DECEMBER 31, 2000			71,054,977		7,060,059			665,084			(5,703	)		(9,875	)		(788,199	)		(138,693	)
Shares issued:
	Upon exercise of stock options		747,639					4,596												4,596
	Class B shares exchanged for Class A shares		78,987		(78,987	)
Deferred compensation								(1,522	)		5,703									4,181
Foreign currency translation adjustment														(1,173	)					(1,173	)
Unrealized loss on hedges														(8,082	)					(8,082	)
Unrealized loss on securities														(3,067	)					(3,067	)
Reclassification adjustment on sale of securities														(1,984	)					(1,984	)
Net loss																	(155,077	)		(155,077	)
BALANCE AS OF DECEMBER 31, 2001			71,881,603		6,981,072			668,158			—			(24,181	)		(943,276	)		(299,299	)
Shares issued:
	Upon exercise of stock options		81,654		25,000			797												797
	Class B shares exchanged for Class A shares		231,348		(231,348	)
Deferred compensation			35,000					117			(39	)								78
Foreign currency translation adjustment														12,078						12,078
Unrealized loss on hedges														(5,856	)					(5,856	)
Unrealized loss on securities														(8,777	)					(8,777	)
Reclassification adjustment on sale of securities														223						223
Net loss																	(185,681	)		(185,681	)
BALANCE AS OF DECEMBER 31, 2002			72,229,605		6,774,724		$	669,072		$	(39	)	$	(26,513	)	$	(1,128,957	)	$	(486,437	)

See accompanying notes to consolidated financial statements.

F-6

WESTERN WIRELESS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)

					For the Years Ended December 31,
					2002			2001			2000
Operating activities:
	Net income (loss)				$	(185,681	)	$	(155,077	)	$	65,406
	Adjustments to reconcile net income (loss) to net cash provided by operating activities:
		Discontinued operations				(5,736	)		5,933
		Gain on sale of subsidiary and joint venture, respectively				(23,903	)					(57,412	)
		Cumulative change in accounting principle							5,580
		(Gain) loss on sale of marketable securities				658			(8,006	)
		Loss on early extinguishment of debt										12,377
		Depreciation and amortization				244,217			214,560			128,204
		Deferred income taxes				120,687
		Asset dispositions				21,304
		Stock-based compensation				(4,122	)		2,307			20,061
		Equity in net (income) loss of unconsolidated affiliates				(4,219	)		7,772			(658	)
		Minority interests in net loss consolidated subsidiaries				(8,408	)		(18,967	)		(2,058	)
		Adjustment of interest rate hedges to fair market value				(546	)		18,710
		Non-cash interest				7,407			936
		Other, net				569			20			804
		Changes in operating assets and liabilities, net of effects from consolidating acquired and disposed of interests:
			Accounts receivable, net			(6,258	)		(15,485	)		(25,816	)
			Inventory			10,794			(9,699	)		(5,687	)
			Prepaid expenses and other current assets			7,349			4,957			10,963
			Other assets			19			(16,782	)		(1,735	)
			Accounts payable			(28,034	)		23,538			(1,273	)
			Accrued liabilities			(237	)		12,633			23,795
				Net cash provided by operating activities		145,860			72,930			166,971
Investing activities:
	Purchase of property and equipment					(300,428	)		(378,228	)		(262,567	)
	Proceeds from sale of subsidiary and joint venture, respectively					28,897						66,576
	Additions to licensing costs and other intangible assets					(15,093	)		(33,537	)		(32,813	)
	Proceeds from asset disposition					5,102
	Acquisition of wireless properties, net of cash acquired											(371,004	)
	Proceeds from sale of marketable securities					1,534			26,636
	Purchase of marketable securities								(3,896	)		(31,402	)
	Investments in and advances to unconsolidated affiliates					(1,096	)		(5,204	)		(16,479	)
	Long-term deposits					(23,242	)
	Proceeds from (payments to) VoiceStream Wireless								(24,500	)		3,438
	Purchase of minority interest in Western Wireless International								(14,140	)
				Net cash used in investing activities		(304,326	)		(432,869	)		(644,251	)
Financing activities:
	Additions to long-term debt					222,780			795,895			1,641,738
	Repayment of long-term debt					(52,024	)		(440,910	)		(1,200,000	)
	Minority interest contributions								22,163			13,727
	Other					970			4,596			2,358
				Net cash provided by financing activities		171,726			381,744			457,823
Effect of exchange rate changes						4,086
Change in cash and cash equivalents						17,346			21,805			(19,457	)
Cash and cash equivalents, beginning of year						45,083			23,278			42,735
Cash and cash equivalents, end of year					$	62,429		$	45,083		$	23,278

See accompanying notes to consolidated financial statements.

F-7

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization:

     Western Wireless Corporation (“Western Wireless,” “the Company,” “we,” “our” and “us”) provides wireless communications services in the United States principally through the ownership and operation of cellular systems. We provide cellular operations primarily in rural areas in 19 western states under the CellularONE^® and Western Wireless^® brand names.

     We own approximately 98% of Western Wireless International Holding Corporation (“WWI”), which, through consolidated subsidiaries and equity investments, is a provider of wireless communications services around the world. Since 1996, WWI has participated in entities that have built and launched fixed and wireless networks in Slovenia, Ireland, Bolivia, Iceland, Ghana, Haiti, Côte d’Ivoire, Croatia, Georgia and Latvia. In November 2002, WWI sold its majority ownership interest in its Icelandic subsidiary, TAL, h.f. On June 29, 2001, we completed the acquisition of tele.ring Telekom Services GmbH (“tele.ring”), a provider of GSM mobile, Internet, and fixed-line services in Austria, from a subsidiary of Vodafone Group Plc. (“Vodafone”). In October 2000, WWI sold its minority interest in Baltcom GSM (“Baltcom”), a Latvian wireless operator.

2. Summary of Significant Accounting Policies:

Principles of Consolidation:

     The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its affiliate investments in which we have a greater than 50% interest. All affiliate investments in which we have a non-controlling interest, but have significant influence are accounted for using the equity method. All significant intercompany accounts and transactions have been eliminated. As of December 31, 2002, we consolidate six of WWI’s operating entities: Slovenia, Austria, Ireland, Bolivia, Ghana and Haiti.

     U.S. headquarter functions of WWI and majority owned European, South American and Caribbean consolidated subsidiaries are recorded as of the date of the financial statements. Our consolidated Ghanaian entity and entities accounted for using the equity method are presented on a one-quarter lag. We believe presenting financial information on a one-quarter lag for certain entities is necessary to provide adequate time to convert the results into U.S. generally accepted accounting principles (“GAAP”) and ensure quality and accurate information to the users of our financial statements.

     There have been no intervening events that materially affect the financial position or results of operations presented.

Revenue Recognition:

     Service revenues based on customer usage are recognized at the time the service is provided. Access and special feature service revenues are recognized when earned. Activation fees are deferred over the expected length of customer service. International prepaid service revenue is deferred until airtime is used, at which point revenue is recognized into income. Equipment sales, which primarily consist of handsets, are recognized upon delivery to the customer. We consider the sale of a handset to be a separate earnings process from that of providing access and special feature services.

Cash and Cash Equivalents:

     Cash and cash equivalents generally consist of cash and marketable securities that have original maturity dates at the time of acquisition not exceeding three months. Such investments are stated at cost which approximates fair value.

Inventory:

     Inventory consists primarily of handsets and related accessories. Inventory is stated at the lower of cost or market. Cost is determined on a first-in, first-out basis and market value is determined using replacement cost.

Marketable Securities:

     Marketable securities are stated at fair market value as determined by the most recently traded price of each security at the balance sheet date. All marketable securities are defined as available-for-sale securities under the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 115, “Accounting for Certain Investments in Debt and Equity Securities” (“SFAS No. 115”). We determine the appropriate classification of our investments in marketable securities at the time of purchase and reevaluate such determination at each balance sheet date. Available-for-sale securities are carried at fair value with the unrealized gains (losses) reported as a separate component of comprehensive income (loss).

Long-Lived Assets:

     Property and equipment are stated at cost. Depreciation commences once the assets have been placed in service and is computed using the straight-line method over the estimated useful lives of the assets. Lives for: (i) buildings and improvements range from 3 to 40 years; (ii) wireless communications range from 3 to 20 years; and (iii) furniture and equipment range from 2 to 7 years.

     Domestic licensing costs primarily represent costs incurred to acquire Federal Communications Commission’s (“FCC”) wireless licenses, including cellular licenses principally obtained through acquisitions. Our domestic licensing costs have an indefinite useful life and, beginning January 1, 2002, are no longer amortized.

F-8

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     International licensing costs primarily represent costs incurred to acquire wireless spectrum in foreign markets and are recorded at cost. Amortization begins with the commencement of service to customers using the straight-line method over the estimated useful lives which include known renewal periods. Estimated useful lives range from 15 to 25 years, depending upon the period of issuance by government regulators.

     Other intangible assets consist primarily of deferred financing costs and trademarks. Trademarks are amortized over their estimated useful lives, typically 10 years. Deferred financing costs are amortized using the effective interest method over the terms of the respective loans.

     We capitalize interest costs associated with the cost of constructing our wireless networks and the cost of acquiring our licenses during the initial construction phase. These costs are amortized over the related assets’ estimated useful lives. For the years ended December 31, 2002 and 2001, we capitalized $2.1 million and $1.5 million of interest costs, respectively.

     It is our policy to review the carrying value of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Measurement of the impairment loss is based on the fair value of the asset. Generally, fair value will be determined using valuation techniques such as the present value of expected future cash flows.

     As described in Note 6, we must assess the recoverability of our domestic licenses at least annually. This evaluation is performed on our domestic licensing costs as a single unit. We are required to separate individual licensing costs for the combined operating unit at the time we adopt or consider a plan to dispose of an individual market. During late 2002, we began considering the sale of one of our domestic Rural Service Area (“RSA”) licenses. Early indication of market values for this RSA reflected that future cash flows upon sale would not exceed the carrying value of the license. Accordingly, we recorded an impairment charge of $15 million related to this RSA which is included in asset dispositions in our consolidated statement of operations. General market prices along with the potential sales price of this RSA still support our aggregate license valuation and do not indicate a broader impairment issue.

Advertising Costs:

     We expense advertising costs as incurred. Advertising costs totaled $34.4 million, $39.1 million and $11.2 million for the years ended December 31, 2002, 2001 and 2000, respectively.

Income Taxes:

     We file consolidated federal and state income tax returns and our foreign subsidiaries also file separate foreign income tax returns as may be applicable. Deferred tax assets and liabilities are recognized based on temporary differences between the financial statements and the tax basis of assets and liabilities using enacted tax rates expected to be in effect when they are realized. A valuation allowance against deferred tax assets is recorded when it is more likely than not that an uncertainty regarding their realizability exists.

Basic and Diluted Income (Loss) Per Share:

     Basic income (loss) per share is calculated using the weighted average number of shares of outstanding common stock during the period. Diluted income (loss) per share is calculated using the weighted average number of shares of outstanding common stock plus the dilutive effect of outstanding stock options and the employee stock purchase plan using the “treasury stock” method. The number of shares outstanding has been calculated based on the requirements of SFAS No. 128, “Earnings Per Share” (“SFAS No. 128”). With respect to net losses incurred during the years 2002 and 2001, all options outstanding are anti-dilutive, thus basic and diluted loss per share are equal.

Stock-based Compensation Plans:

     We account for our stock-based compensation plans under Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees” (“Opinion No. 25”).

F-9

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     Had compensation cost for the Company’s stock option plans been determined consistent with SFAS No. 123, “Accounting for Stock-based Compensation” (“SFAS No. 123”), our net income (loss) and basic and diluted income (loss) per share would have changed to the pro forma amounts indicated below:

		Year Ended December 31,
		2002			2001			2000
		(Dollars in thousands, except per share data)
Net income (loss):
	As reported	$	(185,681	)	$	(155,077	)	$	65,406
	Deduct: stock-based compensation expense determined under fair value based method for all awards, net of related tax effects		(8,226	)		(13,278	)		(5,538	)
	Pro forma	$	(193,907	)	$	(168,355	)	$	59,868
Basic income (loss) per share:
	As reported	$	(2.35	)	$	(1.97	)	$	0.84
	Pro forma	$	(2.46	)	$	(2.14	)	$	0.77
Diluted income (loss) per share:
	As reported	$	(2.35	)	$	(1.97	)	$	0.81
	Pro forma	$	(2.46	)	$	(2.14	)	$	0.75

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model using the following weighted average assumptions:

	2002			2001
Weighted average risk free interest rates		5.0	%		5.0	%
Expected dividend yield		0.0	%		0.0	%
Expected volatility		67.0	%		64.0	%
Expected lives (in years)		7.5			7.5

There were no stock option grants in 2000; therefore, there are no weighted average assumptions for valuation purposes.

The Black-Scholes option-pricing model requires the input of highly subjective assumptions and does not necessarily provide a reliable measure of fair value.

Foreign Currency Translation:

     For operations outside the U.S. that prepare financial statements in currencies other than U.S. dollars, we translate the financial statements into U.S. dollars. Results of operations and cash flows are translated at average exchange rates during the period, and assets and liabilities are translated at end of period exchange rates, except for equity transactions and advances not expected to be repaid in the foreseeable future, which are translated at historical cost. The effects of exchange rate fluctuations on translating foreign currency assets and liabilities into U.S. dollars are accumulated as a separate component in comprehensive income (loss).

Fair Value of Financial and Derivative Instruments:

     We enter into interest rate swap, cap and collar agreements to manage interest rate exposure pertaining to long-term debt. We have only limited involvement with these financial instruments, and do not use them for trading purposes. Interest rate swaps and collars are accounted for on an accrual basis, the cost of which is included in interest expense. Premiums paid to purchase interest rate cap agreements are classified as an asset and amortized to interest expense over the terms of the agreements.

     We enter into foreign exchange contracts as needed to hedge certain foreign currency commitments. Gains and losses are recognized currently and are generally offset by gains or losses on the related commitments.

     On January 1, 2001, we adopted SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS No. 133”). We record all derivative instruments on the balance sheet at fair value. On the date derivative contracts are entered into, we designate the derivative as either: (i) a hedge of the fair value of a recognized asset or liability or of an unrecognized firm commitment (fair value hedge); (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge); or (iii) a hedge of a net investment in a foreign operation (net investment hedge).

     Changes in the fair value of derivatives are recorded each period in current earnings or other comprehensive income (loss), depending on whether a derivative is designated as part of a hedge transaction and, if it is, depending on the type of hedge transaction. For fair value hedge transactions, changes in the fair value of the derivative instrument are generally offset in the statement of operations by changes in the fair value of the item being hedged. For cash flow hedge transactions, changes in the fair value of the derivative instrument are reported in other comprehensive income (loss). For net investment hedge transactions, changes in the fair value are recorded as a component of the foreign currency translation account, which is also included in other comprehensive income (loss). The gains and losses on cash flow hedge transactions that are reported in other comprehensive income (loss) are reclassified to earnings in the periods in which earnings are impacted by the variability of the cash flows of the hedged item or the forecasted transactions are realized. The impact of ineffective hedges is recognized in results of operations in the periods in which the hedges are deemed to be ineffective.

F-10

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     For the years ended December 31, 2002 and 2001, respectively, other expense included a net $0.5 million gain and an $18.7 million loss related to non-qualified cash flow hedges under SFAS No. 133. During the years ended December 31, 2002 and 2001, respectively, other comprehensive income (loss) included a $5.9 million and $8.1 million loss on qualified cash flow hedges.

     The impact of the adoption of SFAS No. 133 was a cumulative change in accounting principle loss of $5.6 million on January 1, 2001.

     Information regarding the fair value of our financial instruments is summarized as follows:

	December 31,
	2002				2001
	Recorded Value		Fair Value		Recorded Value		Fair Value
			(Dollars in thousands)
Current and long-term debt	$	2,466,151	$	2,381,880	$	2,267,280	$	2,281,235
Interest rate swap, cap and collar liabilities		38,700		38,700		33,400		33,400

     The carrying value of short-term financial instruments approximates fair value due to the short maturity of these instruments. The estimated fair value of long-term debt is based on incremental borrowing rates currently available on loans with similar terms and maturities and upon quoted market prices for the same or similar debt issues. The fair value of interest rate swaps, caps, collars and foreign currency forwards is based upon quoted market prices of comparable contracts. We do not hold or issue any financial instruments for trading purposes.

Supplemental Cash Flow Disclosure:

     Cash paid for interest was $149.8 million in 2002, $154.2 million in 2001 and $144.2 million in 2000.

     The effect of exchange rate changes on cash and cash equivalents was not material for the years ended December 31, 2001 and 2000.

     There were no significant non-cash investing or financing activities for the years ended December 31, 2002 and 2001. Significant non-cash investing and financing activities for 2000 included a reduction to equity and recording a liability for net operating losses (“NOL”) obtained from T-Mobile USA, formerly VoiceStream Wireless, of $24.5 million.

Major Customer:

     Our largest roaming partner, AT&T Wireless Services, Inc. (“AT&T Wireless”), accounted for 15%, 17% and 18% of our total domestic revenues in 2002, 2001 and 2000, respectively. Our current contract with AT&T Wireless remains in effect until June 15, 2006.

Estimates Used In Preparation of Financial Statements:

     Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. On an on-going basis, we evaluate our estimates. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

Reclassifications:

     Certain amounts in prior years’ financial statements have been reclassified to conform to the 2002 presentation.

Recently Issued Accounting Standards:

     In January 2003, the Financial Accounting Standards Board (“FASB”) issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (“FIN No. 46”), which clarifies the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements”, relating to consolidation of certain entities. First, FIN No. 46 will require identification of our participation in variable interests entities (“VIE”), which are defined as entities with a level of invested equity that is not sufficient to fund future activities to permit them to operate on a standalone basis, or whose equity holders lack certain characteristics of a controlling financial interest. Then, for entities identified as VIE, FIN No. 46 sets forth a model to evaluate potential consolidation based on an assessment of which party to the VIE, if any, bears a majority of the exposure to its expected losses, or stands to gain from a majority of its expected returns. FIN No. 46 also sets forth certain disclosures regarding interests in VIE that are deemed significant, even if consolidation is not required. We are currently evaluating the impact this statement will have on our future consolidated financial results.

     In December 2002, the FASB issued SFAS No. 148, “Accounting for Stock-Based Compensation - Transition and Disclosure” (“SFAS No. 148”), which amends SFAS No. 123, “Accounting for Stock-Based Compensation” (“SFAS No. 123”). SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation (under the fair value based method, compensation cost for stock options is measured when options are issued.) In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require more prominent disclosures in both annual and

F-11

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The transition guidance and annual disclosure provisions of SFAS No. 148 are effective for us starting with the year ended December 31, 2002. We intend to continue to account for stock-based employee compensation under Accounting Principles Board Opinion No. 25, “Accounting for Stock Issues to Employees,” and will provide the additional SFAS No. 123 disclosures required under SFAS No. 148. The interim disclosure provisions are effective for us starting with the quarter ending March 31, 2003.

     In November 2002, the FASB issued Interpretation No. 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness to Others” (“FIN No. 45”). FIN No. 45 requires the disclosure by the guarantor of certain guarantees that it has issued. FIN No. 45 also clarifies that a guarantor is required to recognize at the inception of the guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee. FIN No. 45 does not prescribe a specific approach for subsequently measuring the guarantor’s recognized liability over the term of the related guarantee. FIN No. 45 incorporates, without change, the guidance in FASB Interpretation No. 34, “Disclosure of Indirect Guarantees of Indebtedness of Others,” which is being superceded. FIN No. 45 is to be applied prospectively to guarantees issued or modified after December 31, 2002. We do not anticipate the adoption of FIN No. 45 will have a material effect on our financial position or results of operations.

     In November 2002, the Emerging Issues Task Force (“EITF”) reached a consensus on Issue No. 02-16, “Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor” (“EITF No. 02-16”), addressing the accounting for cash consideration received by a customer from a vendor, including vendor rebates and refunds. The consensus reached states that consideration received should be presumed to be a reduction of the prices of the vendor’s products or services and should therefore be shown as a reduction of cost of sales in the income statement of the customer. The provisions of this consensus are applied prospectively and are consistent with our existing accounting policy.

     In October 2002, the FASB reached a consensus on EITF Issue No. 00-21, “Revenue Arrangements with Multiple Deliverables” (“EITF No. 00-21”). EITF No. 00-21 addresses arrangements with multiple deliverables specifying how the arrangement consideration should be measured, whether the arrangement should be divided into separate units of accounting and how the arrangement should be allocated among the separate units of accounting. EITF No. 00-21 is applicable to an arrangement in which some, but not all of its deliverables are within the scope of other existing higher-level authoritative literature that does not provide guidance with respect to determining separate units of accounting. EITF No. 00-21 indicates a need for Staff Accounting Bulletin (“SAB”) No 101, “Revenue Recognition in Financial Statements” (“SAB No. 101”), to be modified. EITF No. 00-21 is effective for revenue arrangements entered into in fiscal periods beginning after June 15, 2003. We are currently evaluating the impact this statement, along with any changes to SAB No. 101, will have on our future consolidated financial results.

     In July 2002, the FASB issued SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities” (“SFAS No. 146”). SFAS No. 146 requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. SFAS No. 146 supersedes EITF Issue No. 94-3, “Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring).” SFAS No. 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002.

     In April 2002, the FASB issued SFAS No. 145, “Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections” (“SFAS No. 145”). SFAS No. 145 requires that gains and losses from the extinguishment of debt be classified as extraordinary items only if they meet the criteria in Accounting Principles Board (“APB”) Opinion No. 30, (“Opinion No. 30”). Applying the provisions of Opinion No. 30 distinguishes transactions that are part of an entity’s recurring operations from those that are unusual and infrequent that meet criteria for classification as an extraordinary item. We adopted the provisions of SFAS No. 145 during the second quarter of 2002 and recognized a gain of $1.3 million in other income on the repurchase of approximately $17 million of our 10 1/2% Senior Subordinated Notes due in 2006 and 2007. The extraordinary loss of $12.4 million on early extinguishment of debt in 2000 has been reclassified to other income to conform with SFAS No. 145.

     In June 2001, the FASB issued SFAS No. 143, “Accounting for Asset Retirement Obligations” (“SFAS No. 143”). This statement deals with the costs of closing facilities and removing assets. SFAS No. 143 requires entities to record the fair value of a legal liability for an asset retirement obligation in the period it is incurred if a reasonable estimate of fair value can be made. This cost is initially capitalized and amortized over the remaining life of the underlying asset. Once the obligation is ultimately settled, any difference between the final cost and the recorded liability is recognized as a gain or loss on disposition. SFAS No. 143 is effective for us beginning January 1, 2003. We do not anticipate that the adoption of SFAS No. 143 will have a material effect on our financial position or results of operations.

3. Marketable Securities:

     Marketable securities are classified as available-for-sale and are stated at fair market value. Information regarding our marketable securities is summarized as follows:

			December 31,
			2002			2001
			(Dollars in thousands)
Available-for-sale equity securities:
	Aggregate fair value		$	10,270		$	21,016
	Historical cost			16,767			18,959
		Unrealized holding gain/(loss)	$	(6,497	)	$	2,057

     Our net unrealized holding gain/(loss) is included as an increase/(decrease) to accumulated other comprehensive income (loss). Realized gains and losses are determined on the basis of specific identification.

F-12

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

4. Prepaid Expenses and Other Current Assets:

	December 31,
	2002		2001
	(Dollars in thousands)
Value added taxes receivable	$	9,027	$	17,725
Prepaid maintenance		9,055
Rent		7,651		5,781
Deferred customer acquisition costs		4,962		2,401
Deposits		5,970		6,423
Other		6,413		17,027
	$	43,078	$	49,357

5. Property and Equipment:

	December 31,
	2002			2001
	(Dollars in thousands)
Land, buildings and improvements	$	37,228		$	33,476
Wireless communications systems		1,333,062			1,104,099
Furniture and equipment		135,561			118,292
		1,505,851			1,255,867
Less accumulated depreciation		(739,437	)		(521,660	)
		766,414			734,207
Construction in progress		89,181			88,749
	$	855,595		$	822,956

     Depreciation expense was $233.3 million in 2002, $175.3 million in 2001 and $101.8 million in 2000.

6. Licensing Costs and Other Intangible Assets:

     On January 1, 2002, we adopted SFAS No. 142, “Goodwill and Other Intangible Assets” (“SFAS No. 142”). SFAS No. 142 addresses how acquired goodwill and other intangible assets are recorded upon their acquisition as well as how they are to be accounted for after they have been initially recognized in the financial statements. Under this statement, goodwill, including excess net book value associated with equity method investments, and other intangible assets with indefinite useful lives, on a prospective basis, will no longer be amortized. Our domestic FCC licenses provide us with the exclusive right to utilize certain radio frequency spectrum to provide cellular communications services. FCC licenses are issued for only a fixed time, generally ten years and such licenses are subject to renewal by the FCC. Renewals of FCC licenses have historically occurred routinely and at nominal cost. Moreover, we have determined that there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful life of our FCC licenses. As a result, our FCC licenses will be treated as an indefinite-lived intangible asset under the provisions of SFAS No. 142 and will no longer be amortized but rather will be assessed for impairment. We will reevaluate the useful life determination for wireless licenses at regular intervals to determine whether events and circumstances continue to support an indefinite useful life. We began applying the provisions of SFAS No. 142 in the first quarter of 2002, which included assessing our licenses for impairment. This assessment is performed by combining our individual domestic licenses as a single unit and determining their fair value using the discounted present value of expected future cash flows. We consider our domestic licenses to be a single unit as they are operated in aggregate in such a manner that represents their highest and best use. In addition, it is unlikely that a significant portion of our individual RSAs or MSAs would be sold on a stand-alone basis. The determination of fair value is a complex consideration that involves significant assumptions and estimates. Assumptions and estimates made were based on our best judgments and included among other things: (i) an assessment of market and economic conditions including discount rates; (ii) future operating strategy and performance; (iii) competition and market share; and (iv) the nature and cost of technology utilized. We completed the assessment for impairment of our indefinite life intangible assets required upon the implementation of SFAS No. 142 and determined that in the aggregate they were not impaired. We have also completed our annual impairment assessment of our indefinite life intangible assets as of August 31, 2002 and determined that in the aggregate they continue to not be impaired. Impairment must be assessed at least annually for these assets, or when indications of impairment exist. It is possible that future assessments could cause us to conclude that impairment indications exist. Accordingly, there are no assurances that future valuations will result in the conclusion that our domestic licenses are not impaired.

     In connection with the adoption of SFAS No. 142, we have incurred a deferred income tax provision of $120.7 million for the year ended December 31, 2002 mainly to increase the valuation allowance related to our net operating loss (“NOL”) carryforwards. This charge included $96.9 million as the initial effect as of January 1, 2002. We have significant deferred tax liabilities related to our domestic licenses. Historically, we did not need a valuation allowance for the portion of our NOL carryforward equal to the amount of license amortization expected to occur during the NOL carryforward period. Since we ceased amortizing domestic licenses on January 1, 2002 for book purposes and we can no longer estimate the amount, if any, of deferred tax liabilities related to our domestic licenses which will reverse during the NOL carryforward period, we have increased the valuation allowance accordingly. Subsequent to January 1, 2002, we continue to amortize our domestic licenses for federal income tax purposes, but as previously discussed, domestic license costs are no longer amortized for book purposes. The ongoing difference between book and tax amortization resulted in an additional deferred income tax provision of approximately $23.8 million for the year ended December 31, 2002. The additional continuing deferred income tax provision results from growth in our deferred tax liability that cannot be estimated to reverse during our NOL carryforward period.

F-13

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Deferred income taxes represent a non-cash charge and are not currently paid or payable and accordingly there is no impact on interim cash flows from operating, investing or financing activities.

		December 31,
		2002			2001
		(Dollars in thousands)
Intangible assets subject to amortization:
	International related licensing costs	$	94,324		$	88,510
	Deferred financing costs		30,487			26,675
	Trademark and other		14,347			14,448
			139,158			129,633
Accumulated amortization			(23,838	)		(14,219	)
			115,320			115,414
Intangible assets not subject to amortization:
	Domestic licensing costs		1,048,079			1,060,710
		$	1,163,399		$	1,176,124

     We include the amortization of deferred financing costs in interest and financing expense. The following table represents current and expected amortization expense, excluding deferred financing costs, for each of the following periods:

		(Dollars in thousands)
Aggregate amortization expense:
	For the year ended December 31, 2002	$	7,483
Expected amortization expense:
	For the year ending December 31, 2003	$	6,800
	For the year ending December 31, 2004	$	6,800
	For the year ending December 31, 2005	$	6,800
	For the year ending December 31, 2006	$	6,800
	For the year ending December 31, 2007	$	6,800

F-14

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The following table reconciles our net loss adjusted to exclude amortization expense related to intangible assets, assuming the adoption of SFAS No. 142 had occurred on January 1, 2000:

			Year Ended December 31,
			2002			2001			2000
			(Dollars in thousands, except per share data)
Income (loss) from continuing operations before cumulative change in accounting principle			$	(215,320	)	$	(143,564	)	$	65,406
Add back: license amortization							30,458			22,445
Adjusted income (loss) from continuing operations before cumulative change in accounting principle				(215,320	)		(113,106	)		87,851
Total discontinued operations				29,639			(5,933	)
Income (loss) before cumulative change in accounting principle				(185,681	)		(119,039	)		87,851
Cumulative change in accounting principle							(5,580	)
		Adjusted net income (loss)	$	(185,681	)	$	(124,619	)	$	87,851
Basic income (loss) per share:
	Continuing operations before cumulative change in accounting principle		$	(2.73	)	$	(1.82	)	$	0.84
	Add back: license amortization						0.39			0.29
	Adjusted continuing operations before cumulative change in accounting principle			(2.73	)		(1.43	)		1.13
	Total discontinued operations			0.38			(0.08	)
	Cumulative change in accounting principle						(0.07	)
		Adjusted basic income (loss)	$	(2.35	)	$	(1.58	)	$	1.13
Diluted net income (loss) per share:
	Continuing operations before cumulative change in accounting principle		$	(2.73	)	$	(1.82	)	$	0.81
	Add back: license amortization						0.39			0.28
	Adjusted continuing operations before cumulative change in accounting principle			(2.73	)		(1.43	)		1.09
	Total discontinued operations			0.38			(0.08	)
	Cumulative change in accounting principle						(0.07	)
		Adjusted diluted income (loss)	$	(2.35	)	$	(1.58	)	$	1.09

7. Investments In and Advances To Unconsolidated Affiliates:

		December 31,
		2002		2001
		(Dollars in thousands)
Western Wireless International:
	Croatia	$	31,581	$	20,555
	Georgia		9,703		7,197
	Côte d’Ivoire (Note #10)				5,000
		$	41,284	$	32,752

     As of December 31, 2002, our beneficial ownership interests in these unconsolidated affiliates ranged from 15% to 40%.

F-15

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The following summarized financial information represents the assets, liabilities and results of operations of our unconsolidated Croatian operating company (“VIP-Net”) for the periods in which our percentage of VIP-Net’s results of operations is deemed to be significant:

		As of December 31,
		2002		2001
		(Dollars in thousands)
Balance sheet data:
	Total current assets	$	121,600	$	67,500
	Total non-current assets	$	234,600	$	196,900
	Total current liabilities	$	81,200	$	77,500
	Total non-current liabilities	$	163,400	$	135,400

			Year Ended December 31,
			2002			2001
			(Dollars in thousands)
Statement of operations data:
	Total revenues		$	211,700		$	212,200
	Operating expenses			151,700			168,800
	Operating income			60,000			43,400
	Other expenses			(20,000	)		(8,500	)
		Net income	$	40,000		$	34,900

8. Accrued Liabilities and Other:

	December 31,
	2002		2001
	(Dollars in thousands)
Taxes, mainly sales, use and property	$	31,677	$	28,793
Payroll and benefits		27,747		23,723
Interest expense		23,356		22,484
Interconnect charges		12,310		8,193
Fair market value adjustment of interest rate hedges		38,701		33,391
Stock appreciation rights		4,142		12,486
Licensing costs		6,194		3,422
Unearned revenue		18,760		11,278
Other		23,033		28,965
	$	185,920	$	172,735

9. Long-Term Debt:

		December 31,
		2002			2001
		(Dollars in thousands)
Credit Facility:
	Revolvers	$	700,000		$	640,000
	Term Loans		1,100,000			1,100,000
10 ½% Senior Subordinated Notes Due 2006			187,050			200,000
10 ½% Senior Subordinated Notes Due 2007			196,000			200,000
tele.ring Revolver			151,976			62,351
Slovenian Credit Facility			71,391
Bolivian Bridge Loan			34,700			21,145
Irish Bridge Loan						17,716
Other			25,034			26,068
			2,466,151			2,267,280
Less Current Portion			(144,196	)		(51,723	)
		$	2,321,955		$	2,215,557

Credit Facility:

     We have a $2.1 billion credit facility with a consortium of lenders (the “Credit Facility”) consisting of: (i) a $500 million term loan (“Term Loan A”); (ii) a $600 million term loan (“Term Loan B”); and (iii) two $500 million revolving loans (“Revolver A” and “Revolver B”).

F-16

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     Under the terms of Revolver B and Term Loan A, we are required to make quarterly payments on the outstanding principal balance beginning March 31, 2003. These payments typically tend to increase on the anniversary date of the initial payment, until paid in full on March 31, 2008. Under the terms of Term Loan B, we are required to make small quarterly payments on the outstanding principal balance beginning March 31, 2003, with a balloon payment due September 30, 2008. The amount of required principal payments in 2003 is $106 million based on outstanding borrowings at December 31, 2002. Further, the amount available under Revolver A reduces each quarter beginning with the quarter ending March 31, 2003. Such reductions reduce borrowing capacity under the Revolver A portion of the Credit Facility in 2003 by $50 million. Substantially all our domestic assets are pledged as collateral for such indebtedness. The terms of the Credit Facility contain certain quarterly covenants which impose limitations on our operations and activities, including, among other things, limitations on the incurrence of indebtedness, the sale of assets, investments and acquisitions, distribution of dividends or other distributions and loans. Failure to comply with covenants would result in an event of default and would allow the lenders to accelerate the maturity. Based on certain covenants, at December 31, 2002, we had approximately $300 million available to borrow under Revolver A. We were in compliance with financial covenants at December 31, 2002.

     Under the Credit Facility, interest is payable at an applicable margin in excess of a prevailing base rate. The prevailing rate is based on the prime rate or the Eurodollar rate. The applicable margin for Revolver A, Revolver B and Term Loan A is determined quarterly based on the leverage ratio of the Company and ranges from 1.125% to 2.25% for Eurodollar advances and 0.125% to 1.25% for prime rate advances. The applicable margin on Term Loan B is 2.75% for Eurodollar advances. We typically borrow under the Eurodollar rate. The Credit Facility also provides for an annual fee ranging from 0.25% to 0.50% on any undrawn commitment of Revolver A and Revolver B, payable quarterly.

     The Credit Facility requires us to enter into interest rate hedge agreements to manage the interest rate exposure pertaining to borrowings under the Credit Facility. We had entered into interest rate caps, swaps and collars with a total notional amount of $720 million at both December 31, 2002 and 2001. Generally these instruments have initial terms ranging from three to four years and effectively convert variable rate debt to fixed rate. The weighted average interest rate under these agreements was approximately 6.3% at both December 31, 2002 and 2001.

10 ½% Senior Subordinated Notes Due 2006:

     In May 1996, we issued at par $200 million of 10 1/2% Senior Subordinated Notes that mature on June 1, 2006 (the “2006 Notes”). Interest is payable semi-annually. The 2006 Notes may be redeemed at any time at the option of the Company, in whole or from time to time in part, at redemption prices ranging from 105.25% to 101.75%. During 2002 we repurchased $13.0 million face value of the 2006 Notes in open market transactions. The 2006 Notes contain certain covenants which impose limitations on our operations, including, among other things, limitations on the issuance of other indebtedness, the creation of liens, the sale of assets, issuance of preferred stock of subsidiaries and the making of restricted payments, investments and acquisitions. The 2006 Notes are subordinate in right of payment to the Credit Facility.

10 ½% Senior Subordinated Notes Due 2007:

     In October 1996, we issued at par $200 million of 10 1/2% Senior Subordinated Notes that mature on February 1, 2007 (the “2007 Notes”). Interest is payable semi-annually. The 2007 Notes were issued pari passu to the 2006 Notes. As such, the 2007 Notes may be redeemed at any time at the option of the Company, in whole or from time to time in part, at redemption prices ranging from 105.25% to 101.75%. During 2002, we repurchased $4.0 million face value of the 2007 Notes in open market transactions. The 2007 Notes contain certain restrictive covenants that are consistent with that of the 2006 Notes. The 2007 Notes are subordinate in right of payment to the Credit Facility.

tele.ring Term Loan:

     In June 2001, under the terms of the transaction to acquire tele.ring from a subsidiary of Vodafone Group Plc (“Vodafone”), an affiliate of Vodafone agreed to make available to tele.ring an unsecured term loan (the “tele.ring Term Loan”) for purposes of funding anticipated working capital and system expansion needs. The aggregate amount available under the initial tele.ring Term Loan at inception was approximately 75 million euro increasing quarterly to up to 250 million euro on April 1, 2002. In January 2003, the tele.ring Term Loan was amended decreasing the aggregate availability to 185 million euro and extending the availability period through June 2004. Under the amended terms of the tele.ring Term Loan, repayment terms were extended, such that, all outstanding principal and accrued interest shall be repaid based on predetermined percentages on each of July 1, 2004, 2005, 2006 and December 2006. Interest is payable at EURIBOR plus an applicable margin of 3.5%. For the year and six months ended December 31, 2002 and 2001, the weighted average interest rate was 6.8% and 7.5%, respectively. Terms of the tele.ring Term Loan incorporate certain restrictions that include, among other things, the transfer of assets from tele.ring to WWI. As of December 31, 2002, there was $152.0 million outstanding under the tele.ring Term Loan and $9.2 million of accrued interest. Subsequent to December 31, 2002, tele.ring drew an additional $16.3 million under the tele.ring Term Loan, leaving tele.ring 25 million euro undrawn and available under the tele.ring facility.

Slovenian Credit Facility:

     In April 2002, Vega entered into a credit facility agreement (the “Slovenian Credit Facility”) with a consortium of banks to provide funding for the implementation and expansion of Vega’s network in Slovenia. The total amount available under the Slovenian Credit Facility was 116 million euro. Under the terms of the Slovenian Credit Facility, all outstanding principal is required to be repaid in predetermined semi-annual installments beginning on May 30, 2004 and ending on November 30, 2009. Interest is accrued primarily at EURIBOR plus an applicable margin, ranging from 0.40% to 2.50%, based on Vega’s financial and technical performance. Further, the Slovenian Credit Facility requires Vega to enter into interest rate hedge agreements on a predetermined schedule to manage the interest rate exposure.

     The Slovenian Credit Facility contains certain borrowing conditions and restrictive covenants, including: minimum subscribers; population coverage; certain cash flow requirements; minimum contributed capital and debt service coverage. Western Wireless International Corporation (“WWIC”), a subsidiary of WWI, has guaranteed the Slovenian Credit Facility under the following circumstances: failure to meet specified network construction milestones, the subsidiary’s insolvency,

F-17

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

forfeiture of the licenses, or abandonment of the project. Additionally, WWIC has agreed not to sell or dispose of any majority owned subsidiary without the approval of the Slovenian lenders. Further, WWIC has made a commitment that is collateralized by cash to contribute up to a maximum of 16 million euro in additional capital to provide for revenue or operating cash flow shortfalls and cash balance deficiencies, if any. In October 2002, certain covenants under the Slovenian Credit Facility were amended for which WWI made an additional equity contribution to Vega of $9.1 million.

     As provided for under the Slovenian Credit Facility, WWI contributed an additional $1.3 million and committed $0.7 million, paid in February 2003, to Vega as a result of Vega’s revenue shortfalls during the year ended December 31, 2002. Based on current operating conditions, Vega believes that it is necessary to amend certain terms and conditions of the Slovenian Credit Facility in 2003 in order to avoid future revenue shortfalls or other covenant breaches, some of which cannot be remedied. WWI is involved in ongoing discussions with the lead arranger bank of the Slovenian Credit Facility. We can offer no assurance that the participating banks will grant an amendment. In the event that Vega breaches one of the covenants that cannot be cured, measured each June 30 and December 31, and does not obtain the amendment, the outstanding balance under the Slovenian Credit Facility could become payable upon demand. As of December 31, 2002, Vega had drawn $71.4 million under the Slovenian Credit Facility and drew an additional $5.6 million subsequent to year-end. We believe it is unlikely that further borrowings will not be permitted.

Bolivian Bridge Loan:

     Effective October 2000, NuevaTel, S.A. (“NuevaTel”) entered into a two year bridge loan facility agreement (“Bolivian Bridge Loan”) to provide funding for the construction and launch of NuevaTel’s network in Bolivia. As of December 31, 2002 the outstanding amount of the Bolivian Bridge Loan was $34.7 million and the facility was fully drawn. Interest is payable at LIBOR plus the applicable margin and the Bolivian Bridge Loan is subject to certain restrictive covenants including capital spending limitations and cash flow requirements. For the years ended December 31, 2002 and 2001, the weighted average interest rate was 4.70% and 6.92%, respectively. Terms of the Bolivian Bridge Loan contain certain restrictions that include, among other things, restrictions on the transfer of assets from NuevaTel to its shareholders. In October 2002, the maturity date of the Bolivian Bridge Loan was extended from October 2002 to March 31, 2003. Minimum net worth, minimum EBITDA and capitalization covenants have also been extended. In January 2003, the Overseas Private Investment Corporation (“OPIC”) approved a $50 million loan guarantee for the refinancing of the Bolivian Bridge Loan (the “Bolivian Refinancing”). The final terms of the Bolivian Refinancing are still being negotiated with prospective lenders. We fully expect, but there can be no assurances, that the Bolivian Bridge Loan will be refinanced in the second quarter of 2003. Until the refinancing can be secured, WWI intends to obtain an extension on the maturity date of the Bolivian Bridge Loan but there can be no assurance that any necessary extensions will be granted.

     WWI and NuevaTel’s other shareholder have severally guaranteed the Bolivian Bridge Loan in proportion to their respective share ownership and shares of NuevaTel stock. The Bolivian Bridge Loan is also collateralized by substantially all of NuevaTel’s assets. At December 31, 2002, the portion of WWI’s guarantee is $24.8 million.

Irish Bridge Loan:

     In April 2001, Meteor Mobile Communications Limited (“Meteor”) entered into a bridge loan facility agreement (the “Irish Bridge Loan”) with two banks to provide funding for the development and operation of Meteor’s network in Ireland. In 2002, the outstanding principal plus interest under the Irish Bridge Loan was repaid.

     The aggregate amounts of principal maturities on total debt outstanding as of December 31, 2002, are as follows:

Year ending December 31,	(Dollars in thousands)
2003	$	144,196
2004		162,481
2005		318,031
2006		633,706
2007		517,636
Thereafter		690,101
	$	2,466,151

     None of our international loan facilities have recourse to Western Wireless Corporation. As previously discussed, WWI and certain of its subsidiaries have severally guaranteed the Bolivian Bridge Loan and the Slovenian Credit Facility.

     The weighted average domestic interest rate paid to third parties was 6.6%, 8.0% and 9.3% in 2002, 2001 and 2000, respectively. The consolidated international weighted average interest rate paid to third parties was 5.8%, 7.6% and 7.6% for the years ended December 31, 2002, 2001 and 2000, respectively.

     Our domestic business plans include capital expenditures during 2003. In 2003, if we attain our subscriber growth projections, we anticipate spending approximately $150 million in capital expenditures for the continued improvements to our domestic network and back office infrastructure.

     For 2003, WWI’s business plans include funding for capital expenditures and operating losses. Current 2003 business plans estimate that WWI entities will spend approximately $80 million for capital expenditures. WWI plans to fund these needs through local foreign borrowings, including the tele.ring Term Loan, the Bolivian Refinancing, and contributions and advances from Western Wireless. It is anticipated that the net contributions and advances from Western Wireless in 2003 will be approximately $30 million to $40 million.

F-18

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     We believe that domestic operating cash flow and available international loan facilities will be adequate to fund our projected 2003 domestic and international capital expenditures and Credit Facility principal repayments. During 2003, our domestic business plans do not indicate a need to borrow under the Credit Facility, even though borrowing capacity is expected to exist. Future borrowing capacity under the Slovenian Credit Facility has been cancelled. However, if we do not achieve planned domestic operating cash flow targets, quarterly covenants and borrowing limitations contained in the Credit Facility and the 2006 Notes and 2007 Notes may be triggered that would limit the available borrowing capacity under the Credit Facility. Our operating cash flow is dependent upon, among other things: (i) the amount of revenue we are able to generate from our customers; (ii) the amount of operating expenses required to provide our services; (iii) the cost of acquiring and retaining customers; and (iv) our ability to grow our customer base. In order to comply with debt covenants or in the event that the borrowing capacity under the Credit Facility is limited or an amendment is not granted to us under the Slovenian Credit Facility, or we are unable to complete the Bolivian Refinancing, we may be required to curtail capital spending, reduce expenses, or otherwise modify our planned operations and/or seek additional debt or equity at the domestic or international level and/or restructure or refinance our existing financing arrangements. Our ability to raise additional capital, if necessary, is subject to a variety of factors, including: (i) the commercial success of our operations; (ii) the volatility and demand of the capital markets, conditions in the economy generally and the telecommunications industry specifically; and (iii) other factors we cannot presently predict with certainty. There can be no assurance that such funds will be available to us or if such funding will be available on acceptable terms, if at all.

     Subsequent to December 31, 2002, we entered into interest rate swaps on our bonds with a notional amount of $296 million (the “Bond Swap”). The Bond Swaps effectively convert $296 million of our outstanding fixed rate debt at 10 ½% under the 2006 Notes and the 2007 Notes to variable rate debt. The terms of the Bond Swaps set interest at LIBOR plus 7.45% to 7.75%. In order to maintain compliance under the Credit Facility, we also entered into a three year $300 million notional amount fixed rate collar that limits our interest rate exposure on LIBOR to: between 1.3% and 6.0% for the first year; between 2.0% and 6.0% for the second year; and between 2.85% and 6.0% for the third year.

10. Commitments and Contingencies:

Purchase Commitments:

     We have various purchase commitments for materials, supplies and other items incident to the ordinary course of business which are neither significant individually nor in the aggregate. Such commitments are not at prices in excess of current market value.

Operating Leases:

     Future minimum payments required under operating leases and agreements that have initial or remaining noncancellable terms in excess of one year as of December 31, 2002, are summarized below:

Year ending December 31,	(Dollars in thousands)
2003	$	51,622
2004		30,939
2005		23,621
2006		17,698
2007		12,394
Thereafter		94,686
	$	230,960

     Aggregate rental expense for all operating leases was approximately $51.6 million in 2002, $34.6 million in 2001 and $18.2 million in 2000.

International Contingencies:

Côte d’Ivoire:

     Cora has operated under a provisional operating license since it was formed in 1995. When the provisional license was issued to Cora, the government established certain conditions by which the provisional license would become a long-term license. On July 6, 2001, the government announced its intention to require Cora and the two other wireless operators in Côte d’Ivoire to each pay a license fee of 40 billion CFA francs, or approximately $53 million, in order to obtain their long-term licenses. WWI believes that this requirement violates the terms of the provisional license and is a breach of Cora’s contract with the government. However, in February 2002, Cora agreed to an interim payment plan of approximately $0.1 million per month, funded by Cora’s operating cash flows, until Cora is able to obtain additional funding or renegotiates the license fee and terms. Despite the ongoing negotiations, the government issued Cora the long-term license in the second quarter of 2002 and since then Cora has received official confirmation that its interim payment plan has been accepted by the government. As a result of the above events, WWI reassessed the estimated future cash flows related to its investment in Cora and recorded a provision of $10.4 million in 2001 against the carrying value of the investment.

     In September 2002, rebels in opposition to the Ivorian government attempted a coup and gained control of northern sections of the country. Fighting continues and attempts at peace talks have failed, furthering the political instability. While Cora continues to be operational, its fourth quarter revenues and cash flows have been substantially negatively impacted. In October 2002, Cora ceased making its interim payments to the government. As a result of increased political instability and diminished operating cash flows of Cora, WWI again reassessed the estimated future cash flows related to its investment in Cora and recorded an additional $5 million provision, thereby fully writing off its investment in Cora. These provisions are included in equity in net income (loss) of unconsolidated subsidiaries.

F-19

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Ghana:

     Under the terms of the Ghana license, Westel was required to meet certain customer levels and build-out requirements by February 2002. Westel was unable to meet the required customer levels due to the inability of the regulator to provide spectrum and enforce interconnection with the incumbent telephone company, and all development has been stifled. The National Communication Authority of Ghana (“NCA”) has assessed a penalty claim of $71 million for not meeting these build-out requirements. Westel has contested this fine on the basis that the government and the NCA failed to deliver the key commitments of spectrum and interconnection and does not believe the enforcement of these penalties is probable, but there can be no assurance to that effect. Our net investment in Westel at December 31, 2002 is approximately $5.0 million.

Croatia:

     In December 2002, VIP-Net entered into a Term Loan and Revolving Loan Credit Facility (the “Croatian Credit Facility”) with a consortium of banks, which provides for a secured term loan facility of up to 150 million euro. Under the terms of the Croatian Credit Facility, all outstanding principal is required to be repaid in predetermined semi-annual installments beginning on December 20, 2003 and ending on June 20, 2008. At December 31, 2002, the USD equivalent outstanding balance was $96 million.

     VIP-Net has granted certain security interests over substantially all of its assets in support of the Croatian Credit Facility. In addition, we, along with our partners, have pledged all of our shares of VIP-Net’s stock as collateral for the Croatian Credit Facility. The Croatian Credit Facility contains certain restriction including, among other things, restrictions on the transfer of assets from VIP-Net to its shareholders.

General:

     Our international investments are subject to the laws and regulations governing telecommunications services in effect in each of the countries in which they operate. These laws and regulations can have a significant influence on our results of operations and are subject to change by the responsible governmental agencies. The financial statements as presented reflect certain assumptions based on laws and regulations currently in effect in each of the various countries. We cannot predict what future laws and regulations might be passed that could have a material effect on our results of operations. Further, certain of the countries in which we have investments have experienced or may experience political instability. We assess the impact of significant changes in laws, regulations and political stability on a regular basis and update the assumptions and estimates used to prepare our financial statements when deemed necessary.

11. Income Taxes:

     Significant components of deferred income tax assets and liabilities, at their estimated effective tax rate, are as follows:

		December 31,
		2002			2001
		(Dollars in thousands)
Deferred tax assets:
	Domestic federal and state net operating loss carryforwards	$	267,993		$	209,071
	International net operating loss carryforwards		59,957			29,470
	Stock-based compensation		13,671			17,679
	Other		29,877			10,278
Total deferred tax assets			371,498			266,498
Valuation allowance			(313,576	)		(183,293	)
Deferred tax liabilities:
	Wireless licenses basis difference		(120,687	)		(60,400	)
	Property and equipment basis difference		(38,386	)		(22,805	)
	Other		(19,536	)
Total deferred tax liabilities			(178,609	)		(83,205	)
		$	(120,687	)	$	—

     Income tax expense for the year ended December 31, 2002, is comprised of domestic deferred income tax of $120.7 million and foreign taxes currently payable of $2.6 million.

F-20

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     A reconciliation of taxes on results of continuing operations at the federal statutory rate to the actual tax provision is as follows:

		Year Ended
		December 31, 2002
		(Dollars in thousands)
Income taxes at federal statutory rate		$	(32,218	)
Impact of foreign operations			(14,133	)
Change in valuation allowance			130,283
State income taxes and other			39,338
	Provision for income taxes	$	123,270

     For the years ended December 31, 2001 and 2000, we had no provision for income taxes and no taxes currently payable.

     At December 31, 2002, we had available federal NOL carryforwards of approximately $674 million. We also have NOLs related to foreign jurisdictions of approximately $251 million, which are reported at foreign statutory rates. The federal NOL carryforwards will expire between 2006 and 2022. We may be limited in our ability to use these carryforwards in any one year due to ownership changes that preceded the business combination that formed us in July 1994 and changes in shareholdings that occurred during 1999.

     We believe that available objective evidence creates sufficient uncertainty regarding the realization of the net deferred tax assets, including a history of recurring operating losses. Accordingly, a valuation allowance has been provided for the net deferred tax assets of the Company. The valuation allowance increased approximately $130 million in 2002, $67 million in 2001 and $25 million in 2000.

     In 1999, at the time of the Spin-off, an estimate of the NOL carryforwards resulting from VoiceStream’s cumulative tax losses remained with VoiceStream. Pursuant to a tax sharing agreement entered into at the time that a subsidiary of Hutchison Telecommunications Limited made an investment in VoiceStream, (“the Hutchison Investment”), VoiceStream paid us $20 million; the amount representative of the tax benefit of NOLs generated while VoiceStream was a wholly-owned subsidiary of us. This transaction was accounted for as a return of capital to us. Through operation of tax law we have retained certain of the cumulative tax losses originally transferred to VoiceStream following the Spin-off. Under the tax sharing agreement between the companies, we agreed to pay VoiceStream $24.5 million. This was paid during 2001 and represented the present value of the expected tax benefit of the NOLs retained by us. We have a full valuation allowance against our NOLs.

12. Shareholders’ Equity:

     The authorized capital stock of the Company consists of 300,000,000 shares of Class A Common Stock and Class B Common Stock, no par value, and 50,000,000 shares of preferred stock, no par value (the “Preferred Stock”).

Common Stock:

     The holders of our Class A Common Stock have identical rights to holders of Class B Common Stock, except that holders of Class A Common Stock are entitled to one vote per share and holders of Class B Common Stock are entitled to 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 immediately upon any transfer of the Class B Common Stock other than a transfer from an original holder of Class B Common Stock to certain affiliates of such holder.

Preferred Stock:

     We are authorized to issue 50,000,000 shares of Preferred Stock, which may be issued from time to time in one or more classes or series or both upon authorization by our Board of Directors.

     We have no current plans to issue any Preferred Stock.

Stock Issuances:

     We issued 106,654, 747,639 and 506,180 shares of our Common Stock in 2002, 2001 and 2000, respectively, as a result of employee stock option exercises.

Other Transactions:

     During the second quarter of 1999, as a result of the Spin-off, the Company recognized compensation expense on all options outstanding as of May 3, 1999. On the date of the Spin-off, the Company canceled and reissued all outstanding stock options. All reissued stock options were granted in a manner that ensured employees of both the Company and VoiceStream maintained the value of their options, subject to normal fluctuations in the price of both companies stock, after the Spin-off.

     This reissuance did not accelerate benefits to option holders. The Company believes this allows employees to continue to better participate in the success of the company for which they work. At the date of the Spin-off, the Company recorded deferred compensation of approximately $82.8 million and compensation expense for those options in which the service period had passed of $63.4 million. Subsequent to the date of the Spin-off, the Company has recognized an additional $18.3

F-21

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

million of stock option compensation, net of cancellations, through December 31, 2001. As of December 31, 2001, the Company has fully recognized the stock option compensation associated with these options.

13. Income (Loss) per Common Share:

     Statement of Financial Accounting Standards No. 128, “Earnings Per Share,” requires two presentations of income per share – “basic” and “diluted”. Basic income per share is calculated using the weighted average number of shares outstanding during the period. Diluted income per share is computed on the basis of the weighted average number of common shares outstanding plus the dilutive effect of outstanding stock options and the employee stock purchase plan using the “treasury stock” method.

     Income (loss) per share is calculated using the weighted average number of shares of outstanding stock during the period. For those years presented with net losses, the options outstanding are anti-dilutive, thus basic and diluted loss per share are equal. Weighted average shares issuable upon the exercise of stock options, which were not included in the calculation, were 141,000, 1,794,000 and 9,000 for the years ended December 31, 2002, 2001 and 2000, respectively, because they were antidilutive.

     The following table sets forth the computation of basic and diluted income per share:

			Year Ended December 31,
			2002			2001			2000
			(Dollars in thousands, except per share data)
Numerator:
	Income (loss) from continuing operations before cumulative change in accounting principle		$	(215,320	)	$	(143,564	)	$	65,406
	Total discontinued operations			29,639			(5,933	)
	Cumulative change in accounting principle						(5,580	)
		Net income (loss)	$	(185,681	)	$	(155,077	)	$	65,406
Denominator:
	Weighted average shares:
		Basic		78,955,000			78,625,000			77,899,000
	Effect of dilutive securities:
		Dilutive options								2,404,000
	Weighted average shares:
		Diluted		78,955,000			78,625,000			80,303,000
Basic income (loss) per share:
	Continuing operations		$	(2.73	)	$	(1.82	)	$	0.84
	Discontinued operations			0.38			(0.08	)
	Cumulative change in accounting principle						(0.07	)
		Basic income (loss) per share	$	(2.35	)	$	(1.97	)	$	0.84
Diluted income (loss) per share:
	Continuing operations		$	(2.73	)	$	(1.82	)	$	0.81
	Discontinued operations			0.38			(0.08	)
	Cumulative change in accounting principle						(0.07	)
		Diluted income (loss) per share	$	(2.35	)	$	(1.97	)	$	0.81

14. Stock-based Compensation Plans:

     The 1994 Management Incentive Stock Option Plan (the “MISOP”) as amended, provides for the issuance of up to 10,100,000 shares of common stock as either Nonstatutory Stock Options or as Incentive Stock Options, the terms and conditions of which are at the discretion of the administrator of the MISOP. Typically the vesting period is four years with a maximum term of ten years.

     The 1997 Employee Stock Purchase Plan (the “ESPP”) provides for the issuance of up to 1,000,000 shares of Class A Common Stock to eligible employees participating in the plan. The terms and conditions of eligibility under the ESPP require that an employee must have been employed by us or our subsidiaries for at least three months prior to participation. A participant may contribute up to 10% of their total annual compensation toward the ESPP, not to exceed the Internal Revenue Service contribution limit each calendar year. Shares are offered under this ESPP at 85% of market value at each offer date. Participants are fully vested at all times.

F-22

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Options granted, exercised and canceled under the above MISOP are summarized as follows:

	Year Ended December 31,
	2002					2001					2000
				Weighted					Weighted					Weighted
	Shares			average Price		Shares			average Price		Shares			average Price
	(In thousands, except pricing information)
Outstanding, beginning of period		2,960		$	15.06		3,065		$	7.64		3,642		$	7.32
Options granted		806		$	16.61		675		$	39.19
Options exercised		(107	)	$	6.58		(748	)	$	6.57		(506	)	$	5.26
Options canceled		(368	)	$	19.71		(32	)	$	10.24		(71	)	$	8.25
Outstanding, end of the period		3,291		$	15.20		2,960		$	15.06		3,065		$	7.64
Exercisable, end of period		2,155		$	12.44		1,815		$	9.69		1,991		$	6.56

     The weighted average fair value of stock options granted was $9.96 in 2002 and $28.67 in 2001. There were no stock options granted in 2000.

     The following table summarizes information about fixed price stock options outstanding at December 31, 2002:

					Options Outstanding					Options Exercisable
							Weighted
							Average	Weighted				Weighted
							Remaining	Average				Average
					Number		Contractual	Exercise		Number		Exercise
Range of Exercise Prices					Outstanding		Life	Price		Exercisable		Price
					(In thousands, except pricing information)
$	0.53	-	$	7.66		1,314	5 years	$	5.87		808	$	5.52
$	8.13	-	$	9.95		929	5 years	$	8.84		838	$	8.72
$	9.95	-	$	39.19		1,048	8 years	$	32.53		509	$	29.54
$	0.53	-	$	39.19		3,291	6 years	$	15.20		2,155	$	12.44

     In September 1998, WWI’s Board of Directors approved the 1998 Stock Appreciation Rights (“SAR”) Plan (the “SAR Plan”), effective January 1, 1998. Under the SAR Plan, as amended, selected key employees and agents of WWI may receive performance units, which are “rights” to receive an amount based upon 7% of the fair market value of WWI. Fair value is based upon Management’s estimates at the time, considering various factors and is approved by WWI’s Board of Directors. Effective July 1, 2002, WWI’s Board of Directors approved an amendment to the SAR Plan, providing for quarterly valuations and establishing a quarterly 21-day exercise window. Such rights do not represent an equity interest in WWI, only a right to compensation under the terms of the SAR Plan.

     The SAR Plan, as amended, authorizes a maximum of 28,000 rights and authorizes the SAR Plan administrator to determine, among other things, the grant of SARs, the price of the grant and vesting provisions. Granted SARs generally vest over a four-year period and provide for a cash payout in a lump-sum distribution or installments over a period not to exceed three years. As of December 31, 2002 and 2001, there were 17,788 and 20,413 rights outstanding under the SAR Plan, respectively.

     In connection with a revaluation of the SARs based on current market conditions, WWI recorded a reversal of compensation expense of $5.5 million and $1.9 million in 2002 and 2001, respectively. We recorded compensation expense of $10.8 million in 2000. During 2002 and 2001, 1,394 and 4,600 vested SARs, respectively, were exercised. As a result, WWI paid $0.3 million in 2001, $2.8 million in 2002 and $2.8 million in January 2003.

15. Acquisitions, Dispositions and Discontinued Operations:

Domestic Asset Dispositions:

     In 2002, we have implemented our domestic strategy to dispose of certain minor domestic non-core assets. In conjunction with these efforts, we recognized a charge of approximately $7.6 million related to the disposition of certain of our paging assets. We also sold certain Specialized Mobile Radio and Competitive Local Exchange Carrier assets and recognized a gain of approximately $1.3 million in 2002.

Iceland Disposition:

     In November 2002, WWI sold its majority ownership interest in its Icelandic subsidiary, TAL h.f. (“TAL”), for $28.9 million in cash, which included repayment of a loan to WWI. This transaction resulted in a gain on the sale of $23.9 million. The buyer assumed the obligation to refinance or repay the remaining principal and interest outstanding under the Icelandic credit facility. Since TAL represented a component of our business with distinguishable cash flows and operations, it is presented in the accompanying consolidated financial statements as discontinued operations. Our 2001 statement of operations and balance sheet were reclassified accordingly. Our 2000 statement of operations was not reclassified because we did not acquire a controlling interest in TAL until the third quarter of 2000. The consolidated amounts associated with TAL in 2000 are not significant. For 2002 and 2001, $23.7 and $35.4 million, respectively, of TAL revenue is reported in

F-23

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

discontinued operations. In addition, $5.7 million and ($5.9) million of pretax income (loss) for TAL is reflected in discontinued operations for 2002 and 2001, respectively. TAL was part of our international segment.

Latvian Disposition:

     In October 2000, WWI sold its minority interest in Baltcom, a Latvian cellular operator. WWI’s portion of the proceeds was $66.6 million resulting in a gain of $57.4 million.

North Dakota 3 Acquisition:

     In June 2002, we were notified that we were the successful bidder for the North Dakota 3 RSA license by the FCC for approximately $9.4 million. The purchase of the license was completed in September 2002. The North Dakota 3 RSA was accounted as an asset acquisition. The entire purchase price was recorded to licensing costs.

Austrian UMTS Acquisition:

     In April 2002, an indirect wholly owned subsidiary of WWI, exercised its option to acquire 100% of the stock of EKOM 3G Mobilfunk GmbH (“EKOM 3G”), formerly known as Mannesmann 3G Mobilfunk GmbH (an indirect wholly-owned subsidiary of Vodafone), holder of an Austrian UMTS license for assumption of $0.5 million of liabilities. The acquired entity currently has no ongoing operations.

     In connection with exercising its option to acquire EKOM 3G, WWI has agreed with Vodafone that if prior to tele.ring’s completion of the build out of 25% of the UMTS system (as defined by the UMTS license agreement), WWI were to either: (i) return the UMTS license to the Austrian regulatory authority and as a result received a refund of all or a portion of the license fee; or (ii) tele.ring sold or disposed of all of the shares or assets of EKOM 3G, which sale included the UMTS license, and the sale or disposal is not combined with the sale of other significant non-Austrian based businesses or assets controlled by WWI, WWI would share any net refund or net sales proceeds with Vodafone, 60% to Vodafone and 40% to tele.ring.

Cellular One Group Acquisition:

     In July 2001, we completed the acquisition of Southwestern Bell Mobile Systems’ ownership interest in Cellular One Group, which owns, licenses and promotes the Cellular One brand and related trademarks, services marks and designs. The purchase price was approximately $9 million allocated to trademarks. Southwestern Bell now conducts business as Cingular Wireless, LLC. As a result of this transaction, we now own 100% of the Cellular One Group.

tele.ring Acquisition:

     On June 29, 2001, we completed the acquisition of tele.ring (defined below), a provider of GSM mobile, Internet, and fixed line services in Austria, from a subsidiary of Vodafone Group Plc (“Vodafone”) as described below.

     The acquisition was accomplished pursuant to the terms of an agreement dated May 4, 2001, among Mannesmann Eurokom GmbH (“MEU”), an indirect wholly-owned subsidiary of Vodafone, EKOM Telecommunications Holding AG, a wholly-owned subsidiary of MEU, and EHG Einkaufs und Handels GmbH (“EHG”), an indirect wholly-owned subsidiary of WWI. In accordance with the agreement, EHG acquired for ten euros 100% of the stock of tele.ring Telekom Service GmbH (“tele.ring GmbH”) and 100% of the partnership interests in tele.ring Telekom Service GmbH Co KEG (“tele.ring KEG”; tele.ring GmbH and tele.ring KEG are herein collectively referred to as “tele.ring”). EHG was also granted the option to acquire for one euro and assumption of up to $0.5 million of liabilities 100% of the stock of EKOM 3G, holder of an Austrian UMTS license. After repayment of existing tele.ring debt (which was all intra-company debt due to Vodafone), tele.ring’s balance sheet had a net working capital position of approximately zero as of the closing of the acquisition.

F-24

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     The following unaudited pro forma condensed combined financial information combines the historical statements of operations of the Company for the years ended December 31, 2001 and 2000 and assumes the acquisition was effected on January 1 of each year presented. The accounting policies of the Company and tele.ring differ as a result of differences between U.S. GAAP and Austrian GAAP; tele.ring’s historical financial data has been adjusted to conform to U.S. GAAP. Further, certain reclassifications have been made to tele.ring’s historical presentation to conform to our presentation. These reclassifications do not materially impact tele.ring’s results of operations or financial position for the periods presented.

		Year Ended December 31,
		2001						2000
					Western					Western
					Wireless					Wireless
					Corporation					Corporation
					and tele.ring					and tele.ring
		As Reported			Pro forma			As Reported		Pro forma
		(Dollars in thousands, except per share data)
Total revenues		$	1,037,959		$	1,101,904		$	834,954	$	905,546
Income (loss) from continuing operations before cumulative change in accounting principle		$	(143,564	)	$	(222,412	)	$	65,406	$	(109,851	)
Net income (loss)		$	(155,077	)	$	(233,925	)	$	65,406	$	(122,228	)
Basic income (loss) per share		$	(1.97	)	$	(2.98	)	$	0.84	$	(1.57	)
Diluted income (loss) per share		$	(1.97	)	$	(2.98	)	$	0.81	$	(1.57	)
Weighted average shares outstanding:
	Basic		78,625,000			78,625,000			77,899,000		77,899,000
	Diluted		78,625,000			78,625,000			80,303,000		77,899,000

Other Acquisitions:

     In November 2000, we completed the purchase of the Arizona 4 and California 7 RSAs for approximately $202 million. These acquisitions were accounted for as an asset acquisition. Essentially the entire purchase price was recorded to licensing costs.

     In July 2000, we completed the purchase of the Oklahoma 4 RSA for approximately $60 million. This acquisition was accounted for as an asset acquisition. Essentially the entire purchase price was recorded to licensing costs.

     In May 2000, we completed the purchases of the Arizona 6 RSA for approximately $46 million, and the Wyoming 1 RSA for approximately $20 million. These acquisitions were accounted for as an asset acquisition. Essentially the entire purchase price was recorded to licensing costs.

     In January 2000, we completed the purchase of the Utah 5 RSA for approximately $25 million in cash and $5 million in seller subordinate debt. This acquisition was accounted for as an asset acquisition. Essentially the entire purchase price was recorded to licensing costs.

     In January 2000, we completed an acquisition of a 40% interest in Comstar Cellular (“Comstar”), a GSM cellular operator in Côte d’Ivoire for $3 million.

16. Selected Quarterly Consolidated Financial Information (unaudited):

     As discussed in Note 6, we adopted SFAS No. 142 on January 1, 2002 and prospectively ceased amortizing our domestic licensing cost. In connection with the adoption of SFAS No. 142, our full year financial statements include a deferred income tax provision of $120.7 million. We recently completed a comprehensive analysis of the differences between the book and tax basis of our domestic licensing costs and determined that the deferred income tax provision reported during the first quarter of 2002 associated with the adoption of SFAS No. 142 should be increased because of newly identified basis differences. The reported deferred income tax provisions in the second and third quarters of 2002 should be decreased as a result of these matters. The impact of these adjustments on our quarterly financial results are set forth on the schedule below. The impact to our interim balance sheets for 2002 was an increase in our deficit and our deferred taxes aggregating approximately $21 million through the first three quarters of 2002. Because these adjustments relate to our deferred income tax provision there is no impact on interim cash flows from operations, investing or financing activities. Deferred taxes represent a non-cash charge and are not currently paid or payable.

F-25

WESTERN WIRELESS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Selected quarterly consolidated financial information for the years ended December 31, 2002 and 2001 is as follows:

															Loss From
															Continuing Operations
															Before
						Loss			Provision for						Cumulative Change
			Operating			Before			Income Taxes						in Accounting Principle
	Total		Income			Provision for
Quarter Ended	Revenues		(Loss)			Income Taxes			Quarter			Year-to-Date			Quarter			Year-to-Date
	(Dollars in thousands, except per share data)
March 31, 2002, as reported(1)	$	284,426	$	11,783		$	(18,177	)	$	(79,287	)	$	(79,287	)	$	(97,464	)	$	(97,464	)
March 31, 2002, as recalculated		N/A		N/A			N/A		$	(103,933	)	$	(103,933	)	$	(122,110	)	$	(122,110	)
June 30, 2002, as reported(1)	$	290,849	$	13,213		$	(24,887	)	$	(7,433	)	$	(86,720	)	$	(32,320	)	$	(129,784	)
June 30, 2002, as recalculated		N/A		N/A			N/A		$	(5,055	)	$	(108,988	)	$	(29,942	)	$	(152,052	)
September 30, 2002, as reported(1)	$	306,307	$	30,850		$	(9,094	)	$	(8,203	)	$	(94,923	)	$	(17,297	)	$	(147,081	)
September 30, 2002, as recalculated		N/A		N/A			N/A		$	(7,010	)	$	(115,998	)	$	(16,104	)	$	(168,156	)
December 31, 2002, as reported(1)	$	305,028	$	(4,645	)	$	(39,892	)	$	(7,272	)	$	(123,270	)	$	(47,164	)	$	(215,320	)
March 31, 2001(1)	$	229,150	$	24,201		$	(15,493	)							$	(15,493	)	$	(15,493	)
June 30, 2001(1)	$	245,353	$	22,051		$	(11,405	)							$	(11,405	)	$	(26,898	)
September 30, 2001(1)	$	283,178	$	(14,078	)	$	(65,133	)							$	(65,133	)	$	(92,031	)
December 31, 2001(1)	$	280,278	$	(14,232	)	$	(51,533	)							$	(51,533	)	$	(143,564	)

[Additional columns below]

[Continued from above table, first column(s) repeated]

							Basic and Diluted
							Loss Per Share
							From
							Continuing Operations
							Before
							Cumulative Change						Basic and Diluted
	Net Loss						in Accounting Principle						Net Loss Per Share
Quarter Ended	Quarter			Year-to-Date			Quarter			Year-to-Date			Quarter			Year-to-Date
	(Dollars in thousands, except per share data)
March 31, 2002, as reported(1)	$	(96,002	)	$	(96,002	)	$	(1.24	)	$	(1.24	)	$	(1.22	)	$	(1.22	)
March 31, 2002, as recalculated	$	(120,648	)	$	(120,648	)	$	(1.55	)	$	(1.55	)	$	(1.53	)	$	(1.53	)
June 30, 2002, as reported(1)	$	(29,755	)	$	(125,757	)	$	(0.41	)	$	(1.64	)	$	(0.38	)	$	(1.59	)
June 30, 2002, as recalculated	$	(27,377	)	$	(148,025	)	$	(0.38	)	$	(1.93	)	$	(0.35	)	$	(1.86	)
September 30, 2002, as reported(1)	$	(15,916	)	$	(141,673	)	$	(0.22	)	$	(1.86	)	$	(0.20	)	$	(1.79	)
September 30, 2002, as recalculated	$	(14,723	)	$	(162,748	)	$	(0.20	)	$	(2.13	)	$	(0.19	)	$	(2.06	)
December 31, 2002, as reported(1)	$	(22,933	)	$	(185,681	)	$	(0.60	)	$	(2.73	)	$	(0.29	)	$	(2.35	)
March 31, 2001(1)	$	(22,884	)	$	(22,884	)	$	(0.20	)	$	(0.20	)	$	(0.29	)	$	(0.29	)
June 30, 2001(1)	$	(14,027	)	$	(36,911	)	$	(0.15	)	$	(0.34	)	$	(0.18	)	$	(0.47	)
September 30, 2001(1)	$	(66,758	)	$	(103,669	)	$	(0.83	)	$	(1.17	)	$	(0.85	)	$	(1.32	)
December 31, 2001(1)	$	(51,408	)	$	(155,077	)	$	(0.65	)	$	(1.82	)	$	(0.65	)	$	(1.97	)

⁽¹⁾ As reported amounts exclude the effects of TAL, our Icelandic subsidiary. TAL was sold by us in the fourth quarter of 2002 and has been reported as discontinued operations for all periods presented.

F-26

WESTERN WIRELESS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

17. Segment Information:

     Operations of the Company are overseen by domestic and international management teams each reporting to the Chief Executive Officer of the Company. We mainly provide cellular services in rural markets in the western United States. Our international operations consist of consolidated subsidiaries and operating entities around the world. Certain centralized back office costs and assets benefit all of our operations. These costs are allocated to both segments in a manner which reflects the relative time devoted to each of the segments.

     The domestic cellular operations comprise the majority of our total revenues, expenses and total assets as presented in the table below:

		Domestic			International
		Operations			Operations			Consolidated
		(Dollars in thousands)
Year Ended December 31, 2002
	Total revenues	$	883,704		$	302,906		$	1,186,610
	Depreciation and amortization expense		194,003			46,484			240,487
	Asset dispositions		21,304						21,304
	Stock-based compensation, net		1,328			(5,450	)		(4,122	)
	Provision for income taxes		120,687			2,583			123,270
	Interest and financing expense, net		110,080			46,611			156,691
	Equity in net income (loss) of unconsolidated affiliates		(678	)		4,897			4,219
	Total assets		1,798,758			600,218			2,398,976
	Total capital expenditures		160,676			139,752			300,428
Year Ended December 31, 2001
	Total revenues	$	913,471		$	124,488		$	1,037,959
	Depreciation and amortization expense		190,601			19,325			209,926
	Stock-based compensation, net		4,183			(1,876	)		2,307
	Interest and financing expense, net		138,384			23,469			161,853
	Equity in net income (loss) of unconsolidated affiliates		1,550			(9,322	)		(7,772	)
	Total assets		1,857,743			512,677			2,370,420
	Total capital expenditures		261,431			116,797			378,228
Year Ended December 31, 2000
	Total revenues	$	812,540		$	22,414		$	834,954
	Depreciation and amortization expense		120,826			4,235			125,061
	Stock-based compensation		9,334			10,763			20,097
	Interest and financing expense, net		141,182			11,047			152,229
	Equity in net income of unconsolidated affiliates		623			35			658
	Total assets		1,759,255			237,214			1,996,469
	Total capital expenditures		207,939			54,628			262,567

18. Related Party Transactions:

     During 2002 and 2001, tele.ring earned interconnect and roaming revenues of $28.4 million and $13.4 million, respectively, and incurred roaming and interconnect expenses of $49.2 million and $26.3 million, respectively, with an organization affiliated with WWI. As of December 31, 2002, a payable of $4.6 million was included in current liabilities and a receivable of $2.7 was included in accounts receivable. At December 31, 2001, a payable of $7.9 million was included in current liabilities and a receivable of $2.9 million was included in accounts receivable.

     In the fourth quarter of 2001, WWI’s Austrian subsidiary sold at fair market value 0.5% of its share capital to an officer of the same subsidiary. Under this agreement the officer has the right to put the shares to the subsidiary, and the subsidiary has the right to call the shares, on certain dates and at certain prices at fair value depending on the time period.

     In April 2001, Bradley J. Horwitz, Executive Vice President of the Company and President of WWI exercised a fair value put agreement exchanging a 2.02% interest in WWI for approximately $14.1 million. Mr. Horwitz still holds the right to put his remaining interest in WWI to us at fair value. We now own approximately 98% of the outstanding shares of WWI.

     In 1999, at the time of the Spin-off, an estimate of the NOL carryforwards resulting from VoiceStream’s cumulative tax losses remained with VoiceStream. Pursuant to a tax sharing agreement entered into at the time of the Hutchison Investment, VoiceStream paid us $20 million; the amount representative of the tax benefit of NOLs generated while VoiceStream was a wholly-owned subsidiary of us. This transaction was accounted for as a return of capital to us. Through operation of tax law, we have retained certain of the cumulative tax losses originally transferred to VoiceStream following the Spin-off. Under the tax sharing agreement between the companies, we agreed to pay VoiceStream $24.5 million. This was paid during 2001. This amount represented the present value of the expected tax benefit of the NOLs retained by us. We have a full valuation allowance against our NOLs.

F-27

WESTERN WIRELESS CORPORATION
SCHEDULE I - CONDENSED FINANCIAL INFORMATION
COMBINED BALANCE SHEETS
(Parent Company Only)
(Dollars in thousands)

					As of December 31,
					2002			2001
				ASSETS
Current assets:
	Cash and cash equivalents				$	34,005		$	7,564
	Accounts receivable, net of allowance for doubtful accounts of $12,957 and $13,742, respectively					105,263			107,672
	Inventory					12,223			23,052
	Prepaid expenses and other current assets					8,901			11,544
			Total current assets			160,392			149,832
Property and equipment, net of accumulated depreciation of $676,600 and $502,525, respectively						543,170			583,102
Licensing costs and other intangible assets, net of accumulated amortization of $14,473 and $10,112, respectively						1,076,992			1,093,275
Investments in and advances to unconsolidated affiliates						191,559			179,583
Other assets						285
					$	1,972,398		$	2,005,792
				LIABILITIES AND NET CAPITAL DEFICIENCY
Current liabilities:
	Accounts payable				$	9,556		$	14,027
	Accrued liabilities					130,586			130,387
	Construction accounts payable					6,583			15,236
	Current portion of long-term debt					106,094
			Total current liabilities			252,819			159,650
Long-term debt						2,082,307			2,145,441
Deferred income taxes						120,687
			Total liabilities			2,455,813			2,305,091
Net capital deficiency:
	Preferred stock, no par value, 50,000,000 shares authorized; no shares issued and outstanding
	Common stock, no par value, 300,000,000 shares authorized;
		Class A, 72,229,605 and 71,881,603 shares issued and outstanding, respectively, and:
		Class B, 6,774,724 and 6,981,072 shares issued and outstanding, respectively				669,072			668,158
	Deferred compensation					(39	)
	Accumulated other comprehensive loss					(23,491	)		(24,181	)
	Deficit					(1,128,957	)		(943,276	)
			Total net capital deficiency			(483,415	)		(299,299	)
					$	1,972,398		$	2,005,792

See accompanying notes to condensed financial information.

S-1

WESTERN WIRELESS CORPORATION
SCHEDULE I - CONDENSED FINANCIAL INFORMATION
COMBINED STATEMENTS OF OPERATIONS
(Parent Company Only)
(Dollars in thousands)

			For the Years Ended December 31,
			2002			2001			2000
Revenues:
	Subscriber revenues		$	609,406		$	619,214		$	548,202
	Roamer revenues			228,878			244,538			228,694
	Equipment sales and other revenues			44,277			45,450			33,805
		Total revenues		882,561			909,202			810,701
Operating Expenses:
	Cost of service			176,190			188,434			169,405
	Cost of equipment sales			79,047			79,770			42,750
	General and administrative			144,563			165,692			150,509
	Sales and marketing			115,574			127,630			124,635
	Depreciation and amortization			193,994			187,704			120,502
	Asset disposition			21,304
	Stock-based compensation			1,328			4,183			9,297
		Total operating expenses		732,000			753,413			617,098
Other income (expense):
	Interest and financing expense, net			(146,328	)		(158,861	)		(151,626	)
	Equity in net income (loss) of unconsolidated affiliates			(70,961	)		(127,841	)		31,608
	Other, net			1,734			(18,584	)		(8,179	)
		Total other expense		(215,555	)		(305,286	)		(128,197	)
Income (loss) from continuing operations before provision for income taxes and cumulative change in accounting principle				(64,994	)		(149,497	)		65,406
Provision for income taxes				(120,687	)
Cumulative change in accounting principle							(5,580	)
		Net income (loss)	$	(185,681	)	$	(155,077	)	$	65,406

See accompanying notes to condensed financial information.

S-2

WESTERN WIRELESS CORPORATION
SCHEDULE I - CONDENSED FINANCIAL INFORMATION
COMBINED STATEMENTS OF CASH FLOWS
(Parent Company Only)
(Dollars in thousands)

			For the Years Ended December 31,
			2002			2001			2000
Operating activities:
	Net income (loss)		$	(185,681	)	$	(155,077	)	$	65,406
	Adjustments to reconcile net income (loss) to net cash provided by operating activities			414,472			340,432			107,150
		Net cash provided by operating activities		228,791			185,355			172,556
Investing activities:
	Purchase of property and equipment			(160,675	)		(261,577	)		(206,785	)
	Investments in and advances to unconsolidated affiliates			(80,715	)		(134,761	)		(72,468	)
	Receipts from and (payments to) VoiceStream Wireless						(24,500	)		3,438
	Additions to licensing costs and other intangible assets			(9,472	)		(8,325	)		(12,799	)
	Acquisition of wireless properties, net of cash acquired									(356,606	)
	Purchase of minority interest in Western Wireless International						(14,140	)
	Proceeds from asset disposition			5,102
		Net cash used in investing activities		(245,760	)		(443,303	)		(645,220	)
Financing activities:
	Additions to long-term debt			70,000			690,000			1,640,485
	Repayment of debt			(27,040	)		(440,044	)		(1,200,000	)
	Other			450			4,596			2,358
		Net cash provided by financing activities		43,410			254,552			442,843
Change in cash and cash equivalents				26,441			(3,396	)		(29,821	)
Cash and cash equivalents, beginning of year				7,564			10,960			40,781
Cash and cash equivalents, end of year			$	34,005		$	7,564		$	10,960

See accompanying notes to condensed financial information.

S-3

WESTERN WIRELESS CORPORATION
SCHEDULE I - CONDENSED FINANCIAL INFORMATION
(Parent Company Only)
NOTES TO CONDENSED FINANCIAL INFORMATION

     This Schedule I and the related notes should be read in conjunction with the Consolidated Financial Statements and Notes thereto.

1. Basis of Presentation:

     The condensed financial information presented in Schedule I represents the balance sheets, statements of operations and cash flows for us as if our subsidiary, WWI, was an unconsolidated entity. Certain, but not all, of the net assets of WWI’s consolidated subsidiaries and equity based investments are restricted under loan agreements including those of Slovenia, Austria, Bolivia, Ireland, Croatia and Georgia. The Company less WWI is referred to as “Parent Company Only” in Schedule I. Our ownership in WWI has been reflected in this condensed financial information as if the investment was accounted for using the equity method.

2. Long-Term Debt Maturities:

     The aggregate amounts of principal maturities as of December 31, 2002, of our debt excluding the debt of the restricted subsidiary are as follows:

Year ending December 31,	(Dollars in thousands)
2003	$	106,094
2004		156,099
2005		256,104
2006		518,104
2007		502,000
Thereafter		650,000
	$	2,188,401

S-4

WESTERN WIRELESS CORPORATION
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

		Beginning		Charged to		Charged						Balance at
		of		Costs and		to Other						End
Description		Period		Expenses		Accounts(1)			Deductions(2)			of Period
		(Dollars in thousands)
Year ended December 31, 2002
	Allowance for doubtful account	$	20,407	$	19,051	$	1,090		$	(18,489	)	$	22,059
	Valuation allowance for deferred tax assets	$	183,293	$	130,283							$	313,576
Year ended December 31, 2001
	Allowance for doubtful account	$	15,801	$	31,807	$	7,093		$	(34,294	)	$	20,407
	Valuation allowance for deferred tax assets	$	116,028	$	67,265							$	183,293
Year ended December 31, 2000
	Allowance for doubtful account	$	11,199	$	26,963	$	(387	)	$	(21,974	)	$	15,801
	Valuation allowance for deferred tax assets	$	91,360	$	24,668							$	116,028

(1)	Primarily reflects opening/ending allowance for doubtful accounts related to market acquisitions/dispositions, fraud credits given to customers and currency translation adjustments.
(2)	Write-offs, net of bad debt recovery.

S-5

SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

WESTERN WIRELESS CORPORATION
By:	/s/ JOHN W. STANTON
	John W. Stanton Chairman of the Board and Chief Executive Officer

Date: March 26, 2003

     Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signatures	Title	Date
/s/ JOHN W. STANTON John W. Stanton	Chairman of the Board and Chief Executive Officer (Principal Executive Officer)	March 26, 2003
/s/ THERESA E. GILLESPIE Theresa E. Gillespie	Vice Chairman	March 26, 2003
/s/ MIKAL J. THOMSEN Mikal J. Thomsen	President and Director	March 26, 2003
/s/ M. WAYNE WISEHART M. Wayne Wisehart	Executive Vice President and Chief Financial Officer	March 26, 2003
/s/ SCOTT A. SOLEY Scott A. Soley	Vice President and Controller	March 26, 2003
/s/ JOHN L. BUNCE JR. John L. Bunce, Jr.	Director	March 26, 2003
/s/ MITCHELL R. COHEN Mitchell R. Cohen	Director	March 26, 2003
/s/ DANIEL J. EVANS Daniel J. Evans	Director	March 26, 2003
/s/ JONATHAN M. NELSON Jonathan M. Nelson	Director	March 26, 2003
/s/ TERENCE M. O’TOOLE Terence M. O’Toole	Director	March 26, 2003
/s/ PETER H. VAN OPPEN Peter H. van Oppen	Director	March 26, 2003

CERTIFICATION

     I, John W. Stanton, certify that:

1.	I have reviewed this annual report on Form 10-K of Western Wireless Corporation.
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

(a)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
(b)	evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and
(c)	presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

(a)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
(b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls.

6. The registrant’s other certifying officer and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

By:	/s/ JOHN W. STANTON
	John W. Stanton Chairman and Chief Executive Officer

Dated: March 26, 2003

CERTIFICATION

     I, M. Wayne Wisehart, certify that:

1.	I have reviewed this annual report on Form 10-K of Western Wireless Corporation.
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

(a)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
(b)	evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and
(c)	presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

(a)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
(b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls.

6. The registrant’s other certifying officer and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

By:	/s/ M. Wayne Wisehart
	M. Wayne Wisehart Executive Vice President and Chief Financial Officer

Dated: March 26, 2003

EX-10.17 3 v88021exv10w17.txt EXHIBIT 10.17 Exhibit 10.17 January 3, 2003 Wayne Wisehart 2009 Viburnum Lane Ashville, NC 28803 VIA FACSIMILE Dear Wayne: This letter (the "Letter Agreement") sets forth the terms of your employment with Western Wireless Corporation ("WWC"), effective January 30, 2003. 1. ROLE: Your title will be Executive Vice President and Chief Financial Officer. In that capacity you will report to the Chief Executive Officer of WWC (the "CEO"). 2. RESPONSIBILITIES: Your responsibilities will include supervision of all financial functions of WWC including accounting, tax, finance, treasury and investor relations together with such other duties as may be assigned to you by the CEO. You will work closely with the Vice Chairmen on certain financial issues. You will devote substantially all of your business time and attention to the obligations delineated in this Letter Agreement. 3. CASH COMPENSATION: Your base compensation will be $240,000, payable in accordance with standard payroll practices of WWC. In addition, you will have an opportunity, as determined by WWC, to earn a performance bonus targeted at $120,000 per year, to be paid annually at year end. The bonus will be based on a formula based mutually developed objective and subjective criteria. It is understood that nothing contained herein will prevent WWC, in its sole and absolute discretion, from, at any time, increasing your compensation, either permanently or for a limited period, whether in base compensation, by bonus or otherwise, if WWC in its sole discretion, shall deem it advisable to do so in order to recognize and fairly compensate you for the value of your services to WWC; provided, however, that nothing contained in this paragraph three shall in any manner obligate WWC to make any such increase or provide any such additional compensation or benefits. 4. STOCK OPTIONS: You will receive an option to purchase 75,000 shares of WWC's common stock at an exercise price per share as of the closing price of the stock as of the date of this offer or other mutually agreed upon date. Your options will have a 4-year vesting and shall contain Change of Control protection consistent with other officers of WWC. You will be eligible to continue, during the course of your employment, to participate in the option program at a level to be determined by the CEO and the Compensation Committee. 5. RELOCATION: We will pay you a flat payment of $60,000, which is intended to cover your costs of relocation including moving your belongings, vehicles, the costs associated with buying and selling houses and any other costs associated with the move. This payment is intended to cover all costs of relocation except that it is understood that the company will separately reimburse you for the cost of travel to and from Seattle prior to your relocation, the cost of temporary housing in the Seattle area and the cost of house hunting trips for your family to come to the Seattle area. 6. BENEFITS: You will also be eligible to participate in the WWC's Employee Benefit Programs upon eligibility, which includes a group health insurance program; life insurance and 401(k) plan with matching. You will be entitled to three weeks of vacation annually. We will waive the waiting period on the ESPP plan and will pay COBRA from your existing health care costs during the waiting period for our medical benefits. Page 2 7. EXPENSES: WWC will reimburse you for all reasonable out-of-pocket business expenses paid or incurred by you in connection with the performance of your duties, upon submission of signed, itemized lists of such expenses on general forms established for that purpose by WWC. 8. INDEMNIFICATION: WWC will enter into an Indemnification Agreement with you pursuant to which WWC will agree to indemnify you against certain liabilities arising by reason of your affiliation with WWC. 9. NON-DISCLOSURE: You agree not to disclose at any time, whether during the term of this Letter Agreement or thereafter, any secret or confidential information relating to WWC's or any of its subsidiaries' businesses, financial condition or prospects, which information you have obtained while employed by WWC or by any of its subsidiaries or any of the predecessors in interest of any of them, except (i) as may be required in furtherance of the businesses of WWC or of any of its subsidiaries, (ii) with WWC's express prior written consent, (iii) if such information is made generally available to the public through no fault of yours, or (iv) if such disclosure is required by applicable law or regulation or by legal process and then only with prompt written notice to WWC in advance of any such disclosure. 10. NON-COMPETE: You agree that, during the term of your employment by WWC and for a period of one (1) year immediately following the termination of your employment with WWC for any reason whatsoever, you will not, either directly or indirectly, for compensation or any other consideration, individually or as an employee, broker, agent, consultant, lender, contractor, advisor, solicitor, stockholder (provided that ownership of 5% or less of the outstanding stock of any corporation listed on a national securities exchange is not prohibited), proprietor, partner, or person having any other material economic interest in, affiliated with or rendering services to any other entity, engage in or provide services to or for a business that is substantially the same as or similar to WWC's or its subsidiaries businesses and which competes within the applicable commercial mobile radio services markets serviced by WWC or its subsidiaries, directly or indirectly. 11. EMPLOYMENT AT WILL: Notwithstanding any other provision of this Letter Agreement, your employment by WWC may be terminated by WWC at any time, with or without Cause, as defined below. In the event of a termination for Cause you will have no rights to severance payments. Termination for "Cause" means (i) your gross neglect or willful material breach of your principal employment responsibilities or duties, (ii) a final judicial adjudication that you are guilty of a felony, (iii) fraudulent conduct as determined by a court of competent jurisdiction in the course of your employment with WWC or any of its subsidiaries, (iv) the breach by you of the covenant set forth in paragraph nine, below, or (v) the material breach by you of any other provision of this Letter Agreement which continues uncured for a period of thirty (30) days after notice thereof by WWC. In the event of your voluntary termination of employment with WWC, you will have no rights to severance benefits. In the event of an involuntary termination for other than Cause (which shall include your resignation as a direct result of (i) a reduction in your base compensation and/or incentive bonus target percentage, or (ii) the material breach by the Company of any provision of this Letter Agreement which continues uncured for a period of thirty (30) days after notice thereof by you), then (A) you will be entitled to receive a severance payment in an amount equal to your accrued but unpaid existing annual targeted incentive bonus through the date of termination, twelve (12) months of your then base compensation and an amount equal to twelve (12) months of your existing annual targeted incentive bonus; (B) WWC will, at its expense, make all COBRA benefit payments on behalf of you and your dependents for twelve (12) months following such involuntary termination; and (C) with respect to any stock options previously granted to you by WWC which remain unvested at the time of the involuntary termination, notwithstanding the vesting language in the stock option agreement pursuant to which such options were granted, there shall be immediate vesting of that portion of each such grant of unvested stock options as equals the product of the total number of such options under such grant which remain unvested multiplied by a fraction the numerator of which is the Page 3 sum of (i) the number of days from the date on which the last vesting of options under such grant took place to and including the date on which the termination occurs plus (ii) 365 and the denominator of which is the number of days remaining from the date on which the last vesting of options under such grant took place to and including the date on which the final vesting under such grant would have occurred. Your death or permanent disability will be deemed an involuntary termination for other than Cause. "Permanent disability" shall mean your inability substantially to render the services required hereunder for eight (8) months in any eighteen (18) month period because of a physical or mental condition, it being understood that until you have received notice from WWC terminating this Letter Agreement, you will continue to receive your base compensation and all other benefits to which you are entitled under this Letter Agreement. You agree that upon termination of your employment by WWC for any reason you will surrender to WWC all proprietary records, lists and other documents obtained by you or entrusted to you during the course of your employment by WWC, together with all copies of all such documents. This Letter Agreement contains the entire agreement between you and WWC with respect to your employment by WWC, other than human resource and corporate policies, which are to be executed by all employees. This Letter Agreement may not be amended, waived, changed, modified or discharged except by an instrument in writing executed by or on behalf of you and WWC. 12. NOTICES: All notices, requests, demands and other communications with respect to this Letter Agreement will be in writing and will be deemed to have been duly given if delivered by hand, registered or certified mail (first class postage and fees prepaid, return receipt requested), telecopier or overnight courier guaranteeing next-day delivery, as follows: Western Wireless Corporation 3650 - 131st Avenue SE, #400 Bellevue, Washington 98006 Attention: General Counsel Telecopy: (425) 586-8102 Wayne Wisehart 2009 Viburnum Lane Ashville, NC 28803 and to such other persons as either you or WWC has specified in writing to the other by notice as aforesaid. 14. ENFORCEMENT: If any part of this Letter Agreement is hereafter construed to be invalid or unenforceable in any jurisdiction, the same will not affect the remainder of the Letter Agreement or the enforceability of such part in any other jurisdiction, which will be given full effect, without regard to the invalid portions or the enforceability in such other jurisdiction. If any part of this Letter Agreement is held to be unenforceable because of the scope thereof, you and WWC agree that the court making such determination will have the power to reduce the duration and/or area of such provision and, in its reduced form, said provision shall be enforceable; provided, however, that such court's determination will not affect the enforceability of this Letter Agreement in any other jurisdiction beyond such court's authority. Page 4 15. JURISDICTION: This Letter Agreement will be governed by and construed and interpreted in accordance with the laws of the State of Washington without reference to conflicts of laws principles. Please signify your acceptance of the terms of this Letter Agreement by signing where indicated below. Sincerely yours, WESTERN WIRELESS CORPORATION By: ----------------------------------------- John W. Stanton Chief Executive Officer AGREED TO AND ACCEPTED: - ----------------------- Wayne Wisehart EX-10.28 4 v88021exv10w28.txt EXHIBIT 10.28 Exhibit 10.28 WESTERN WIRELESS INTERNATIONAL HOLDING CORPORATION 1998 STOCK APPRECIATION PLAN (Adopted September 9, 1998) (As Amended July 2002) 1. ESTABLISHMENT AND PURPOSE. This 1998 Stock Appreciation Plan was established to provide an important inducement for management to generate shareholder value by giving certain key personnel of Western Wireless International Corporation and its Subsidiaries a stake in the equity value of the Company. The Company believes that the managers participating in the, Plan will seek to build personal financial security through creating and maintaining value in the Company for all shareholders. 2. DEFINITIONS. As used herein, the following definitions shall apply: "Account" means the account established and maintained in accordance with Section 5 hereof. "Administrator" means the Board or any Committee designated by the Board to Administer the Plan in accordance with Section 4 hereof. "Board" means the Board of Directors of the Company, as constituted from time to time. "Code" means the Internal Revenue Code Of 1986, as amended. "Committee" means a committee appointed by the Board, in accordance with Section 4 hereof. If no such committee has been appointed, "Committee" means the full Board.- "Company" means Western Wireless International Corporation, a Delaware corporation. "Consultant" shall mean any person engaged by the Company who is not an Employee. "Director" means a member of the Board. "Disability" means total and permanent disability as defined in Section 22(e)(3) of the Code. "Employee" means any person, including an Officer or Director, who is an employee (within the meaning of Section 3401(c) of the Code and the regulations thereunder) of the Company or a Subsidiary. 1 "Fair Market Value" means value determined pursuant to Section 8 hereof. "Participant" means an Employee, Director or Consultant who holds an outstanding Performance Unit. "Performance Unit" means an interest in the rights awarded and available for award under the Plan, as provided in Section 5 hereof. "Plan" means this 1998 Stock Appreciation Plan of Western Wireless International Corporation, as it may be amended. "Subsidiary" means a "subsidiary corporation" (other than the Company), whether now or hereafter existing, as defined in Section 424(f) of the Code. 3. GRANTS. Performance Units shall be granted to such Employees, Directors and Consultants as the Administrator shall determine, who shall hereafter be referred to as "Participants." The number of Performance Units that may be awarded under the Plan shall not exceed an aggregate of 28,000. If any Performance Units awarded under the Plan shall be forfeited or cancelled, such Performance Units may again be awarded under the Plan. Performance Units shall be granted at such time or times and shall be subject to such terms and conditions, in addition to the terms and conditions set forth in the Plan, as the Administrator shall determine. 4. ADMINISTRATION OF THE PLAN. The Plan shall be administered by a Committee appointed by the Board consisting of two or more members of the Board. If no such Committee is appointed, the Plan shall be administered by the Board. The members of the Committee will serve for such term as the Board may determine. From time to time, the Board may increase the size of the Committee and appoint additional members, remove members, fill vacancies (however caused), and remove all members of the Committee and thereafter directly administer the Plan. Decisions of the Committee made within the discretion delegated to it by the Board will be final and binding on all persons who have an interest in the Plan. (a) Authority of the Administrator. The Administrator of the Plan will have full authority to administer the Plan within the scope of its delegated responsibilities, consistent with the terms of the Plan, including authority to interpret and construe any relevant provision of the Plan, to adopt such rules and regulations as it may deem necessary, and to determine the terms and conditions of Performance Unit grants made under the Plan (which need not be identical). Without limiting the foregoing, the Administrator will have the authority, in its discretion: (i) to determine whether and to what extent Performance Units are granted hereunder; 2 (ii) to select the Employees. Directors and Consultants to whom Performance Units may be granted hereunder; (iii) to determine the number of Performance Units to be granted hereunder to any Employee, Director or Consultant, provided, that the maximum number of Performance Units outstanding at any time shall not exceed 28,000; (iv) to determine the Fair Market Value of the Performance Units; (v) to approve forms for notice of the grant of Performance Units for use under the Plan; (vi) to determine the terms and conditions, not inconsistent with those of the Plan, of any award of Performance Units granted hereunder, including, but not limited to, all vesting provisions; any waiver of forfeiture restrictions; and any restriction or limitation regarding any Performance Units based on such factors as the Administrator, in its sole discretion, shall determine; (vii) with the consent of the affected Participant, to effect, at any time and from time to time, the cancellation of any or all outstanding Performance Units under the Plan and to grant new Performance Units in substitution therefor, in accordance with Section 13 hereof; (viii) to prescribe, amend and rescind rules and regulations relating to the Plan; (ix) to modify, amend or waive the terms, conditions and restrictions of any outstanding Performance Units; provided, however, no such modification, amendment or waiver shall, without the written consent of the Participant, impair the Participant's rights or increase the Participant's obligations with respect to such Performance Units; (x) to institute a Performance Unit Exchange Program (as defined in Section 13); and (xi) to make all other determinations deemed necessary or advisable for administering the Plan. (b) Effect of Administrator's Decision. The Administrator's decisions, determinations and interpretations shall be final and binding on all Participants. 5. PERFORMANCE UNITS. Performance Units granted to a Participant shall be credited to a Performance Unit Account (the "Account") established and maintained for such participant. The Account of a Participant shall be the record of Performance Units granted to him under the Plan, is solely for accounting purposes and shall not require a segregation of any Company assets. Each Performance Unit shall be valued at its fair market value by the 3 Committee, in the manner provided in Section 8, as of the date of grant thereof. Each grant of any Performance Units under the Plan to a Participant and the value of such Performance Units as of the date of grant shall be communicated by the Administrator, in writing to the Participant within thirty (30) days after the date of grant. 6. VESTING OF PERFORMANCE UNITS. Subject to any other vesting schedule determined by the Administrator at the time of grant thereof, Performance Units granted to a Participant shall vest according to the following schedule:

Anniversary of Grant Date Percentage of Performance Units Vested ------------------------- -------------------------------------- First 25% Second 50% Third 75% Fourth 100%

7. PAYMENT FOR PERFORMANCE UNITS. (a) (i) Upon receipt of written notice in the form acceptable to the Committee from a Participant during the exercise window set by the Administrator of his or her surrender of all or a portion of such Participant's vested Performance Units and (ii) three months after the date of the termination of employment of a Participant with the Company for any reason (other than as provided in Section 7(c), below), the Participant shall be entitled to receive from the Company with respect to each then vested Performance Unit in the Participant's Account as to which the Participant has given a notice of surrender, or with respect to each then vested Performance Unit in the Participant's Account at the termination of employment, as the case may be, an amount determined as follows: (x) the Fair Market Value of each such Performance Unit in the Participant's Account as to which the Participant has given notice of surrender or the Fair Market Value of all such Performance Units in the Participant's Account at the date of termination of his employment with the Company, as the case may be, reduced by (y) the Fair Market Value of such Performance Unit as of the date of grant thereof to the Participant. (b) Payment to a Participant of the amount set forth in paragraph (a) next above for Performance Units shall be made in cash either in a lump sum or in equal bi-annual installments over a period not to exceed 3 years. The Administrator shall have the sole discretion to determine the method of payment under the Plan and the period over which such payment shall be made. Payment will be made or commence within ninety (90) days after the applicable date referred to in Section 7(a)(i) or (ii). A Participant will not be entitled to receive any earnings on the value of his Performance Units with respect to the period between the date referred to in Section 7(a)(i) or, if Participant's entitlement arises under Section 7(a)(ii), the date of termination of employment and the receipt of payments under the Plan. 8. VALUATION OF PERFORMANCE UNITS. For all purposes of the Plan, the Fair Market Value of a Performance Unit and of the common stock of the Company as of the date of grant, as of the date of exercise and as of the date of termination of employment shall be 4 the Fair Market Value immediately preceding each such date, as determined by the Administrator quarterly, as of a date determined by the Administrator but not later than the 45th day of each quarter. For purposes of determining Fair Market Value, the 28,000 Performance Units subject to the Plan shall have an aggregate Fair Market Value at any time equal to 7% of the Fair Market Value at such time of all the shares of common stock of the Company that were outstanding at January 1, 1998. The aggregate Fair Market Value of all the outstanding common stock of the Company at January 1, 1998 (without regard to Performance Units) shall be deemed to be $80 million and the Fair Market Value of each Performance Unit at that time shall be deemed to be $200. 9. FORFEITURE OF PERFORMANCE UNITS. If (i) the employment of a Participant with the Company is terminated for any reason or (ii) the owner of a majority of shares of capital stock of the Company terminates the business of, or liquidates or dissolves, the Company; (iii) substantially all of the assets of the Company are sold, or (iv) the Company merges or consolidates with any other corporation and either the Company is not the surviving corporation of such merger or consolidation or the owners of the common stock of the Company immediately before such merger or consolidation do not own, directly or indirectly, as a result of such ownership, at least a majority of the common stock of the surviving corporation of the merger or consolidation, then each Participant's rights with respect to Performance Units which have not vested on or prior to the date of the occurrence of such event will terminate and be forfeited and neither the Participant nor his heirs, personal representatives, successors or assigns shall have any future rights with respect to any such Performance Units. 10. CHANGES IN CAPITAL AND CORPORATE STRUCTURE. In the event of any change in the outstanding shares of common stock of the Company by reason of a recapitalization, reclassification, reorganization, stock split, reverse stock split, combination of shares, stock dividend or similar transaction, the Administrator shall proportionately adjust, in an equitable manner, the number of Performance Units held by Participants under the Plan to maintain the relationship between 28,000 Performance Units and 7% of outstanding common stock of the Company at January 1, 1998. The foregoing adjustment shall be made in a manner that will cause the relationship between the aggregate appreciation in outstanding common stock of the Company and the increase in value of each Performance Unit granted hereunder to remain unchanged as a result of the applicable transaction. 11. NONTRANSFERABILITY. Performance Units granted under the Plan, and any rights and privileges pertaining thereto, may not be transferred, assigned, pledged or hypothecated in any manner, by operation of law or otherwise, other than by will or by the laws of descent and distribution, and shall not be subject to execution, attachment or similar process. In the event of a Participant's death, payment of any amount due under the Plan shall be made to the duly appointed and qualified executor or other personal representative of the Participant to be distributed in accordance with the Participant's will or applicable intestacy law, or in the event that there shall be no such representative duly appointed and qualified within six (6) months after the date of death of such deceased Participant, then to such persons as, at the date of his death, would be entitled to share in the distribution of such deceased Participant's personal estate under 5 the provisions of the applicable statute then in force governing the descent of intestate property, in the proportions specified in such statute. 12. WITHHOLDING. The Company shall have the right to deduct from all amounts paid pursuant to the Plan any taxes required by law to be withheld with respect to such awards. 13. PERFORMANCE UNIT EXCHANGE PROGRAM. The Administrator will have the authority to effect, at any time and from time to time, with the consent of the affected Participants, the cancellation of any or all outstanding Performance Units under the Plan and to grant in substitution therefor new Performance Units under the Plan. 14. VOTING AND DIVIDEND RIGHTS. No Participant shall be entitled to any voting rights, to receive any dividends, or, except as provided under Section 10, to have his Account credited or increased as a result of any dividends or other distribution with respect to the common stock of the Company. 15. MISCELLANEOUS PROVISIONS. (a) No Employee, Director, Consultant or other person shall have any claim or right to be granted an award under the Plan. (b) The Plan shall at all times be entirely unfunded and no provision shall at any time be made with respect to segregating assets of the Company for payment of any benefits hereunder. No Participant or other person shall have any interest in any particular assets of the Company by reason of the right to receive a benefit under the Plan and any such Participant or other person shall have only the rights of a general unsecured creditor of the Company with respect to any rights under the Plan. (c) Except when otherwise required by the context, any masculine terminology in this document shall include the feminine, and any singular terminology shall include the plural. 16. EFFECTIVENESS AND TERMS OF PLAN. The effective date of the Plan shall be January 1, 1998. The Administrator may at any time terminate the Plan and unless sooner terminated by the Committee, the Plan shall terminate on December 31, 2008. No Performance Units shall be granted pursuant to the Plan after the date of termination of the Plan, although after such date payments shall be made with respect to Performance Units granted prior to the date of termination. 17. NO EMPLOYMENT RIGHTS. Neither the Plan nor any Performance Units shall confer upon any Employee, Director or Consultant any right to continue in the employ of the Company of any affiliate or constitute a contract or agreement of employment or interfere in any way with any right that the Company or an affiliate may have to reduce such person's compensation or to terminate such person's employment at any time with or without cause; however, nothing contained in the Plan or in any Performance Unit granted under the Plan shall 6 affect any contractual rights of an Employee, Director or Consultant pursuant to a written employment or other agreement. 18. AMENDMENT AND TERMINATION OF THE PLAN. (a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan in whole or in part. (b) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights or increase the obligations of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. 19. GOVERNING LAW. The Plan shall be governed by and construed in accordance with the laws of the state of Delaware. 7 EX-10.32 5 v88021exv10w32.txt EXHIBIT 10.32 Exhibit 10.32 TELE.RING TELEKOM SERVICE GmbH as Borrower and EKOM TELECOMMUNICATIONS HOLDING AG as Lender AMENDMENT NO. 1 TO TERM LOAN AGREEMENT Attention: No Original Signed Counterpart or True Copy of this Agreement May Be Brought into Austria (See Clause 17) This Amendment No. 1 made on January 30, 2003, to the Term Loan Agreement made on June 29, 2001. It is agreed as follows: BETWEEN: (1) TELE.RING TELEKOM SERVICE GmbH, a limited liability company established and validly existing under the laws of Austria whose registered number at the Vienna Commercial Court is FN 171112k (the "Borrower"); and (2) EKOM TELECOMMUNICATIONS HOLDING AG, a joint stock corporation established and validly existing under the laws of Austria whose registered number at the Vienna Commercial Court is FN 158908p (the "Lender"). Whereas, the parties entered into the Term Loan Agreement on June 29, 2001 and the parties intend to modify the terms of the Term Loan Agreement as herein set forth. 1. Defined Terms 1.1 All terms used herein and not otherwise defined shall have the meanings ascribed to them in the Agreement. 1.2 The provisions of the Clauses listed below are amended by deleting such provisions as they currently exist in the Agreement and inserting the following provisions in lieu thereof or specifically amending such provisions pursuant to the instructions listed below, as the case may be: "Agreement" means the Term Loan Agreement dated June 29, 2001, as amended by the Letter Agreement dated April 5, 2002, and as further amended by this Amendment No. 1. "Commitment" means, at any time E185,000,000 (Euro one hundred eighty-five million). "Commitment Period" means the period commencing on the date of the Agreement and ending on the earlier of: (a) June 30, 2004; and (b) The date on which the Loan has been drawn down in full; "Repayment Date" means each of July 1, 2004, July 1, 2005, July 1, 2006 and December 31, 2006. 2.1 The Lender, upon the terms and subject to the conditions hereof, and relying upon each of the representations and warranties in Clause 8, agrees to make available to the Borrower a term loan facility of up to E185,000,000. The claims of the Lender against the Borrower under this Agreement will rank at least pari passu with the claims of all its other unsecured creditors save those whose claims are preferred solely by any bankruptcy, insolvency, liquidation or other similar laws of general application. Subject to Sections 3 and 4, the Lender shall make available Advances to the Borrower for Drawdown in an aggregate amount not to exceed E185,000,000 less any prior Advances made, which Advances shall be used for the purposes described in or contemplated by the Business Plan. The Borrower agrees to apply all amounts raised by it hereunder in or towards satisfaction of the purposes of the Business Plan and the Lender shall not be obliged to concern itself with such application. 2.2 - Intentionally deleted 3.3; 3.3.1; 3.3.2; and 3.3.3 - intentionally deleted. 3.4 In Clause 3.4, the reference to Clause 3.3 is deleted. 4.1.2 In Clause 4.1.2, the date "April 1, 2003" is changed to "June 30, 2004." 6.1 The Borrower shall repay the Loan in installments on the Repayment Dates set forth below, which installments shall be calculated in the following manner: 6.1.1 On July 1, 2004, an installment of principal equal to E83,333,333 less the difference between E250,000,000 and the total principal amount of the Loan outstanding on June 30, 2004, together with interest in an amount calculated in accordance with Exhibit A to this Amendment No. 1. The remaining principal amount after the payment of the installment set forth in this Clause 6.1.1 shall be referred to below in this section as the "Remaining Principal Amount." 6.1.2 On each of July 1, 2005 and July 1, 2006, one-third of the Remaining Principal Amount of the Loan (after the payment of the installment set forth in Clause 6.1.1 above) together with interest accrued on the principal amount of the Loan being repaid on such Repayment Dates as illustrated on Exhibit A to this Amendment No. 1. 6.1.3 On December 31, 2006, one-third of the Remaining Principal Amount of the Loan (after the payment of the installment set forth in Clause 6.1.1 above together with the balance of the outstanding interest, as illustrated on Exhibit A to this Amendment No. 1. 6.1.4 For example, if on June 30, 2004 Borrower had borrowed a total of E185,000,000, the Repayments would be as follows: 2 (a) July 1, 2004 - E83,333,333 less E65,000,000 equals a principal payment of E18,333,333, plus interest in an amount calculated in accordance with Exhibit A to this Amendment No. 1. (b) July 1, 2005, July 1, 2006 and December 31, 2006 - E55,555,556 plus interest in an amount calculated in accordance with Exhibit A to this Amendment No. 1. (c) For the avoidance of doubt, the parties have agreed that (i) interest will be compounded (i.e. interest on interest) only for the period from the date of the first Advance through December 31, 2002; thereafter, for the balance of the term of the Loan, interest will not be compounded; (ii) the amount of interest accrued and unpaid on the total outstanding principal of the Loan as of December 31, 2002 (Euro 145 million) is Euro 8,834,800; (iii) the amount of interest to be paid on July 1, 2004 shall be one-half of the total amount of the interest that is accrued and unpaid on the total amount of the principal outstanding on June 30, 2004. (The amount of such interest is currently estimated to be Euro 13,206,393 as set forth on Exhibit A, based upon the assumptions contained in Exhibit A as to the actual Interest Rates, the aggregate amount of principal drawn and the dates on which Advances will be made through June 30, 2004. The assumptions (Interest Rates, amount of principal drawn and the dates on which Advances will be made) shall not be binding and are made for illustrative purposes only); (iv) the final payment to be made on December 31, 2006 shall include the balance of the principal outstanding and all remaining accrued but unpaid interest; and (v) the rate used to calculate the interest shall be the Interest Rate, as such term is defined in this Agreement. 6.2 The last sentence of Clause 6.2 is deleted in its entirety and the following is substituted in lieu thereof: "Commencing January 1, 2003, Borrower shall, twice during each calendar year until the Facility and all accrued interest has been repaid in full, use commercially reasonable endeavors, in the same manner as it has done in the past and represented to the Lender, to refinance the Facility." 9.4 In Clause 9.4, the date "July 1, 2006" is changed to "December 31, 2006." 13.1(c) In Clause 13.1(c), the reference to "E250,000,000" shall be deleted and "E185,000,000" shall be substituted in lieu thereof. 16.1.2 Copies of all notices sent to the Borrower shall be sent to: Friedman Kaplan Seiler & Adelman LLP 1633 Broadway, 46th Floor New York, NY 10019-6708 3 Attn.: Barry A. Adelman and Richard M. Hoffman Fax: 212-833-1250 17.2 The references in Clause 17.2 to "E250,000,000" shall be deleted and "E185,000,000" substituted in lieu thereof. 2. Full Force and Effect Except as specifically set forth herein, the Term Loan Agreement as modified by the Letter Agreement dated April 5, 2002 and as amended hereby, shall remain in full force and effect in accordance with its terms. 3. Shareholder Consent By his signature below, Mr. Bradley Horwitz also gives his consent to this Amendment No. 1 in his capacity as Managing Director (with sole power of representation) of, and on behalf of, the Borrower's parent, EHG Einkaufs-und Handels GmbH. 4 IN WITNESS WHEREOF, the parties to this have caused this Amendment No. 1 to be duly executed on the date first above written. Borrower SIGNED for and on behalf of TELE.RING TELEKOM SERVICE GmbH By:__________________________________ Lender SIGNED for and on behalf of EKOM TELECOMMUNICATIONS HOLDING AG By: __________________________________ Shareholder (solely as to Clause 3) SIGNED for and on behalf of EHG EINKAUFS-und HANDELS GmbH By:__________________________________ Brad Horwitz Managing Director 5 EX-10.34 6 v88021exv10w34.txt EXHIBIT 10.34 CLIFFORD CHANCE Exhibit 10.34 PUNDER DATED 30 APRIL 2002 WESTERN WIRELESS INTERNATIONAL D.O.O. as Borrower IKB DEUTSCHE INDUSTRIEBANK AG as Lead Arranger, Off Shore Security Agent, Off Shore Facility Agent and Original Euro Facility Bank KREDITANSTALT FUR WIEDERAUFBAU as Lead Arranger and Original Euro Facility Bank RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. as Senior Co-Arranger and Original Euro Facility Bank NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as Senior Co-Arranger, On Shore Security Agent, On Shore Facility Agent and Original SIT Facility Bank LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE as Co-Arranger and Original Euro Facility Bank HYPO ALPE-ADRIA-BANK AG as Co-Arranger and Original Euro Facility Bank HYPO ALPE-ADRIA-BANK D.D. as Original SIT Facility Bank and OTHERS ------------------------------------------------ FACILITY AGREEMENT RELATING TO THE PROJECT FINANCING OF THE VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA ------------------------------------------------ CONTENTS

CLAUSE PAGE 1. Definitions and Interpretation ............................... 2 2. The Facilities ............................................... 27 3. Purpose ...................................................... 28 4. Conditions of Utilisation .................................... 29 5. Utilisation .................................................. 30 6. Loans ........................................................ 33 7. Guarantees and Letters of credit ............................. 33 8. SIT Facility Guarantees and Letters of Credit ................ 34 9. Interest on Loans ............................................ 36 10. Interest Periods ............................................. 41 11. Changes to the Calculation of Interest ....................... 42 12. Fees ......................................................... 43 13. Repayment .................................................... 45 14. Prepayment and Cancellation .................................. 46 15. Tax Gross-Up and Indemnities ................................. 50 16. Increased Costs .............................................. 52 17. Other Indemnities ............................................ 53 18. Mitigation by the Banks ...................................... 54 19. Costs and Expenses ........................................... 54 20. Representations .............................................. 56 21. Reporting Requirements ....................................... 62 22. Financial Covenants and Network Milestones ................... 65 23. Accounts and Payments ........................................ 68 24. General Undertakings ......................................... 77 25. Events of Default ............................................ 85 26. Changes to the Parties ....................................... 90

27. Role Of The Agent And The Arranger ........................... 94 28. Conduct Of Business By The Finance Parties ................... 98 29. Sharing Among The Finance Parties ............................ 99 30. Payment Mechanics ............................................ 101 31. Set Off ...................................................... 103 32. Notices ...................................................... 103 33. Calculations and Certificates ................................ 106 34. Partial Invalidity ........................................... 107 35. Remedies and Waivers ......................................... 107 36. Amendments and Waivers ....................................... 107 37. Counterparts ................................................. 108 38. Governing Law ................................................ 109 39. Arbitration .................................................. 109 40. Jurisdiction ................................................. 109 THIS AGREEMENT is dated 30 April 2002 and made between: (1) WESTERN WIRELESS INTERNATIONAL D.O.O., LJUBLJANA as borrower (the "BORROWER"); (2) IKB DEUTSCHE INDUSTRIEBANK AG AND KREDITANSTALT FUR WIEDERAUFBAU, as lead arrangers (the "LEAD ARRANGERS"); (3) RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. and NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as senior co-arrangers (the "SENIOR CO-ARRANGERS"); (4) LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as co-arrangers (the "CO-ARRANGERS"); (5) IKB DEUTSCHE INDUSTRIEBANK AG, KREDITANSTALT FUR WIEDERAUFBAU, RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as original lenders with regard to the Euro Facility (the "ORIGINAL EURO FACILITY BANKS"); (6) IKB DEUTSCHE INDUSTRIEBANK AG, as facility agent with regard to the Euro Facility and the SIT Facility (the "OFF SHORE FACILITY AGENT"); (7) IKB DEUTSCHE INDUSTRIEBANK AG, as security agent with regard to the Off Shore Security (the "OFF SHORE SECURITY AGENT"); (8) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as an original lender and issuing bank with regard to the SIT Facility and HYPO ALPE-ADRIA-BANK D.D. as original lender with regard to the SIT Facility (the "ORIGINAL SIT FACILITY BANKS"); (9) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as local facility agent with regard to the SIT Facility (the "ON SHORE FACILITY AGENT"); and (10) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as security agent with regard to the On Shore Security (the "ON SHORE SECURITY AGENT"). WHEREAS (A) On November 16, 2000, the Borrower was selected to become the third mobile operator in Slovenia by the Slovenian telecommunications regulator and on 3 January 2001 signed the Concession Agreement. (B) The Borrower intends to install and to operate a third wireless communication network in Slovenia. (C) For the financing of the construction and operation of such network the Original Euro Facility Banks have agreed to grant two term loan facilities in the amount of Euro 96,443,308.50 upon the terms and conditions set out below and the Original SIT Facility Banks have agreed to grant a revolving loan, guarantee and letter of credit facility in the amount of SIT 4,400,000,000. - 1 - IT IS AGREED as follows: SECTION 1 INTERPRETATION 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS In this Agreement: "ABANDONMENT OF THE PROJECT" means that the Sponsors and/or Shareholders fail to provide the Borrower with: (a) the assistance required pursuant to clause 3.2.2 (Technical and managerial capacity and assistance) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee and/or the Management Agreement; and/or (b) the Sponsor Contributions required in accordance with the Sponsors' and Shareholders' Undertaking and Completion Guarantee are not made at the times and in the manner required by the Sponsors' and Shareholders' Undertaking and Completion Guarantee. "AFFILIATE" means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company. "AGENT" means the Off Shore Facility Agent and/or the On Shore Facility Agent as the case may be. "AGREEMENT" means this agreement including all of its Schedules. "AMOUNT DEMANDED" has the meaning given to it in Clause 8.1 (Notification of demand). "ANNUALISED EBITDA" means twice the aggregate EBITDA in respect of the last two (2) Quarters immediately preceding the relevant calculation date. "APPLICABLE MARGIN" means the ECA Facility Applicable Margin, the Commercial Facility Applicable Margin or the SIT Facility Applicable Margin as the case may be. "ARRANGER" means any of the Lead Arrangers, the Senior Co-Arrangers and/or the Co-Arrangers as the case may be. "ASSET AND LICENCE PLEDGE AND LEASE CONTRACTS ASSIGNMENT AGREEMENT" means the asset and licence pledge and lease contracts assignment agreement to be entered into between the Borrower and the Senior Creditors. "ASSIGNMENT OF RECEIVABLES AS SECURITY AND ASSIGNMENT OF INSURANCE POLICIES AGREEMENT" means the assignment of receivables as security and assignment of insurance policies agreement to be entered into between the Borrower and the Senior Creditors. "AUTHORISATION" means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration. - 2 - "AVAILABILITY PERIOD" means: (a) in relation to the ECA Facility, the period from the date upon which the conditions precedent in Schedule 6 (Conditions Precedent) have been satisfied up to and including 31 December 2003; (b) in relation to the Commercial Facility, the period from the date upon which the conditions precedent in Schedule 6 (Conditions Precedent) have been satisfied up to and including 31 December 2004; and (c) in relation to the SIT Facility, the period from the date upon which the conditions precedent in Schedule 6 (Conditions Precedent) have been satisfied up to and including 31 October 2009. "AVAILABLE COMMITMENT" means, in relation to a Facility, a Bank's Commitment under that Facility minus: (a) the amount of its participation under that Facility in any outstanding Loans and, if applicable, SIT Facility Guarantees or LCs; and (b) in relation to any proposed Utilisation, the amount of its participation under that Facility in any Loans that are due to be made and, if applicable, SIT Facility Guarantees or LCs that are due to be issued or opened on or before the proposed Utilisation Date, other than, in relation to any proposed Utilisation under the SIT Facility only, that Bank's participation in any SIT Facility Loans and, if applicable, SIT Facility Guarantees or LCs that are due to be repaid or prepaid or expire on or before the proposed Utilisation Date. "AVAILABLE FACILITY" means: (a) in relation to a Euro Facility, the aggregate of each Euro Facility Bank's Available Commitment; and (b) in relation to the SIT Facility, the aggregate of each SIT Facility Bank's Available Commitment. "BANK" means: (a) any of the Original Euro Facility Banks and any of the Original SIT Facility Banks; and (b) any bank, financial institution, trust, fund or other entity which has become a Party in accordance with Clause 26 (Changes to the Parties), which in each case has not ceased to be a Party in accordance with the terms of this Agreement. "BENEFICIARY" means a beneficiary of a SIT Facility Guarantee or LC. "BILLS OF EXCHANGE" means ten (10) blank bills of exchange to be issued by the Borrower as collateral for the purpose of securing the obligations of the Borrower under this Agreement. "BORROWER" means Western Wireless International d.o.o. - 3 - "BORROWER'S SHARE PLEDGE AGREEMENT" means the agreement to be entered into by the Shareholders, the Borrower and the Senior Creditors for the purpose of pledging the Shareholders' interests in the Borrower to the Senior Creditors. "BREAK COSTS" means, in the case of any Euro Facility Loan, the amount (if any) in Euro or, in the case of any SIT Facility Loan, the amount (if any) in SIT by which: (i) the interest which a Bank should have received for the period from the date of receipt of all or any part of its participation in a Loan or Unpaid Sum to the last day of the current Interest Period in respect of that Loan or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period; exceeds: (ii) the amount which that Bank would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank in the European Interbank Market or as the case may be the Slovenian Interbank Market for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period in each case as determined and notified to the Borrower by the relevant Bank in accordance with Clause 11.4 (Break Costs) on the date the Borrower becomes liable for such costs in accordance with this Agreement. "BUSINESS DAY" means a day (other than a Saturday or Sunday) on which banks are open for general business in Ljubljana (in relation to any date for payment or a Utilisation under the SIT Facility) and in all other cases in Dusseldorf and Ljubljana and (in relation to any date for payment or purchase of Euro) any TARGET Day. "BUSINESS PLAN" means, prior to the delivery of the first Updated Business Plan, the Initial Business Plan and thereafter the most recently delivered Updated Business Plan. "CAPITAL EXPENDITURE RESERVE ACCOUNT" means the account established pursuant to Clause 23.7 (Capital Expenditure Reserve Account). "CASH FLOW" means, in respect of the relevant period, EBITDA plus the amount of any reductions in working capital and any realised foreign exchange gains less the amount of any increases in working capital, income tax and realised foreign exchange losses. "CASH INTEREST EXPENSE" means in relation to any period the total amount of all interest, fees and commissions due and payable in respect of Financial Indebtedness during such period. "CASH SHORTFALL" means the inability of the Borrower to meet its payment obligations when due in accordance with Clauses 23.3(d)(i) to (vii) (Application of moneys on the Proceeds and Revenue Accounts) at any time. "CFO" means the person holding the office of chief financial officer of the Borrower. "CLAIMS ASSIGNMENT AND BILLS OF EXCHANGE AGREEMENT" means the claims assignment and bills of exchange agreement to be entered into between the Borrower and the Senior Creditors. "CO-ARRANGERS" means Landesbank Schleswig-Holstein Girozentrale and Hypo Alpe-Adria-Bank AG. - 4 - "COMMERCIAL FACILITY" means the term loan facility made available under this Agreement as described in Clause 2 (The Facilities). "COMMERCIAL FACILITY APPLICABLE MARGIN" has the meaning given to it in Clause 9.2(b) (Calculation of floating rate interest under the Commercial Facility). "COMMERCIAL FACILITY APPLICABLE MARGIN ADJUSTMENT DATE" has the meaning given to it in Clause 9.2(b) (Calculation of floating rate interest under the Commercial Facility). "COMMERCIAL FACILITY COMMITMENT" means: (a) in relation to an Original Euro Facility Bank, the amount set opposite its name under the heading "Commercial Facility Commitment" in Schedule 1 (Commitments) and the amount of any other Commercial Facility Commitment transferred to it under this Agreement; and (b) in relation to any other Euro Facility Bank, the amount of any Commercial Facility Commitment transferred to it under this Agreement, to the extent not cancelled, reduced or transferred by it under this Agreement. "COMMERCIAL FACILITY LOAN" means a loan made or to be made under the Commercial Facility or the principal amount outstanding for the time being of that loan. "COMMERCIAL FACILITY REPAYMENT DATE" means the dates set out in Schedule 2 (Repayment dates). "COMMITMENT" means a ECA Facility Commitment, Commercial Facility Commitment or SIT Facility Commitment. "CONCESSION AGREEMENT" means the concession agreement between the Government and the Borrower dated January 03, 2001 based on the Government's decision no. 347-16/99-6 dated 16 November 2000. "CONFIDENTIALITY UNDERTAKING" means a confidentiality undertaking substantially in a recommended form of the LMA as set out in Schedule 3 (LMA Form of Confidentiality Undertaking) or in any other form agreed between the Borrower and the Off Shore Facility Agent. "CONTRIBUTED CAPITAL" means the sum of (a) Equity Contributions to the Borrower plus (b) Subordinated Loans (but excluding in each case any deferred interest or dividend amounts thereon). "CONTRIBUTED CAPITAL RATIO" means the ratio of Contributed Capital to the sum of Contributed Capital plus aggregate Financial Indebtedness. "COVENANT COMPLIANCE CERTIFICATE" means a certificate substantially in the form set out in Schedule 14 (Covenant Compliance Certificate). "DEBT SERVICE" means, in relation to any period, the sum of (a) Cash Interest Expense plus (b) the principal amount of any Financial Indebtedness due to be repaid in accordance with its terms during such period. "DEBT SERVICE COVER RATIO" OR "DSCR" means the Cash Flow calculated by reference to the last two (2) Quarters immediately preceding the relevant calculation date divided - 5 - by the Debt Service calculated by reference to the last two (2) Quarters immediately preceding the relevant calculation date. "DEBT SERVICE PAYMENTS" means any interest, principal, fees and any other financing costs payable by the Borrower under the Facilities, the Hedging Agreements, the Sponsors Unsecured Loan Agreement and the Lucent Loan Agreement. "DEBT SERVICE RESERVE ACCOUNT" means the account to be set up and funded by the Borrower in accordance with Clause 23.9 (Debt Service Reserve Account). "DEBT SERVICE RESERVE ACCOUNT PLEDGE AGREEMENT" means the debt service reserve account pledge agreement to be entered into between the Borrower and the Off Shore Security Agent acting on behalf of the Senior Creditors. "DEBT SERVICE ACCOUNT" means the account established pursuant to Clause 23.6 (Debt Service Account). "DEBTOR" has the meaning given to it in Clause 25.1.8 (Insolvency). "DELIVERY CONTRACT" means the delivery contract between the Equipment Vendor and the Borrower dated 15 March 2001 and signed on 21 March 2001 and 30 April 2001 as amended from time to time. "DELIVERY CONTRACT CLAIMS AND LICENCE ASSIGNMENT AGREEMENT" means the delivery contract claims and licence assignment agreement to be entered into between the Equipment Vendor and the Off Shore Facility Agent acting on behalf of the Senior Creditors. "DISCHARGED RIGHTS AND OBLIGATIONS" has the meaning given to it in Clause 26.5(b)(i) (Procedure for transfer). "DISPUTE" has the meaning given to it in Clause 39.1 (Arbitration). "DSRA-REQUIRED BALANCE" has the meaning given to it in Clause 23.9.2 (Debt Service Reserve Account). "EBITDA" means in relation to the relevant period, the sum of: (a) net income; (b) the sum of interest expense in respect of Financial Indebtedness minus interest earnings; (c) taxes; (d) depreciation and amortisation; and (e) other finance and non-cash charges. "ECA" means Hermes Kreditversicherungs AG-, Hamburg. "ECA COVER DOCUMENTS" means the documentation issued by the ECA in connection with a "Guarantee of Finance Credit" under the terms of which the ECA guarantees the repayment of 95% of the ECA Facility upon the occurrence of certain political and/or commercial risk events. - 6 - "ECA FACILITY" means the term loan facility made available under this Agreement as described in Clause 2 (The Facilities) (divided into ECA Facility Tranche 1, ECA Facility Tranche 2 and ECA Facility Tranche 3) and which is covered by the ECA pursuant to the ECA Cover Documents. "ECA FACILITY APPLICABLE MARGIN" has the meaning given to it in Clause 9.1(b) (Calculation of floating rate interest under the ECA Facility). "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT DATE" has the meaning given to it in Clause 9.1(b) (Calculation of floating rate interest under the ECA Facility). "ECA FACILITY COMMITMENT" means: (a) in relation to an Original Euro Facility Bank, the aggregate amount set opposite its name under the heading "ECA Facility Commitment" in Schedule 1 (Commitments) and the amount of any other ECA Facility Commitment transferred to it under this Agreement; and (b) in relation to any other Euro Facility Bank, the amount of any ECA Facility Commitment transferred to it under this Agreement, to the extent not cancelled, reduced or transferred by it under this Agreement. "ECA FACILITY LOAN" means a loan made or to be made under the ECA Facility or the principal amount outstanding for the time being of that loan. "ECA FACILITY TRANCHE 1" has the meaning given to it in Clause 2.1(a)(i) (The Facilities). "ECA FACILITY TRANCHE 2" has the meaning given to it in Clause 2.1(a)(i) (The Facilities). "ECA FACILITY TRANCHE 3" has the meaning given to it in Clause 2.1(a)(i) (The Facilities). "ECA FACILITY TRANCHE 1 COMMITMENT" means: (a) in relation to an Original Euro Facility Bank, the amount set opposite its name under the heading "ECA Facility Tranche 1 Commitment" in Schedule 1 (Commitments) and the amount of any other ECA Facility Tranche 1 Commitment transferred to it under this Agreement; and (b) in relation to any other Euro Facility Bank, the amount of any ECA Facility Tranche 1 Commitment transferred to it under this Agreement, to the extent not cancelled, reduced or transferred by it under this Agreement. "ECA FACILITY TRANCHE 2 COMMITMENT" means: (a) in relation to an Original Euro Facility Bank, the amount set opposite its name under the heading "ECA Facility Tranche 2 Commitment" in Schedule 1 (Commitments) and the amount of any other ECA Facility Tranche 2 Commitment transferred to it under this Agreement; and (b) in relation to any other Euro Facility Bank, the amount of any ECA Facility Tranche 2 Commitment transferred to it under this Agreement, - 7 - to the extent not cancelled, reduced or transferred by it under this Agreement. "ECA FACILITY TRANCHE 3 COMMITMENT" means: (a) in relation to an Original Euro Facility Bank, the amount set opposite its name under the heading "ECA Facility Tranche 3 Commitment" in Schedule 1 (Commitments) and the amount of any other ECA Facility Tranche 3 Commitment transferred to it under this Agreement; and (b) in relation to any other Euro Facility Bank, the amount of any ECA Facility Tranche 3 Commitment transferred to it under this Agreement, to the extent not cancelled, reduced or transferred by it under this Agreement. "ECA PREMIUM" means the fee payable to the ECA by the Off Shore Facility Agent pursuant to the ECA Cover Documents and by the Equipment Vendor pursuant to any additional cover granted by the ECA to the Equipment Vendor in connection with the Delivery Contract. "ELIGIBLE EXPENDITURE" means expenditures which do not exceed and may be applied in respect of: (a) 85 per cent. of the Estimated Contract Value; (b) 85 per cent. of the ECA Premium due to the ECA (or to the Equipment Vendor in reimbursement of amounts paid by the Equipment Vendor to the ECA in respect of the ECA Premium) under the terms of the ECA Cover Documents; and (c) 85 per cent. of interest due on the ECA Facility during the Availability Period. "ENVIRONMENTAL CLAIM" means any claim, proceeding or investigation by any person in respect of any Environmental Law. "ENVIRONMENTAL LAW" means any applicable law, regulation, court decision or administrative decision binding on the Borrower in any jurisdiction in which the Borrower conducts business which relates to the pollution or protection of the environment or harm to or the protection of human health or the health of animals or plants. "ENVIRONMENTAL PERMITS" means any Authorisation and the filing of any notification, report or assessment required under any Environmental Law for the operation of the business of the Borrower conducted on or from the properties owned or used by the Borrower. "EQUIPMENT REVENUES" means revenues deriving from the sale of hand-sets. "EQUIPMENT VENDOR" means Lucent Technologies Network Systems GmbH, Nurnberg, Germany. "EQUITY CONTRIBUTION" means a cash contribution in the Share Capital or subsequent payments in cash or in kind towards the capital (Naknadna vplaeila). "ESTIMATED CONTRACT VALUE" means the estimated value of the equipment and services for all phases of the Project (comprising the Initial Configuration and the Planned Network Expansion) payable under the Delivery Contract, being Euro 60,548,303. - 8 - "ETSI" means the European Telecommunications Standards Institute. "EURIBOR" means, in relation to any Loan in Euro: (a) the applicable Screen Rate; or (b) (if no Screen Rate is available for the Interest Period of that Loan) the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the Off Shore Facility Agent at its request quoted by the Reference Banks to leading banks in the European Interbank Market, as of 11:00 am (Central European time) on the Quotation Day for the offering of deposits in Euro for a period comparable to the Interest Period of the relevant Loan. "EURO" means the single currency unit of the European Union as constituted by the Treaty on European Union as referred to in European Monetary Union legislation. "EURO FACILITY" means the ECA Facility and/or the Commercial Facility. "EURO FACILITY BANK" means any Bank which has become a Party in accordance with the terms of this Agreement, which will participate in the Euro Facility and which, in any case, has not ceased to be a Party to this Agreement. "EURO FACILITY INTEREST PAYMENT DATE" means the last day of an Interest Period or where an Interest Period is longer than 3 Months, the last day of each consecutive period of 3 Months from (and including) the first day of that Interest Period. "EURO FACILITY LOAN" means a loan made or to be made under a Euro Facility or the principal amount outstanding for the time being of that loan. "EVENT OF DEFAULT" means any event or circumstance specified as such in Clause 25 (Events of Default). "EXCESS CASH FLOW" means any amount available for further distribution from time to time following the application of any amounts from time to time standing to the credit of the Proceeds and Revenue Accounts pursuant to Clauses 23.3(d)(i) to (vii) (Application of moneys on the Proceeds and Revenue Accounts) excluding the following amounts, as at the date of prepayment pursuant to Clause 14.5.1(Mandatory prepayments): (a) the amount of any Contributed Capital: (i) in addition to that required to be provided by the Sponsors or the Shareholders under the Sponsors' and Shareholders' Undertaking and Completion Guarantee; and/or (ii) made by a Sponsor under clause 3.3 (Contingent Equity) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee, which exceeds the amount of the Cash Shortfall, in each case contributed in the immediately preceding Quarter; (b) the amount of any Insurance Proceeds standing to the credit of the Insurance Proceeds Account; (c) the amount of any Proceeds and Revenues standing to the credit of the Sale Proceeds Account; - 9 - (d) the amounts planned to be paid by the Borrower in accordance with Clause 23.3(d)(iii) and (vii) (Application of moneys on the Proceeds and Revenue Accounts) within the next twelve (12) month period which are provided for in the Business Plan and which are standing to the credit of the Capital Expenditure Reserve Account; and (e) the principal amount of any outstanding Permitted Indebtedness (other than indebtedness for borrowed money under the Finance Documents or the Subordinated Loans). "EXISTING BANK" has the meaning given to it in Clause 26.1 (Assignments and transfers by the Banks). "EXISTING WWIC LOAN" means the unsecured loan made to the Borrower by Western Wireless International Corporation in an aggregate principal amount not exceeding US Dollars 25,000,000. "EXISTING WWIC LOAN AGREEMENT" means the loan agreement, amended on 15 April 2002 and as further amended on 30 April 2002 setting forth the terms of the Existing WWIC Loan to the Borrower. "FACILITY" means the ECA Facility, the Commercial Facility and/or the SIT Facility. "FACILITY OFFICE" means the office or offices notified by a Bank to the Off Shore Facility Agent in writing on or before the date it becomes a Bank (or, following that date, by not less than five (5) Business Days written notice) as the office or offices through which it will perform its obligations under this Agreement. "FEE LETTER" means any letter or letters dated on or about the date of this Agreement between any of the Arrangers and the Borrower or any of the Agents and the Borrower setting out any of the fees referred to in Clause 12 (Fees) and the advisory agreement between the Borrower and the Off Shore Facility Agent dated 2 February 2001 as amended from time to time. "FINANCE DOCUMENTS" means each of: (a) this Agreement; (b) any Fee Letter; (c) the Security Documents; (d) any Hedging Agreement; (e) the Intercreditor Agreement; (f) the Sponsors' and Shareholders' Undertaking and Completion Guarantee; (g) the Lucent Loan Agreement; (h) the Sponsors Unsecured Loan Agreement; and (i) any other document designated as such by the Off Shore Facility Agent, the On Shore Facility Agent and the Borrower. "FINANCE PARTY" means any of the Agents, the Security Agents, the Issuing Bank, the Arrangers or the Banks. - 10 - "FINANCIAL INDEBTEDNESS" means, without duplication, any indebtedness for or in respect of: (a) moneys borrowed; (b) any amount raised by acceptance under any acceptance credit facility; (c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument; (d) the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with US GAAP, be treated as a finance or capital lease; (e) receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis); (f) any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing but excluding trade indebtedness arising in the normal course of business paid within 45 days from the date of invoice; (g) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value shall be taken into account PROVIDED THAT in respect of calculating the value of any interest rate or currency exchange rate derivative transaction entered into pursuant to a Hedging Agreement no account shall be taken of such transaction); (h) any counter-indemnity obligation (including a reimbursement obligation) in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and (i) the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in paragraphs (a) to (h) above. "3GPP" means the 3G Partnership Project. "GOVERNMENT" means the Government of the Republic of Slovenia. "GSM" means Global System For Mobile Communications, a standard for digital mobile telephone transmissions. "GSM ACTIVITIES" means all activities relating to or in connection with the use of GSM technology in relation to the Project. "HEDGING AGREEMENT" means any hedging agreement between the Borrower and any Hedging Counterparty designated as a Hedging Agreement by the Borrower and the Hedging Counterparty and notified to the Off Shore Facility Agent, in each case, in accordance with the terms of the Intercreditor Agreement. "HEDGING COUNTERPARTY" means the Original Hedging Counterparty and any bank or financial institution which accedes to the terms of the Intercreditor Agreement in accordance with the terms thereof. "HEDGING LETTER" means a letter from the Borrower to the Off Shore Facility Agent setting out its interest rate hedging strategy. - 11 - "HOLDING COMPANY" means, in relation to a company or corporation, any other company or corporation in respect of which it is a Subsidiary. "INCREASED COSTS" has the meaning given to it in Clause 16.1 (Increased costs). "INDEPENDENT TECHNICAL CONSULTANT" means Mr Sami Ali of Teleconsultants and Associates Limited, who shall assist the Banks in connection with the Project or any replacement consulting firm nominated by the Majority Banks after consultation with the Borrower. "INFORMATION MEMORANDUM" means the document dated September 2001 prepared by the Off Shore Facility Agent and approved by the Borrower in relation to the Project, distributed to the Banks and the ECA prior to the date hereof. "INITIAL BUSINESS PLAN" means a statement of the technical, economic and tax assumptions in the form of the financial model agreed between the Parties and referred to as the excel spreadsheet named "Base Case 12 July 01.xls". "INITIAL CONFIGURATION" means such part of the deliveries and services as agreed as at the date of the Delivery Contract to be made or rendered under the terms of the Delivery Contract for which the Borrower has placed a firm order with the Equipment Vendor. "INSURANCE" means any of the contracts of insurance which the Borrower is required from time to time to procure and maintain pursuant to Schedule 11 (Insurance). "INSURANCE PROCEEDS" means all proceeds of insurance payable to or received by the Borrower in relation to the Project but excluding third party insurance proceeds. "INSURANCE PROCEEDS ACCOUNT" means the account established pursuant to Clause 23.4 (Insurance Proceeds Account). "INTELLECTUAL PROPERTY" means the Intellectual Property Rights (i) required by the Borrower to carry on its business as it is then being conducted or (ii) any other Intellectual Property Rights which are material to the business of the Borrower. "INTELLECTUAL PROPERTY RIGHTS" means all know-how, patents, trademarks, designs, trading names, copyrights and other intellectual property rights (in each case whether registered or not and including all applications for the same). "INTERCREDITOR AGREEMENT" means the intercreditor agreement to be entered into between the Senior Creditors and the Borrower. "INTEREST COVERAGE RATIO" means the ratio of Cash Flow (calculated by reference to the last two (2) Quarters immediately preceding the relevant calculation date) to Cash Interest Expense for the same period. "INTEREST PAYMENT DATE" means a Euro Facility Interest Payment Date and/or a SIT Facility Interest Payment Date. "INTEREST PERIOD" means, in relation to a Loan, each period determined in accordance with Clause 10 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with Clause 9.5 (Default interest). "INTERNATIONAL MOBILE SUBSCRIBER IDENTITY" means a number allocated by a mobile operator which uniquely identifies a Subscriber. The number format and allocation methodology is stipulated within the relevant ETSI standards. - 12 - "ISSUING BANK" means Nova Ljubljanska banka d.d., Ljubljana or such other financial institution or bank from time to time which issues a SIT Facility Guarantee or LC. "ITU" means the International Telecommunications Union. "LEAD ARRANGERS" means IKB Deutsche Industriebank AG and Kreditanstalt fur Wiederaufbau. "LEGAL DUE DILIGENCE REPORT" means the due diligence report dated 28 March 2002 prepared by counsel to the Banks based on certain information provided by the Borrower. "LICENCE" means the GSM-1800 licence issued by the Government to the Borrower (including the Concession Agreement) and any renewal, extension or replacement thereof. "LMA" means the Loan Market Association. "LOAN" means a Euro Facility Loan or a SIT Facility Loan. "LOAN PROCEEDS ACCOUNT" means the account established pursuant to Clause 23.6 (Loan Proceeds Account). "LUCENT LOAN AGREEMENT" means the loan agreement to be entered into between Lucent Technologies Inc., the Equipment Vendor, the Borrower, and the Off Shore Facility Agent acting on behalf of the Senior Creditors. "MAJORITY BANKS" means: (a) if there are no Loans then outstanding and, if applicable, no SIT Facility Guarantees or LCs issued or opened, a Bank or Banks whose Commitments aggregate more than 66 2/3% of the Total Commitments (or, if the Total Commitments have been reduced to zero, aggregated more than 66 2/3% of the Total Commitments immediately prior to the reduction); or (b) at any other time a Bank or Banks whose participations in the Loans then outstanding and, if applicable, SIT Facility Guarantees or LCs, on issue or opened aggregate more than 66 2/3% of all Loans then outstanding and SIT Facility Guarantees or LCs then on issue or opened "MAJORITY SENIOR CREDITORS" has the meaning given to it in the Intercreditor Agreement. "MANAGEMENT AGREEMENT" means the management agreement to be entered into between the Borrower and Western Wireless International Corporation. "MARKET DISRUPTION EVENT" has the meaning given to it in Clause 11.2(c) (Market disruption). "MARKET STUDY" means the evaluation by DETECON GmbH, Bonn of the Business Plan for the Borrower dated 10 May 2001 with the update dated 27 July 2001. "MATERIAL ADVERSE EFFECT" means any event, occurrence or condition which has or could reasonably be expected to have a material adverse effect on: (a) the business, operation, property (taken as a whole) and/or financial condition of the Borrower and/or the Shareholders; - 13 - (b) the ability of the Borrower and/or the Sponsors to perform a payment obligation or other material obligation under a Transaction Document to which it is a party; (c) except as permitted under this Agreement, the validity or enforceability of a Material Contract; or (d) the validity or enforceability of any of the Security purported to be granted under the Security Documents (as and when such Security is required to be valid and enforceable). "MATERIAL ASSET" means any asset of the Borrower: (a) subject to or required to become subject to the Security Documents; (b) with a book value in excess of Euro 100,000; or (c) that is necessary in any material respect for the design, functionality or operability of the Network or for charging or maintenance of Subscribers of the Network and which the Off Shore Facility Agent (acting reasonably) notifies the Borrower (acting on the advice of the Independent Technical Consultant) is a Material Asset. "MATERIAL CONTRACTS" means each of: (a) the Licence and all material related documents; (b) the Software Licences; (c) the Delivery Contract; (d) the Finance Documents; (e) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** (f) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** (g) the contracts for the procurement of or support services in relation to Material Assets; (h) the lease agreement in respect of the Borrower's premises at Brnciceva ulica 49, 1231 Ljubljana and those lease agreements in respect of property upon which the assets subject to the Asset and Licence Pledge and Lease Contracts Assignment Agreement are situated; (i) the contracts in respect of the leasing of lines or sharing of infrastructure; (j) the Management Agreement; (k) the Existing WWIC Loan Agreement; (l) the documents entitled "General Terms and Conditions" relating to pre-paid and post-paid Subscribers which have been approved by the Ministry of Information Society or any substitute of such documents; - 14 - (m) any other document or agreement which the Off Shore Facility Agent and the Borrower agree to be a Material Contract; and (n) any replacement or substituted contract in respect of any of the above documents. "MONTH" means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that: (a) (subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day; (b) if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; (c) if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end. The above rules will only apply to the last Month of any period. "NETWORK" means the Borrower's telecommunication network including, without limitation, all associated hardware, software, infrastructure, civil works, tower, masts and antenna systems, links and interconnection in Slovenia using the GSM ETSI standards and any evolution of these standards to 3GPP standards, or otherwise, and any equipment conforming to ITU standards and shall include all hardware, licensed software and documentation, services and support procured under the Delivery Contract. "NEW BANK" has the meaning given to it in Clause 26.1 (Assignments and transfers by the Banks). "OFF SHORE FACILITY AGENT" means IKB Deutsche Industriebank AG. "OFF SHORE SECURITY" has the meaning given to it in the definition of Security Documents in this Clause 1.1. "OFF SHORE SECURITY AGENT" means IKB Deutsche Industriebank AG. "ON SHORE FACILITY AGENT" means Nova Ljubljanska banka d.d., Ljubljana. "ON SHORE SECURITY" has the meaning given to it in the definition of Security Documents in this Clause 1.1. "ON SHORE SECURITY AGENT" means Nova Ljubljanska banka d.d., Ljubljana. "ORACLE SOFTWARE ASSIGNMENT AGREEMENT" means the assignment agreement relating to the Oracle software licence to be entered into between the Borrower and the Senior Creditors. "ORIGINAL EURO FACILITY BANK" means each of IKB Deutsche Industriebank AG, Kreditanstalt fur Wiederaufbau, Raiffeisenlandesbank Oberosterreich reg.Gen.m.b.H., Landesbank Schleswig-Holstein Girozentrale and Hypo Alpe-Adria-Bank AG. - 15 - "ORIGINAL FINANCIAL STATEMENTS" means in relation to the Borrower, its audited financial statements for the financial year ended 31 December 2001 prepared in accordance with US GAAP. "ORIGINAL HEDGING COUNTERPART" means IKB International S.A., Luxembourg. "ORIGINAL SIT FACILITY BANK" means each of Nova Ljubljanska banka d.d. and Hypo Alpe-Adria-Bank d.d.. "PARTICIPATING MEMBER STATE" means any member state of the European Community that adopts or has adopted the Euro as its lawful currency in accordance with legislation of the European Community relating to Economic and Monetary Union. "PARTY" means a party to this Agreement. "PERMITTED ACCOUNTS" means the accounts listed in Schedule 7 (Permitted Accounts), those accounts required to be opened by the Borrower under Clause 23 (Accounts and Payments) and/or such other accounts agreed with the Off Shore Facility Agent pursuant to Clause 24.22 (Bank accounts). "PERMITTED ASSET SALES" means any sale, lease, transfer or disposal of any assets (including obsolete surplus assets) of the Borrower in the ordinary course of business (other than sales of Material Assets) on arm's length terms. "PERMITTED ENCUMBRANCES" means: (a) Security created pursuant to any of the Security Documents; (b) Security which does not affect or impair the Security created pursuant to the Security Documents or the assets subject to the Security created pursuant to the Security Documents, in each case arising out of retention of title provisions relating to the supply of goods in the ordinary course of business, payment for which is discharged when due; (c) any lien arising by operation of law in the ordinary course of the Borrower's business and securing an amount which is being contested in good faith or for which appropriate reserves have been made; (d) rights of set off arising by operation of law in the ordinary course of the Borrower's business which are being contested in good faith or for which appropriate reserves have been made; (e) Security created in accordance with Clause 24.33 (UMTS and other licences) and/or Clause 24.38 (Bills of Exchange and Security Deposits); and (f) Security created with the consent of the Banks. "PERMITTED INDEBTEDNESS" has the meaning given to it in Clause 24.31 (Indebtedness). "PLANNED NETWORK EXPANSION" means such part of the deliveries and services as agreed as at the date of the Delivery Contract to be made or rendered under the terms of the Delivery Contract for which the Borrower has been granted an option to place a firm order with the Equipment Vendor. "POPULATION COVERAGE" has the meaning given to it in Schedule 18 (Population Coverage Verification). - 16 - "POTENTIAL EVENT OF DEFAULT" means any event or circumstance specified in Clause 25 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of any of the foregoing) be an Event of Default. "PROCEEDS AND REVENUES" has the meaning given to it in Clause 23.2 (Payments into the Proceeds and Revenue Accounts). "PROCEEDS AND REVENUE ACCOUNT" means any of the accounts set up in accordance with Clause 23.1 (Proceeds and Revenue Accounts). "PROJECT" means the design, construction, testing, completion and operation of the Network. "PROJECT CONTRACTS" means any agreement entered into by the Borrower from time to time (other than a Material Contract). "PROJECT COSTS" means all costs and expenses for the design, construction, testing, financing and completion of the Project as set out in the Initial Business Plan and operation of the Project in accordance with the Business Plan. "PROJECT STATUS AND PROGRESS REPORT" means a report required pursuant to Clause 21.1(c)(iii) (Financial statements and other information) substantially in the form set out in Schedule 15 (Project Status and Progress Report). "QUARTER" means each period of three months in a financial year of the Borrower, the first such period of any financial year commencing on the first day of such financial year. "QUOTATION DAY" means: (a) in relation to any period for which an interest rate is to be determined in Euro two TARGET Days before the first day of that period unless market practice differs in the European Interbank Market for a currency, in which case the Quotation Day for that currency will be determined by the Off Shore Facility Agent in accordance with market practice in the European Interbank Market (and if quotations would normally be given by leading banks in the European Interbank Market on more than one day, the Quotation Day will be the last of those days); and (b) in relation to any period for which an interest rate is to be determined in SIT two (2) Business Days before the first day of that period. "RECOVERING FINANCE PARTY" has the meaning given to it in Clause 29.1 (Payments to Finance Parties). "REFERENCE BANKS" means, in relation to EURIBOR, the principal office in Frankfurt am Main of Deutsche Bank AG, the principal office in Dusseldorf of Westdeutsche Landesbank Girozentrale and the principal office in London of JP Morgan Chase or such other banks as may be appointed by the Off Shore Facility Agent in consultation with the Borrower. "REFERENCE INTEREST RATE" means, on any Quotation Day, the highest interest rate used by the On Shore Facility Agent for long term deposits of legal entities in SIT with maturities longer than two (2) years and shorter than 3 years and one day in accordance with the applicable "Resolution on Interest Rates of Nova Ljubljanska banka d.d., Ljubljana (Sklep o obrestnih merah Nove Ljubljanske banke d.d., Ljubljana)" or any - 17 - other applicable document of the On Shore Facility Agent containing substantially similar terms. "REPAYMENT DATE" means in relation to a Facility the dates specified for repayment in Schedule 2 (Repayment dates). "REPEATED REPRESENTATIONS" has the meaning given to it in Clause 20.2 (Repetition). "ROLLOVER SIT FACILITY LOAN" means one or more SIT Facility Loans: (a) made or to be made on the same day that a maturing SIT Facility Loan is due to be repaid; (b) the aggregate amount of which is equal to or less than the maturing SIT Facility Loan in SIT; and (c) made or to be made to the Borrower for the purpose of refinancing a maturing SIT Facility Loan. "RULES" has the meaning given to it in Clause 39.1 (Arbitration). "SALE PROCEEDS ACCOUNT" means the account established pursuant to Clause 23.5 (Sale Proceeds Account). "SCREEN RATE" means, in relation to EURIBOR, the percentage rate per annum determined by the Banking Federation of the European Union for the relevant period, displayed on the appropriate page of the Reuters screen as of 11:00 a.m. (Brussels time) on the Quotation Day. If the agreed page is replaced or service ceases to be available, the Off Shore Facility Agent may specify another page or service displaying the appropriate rate after consultation with the Borrower and the Euro Facility Banks. "SECURITY" means a mortgage, charge, pledge, lien, bill of exchange, security deposit or other security interest securing any obligation of any person or any other agreement or arrangement having a similar effect. "SECURITY AGENT" means the Off Shore Security Agent and/or the On Shore Security Agent. "SECURITY ASSIGNMENT OF RIGHTS UNDER A SUPPLY AND LICENSE AGREEMENT" means the security assignment of rights under a supply and license agreement to be entered into between the Borrower and the Off Shore Facility Agent acting on behalf of the Senior Creditors. "SECURITY DOCUMENTS" means each of: (a) the ECA Cover Documents; (b) the Security Assignment of Rights under a Supply and License Agreement; (c) the Delivery Contract Claims and Licence Assignment Agreement; (d) the Sponsors' Cash Collateral Account Pledge Agreement; (e) the Shareholders Pledge Agreement; and (f) the Debt Service Reserve Account Pledge Agreement; - 18 - (together the "OFF SHORE SECURITY"); and (g) the Borrower's Share Pledge Agreement; (h) the Asset and Licence Pledge and Lease Contracts Assignment Agreement; (i) the Claims Assignment and Bills of Exchange Agreement; (j) the Bills of Exchange; (k) the Assignment of Receivables as Security and Assignment of Insurance Policies Agreement; (l) the Trademark Pledge Agreement; and (m) the Oracle Software Assignment Agreement (together the "ON SHORE SECURITY"); and (n) any other document or agreement which the Off Shore Facility Agent and the Borrower agree to be a Security Document. "SELECTION NOTICE" means a notice substantially in the form set out in Schedule 5 (Selection Notice) given in accordance with Clause 10 (Interest Periods) in relation to a Euro Facility. "SENIOR CO-ARRANGERS" means Raiffeisenlandesbank Oberosterreich reg.Gen.m.b.H. and Nova Ljubljanska banka d.d., Ljubljana. "SENIOR CREDITORS" means the Finance Parties, the Hedging Counterparties and Lucent Technologies Inc. "SERVICE REVENUES" means Total Revenues minus Equipment Revenues. "SHARE" means an ordinary fully paid up share in the Share Capital. "SHARE CAPITAL" means the share capital of the Borrower as increased from time to time in accordance with the Sponsors' and Shareholders' Undertaking and Completion Guarantee. "SHAREHOLDERS" means Western Wireless International Slovenia Corporation and Western Wireless International Slovenia II Corporation and any permitted transferee in accordance with and pursuant to the Sponsors' and Shareholders' Undertaking and Completion Guarantee. "SHAREHOLDERS PLEDGE AGREEMENT" means the shareholder pledge agreement to be entered into by Western Wireless International Corporation for the purposes of pledging its interests in the Shareholders to the Off Shore Security Agent acting on behalf of the Senior Creditors. "SHARING PAYMENT" has the meaning given to it in Clause 29.1 (Payments to Finance Parties). "SIM" means a subscriber identity module. "SIT" means the lawful monetary unit of the Republic of Slovenia from time to time. - 19 - "SIT FACILITY" means the revolving loan, guarantee and letter of credit issuance facility made available under this Agreement as described in Clause 2 (The Facilities). "SIT FACILITY APPLICABLE MARGIN" has the meaning set out in Clause 9.3.1(b) (Calculation of floating rate interest under the SIT Facility). "SIT FACILITY BANK" means any Bank which has become a Party in accordance with the terms of this Agreement, which will participate in the SIT Facility and which, in any case, has not ceased to be a Party to this Agreement. "SIT FACILITY COMMITMENT" means: (a) in relation to an Original SIT Facility Bank, the amount set opposite its name under the heading "SIT Facility Commitment" in Schedule 1 (Commitments) and the amount of any other SIT Facility Commitment transferred to it under this Agreement; and (b) in relation to any other SIT Facility Bank, the amount of any SIT Facility Commitment transferred to it under this Agreement, to the extent not cancelled, reduced or transferred by it under this Agreement. "SIT FACILITY GUARANTEE OR LC" means any guarantee issued or to be issued or letter of credit opened or to be opened by the Issuing Bank upon request of the Borrower. "SIT FACILITY GUARANTEE OR LC PERCENTAGE" means, in relation to a SIT Facility Bank and a SIT Facility Guarantee or LC, the proportion (expressed as a percentage) borne by such SIT Facility Bank's Available Commitment to the Available Facility, immediately prior to the date of issue or opening of the SIT Facility Guarantee or LC. "SIT FACILITY INTEREST PAYMENT DATE" has the meaning given to it in Clause 9.4.2 (Payment of interest). "SIT FACILITY LOAN" means a loan made or to be made under the SIT Facility or the principal amount outstanding for the time being of that loan (as such amount may be revalued in accordance with Clause 6.3) (Revaluation of SIT Facility Loans). "SLOVENIAN ACCOUNTING STANDARDS" means Slovenian Accounting Standards, issued by the Association of Accountants, Treasurers and Auditors of Slovenia (Zveza Racunovodij, Financnikov In Revizorjev Slovenije). "SMOM" means, in relation to any SIT Facility Loan: (a) the applicable SMOM Screen Rate; or (b) (if no Screen Rate is available for the Interest Period of that SIT Facility Loan) the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the On Shore Facility Agent at its request quoted by the SMOM Reference Banks to leading banks in the Slovenian Interbank Market, as of 11.00 a.m. (Ljubljana time) on the Quotation Day for the offering of deposits in SIT for a period comparable to the Interest Period of the relevant SIT Facility Loan. "SMOM REFERENCE BANKS" means Hypo Alpe-Adria-Bank d.d., Ljubljana, SKB Banka d.d., Ljubljana and Nova Ljubljanska banka d.d., Ljubljana or such other banks as may be appointed by the On Shore Facility Agent in consultation with the Borrower. - 20 - "SMOM SCREEN RATE" means, in relation to SMOM, the percentage rate per annum determined by the Slovenian Banking Association for the relevant period displayed on its website (www.zbs-giz.si) as of 11.00 a.m. (Ljubljana time) on the Quotation Day. If the website is replaced or service ceases to be available, the On Shore Facility Agent may specify another website or service displaying the appropriate rate after consultation with the Borrower and the SIT Facility Banks. "SOFTWARE LICENCES" means: (a) the software licence granted to the Borrower by the Equipment Vendor according to the Delivery Contract; (b) the software licence granted to the Borrower by Protek Flagship (UK) Ltd in relation to customer care and billing software systems; and (c) the software licence granted by Oracle Software d.o.o., Ljubljana to the Borrower. "SPONSOR CONTRIBUTIONS" means contributions made to the Borrower by way of Equity Contributions or Subordinated Loans. "SPONSORS" means Western Wireless International Corporation, Western Wireless International Slovenia Corporation and Western Wireless International Slovenia II Corporation. "SPONSORS' AND SHAREHOLDERS' UNDERTAKING AND COMPLETION GUARANTEE" means the Sponsors' and Shareholders' undertaking and completion guarantee agreement on or about the date of this Agreement between the Borrower, the Sponsors, the Shareholders and the Off Shore Facility Agent acting on behalf of the Senior Creditors. "SPONSORS' CASH COLLATERAL ACCOUNT" has the meaning given to it in the Sponsors' and Shareholders' Undertaking and Completion Guarantee. "SPONSORS' CASH COLLATERAL ACCOUNT PLEDGE AGREEMENT" means the cash collateral account pledge agreement to be entered into between Western Wireless International Corporation and the Off Shore Security Agent acting on behalf of the Senior Creditors. "SPONSORS UNSECURED LOAN AGREEMENT" means the credit agreement to be entered into between the Sponsors and the Borrower in respect of Sponsors Unsecured Loans. "SPONSORS UNSECURED LOANS" means any loans made by the Sponsors in accordance with the Sponsors Unsecured Loan Agreement up to a maximum principal amount of Euro 1,561,318.60 and upon the terms approved by the Off Shore Facility Agent prior to the date of this Agreement. "SUBORDINATED LOAN" means a subordinated loan (other than a Sponsors Unsecured Loan) made to the Borrower in accordance with the Sponsors' and Shareholders' Undertaking and Completion Guarantee. "SUBSCRIBER" means an entity or individual with an International Mobile Subscriber Identity belonging to the Network who is not disconnected or barred from making and receiving calls on the respective date of the reporting of the figure EXCLUDING the Borrower's employees, subscribers with any test SIM cards, any SIM cards used for demonstration purposes and any SIM cards used for international roaming tests and any contractors that are given terms or conditions preferable to those generally provided to other subscribers and: - 21 - (a) For the purpose of counting the number of postpaid Subscribers, the Subscriber must have generated revenue of an equivalent amount of at least Euro 5 (excluding VAT) within the last Quarter immediately preceding the relevant calculation date: (b) For the purposes of determining the revenue per postpaid Subscriber, such revenue shall be determined as follows: (i) the initial connection fee depreciated on a straight line basis over the minimum duration (and if not stipulated within the contract, then 12 months shall be assumed) of the Subscriber's contract (totalled for the relevant Quarter). (ii) rental fee or periodic subscription fee of that Subscriber for the relevant Quarter; (iii) any other periodic, one time and regular fees levied during the relevant Quarter; (iv) call. SMS and any usage related fees (excluding any credits given to the Subscriber by the Borrower) for calls made by that Subscriber during the relevant Quarter; plus (v) interconnect revenue (interconnect income from other operators) calculated per Subscriber during the relevant Quarter. (c) Handset and SIM fees charged to the Subscriber shall not be included in the calculation. (d) For the purpose of counting the number of prepaid Subscribers, the Subscriber must have generated five decremented events in a given Quarter. A decremented event is a call, SMS or any other usage related fee that is decremented from the Subscriber's prepaid balance, (excluding any credits given to the Subscriber by the Borrower). (e) For both post-paid and prepaid Subscribers, the 5 Euro or five decremented events respectively shall not apply for Subscribers that have been activated in the most recently reported Quarter. "SUBSIDIARY" means, in relation to any company or corporation, any company, corporation or partnership: (a) which is controlled, directly or indirectly, by the first-mentioned company or corporation and, for these purposes, a company, corporation or partnership shall be treated as being controlled by a company or corporation if that other company or corporation is able to direct its affairs and/or to control the composition of its board of directors or equivalent body; (b) more than half the issued share capital or partnership interest of which is beneficially owned, directly or indirectly, by the first-mentioned company or corporation; or (c) which is a subsidiary of another subsidiary of the first-mentioned company or corporation. "TARGET" means Trans-European Automated Real-time Gross Settlement Express Transfer payment system. - 22 - "TARGET DAY" means any day on which TARGET is open for the settlement of payments in Euro. "TAX" means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same). "TERMINATION DATE" means 30 November 2009. "TOM" means the applicable base rate in accordance with the Slovenian Law on Prescribed Interest Rates for Late Payment and on the Base Rate (Official Gazettes of the Republic of Slovenia No. 45/1995 and 109/2001) and published by Banka Slovenije in accordance with the Decree on Base Interest Rate (Official Gazettes of the Republic of Slovenia No. 61/1996, 3/1997, 23/1997 and 81/1997). "TOTAL COMMERCIAL FACILITY COMMITMENTS" means the aggregate of the Commercial Facility Commitments, being Euro 42,800,000 at the date of this Agreement. "TOTAL COMMITMENTS" means the aggregate of the Total ECA Facility Commitments, the Total Commercial Facility Commitments and the Total SIT Facility Commitments. "TOTAL ECA FACILITY COMMITMENTS" means the aggregate of the ECA Facility Commitments, being Euro 53,643,308.50 at the date of this Agreement. "TOTAL ECA FACILITY TRANCHE 1 COMMITMENTS" means the aggregate of the ECA Facility Tranche 1 Commitments. "TOTAL ECA FACILITY TRANCHE 2 COMMITMENTS" means the aggregate of the ECA Facility Tranche 2 Commitments. "TOTAL ECA FACILITY TRANCHE 3 COMMITMENTS" means the aggregate of the ECA Facility Tranche 3 Commitments. "TOTAL LEVERAGE RATIO" means the ratio of aggregate Financial Indebtedness to Annualised EBITDA of the Borrower at the relevant calculation date. "TOTAL REVENUES" means all revenues as determined in accordance with US GAAP. "TOTAL SIT FACILITY COMMITMENTS" means the aggregate of the SIT Facility Commitment, being SIT 4,400,000,000 at the date of this Agreement and which, at no time shall exceed the Euro equivalent amount of Euro 20,000,000 as reduced in accordance with the terms hereof. "TRADEMARK PLEDGE AGREEMENT" means the trademark pledge agreement to be entered into between the Borrower and the Senior Creditors. "TRANSACTION DOCUMENTS" means: (a) the Project Contracts; and (b) the Material Contracts. "TRANSFER CERTIFICATE" means a certificate substantially in the form set out in Schedule 10 (Form of Transfer Certificates) or any other form agreed between the Off Shore Facility Agent and the Borrower. - 23 - "TRANSFER DATE" means, in relation to a transfer, the later of: (a) the proposed transfer date specified in the Transfer Certificate; and (b) the date on which the Agent executes the Transfer Certificate. "UMTS" means a Universal Mobile Telecommunications System, being the third generation communications system based on the standards delivered by the ITU and the ETSI. "UMTS ACTIVITIES" means all activities relating to or in connection with the use of UMTS technology and for the avoidance of doubt excludes any activities conducted using GSM 1800 frequencies. "UMTS SUBSIDIARY" has the meaning given to it in Clause 24.33 (UMTS and other licences). "UNPAID SUM" means any sum due and payable but unpaid under the Finance Documents by the Borrower. "UPDATED BUSINESS PLAN" means an update of the Business Plan in a manner consistent with the most recent financial statements delivered and reviewed in accordance with Clause 21 (Reporting requirements). "US GAAP" means generally accepted accounting principles, standards and practices in the United States of America consistently applied. "UTILISATION" means a utilisation of a Facility. "UTILISATION DATE" means the date of a Utilisation, being the date on which the relevant Loan is to be made or, as the case may be, SIT Facility Guarantee or LC is to be issued or opened or, in the case of a Rollover SIT Facility Loan, the date on which the maturing SIT Facility Loan in respect of which it is made is due to be repaid. "UTILISATION REQUEST" means a notice substantially in the form set out in Schedule 4A (Utilisation Request (Borrower)), Schedule 4B (Utilisation Request (Payments to Equipment Vendor)) or Schedule 4C (Utilisation Request (Payments to ECA)) as the case may be. "VAT" means value added tax as provided for in the Law on Value Added Tax published in the Official Gazettes of the Republic of Slovenia, no. 89/98, 17/2000 - decision of Constitution Court, 30/2001 and any other tax of a similar nature. "WITHDRAWAL OF THE LICENCE" means the Licence is withdrawn or measures have been taken or court proceedings have been commenced which, in the opinion of the Majority Banks (acting reasonably), are reasonably likely to result in an order to withdraw the Licence as a consequence of the construction, coverage provided by or technical performance of the Network failing to meet the specifications of the Licence. 1.2 CONSTRUCTION 1.2.1 Unless a contrary indication appears, any reference in this Agreement to: (a) the "OFF SHORE FACILITY AGENT", the "OFF SHORE SECURITY AGENT", the "ON SHORE FACILITY AGENT", the "ON SHORE SECURITY AGENT", the "ISSUING BANK", any "ARRANGER", any "FINANCE PARTY", any "BANK", the "BORROWER", any "SENIOR Creditor", any "HEDGING COUNTERPARTY" or any "PARTY" shall be - 24 - construed so as to include its successors in title, permitted assigns and permitted transferees; (b) "ASSETS" includes present and future properties, revenues and rights of every description; (c) "DBM" means decibel above or below 1 milliwatt; (d) except as expressly provided in this Agreement, the "EQUIVALENT" on any given date in one currency (the "FIRST CURRENCY") of an amount denominated in another currency (the "SECOND CURRENCY") is a reference to the amount of the first currency which could be purchased with the amount of the second currency at the mean spot rate of exchange quoted to the Off Shore Facility Agent at or about 11.00 a.m. (Dusseldorf time) on such date for the purpose of the purchase of the first currency with the second currency; (e) the "EUROPEAN INTERBANK MARKET" means the interbank market for Euro operating in Participating Member States; (f) a "TRANSACTION DOCUMENT" or any other agreement or instrument is a reference to that Transaction Document or other agreement or instrument as amended or novated; (g) "INDEBTEDNESS" includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent; (h) a "PERSON" includes any person, firm, company, corporation, government, state or agency of a state or any association, trust or partnership (whether or not having separate legal personality) or two or more of the foregoing; (i) a "REGULATION" includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation; (j) a provision of law is a reference to that provision as amended or re-enacted; and (k) Section, Clause and Schedule headings are for ease of reference only. (l) unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement. 1.2.2 In this Agreement: (a) A Potential Event of Default is continuing if it has not been remedied or waived. (b) (i) An Event of Default can be assumed to be continuing unless the Borrower has satisfied the Agents or Security Agents (in each case acting on the instructions of the Majority Banks acting reasonably) that such Event of Default has been cured or waived. - 25 - (ii) If any enforcement action as directed by the Majority Senior Creditors in accordance with the Intercreditor Agreement, permitted to be taken upon an Event of Default, has been commenced, the Borrower may not subsequently cure such Event of Default without the prior written consent of the Agents or Security Agents (in each case acting on the instructions of the Majority Senior Creditors). - 26 - SECTION 2 THE FACILITIES 2. THE FACILITIES 2.1 THE FACILITIES Subject to the terms of this Agreement: (a) the Euro Facility Banks make available to the Borrower: (i) a term loan facility in an aggregate principal amount of up to the Total ECA Facility Commitments on the following basis: (1) the Total ECA Facility Tranche 1 Commitments (being no more than 85% of the Estimated Contract Value being an amount of not more than Euro 47,163,886.50) payable directly by the Off Shore Facility Agent to the Equipment Vendor subject to the conditions set out in this Agreement ("ECA FACILITY TRANCHE 1"); and (2) the Total ECA Facility Tranche 2 Commitments (being no more than 85% of the ECA Premium being an amount of not more than Euro 2,122,820.50) payable directly by the Off Shore Facility Agent to the ECA for payment of the ECA Premium and/or to the Equipment Vendor in reimbursement of amounts paid to the ECA in respect of the ECA Premium ("ECA FACILITY TRANCHE 2"), (3) the Total ECA Facility Tranche 3 Commitments (being no more than 85% of scheduled interest due on the ECA Facility during the Availability Period being an amount of not more than Euro 4,356,601.50) payable directly to the Off Shore Facility Agent for the account of the Euro Facility Banks subject to the conditions set out in this Agreement ("ECA FACILITY TRANCHE 3"); and (ii) a term loan facility in an aggregate principal amount of up to the Total Commercial Facility Commitments; and (b) the SIT Facility Banks make available to the Borrower a revolving loan, guarantee and letter of credit issuance facility in an aggregate principal amount of up to the Total SIT Facility Commitments. 2.2 FINANCE PARTIES' RIGHTS AND OBLIGATIONS (a) The obligations of each Finance Party under the Finance Documents are several. Failure by a Finance Party to perform its obligations under the Finance Documents does not affect the obligations of any other party under the Finance Documents. No Finance Party is responsible for the obligations of any other Finance Party under the Finance Documents. (b) The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from the Borrower shall be a separate and independent debt. - 27 - (c) A Finance Party may, except as otherwise stated in the Finance Documents where a Finance Party must first comply with a Majority Banks or all Bank decision, separately enforce its rights under the Finance Documents. 3. PURPOSE 3.1 PURPOSE (a) The Borrower shall apply all ECA Facility Loans in payment of Eligible Expenditures. (b) The Borrower shall apply all Commercial Facility Loans towards Project Costs (other than those which are financed by the ECA Facility) and the repayment of principal, interest and other amounts owing under the Existing WWIC Loan Agreement (in accordance with Clause 23.8 (Loan Proceeds Account)). (c) The Borrower shall apply all SIT Facility Loans towards and only request SIT Facility Guarantees or LCs in respect of: (i) Project Costs; and (ii) for such other purposes as set out in this Agreement. In no event shall any amounts made available under this Agreement be used by the Borrower in connection with any UMTS Activities or for any other purpose than those relating to the GSM Activities unless such amounts have been expressly listed in the Business Plan. 3.2 MONITORING No Finance Party is bound to monitor or verify the application of any amount borrowed pursuant to this Agreement. - 28 - SECTION 3 UTILISATION OF THE FACILITIES 4. CONDITIONS OF UTILISATION 4.1 CONDITIONS PRECEDENT TO THE FIRST UTILISATION UNDER ALL FACILITIES The Borrower may only deliver a Utilisation Request and the Banks will only be obliged to comply with Clause 6 (Loans) and Clause 7.1 (SIT Facility Banks' participation in SIT Facility Guarantees or LCs) if the Off Shore Facility Agent has received all of the documents and other evidence listed in Schedule 6 (Conditions Precedent) in form and substance satisfactory to the Off Shore Facility Agent (acting reasonably) or in the case of the funding of the Sponsors' Cash Collateral Account, the Off Shore Facility Agent is satisfied that contemporaneous with the first Utilisation such condition shall be satisfied. The Off Shore Facility Agent shall notify the Borrower and the Banks promptly upon being so satisfied. 4.2 FURTHER CONDITIONS PRECEDENT TO ALL UTILISATIONS 4.2.1 Subject to Clause 4.2.2 and other than in the case of Rollover SIT Facility Loans, the Banks will only be obliged to comply with Clause 6 (Loans) and Clause 7.1 (SIT Facility Banks' participation in SIT Facility Guarantees or LCs) if on the date of the Utilisation Request and on the proposed Utilisation Date: (a) the conditions set out below have been satisfied in form and substance satisfactory to the Off Shore Facility Agent (acting reasonably): (i) the proposed aggregate amount of a Loan or, as the case may be, SIT Facility Guarantee or LC will not exceed the Available Facility under the relevant Facility; (ii) the Sponsors have complied with their obligations to provide Sponsor Contributions pursuant to, and the Borrower and the Sponsors and/or Shareholders have complied with clause 3.4.20 (Confirmation of contributions) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee; (iii) the Contributed Capital Ratio is or as a result of such Utilisation will be at least 0.4; (iv) in respect of the SIT Facility, the aggregate SIT Facility Loans and reimbursement obligations under the SIT Facility Guarantees or LCs will not exceed an equivalent amount of Euro 20,000,000 at the exchange rate (middle rate) of Banka Slovenije on the date of calculation on or before the proposed Utilisation Date; and (v) in respect of the SIT Facility, evidence that at least 50% of the Total ECA Facility Commitments has been utilised; (b) in respect of a proposed Utilisation by way of an issue or opening of a SIT Facility Guarantee or LC, the form of the proposed SIT Facility Guarantee or LC has been agreed with the Issuing Bank (in each case acting reasonably); (c) no Event of Default or Potential Event of Default is continuing or would result from the proposed Loan or, as the case may be, SIT Facility Guarantee or LC; and - 29 - (d) the Repeated Representations to be made by the Borrower are true in all material respects. 4.2.2 The Banks will only be obliged to comply with Clause 6 (Loans) in relation to a Rollover SIT Facility Loan if on the Utilisation Date: (a) no Event of Default is continuing or would result from the Rollover SIT Facility Loan; and (b) the aggregate SIT Facility Loans and reimbursement obligations under the SIT Facility Guarantees or LCs will not exceed the lesser of: (i) an equivalent amount of Euro 20,000,000 at the exchange rate (middle rate) of Banka Slovenije on the proposed Utilisation Date; and (ii) the amount to which the SIT Facility Commitment is to be reduced in accordance with Clause 13.3 (Reduction of the SIT Facility Commitment) on or before the proposed Utilisation Date. 5. UTILISATION 5.1 DELIVERY OF UTILISATION REQUEST 5.1.1 The Borrower may utilise a Facility if the Off Shore Facility Agent with regard to any Utilisation of the Euro Facility and the On Shore Facility Agent with regard to a Utilisation of the SIT Facility receives a duly completed Utilisation Request (together with all related documentation): (a) with regard to a Utilisation of a Euro Facility Loan, no later than 11.00 a.m. (Dusseldorf time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date; (b) with regard to a Utilisation of a SIT Facility Loan in an amount exceeding SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date; (c) with regard to a Utilisation of a SIT Facility Loan in an amount of up to SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time) two (2) Business Day prior to the proposed Utilisation Date; and (d) with regard to a SIT Facility Guarantee or LC, no later than 11:00 a.m. (Ljubljana time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date, PROVIDED THAT if the Borrower fails to issue a Utilisation Request in respect of a Rollover SIT Facility Loan such request shall, subject to compliance with Clause 4.2.2(a) (Further conditions precedent to all Utilisations) and any repayments necessary to comply with Clause 4.2.2(b), be deemed to have been given by the Borrower to the On Shore Facility Agent. 5.1.2 If a Utilisation Request is required to be issued pursuant to Clause 5.1.1 (Delivery of Utilisation Request) and PROVIDED THAT the Agent has received such Utilisation Request, the Agent shall: (a) in the case of the Euro Facility, notify each Euro Facility Bank no later than 11:00 a.m. (Dusseldorf time) three (3) Business Days prior to the proposed - 30 - Utilisation Date of the amount of the Loan and its participation in that Loan; and (b) in the case of the SIT Facility, notify each SIT Facility Bank no later than 11:00 a.m. (Ljubljana time) two (2) Business Days prior to the proposed Utilisation Date of the amount of the Loan, or as the case may be, the face amount of the SIT Facility Guarantee or LC and its participation therein. 5.2 COMPLETION OF A UTILISATION REQUEST (a) Each Utilisation Request is irrevocable and will not be regarded as having been duly completed unless: (i) it identifies the Facility to be utilised, and: (1) in the case of a requested Loan in respect of ECA Facility Tranche 1, is in the form set out in Schedule 4B (Utilisation Request (Payments to Equipment Vendor)), duly completed and executed by the Equipment Vendor and is accompanied by the following documents that in the reasonable opinion of the Off Shore Facility Agent are in accordance with the "Uniform Rules for Collection, 1995 Revision, ICC Publication no. 522" (i) an original invoice to the Borrower from the Equipment Vendor; and (ii) in respect of a Utilisation Request completed with reference to clause 1.10.2(b)(iii) of the Delivery Contract a copy of a certificate executed by the Borrower and referring to the final acceptance of the Initial Configuration; (2) in the case of a requested Loan in respect of ECA Facility Tranche 2 where such Loan shall be payable to the Equipment Vendor in reimbursement of amounts paid to the ECA in respect of the ECA Premium, is in the form set out in Schedule 4C (Utilisation Request (Payments to ECA)), duly completed and executed by the Equipment Vendor, together with an original invoice to the Equipment Vendor from the ECA that is due and payable pursuant to the ECA Cover Documents; and (3) in the case of a requested Loan in respect of the Commercial Facility or a request for a SIT Facility Loan or SIT Facility Guarantee or LC in the form set out in Schedule 4A (Utilisation Request (Borrower)) duly completed and executed by the Borrower; (ii) the proposed Utilisation Date is a Business Day within the Availability Period applicable to that Facility; (iii) the amount of the Utilisation: (1) in the case of a Utilisation of the ECA Facility, is a minimum amount of Euro 500,000 (except in the case of a Utilisation in respect of the ECA Facility Tranche 2 or ECA Facility Tranche 3) or in respect of the last payment under the Delivery Contract such lesser amount payable thereunder and relates to Eligible Expenditures; - 31 - (2) in the case of a Utilisation of the Commercial Facility, is a minimum amount of Euro 3,000,000 or, if less, the amount of Available Facility; and (3) in the case of a Utilisation of the SIT Facility, is a minimum amount of SIT 100,000,000 or, if less, the amount of Available Facility; (iv) in the case of a Loan, the proposed Interest Period complies with Clause 10 (Interest Periods). (b) Only one Loan or, as the case may be, SIT Facility Guarantee or LC may be requested in each Utilisation Request. (c) Each Utilisation Request shall be accompanied by the documentation and evidence as required by such Utilisation Request, in form and substance satisfactory to the Off Shore Facility Agent (acting reasonably) and, in the case of a Utilisation Request for the SIT Facility, the On Shore Facility Agent (acting reasonably). 5.3 AUTHORISATION The Off Shore Facility Agent is irrevocably authorised and instructed by the Borrower: (a) in respect of a Utilisation Request received pursuant to: (i) Clause 5.2(a)(i)(1) (Completion of a Utilisation Request) in relation to a loan in respect of ECA Facility Tranche 1; or (ii) Clause 5.2(a)(i)(2) (Completion of a Utilisation Request) in relation to a Loan in respect of ECA Facility Tranche 2 where such Loan shall be payable to the Equipment Vendor in reimbursement of amounts paid to the ECA in respect of the ECA Premium, pay the proceeds of each such Loan to, or into an account designated by, the Equipment Vendor; (b) in respect of an amount payable: (i) to the ECA in respect of the ECA Premium for which the Off Shore Facility Agent has been invoiced by the ECA and in respect of which a reimbursement is not payable to the Equipment Vendor; or (ii) under ECA Facility Tranche 3, in respect of the payment of interest on the ECA Facility during the Availability Period, to make Loans at such times and in such manner for the payment of such amounts and pay the proceeds of such Loans to: (1) in the case of the ECA Premium, directly to the ECA; and (2) in the case of the payment of interest on the ECA Facility directly to the Off Shore Facility Agent for the account of the Euro Facility Banks. Notwithstanding that the Borrower does not issue any Utilisation Request in respect of such payments, the Borrower acknowledges that such payments made by the Off Shore Facility Agent constitute Loans under this Agreement. The Off Shore Facility Agent - 32 - will promptly notify the Borrower of the details of any Loans made under the ECA Facility. 6. LOANS 6.1 EURO FACILITY BANKS' PARTICIPATION IN EURO FACILITY LOANS (a) If the conditions set out in this Agreement have been met, each Euro Facility Bank shall make its participation in each Euro Facility Loan available by the Utilisation Date through its Facility Office to the account designated for such purpose by the Off Shore Facility Agent to the other Finance Parties. (b) The amount of each Euro Facility Bank's participation in each Euro Facility Loan will be equal to the proportion borne by its Available Commitment to such Available Facility immediately prior to making the Euro Facility Loan. 6.2 SIT FACILITY BANKS' PARTICIPATION IN SIT FACILITY LOANS (a) If the conditions set out in this Agreement have been met, each SIT Facility Bank shall make its participation in each SIT Facility Loan available by the Utilisation Date through its Facility Office to the account designated for such purpose by the On Shore Facility Agent to the other Finance Parties. (b) The amount of each SIT Facility Bank's participation in each SIT Facility Loan will be equal to the proportion borne by its Available Commitment to such Available Facility immediately prior to making the SIT Facility Loan. 6.3 REVALUATION OF SIT FACILITY LOANS On the first day of each calendar month ("TOM DETERMINATION DATE"), the principal amount of the SIT Facility Loans outstanding shall be adjusted for inflation by the On Shore Facility Agent applying the then current rate of TOM in accordance with the applicable resolutions relating thereto and the On Shore Facility Agent's standard procedures and advise the Borrower and the SIT Facility Banks of any adjustments to the principal amount of the SIT Facility Loans outstanding for that month. The Borrower shall repay to the SIT Facility Banks the amount of such adjustment (if any) on the 8th Business Day of the calendar month immediately following the calendar month in which the TOM Determination Date occurred. 7. GUARANTEES AND LETTERS OF CREDIT 7.1 SIT FACILITY BANKS' PARTICIPATION IN SIT FACILITY GUARANTEES OR LCS If the conditions set out in this Agreement have been met, on the Utilisation Date on which a SIT Facility Guarantee or LC is to be issued or opened, the Borrower and each SIT Facility Bank hereby authorises the Issuing Bank to issue or open such SIT Facility Guarantee or LC on behalf of the SIT Facility Banks by completing the issue or opening date and executing and delivering such SIT Facility Guarantee or LC to the Beneficiary so that each SIT Facility Bank shall be liable for its relevant SIT Facility Guarantee or LC Percentage of each claim thereunder PROVIDED THAT no SIT Facility Bank's liability to the Issuing Bank will exceed its Available Commitment. 7.2 SIT FACILITY GUARANTEE AND LC FEES The Borrower shall pay to the On Shore Facility Agent for the benefit of each SIT Facility Bank a fee equivalent to the SIT Facility Applicable Margin calculated on that SIT Facility Bank's exposure under each SIT Facility Guarantee or LC outstanding from time to time and pay such fee at the times required for the payment of interest under the SIT Facility Loans in accordance with Clause 9.4 (Payment of interest). - 33 - SECTION 4 SIT FACILITY GUARANTEES AND LETTERS OF CREDIT 8. SIT FACILITY GUARANTEES AND LETTERS OF CREDIT 8.1 NOTIFICATION OF DEMAND If, at any time, a demand for payment (the amount so demanded being herein referred to as the "AMOUNT DEMANDED") is made by a Beneficiary to the Issuing Bank under any SIT Facility Guarantee or LC, the Issuing Bank shall notify the Borrower of such demand and provide to the Borrower a copy of such demand promptly and in any event by 5:00 p.m. (Ljubljana time) on the Business Day following receipt by the Issuing Bank of the demand from the Beneficiary. 8.2 DEMAND ON SIT FACILITY BANKS The Issuing Bank shall (at the same time as notifying the Borrower pursuant to Clause 8.1 (Notification of demand)) make demand of each SIT Facility Bank for an amount equal to its relevant SIT Facility Guarantee or LC Percentage of the Amount Demanded, whereupon each SIT Facility Bank shall pay to the Issuing Bank promptly upon receipt of a demand made on it by the Issuing Bank, and in any event no later than 11.00 a.m. (Ljubljana time) on the second Business Day following receipt of the demand, the amount so demanded by the Issuing Bank. 8.3 PAYMENT TO BENEFICIARIES 8.3.1 Upon receipt of all or any of the Amount Demanded pursuant to Clause 8.2 (Demand on SIT Facility Banks), the Issuing Bank shall pay the relevant amount to each Beneficiary in accordance with the terms of the relevant SIT Facility Guarantee or LC. 8.3.2 Any payment by the Issuing Bank of the Amount Demanded made pursuant to Clause 8.3 (Payment to Beneficiaries) shall be deemed to be a SIT Facility Loan made to the Borrower by the SIT Facility Banks in an amount equal to the Amount Demanded PROVIDED THAT the provisions of Clause 4.2.1 (Further conditions precedent to all Utilisations) will not apply to such Utilisation. 8.3.3 The Utilisation Date of any SIT Facility Loan made under Clause 8.3.2 (Payment to Beneficiaries) will be the date of payment of the Amount Demanded by the Issuing Bank under Clause 8.3.1 (Payment to Beneficiaries). 8.4 INDEMNIFICATION The Borrower hereby irrevocably and unconditionally agrees to indemnify and keep indemnified each SIT Facility Bank against each and every sum paid or payable by any such SIT Facility Bank under any SIT Facility Guarantee or LC and against all liabilities, costs, claims, losses, damages and expenses which each SIT Facility Bank may at any time incur or sustain in connection with or arising out of any third party actions or proceedings relating to such SIT Facility Guarantee or LC. 8.5 PAYMENTS UNDER THE SIT FACILITY GUARANTEES OR LCS The Issuing Bank and each SIT Facility Bank shall be entitled to make any payment under any SIT Facility Guarantee or LC for which a demand in the manner required by such SIT Facility Guarantee or LC has been made without any reference to or further authority from the Borrower or any other investigation or enquiry, need not concern themselves with the propriety of any demand made under and in the manner required by the terms of such SIT Facility Guarantee or LC and shall be entitled to assume that any person expressed in such SIT Facility Guarantee or LC or in any notice served pursuant to such SIT Facility Guarantee or LC to be entitled to make demand is so entitled and that such person is duly authorised to do so; accordingly, it shall not be a defence to any demand made of the Borrower, nor shall the Borrower's obligations hereunder be - 34 - impaired by the fact (if it be the case), that any SIT Facility Bank or the Issuing Bank was or might have been justified in refusing payment, in whole or in part, of the amounts so demanded. 8.6 ACTS OR OMISSIONS The obligations of the Borrower to the Issuing Bank and each SIT Facility Bank under this Clause 8.6 shall not be discharged, lessened or impaired by any act, omission or circumstance whatsoever which, but for this provision, might operate to release or exonerate the Borrower from all or part of such obligations or in any other way discharge, lessen or impair the same. 8.7 CONCLUSIVE CERTIFICATE A certificate of the Issuing Bank as to the amount paid out by the Issuing Bank or any SIT Facility Bank under any SIT Facility Guarantee or LC shall, save for manifest error, be conclusive and binding upon the Borrower for the purposes of this Agreement and prima facie evidence of the payment of such amounts in any legal action or proceedings arising in connection therewith. 8.8 CASH COLLATERAL In respect of any SIT Facility Guarantee or LC which has a date of expiry after the Termination Date, the Borrower shall at least five (5) Business Days before the Termination Date procure that the Issuing Bank's and SIT Facility Banks' actual or contingent obligations in relation to each SIT Facility Guarantee or LC are cancelled or discharged in full or provide 100% cash cover to the satisfaction of the Issuing Bank and the SIT Facility Banks together with an authorisation from the Borrower (in form and substance satisfactory to the Issuing Bank) to the Issuing Bank permitting such cash cover to be set off against any liability of the Issuing Bank and the SIT Facility Banks under such SIT Facility Guarantee or LC. - 35 - SECTION 5 COSTS OF UTILISATION 9. INTEREST ON LOANS 9.1 CALCULATION OF FLOATING RATE INTEREST UNDER THE ECA FACILITY The rate of interest on each ECA Facility Loan for each Interest Period is the percentage rate per annum which is the aggregate of the applicable: (a) EURIBOR; (b) a margin (the "ECA FACILITY APPLICABLE MARGIN") in an amount of, initially, 1.25% per annum and thereafter the rate per annum set out in the column headed "Margin (% p.a.)" opposite the relevant Population Coverage (set out in the same line in the column headed "Population Coverage") and subject to the achievement of the relevant financial performance tests (set out in the same line in the column headed "Financial Performance") in the table below, in each case as at the end of the most recently ended Quarter:

POPULATION MARGIN COVERAGE FINANCIAL PERFORMANCE (% P.A.) ---------- --------------------- ------- 75% EBITDA for the immediately preceding two (2) 1.10 Quarters does not negatively deviate by more than 10% from the EBITDA in the Initial Business Plan. 80% EBITDA for the immediately preceding two (2) 1.00 Quarters does not negatively deviate by more than 10% from the EBITDA in the Initial Business Plan. 87% Total Leverage Ratio greater than 6.00. 0.90 87% Total Leverage Ratio less than or equal to 0.80 6.00 and greater than 5.00. 87% Total Leverage Ratio less than or equal to 0.70 5.00 and greater than 4.00. 87% Total Leverage Ratio less than or equal to 0.60 4.00 and greater than 3.00. 87% Total Leverage Ratio less than or equal to 0.50 3.00 and greater than 2.00. 87% Total Leverage Ratio less than or equal to 0.40 2.00.

PROVIDED THAT: (i) any change to the ECA Facility Applicable Margin shall take place from the immediately following Euro Facility Interest Payment Date (the "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT DATE") (subject to Clause 9.1(b)(iii)) if: (1) the Borrower has requested a reduction in the Applicable Margin in the Covenant Compliance Certificate at least 15 Business Days prior to such Euro Facility Interest Payment Date or the Off Shore Facility Agent has notified the Borrower, based on the information referred to in (2) below, that there will be an increase in the Applicable Margin in accordance with the above provisions of this paragraph (b); - 36 - (2) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to financial performance of the Borrower on the basis of the most recent information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate); (3) no Event of Default or Potential Event of Default is continuing; and (4) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to Population Coverage (on receipt of confirmation of such Population Coverage from the Independent Technical Consultant) or such confirmation has not been received by the date upon which the Borrower would be entitled to a change in the ECA Facility Applicable Margin (had such confirmation been received); (ii) if the Off Shore Facility Agent has not received the information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate) in respect of the relevant period by its due date for delivery pursuant to this Agreement, the Applicable Margin will be 1.25% per annum from that date until such time as the Borrower satisfies the conditions set out in this paragraph (b) and is in compliance with its obligations under Clause 21 (Reporting requirements); (iii) if after an ECA Facility Applicable Margin Adjustment Date the Independent Technical Consultant is of the opinion that the above conditions relating to Population Coverage have not been satisfied but the ECA Facility Applicable Margin has been changed by the Off Shore Facility Agent the ECA Facility Applicable Margin shall be readjusted to the applicable level in accordance with the above provisions of this paragraph (b) for the entire Interest Period from such ECA Facility Applicable Margin Adjustment Date. 9.2 CALCULATION OF FLOATING RATE INTEREST UNDER THE COMMERCIAL FACILITY The rate of interest on each Commercial Facility Loan for each Interest Period is the percentage rate per annum which is the aggregate of the applicable: (a) EURIBOR; (b) a margin (the "COMMERCIAL FACILITY APPLICABLE MARGIN") in an amount of, initially, 3.25% per annum and thereafter the rate per annum set out in the column headed "Margin (% p.a.)" opposite the relevant Population Coverage (set out in the same line in the column headed "Population Coverage") and subject to the achievement of the relevant financial performance tests (set out in the same line in the column headed "Financial Performance") in the table below, in each case as at the end of the most recently ended Quarter: - 37 -

POPULATION COVERAGE FINANCIAL PERFORMANCE MARGIN (% P.A.) ------------------- --------------------- --------------- 75% EBITDA for the immediately preceding two (2) 2.50 Quarters does not negatively deviate by more than 10% from the EBITDA in the Initial Business Plan. 80% EBITDA for the immediately preceding two (2) 2.25 Quarters does not negatively deviate by more than 10% from the EBITDA in the Initial Business Plan. 87% Total Leverage Ratio greater than 6.00 or 2.25 EBITDA for the immediately preceding two (2) Quarters is negative. 87% Total Leverage Ratio less than or equal to 2.00 6.00 and greater than 5.00. 87% Total Leverage Ratio less than or equal to 1.50 5.00 and greater than 4.00. 87% Total Leverage Ratio less than or equal to 1.25 4.00 and greater than 3.00. 87% Total Leverage Ratio less than or equal to 1.00 3.00 and greater than 2.00. 87% Total Leverage Ratio less than or equal to 0.75 2.00.

PROVIDED THAT: (i) any change to the Commercial Facility Applicable Margin shall take place from the immediately following Euro Facility Interest Payment Date (the "COMMERCIAL FACILITY APPLICABLE MARGIN ADJUSTMENT DATE") (subject to Clause 9.2(b)(iii)) if: (1) the Borrower has requested a reduction in the Applicable Margin in the Covenant Compliance Certificate at least 15 Business Days prior to such Euro Facility Interest Payment Date or the Off Shore Facility Agent has notified the Borrower, based on the information referred to in (2) below, that there will be an increase in the Applicable Margin in accordance with the above provisions of this paragraph (b); (2) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to financial performance of the Borrower on the basis of the most recent information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate); (3) no Event of Default or Potential Event of Default is continuing; and (4) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to Population Coverage (on receipt of confirmation of such Population Coverage from the Independent Technical Consultant) or such confirmation has not been received by the date upon which the Borrower would be entitled to a change in the Commercial Facility Applicable Margin (had such confirmation been received); (ii) if the Off Shore Facility Agent has not received the information required to be provided by the Borrower pursuant to Clauses 21.1(a) - 38 - and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate) in respect of the relevant period by its due date for delivery pursuant to this Agreement, the Applicable Margin will be 3.25% per annum from that date until such time as the Borrower satisfies the conditions set out in this paragraph (b) and is in compliance with its obligations under Clause 21 (Reporting requirements); (iii) if after a Commercial Facility Applicable Margin Adjustment Date the Independent Technical Consultant is of the opinion that the above conditions relating to Population Coverage have not been satisfied but the Commercial Facility Applicable Margin has been changed by the Off Shore Facility Agent, the Commercial Facility Applicable Margin shall be readjusted to the applicable level in accordance with the above provisions of this paragraph (b) for the entire Interest Period from such Commercial Facility Applicable Margin Adjustment Date. 9.3 CALCULATION OF FLOATING RATE INTEREST UNDER THE SIT FACILITY 9.3.1 The rate of interest on each SIT Facility Loan for each Interest Period is the aggregate sum of: (a) the Reference Interest Rate; and (b) a margin (the "SIT FACILITY APPLICABLE MARGIN") in an amount of, initially, 1.50% per annum and thereafter the rate per annum set out in the column headed "Margin (% p.a.)" subject to the achievement, as at the end of the most recently ended Quarter, of the relevant financial performance tests set out in the same line in the column headed "Financial Performance" in the table below:

FINANCIAL PERFORMANCE MARGIN (% P.A.) --------------------- --------------- Total Leverage Ratio greater than 4.00 or EBITDA for 1.50 the immediately preceding two (2) Quarters is negative Total Leverage Ratio less than or equal to 4.00 and 1.25 greater than 2.00 Total Leverage Ratio less than or equal to 2.00 1.00

PROVIDED THAT: (i) any change to the SIT Facility Applicable Margin shall take place from the first day of the immediately following Interest Period if: (1) the Borrower has requested a reduction in the Applicable Margin in the Covenant Compliance Certificate at least 15 Business Days prior to such Interest Period or the Off Shore Facility Agent has notified the Borrower, based on the information referred to in (2) below, that there will be an increase in the Applicable Margin in accordance with the above provisions of this paragraph (b); (2) the On Shore Facility Agent has confirmed the satisfaction of the above conditions relating to financial performance of the Borrower on the basis of the most recent information required to be provided by the Borrower pursuant to Clauses 21.1(a) and - 39 - (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate); and (3) no Event of Default or Potential Event of Default is continuing; (ii) if the On Shore Facility Agent has not received the information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate) in respect of the relevant period by its due date for delivery pursuant to this Agreement, the Applicable Margin will be 1.50% per annum from that date until such time as the Borrower satisfies the conditions set out in this paragraph (b) and is in compliance with its obligations under Clause 21 (Reporting requirements). 9.4 PAYMENT OF INTEREST 9.4.1 The Borrower shall pay accrued interest on each Euro Facility Loan on each Euro Facility Interest Payment Date. 9.4.2 The Borrower shall pay on each SIT Facility Loan interest accrued in respect of an Interest Period on the 8th Business Day of the calendar month immediately following the calendar month in which the last day of that Interest Period (a "SIT FACILITY INTEREST PAYMENT DATE") occurred. 9.5 DEFAULT INTEREST 9.5.1 If the Borrower fails to pay any amount (other than interest) payable by it hereunder on its due date, interest will accrue on the overdue amount from the due date up to the date of actual payment at a rate of 2 per cent. per annum above: (a) in relation to an amount becoming due and payable before expiration of the Interest Period applicable thereto, for the period until the expiration of such Interest Period the rate applicable to such overdue amount immediately prior to the due date; and (b) in all other cases, the interest rate on the most recent Quotation Day for such periods as the Agent may designate, PROVIDED THAT such Interest Period will not exceed three (3) months, All interest accrued hereunder shall be paid at the end of each month. 9.5.2 If the Borrower fails to pay any interest payable by it hereunder on its due date, it will make, at the time of payment of all arrears of interest and in any event on a monthly basis, a lump sum payment for all arrears of interest in the amount of 2 per cent. above, in the case of the Euro Facility, EURIBOR for such periods as the Agent may designate or, in the case of the SIT Facility, SMOM applicable to an interest period of one (1) month. 9.5.3 The rights of the Banks to compensation for any loss (in addition to those set out in Clauses 9.5.1 and 9.5.2) arising from the default remain unaffected. 9.5.4 The Agent will promptly notify the Borrower and the Banks of the determination of any default interest. Each determination by the Agent will, in the absence of a manifest error, be conclusive and binding on the Borrower and the Banks. - 40 - 9.6 NOTIFICATION OF INTEREST RATES The Off Shore Facility Agent shall promptly notify the relevant Banks and the Borrower of the determination of a rate of interest in respect of the ECA Facility or the Commercial Facility and the On Shore Facility Agent shall promptly notify the Off Shore Facility Agent, the relevant Banks and the Borrower of the determination of a rate of interest in respect of the SIT Facility. 10. INTEREST PERIODS 10.1 INTEREST PERIODS FOR THE EURO FACILITY LOANS (a) The first Interest Period for the first Euro Facility Loan shall begin on the Utilisation Date therefor and shall end on the last day of the calendar month in which such Utilisation is made. The first Interest Period for any subsequent Euro Facility Loan shall begin on the Utilisation Date therefor and shall end on the last day of the then applicable Interest Period relating to the first Euro Facility Loan. (b) The Borrower may select an Interest Period for a Loan under the Euro Facility in a Selection Notice. (c) Each Selection Notice for a Loan under the Euro Facility is irrevocable and must be delivered to the Off Shore Facility Agent by the Borrower no later than 11.00 a.m. (Dusseldorf time) five (5) Business Days prior to the first day of the relevant Interest Period. Upon receipt of a Selection Notice from the Borrower the Off Shore Facility Agent shall notify each Euro Facility Bank no later than 11.00 a.m. (Dusseldorf time) three (3) Business Days prior to the first day of the relevant Interest Period. (d) If the Borrower fails to deliver a Selection Notice to the Off Shore Facility Agent in accordance with paragraph (c) above, the relevant Interest Period will be three (3) Months and the Off Shore Facility Agent shall notify each Euro Facility Bank accordingly. (e) Subject to this Clause 10, the Borrower may select an Interest Period of 3, 6 or 12 Months or any other period agreed between the Borrower and the Off Shore Facility Agent (acting on the instructions of all Euro Facility Banks) PROVIDED THAT the Borrower shall select Interest Periods to ensure that the Interest Period immediately preceding a Repayment Date under the Euro Facility ends on such Repayment Date. 10.2 INTEREST PERIODS FOR THE SIT FACILITY LOANS (a) Each Interest Period under the SIT Facility, other than the first Interest Period for each SIT Facility Loan, shall begin on the first day and end on the last day of each calendar month. (b) The first Interest Period for each Loan under the SIT Facility shall begin on the Utilisation Date of a SIT Facility Loan and end on the last day of the calendar month during which the drawdown occurred. 10.3 DURATION OF INTEREST PERIODS An Interest Period for a Loan shall not extend beyond the Termination Date. 10.4 NON-BUSINESS DAYS Except as provided in Clause 10.2 (Interest Periods for the SIT Facility Loans), if an Interest Period would otherwise end on a day which is not a Business Day, that Interest - 41 - Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not). 10.5 CONSOLIDATION If two or more Interest Periods relate to a Loan in the same currency and end on the same date those Loans will, unless the Borrower specifies to the contrary, be consolidated into, and treated as, a single Loan on the last day of the Interest Period. 11. CHANGES TO THE CALCULATION OF INTEREST 11.1 ABSENCE OF QUOTATIONS Subject to Clause 11.2 (Market disruption), if EURIBOR is to be determined by reference to the Reference Banks but a Reference Bank does not supply a quotation by 11:00 a.m. (Brussels Time) on the Quotation Day, the applicable EURIBOR shall be determined on the basis of the quotations of the remaining Reference Banks. 11.2 MARKET DISRUPTION (a) If a Market Disruption Event occurs in relation to a Euro Facility Loan for any Interest Period, then the rate of interest on each Euro Facility Bank's share of that Euro Facility Loan for the Interest Period shall be the rate per annum which is the sum of: (i) the Applicable Margin; and (ii) the rate notified to the Off Shore Facility Agent by that Bank as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to that Euro Facility Bank of funding its participation in that Euro Facility Loan from whatever source it may reasonably select. (b) The Off Shore Facility Agent shall, upon becoming aware of a Market Disruption Event, notify the Borrower thereof. (c) In this Agreement "MARKET DISRUPTION EVENT" means: (i) at or about noon on the Quotation Day for the relevant Interest Period the Screen Rate is not available and none or only one of the Reference Banks supplies a rate to the Off Shore Facility Agent to determine EURIBOR for the relevant currency and Interest Period; or (ii) before close of business in Dusseldorf on the Quotation Day for the relevant Interest Period, the Off Shore Facility Agent receives notifications from a Euro Facility Bank or Euro Facility Banks (whose participations in a Euro Facility Loan in aggregate exceed 66 2/3 per cent. of that Euro Facility Loan) that the cost to it of obtaining matching deposits in the European Interbank Market would be in excess of EURIBOR. 11.3 ALTERNATIVE BASIS OF INTEREST OR FUNDING (a) If a Market Disruption Event occurs and the Off Shore Facility Agent or the Borrower so requires, the Off Shore Facility Agent and the Borrower shall enter into negotiations (for a period of not more than thirty days) with a view to agreeing a substitute basis for determining the rate of interest. - 42 - (b) Any alternative basis agreed pursuant to paragraph (a) above shall, with the prior consent of all the Euro Facility Banks and the Borrower, be binding on all Parties. 11.4 BREAK COSTS (a) The Borrower shall, within three (3) Business Days of demand by a Finance Party, pay to that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid Sum being paid by that Borrower on a day other than the last day of an Interest Period for that Loan or Unpaid Sum. (b) Each Bank shall, as soon as reasonably practicable after a demand by the Off Shore Facility Agent, provide a certificate confirming the amount of its Break Costs for any Interest Period in which they accrue. 12. FEES 12.1 COMMITMENT FEES (a) The Borrower shall pay to the Off Shore Facility Agent (for the account of each Euro Facility Bank) a fee computed at the rate of: (i) 0.75% per annum on each Bank's Available Commitment under the Euro Facility until 75% of the ECA Facility Commitment and the Commercial Facility Commitment has been disbursed; and (ii) thereafter 0.50% per annum on that Bank's Available Commitment under the Euro Facility for the Availability Period applicable to the Euro Facility. (b) The Borrower shall pay to the On Shore Facility Agent (for the account of each SIT Facility Bank) a fee computed at the rate of 0.10% per annum on the Available Commitment under the SIT Facility. (c) The fees under paragraphs (a) and (b) above shall be payable quarterly in arrears from the date of execution of this Agreement. 12.2 UNDERWRITING FEE The Borrower shall pay to the Off Shore Facility Agent (for the account of each of the Arrangers) within ten (10) Business Days after execution of this Agreement an underwriting fee as set out in a Fee Letter. 12.3 ON SHORE SECURITY AGENT FEE The Borrower shall pay to the On Shore Security Agent for its services an annual fee as set out in a Fee Letter. 12.4 SIT FACILITY GUARANTEE OR LC ISSUANCE FEES The Borrower shall pay to the Issuing Bank for its own account a fronting fee, at the rates set out in the Fee Letter and payable at the times and in the manner set forth therein. 12.5 ECA PREMIUM The Borrower shall pay or reimburse the Off Shore Facility Agent and/or the Equipment Vendor for payment of any ECA Premium to the ECA. - 43 - 12.6 PROCEEDS AND REVENUE ACCOUNT #2 The Borrower shall pay to Hypo Alpe-Adria-Bank d.d., for its own account, fees in relation to the opening and handling of the Proceeds and Revenue Account #2 as set out in the Fee Letter and payable at the times and in the manner set forth therein. - 44 - SECTION 6 REPAYMENT 13. REPAYMENT 13.1 REPAYMENT OF THE EURO FACILITY LOANS 13.1.1 Each Euro Facility Loan shall be repaid on the dates and in the amounts which correspond to the percentage rates set out in Schedule 2 (Repayment dates). 13.1.2 The Borrower may not re-borrow any part of a Euro Facility Loan which is repaid. 13.2 REPAYMENT OF THE SIT FACILITY LOANS Each SIT Facility Loan shall be repaid on the last day of its Interest Period PROVIDED THAT if the conditions set out in Clause 4.2.2 (Further conditions precedent to all Utilisations) are satisfied or the proviso in Clause 5.1.1 (Delivery of Utilisation Request) applies the Borrower may refinance any outstanding SIT Facility Loans with SIT Facility Rollover Loans. 13.3 REDUCTION OF THE SIT FACILITY COMMITMENT The SIT Facility Commitment shall be reduced on the dates and in the amounts which correspond to the percentage rates set out in Schedule 2 (Repayment Dates). - 45 - SECTION 7 PREPAYMENT AND CANCELLATION 14. PREPAYMENT AND CANCELLATION 14.1 ILLEGALITY If it becomes unlawful in any applicable jurisdiction for a Bank to perform any of its obligations as contemplated by this Agreement: (a) that Bank shall promptly notify the Off Shore Facility Agent upon becoming aware of that event; (b) the Off Shore Facility Agent shall, upon becoming aware of the same, notify the Borrower thereof; (c) upon the Off Shore Facility Agent notifying the Borrower and if necessary the On Shore Facility Agent, the Commitment of that Bank will be immediately cancelled; (d) the Borrower shall repay that Bank's participation in the Loans made to the Borrower on the last day of the Interest Period for each Loan occurring after the Off Shore Facility Agent has notified the Borrower or, if earlier, the date specified by the Bank in the notice delivered to the Off Shore Facility Agent (being no earlier than the last day of any applicable grace period permitted by law); and (e) if such Bank is the Issuing Bank or a SIT Facility Bank guaranteeing the Issuing Bank, the Borrower shall procure that the Issuing Bank's or SIT Facility Bank's actual or contingent obligations in relation to each SIT Facility Guarantee or LC are cancelled or discharged in full or within 30 days from the date of the notification mentioned in (d) above provide 100% cash cover to the satisfaction of the Issuing Bank and the SIT Facility Banks together with an authorisation from the Borrower (in form and substance satisfactory to the Issuing Bank, acting reasonably) to the Issuing Bank permitting such cash cover to be set off against any liability of the Issuing Bank and the SIT Facility Banks under such SIT Facility Guarantee or LC. 14.2 CHANGE OF CONTROL, WITHDRAWAL OF THE LICENCE AND ABANDONMENT OF THE PROJECT If: (a) Western Wireless International Corporation's direct or indirect shareholding in the Borrower at any time falls below 80% of the Share Capital without the prior written consent of the Majority Banks; (b) there is a Withdrawal of the Licence; or (c) there is an Abandonment of the Project, then: (i) the Borrower shall promptly notify the Off Shore Facility Agent upon becoming aware of that event; (ii) the Borrower shall not request a Utilisation (except for a Rollover SIT Facility Loan) unless otherwise agreed by the Majority Banks; - 46 - (iii) the Off Shore Facility Agent may (acting on the instructions of the Majority Banks), by not less than 30 days notice to the Borrower, declare all outstanding Loans, together with accrued interest, and all other amounts accrued under the Finance Documents immediately due and payable; (iv) the Off Shore Facility Agent may (acting on the instructions of the Majority Banks), instruct each Bank to cancel its Available Commitment; and (v) the Borrower shall procure that the Issuing Bank's actual or contingent obligations in relation to each SIT Facility Guarantee or LC are cancelled or discharged in full or within 30 days from the date of the declaration mentioned in (iii) above provide 100% cash cover to the satisfaction of the Issuing Bank and the SIT Facility Banks together with an authorisation from the Borrower (in form and substance satisfactory to the Issuing Bank, acting reasonably) to the Issuing Bank permitting such cash cover to be set off against any liability of the Issuing Bank and the SIT Facility Banks under such SIT Facility Guarantee or LC. 14.3 CANCELLATION BY THE BORROWER The Borrower may, if it gives the Off Shore Facility Agent and, in respect of a cancellation of the SIT Facility Commitment, the On Shore Facility Agent not less than five (5) Business Days' prior notice and has satisfied the Off Shore Facility Agent (acting reasonably) that it has sufficient funds to pay all relevant Project Costs, cancel the whole or any part (being a minimum amount of Euro 1,000,000 or the equivalent amount in SIT at the exchange rate (middle rate) of Banka Slovenije on the relevant calculation date) of an Available Facility in respect of the SIT Facility or the Commercial Facility. Subject to Clause 14.6.1 (Right of repayment and cancellation in relation to a single Bank), the Borrower may only cancel any part of an Available Facility in respect of the ECA Facility with the prior written consent of the ECA, the Equipment Vendor and the Off Shore Facility Agent. Any cancellation under this Clause 14.3 shall reduce the Commitments of the Banks rateably under that Facility. 14.4 VOLUNTARY PREPAYMENT OF EURO FACILITY LOANS In addition to the Borrower's rights set forth in Clause 14.6 (Right of repayment and cancellation in relation to a single Bank) the Borrower may, after the end of the Availability Period and if it gives the Off Shore Facility Agent not less than five (5) Business Days' (or such shorter period as the Majority Banks may agree) prior notice, prepay any part of any ECA Facility Loan and any Commercial Facility Loan in minimum amounts of Euro 1,000,000. 14.5 MANDATORY PREPAYMENTS 14.5.1 The Borrower shall: (a) on the immediately following Interest Payment Date, apply all proceeds of sale or exchange of any assets required to be repaid in accordance with Clause 23.5 (Sale Proceeds Account); (b) on the immediately following Interest Payment Date, apply proceeds of insurance policies required to be prepaid in accordance with Clause 23.4 (Insurance Proceeds Account); - 47 - (c) on the last Interest Payment Date of each Quarter of the Borrower apply 50% of the Excess Cash Flow; and (d) on the last Interest Payment Date of each Quarter, apply all amounts that have been standing to the credit of the Capital Expenditure Reserve Account for a period of more than twelve (12) months, towards the mandatory prepayment of the Euro Facility Loans and the Lucent Loan Agreement and, at the option of the On Shore Facility Agent, a reduction of the SIT Facility Commitments. 14.5.2 Prepayments under Clause 14.5.1 (Mandatory prepayments) will be applied in an inverse order of maturity to the amounts outstanding under the Euro Facility Loans and the Lucent Loan Agreement, and, if the On Shore Facility Agent has requested reduction of the SIT Facility Commitments or prepayment of SIT Facility Loans, under the SIT Facility pro rata across the relevant Facilities. If the On Shore Facility Agent elects such reduction in the SIT Facility Commitments, the Available Commitment in respect of the SIT Facility shall be cancelled by the amount which is applied in reduction thereof. 14.6 RIGHT OF REPAYMENT AND CANCELLATION IN RELATION TO A SINGLE BANK 14.6.1 If: (a) any sum payable to any Bank by the Borrower is required to be increased under Clause 15.2(c) (Tax gross-up); or (b) any Bank claims indemnification from the Borrower under Clause 15.3 (Tax indemnity) or Clause 16.1 (Increased Costs); and the steps, if any, taken by the relevant Finance Party in accordance with Clause 18 (Mitigation by the Banks) have not successfully mitigated the circumstance giving rise to the requirement or indemnification, the Borrower may, whilst the circumstance giving rise to the requirement or indemnification continues, give the Agent notice of cancellation of the Commitment of that Bank and its intention to procure the repayment of that Bank's participation in the Loans. 14.6.2 On receipt of a notice referred to in Clause 14.6.1(a) (Right of repayment and cancellation in relation to a single Bank), the Commitment of that Bank shall immediately be reduced to zero. 14.6.3 On the last day of each Interest Period which ends after the Borrower has given notice under Clause 14.6.1(a) (Right of repayment and cancellation in relation to a single Bank) (or, if earlier, the date specified by the Borrower in that notice), the Borrower shall repay that Bank's participation in the Loans. 14.7 RESTRICTIONS 14.7.1 Any notice of cancellation or prepayment given by any Party under this Clause 14 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant cancellation or prepayment is to be made and the amount of that cancellation or prepayment. 14.7.2 Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, subject to any Break Costs, without premium or penalty. - 48 - 14.7.3 The Borrower shall not repay or prepay all or any part of the Loans or cancel all or any part of the Commitments except at the times and in the manner expressly provided for in this Agreement. 14.7.4 If the Off Shore Facility Agent receives a notice under this Clause 14 it shall promptly forward a copy of that notice to either the Borrower or the affected Bank, as appropriate. 14.7.5 Unless a contrary indication appears in this Agreement, amounts prepaid may not be reborrowed. 14.7.6 No amount of the Total Commitments cancelled under this Agreement may be subsequently reinstated. 14.7.7 Any prepayment under Clause 14.4 (Voluntary prepayment of Euro Facility Loans) and Clause 14.5 (Mandatory prepayments) shall satisfy the obligations under Clause 13 (Repayment) in inverse chronological order. - 49 - SECTION 8 ADDITIONAL PAYMENT OBLIGATIONS 15. TAX GROSS-UP AND INDEMNITIES 15.1 DEFINITIONS 15.1.1 In this Clause 15: "PROTECTED PARTY" means a Finance Party which is or will be, for or on account of Tax, subject to any liability or required to make any payment in relation to a sum received or receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a Finance Document. "TAX CREDIT" means a credit against, relief or remission for, or repayment of any Tax. "TAX DEDUCTION" means a deduction or withholding for or on account of Tax from a payment under a Finance Document. "TAX PAYMENT" means an increased payment made by the Borrower to a Finance Party under Clause 15.2 (Tax gross-up) or a payment under Clause 15.3 (Tax indemnity). 15.1.2 In this Clause 15 a reference to "determines" or "determined" means a determination made in the absolute discretion of the person making the determination and the determination may be on an affiliated group basis. 15.2 TAX GROSS-UP (a) The Borrower shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law. (b) The Borrower or a Bank shall promptly upon becoming aware that the Borrower must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Off Shore Facility Agent accordingly. If the Off Shore Facility Agent receives such notification from a Bank it shall promptly notify the Borrower. (c) If a Tax Deduction is required by law to be made by the Borrower in one of the circumstances set out in paragraph (d) below, unless paragraph (g) below applies, the amount of the payment due from the Borrower shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required. (d) The circumstances referred to in paragraph (c) above are where a person entitled to the payment is an Agent, an Arranger or a Security Agent, Issuing Bank or a Bank. (e) If the Borrower is required to make a Tax Deduction, the Borrower shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law. (f) Within thirty days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Borrower making that Tax Deduction shall deliver to the Off Shore Facility Agent for the Finance Party entitled to the payment evidence reasonably satisfactory to that Finance Party - 50 - that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority. (g) The Borrower is not obliged to make a Tax Payment under paragraph (c) above in respect of any Tax Deduction which would not have been required had the Finance Party concerned co-operated in completing any declaration, claim, exemption or other form reasonably requested by the Borrower which it is able to complete or provide unless the Finance Party determines in good faith to do so would prejudice its legal or commercial position. 15.3 TAX INDEMNITY (a) The Borrower shall (within five (5) Business Days of demand by the Off Shore Facility Agent) pay to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in connection with the transactions contemplated under the Finance Documents. Such demand shall include reasonable details of such loss, liability or cost which the Protected Party determined will be or has been suffered. (b) Paragraph (a) above shall not apply with respect to any Tax assessed on a Finance Party: (i) under the law of the jurisdiction in which that Finance Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Finance Party is treated as resident for tax purposes; or (ii) under the law of the jurisdiction in which that Finance Party's Facility Office is located in respect of amounts received or receivable in that jurisdiction, if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by that Finance Party. (c) A Protected Party making, or intending to make, a claim pursuant to paragraph (a) above shall promptly notify the Agent of the event which will give, or has given, rise to the claim, following which the Agent shall notify the Borrower. (d) A Protected Party shall, on receiving a payment from the Borrower under this Clause 15.3, notify the Agent. 15.4 TAX CREDIT If the Borrower makes a Tax Payment and the relevant Finance Party determines that: (a) a Tax Credit is attributable to that Tax Payment; and (b) that Finance Party has obtained, utilised and retained that Tax Credit, the Finance Party shall pay an amount to the Borrower which that Finance Party determines will leave it (after that payment) in the same after-tax position as it would have been in had the Tax Payment not been made by the Borrower. The Finance Party will provide to the Borrower reasonable details of the calculation of the amounts it has determined to be payable to the Borrower. - 51 - 15.5 STAMP TAXES The Borrower shall pay and, within five (5) Business Days of demand, indemnify each Finance Party against any cost, loss or liability that Finance Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document. 15.6 VALUE ADDED TAX (a) All consideration payable under a Finance Document by the Borrower to a Finance Party shall be deemed to be exclusive of any VAT. If VAT is chargeable, the Borrower shall pay to the Finance Party (in addition to and at the same time as paying the consideration) an amount equal to the amount of the VAT on receipt of a copy of a VAT invoice. (b) Where a Finance Document requires the Borrower to reimburse a Finance Party for any costs or expenses, the Borrower shall also at the same time pay and indemnify that Finance Party on receipt of a copy of a VAT invoice against all VAT incurred by that Finance Party in respect of the costs or expenses save to the extent that that Finance Party is entitled to repayment or credit in respect of the VAT. 16. INCREASED COSTS 16.1 INCREASED COSTS (a) Subject to Clause 16.3 (Exceptions) the Borrower shall, within five (5) Business Days of a demand by the Off Shore Facility Agent (setting forth in reasonable detail the amounts so payable), pay for the account of a Finance Party the amount of any Increased Costs incurred by that Finance Party or any of its Affiliates as a result of (i) the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation after the date of this Agreement or (ii) compliance with any law or regulation made after the date of this Agreement (including the New Basle Capital Accord known as "Basle II" and any replacement thereof). (b) In this Agreement "INCREASED COSTS" means: (i) a reduction in the rate of return from the Facility or on a Finance Party's (or its Affiliate's) overall capital; (ii) an additional or increased cost; or (iii) a reduction of any amount due and payable under any Finance Document, which is incurred or suffered by a Finance Party or any of its Affiliates to the extent that it is attributable to that Finance Party having entered into its Commitment or funding or performing its obligations under any Finance Document. 16.2 INCREASED COSTS CLAIMS (a) A Finance Party intending to make a claim pursuant to Clause 16.1 (Increased Costs) shall notify the Off Shore Facility Agent of the event giving rise to the claim, following which the Off Shore Facility Agent shall promptly notify the Borrower. - 52 - (b) Each Finance Party shall, as soon as practicable after a demand by the Off Shore Facility Agent, provide a certificate confirming the amount of its Increased Costs. 16.3 EXCEPTIONS (a) Clause 16.1 (Increased Costs) does not apply to the extent any Increased Cost is: (i) attributable to a Tax Deduction required by law to be made by the Borrower; (ii) compensated for by Clause 15.3 (Tax indemnity) (or would have been compensated for under Clause 15.3 (Tax indemnity) but was not so compensated solely because the exclusion in Clause 15.3(b) (Tax indemnity) applied); or (iii) attributable to the wilful breach by the relevant Finance Party or its Affiliates of any law or regulation. (b) In this Clause 16.3, a reference to "Tax Deduction" has the same meaning given to the term in Clause 15.1 (Definitions). 17. OTHER INDEMNITIES 17.1 CURRENCY INDEMNITY (a) If any sum due from the Borrower under the Finance Documents (a "SUM"), or any order, judgment or award given or made in relation to a Sum, has to be converted from the currency (the "FIRST CURRENCY") in which that Sum is payable into another currency (the "SECOND CURRENCY") for the purpose of: (i) making or filing a claim or proof against the Borrower; or (ii) obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings, the Borrower shall as an independent obligation, within five (5) Business Days of demand, indemnify each Finance Party to whom that Sum is due against any cost, loss or liability arising out of or as a result of the conversion including any discrepancy between (1) the rate of exchange used to convert that Sum from the First Currency into the Second Currency and (2) the rate or rates of exchange available to that person at the time of its receipt of that Sum. (b) The Borrower waives any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency or currency unit other than that in which it is expressed to be payable. 17.2 OTHER INDEMNITIES The Borrower shall, within five (5) Business Days of demand, indemnify each Finance Party against any cost, loss or liability reasonably incurred by that Finance Party as a result of: (a) the occurrence of any Event of Default or Potential Event of Default and any costs reasonably incurred by any of the Banks in attending any meetings to consider any Event of Default or Potential Event of Default or the investigation of any Event of Default or Potential Event of Default; - 53 - (b) a failure by the Borrower to pay any amount due under a Finance Document on its due date including, without limitation, any cost, loss or liability arising as a result of Clause 29 (Sharing among the Finance Parties); (c) funding, or making arrangements to fund, its participation in a Loan requested by the Borrower in a Utilisation Request but not made by reason of the operation of any one or more of the provisions of this Agreement (other than by reason of default or negligence by that Finance Party); or (d) a Loan (or part of a Loan) not being prepaid in accordance with a notice of prepayment given by the Borrower. 17.3 INDEMNITY TO THE AGENTS The Borrower shall promptly indemnify each Agent against any cost, loss or liability incurred by the relevant Agent (acting reasonably) as a result of: (a) investigating any event which it reasonably believes is an Event of Default or Potential Event of Default; (b) except as expressly provided in this Agreement, the Agent performing and discharging its obligations in accordance with the requirements of the Finance Documents; and/or (c) acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised. 18. MITIGATION BY THE BANKS 18.1 MITIGATION (a) Each Finance Party shall, in consultation with the Borrower, take all reasonable steps to mitigate any circumstances which arise and which would result in any amount becoming payable under or pursuant to, or cancelled pursuant to, any of Clause 14.1 (Illegality), Clause 15 (Tax gross-up and indemnities) or Clause 16 (Increased Costs) including (but not limited to) transferring its rights and obligations under the Finance Documents to another Affiliate or Facility Office. (b) Paragraph (a) above does not in any way limit the obligations of the Borrower under the Finance Documents. 18.2 LIMITATION OF LIABILITY (a) The Borrower shall indemnify each Finance Party for all costs and expenses reasonably incurred by that Finance Party as a result of steps taken by it under Clause 18.1 (Mitigation). (b) A Finance Party is not obliged to take any steps under Clause 18.1 (Mitigation) if, in the opinion of that Finance Party (acting reasonably), to do so might be prejudicial to it. 19. COSTS AND EXPENSES 19.1 TRANSACTION EXPENSES The Borrower shall promptly on demand pay the Off Shore Facility Agent (for the account of the Agents, the Security Agents, the Issuing Bank, the ECA and the Arrangers) the amount of all out of pocket costs and expenses (including but not limited to the fees of the Independent Technical Consultant, insurance consultant and legal fees - 54 - of Slovenian law counsel to the Banks (Selih, Selih, Janezic & Jarcovic) and German, New York and Luxembourg law counsel to the Banks (Clifford Chance)) reasonably incurred by any of them in connection with the negotiation, preparation, execution, registration, implementation, preservation, and syndication of the Finance Documents irrespective of whether this financing is completed or any Utilisation is made (including, without limitation in connection with any perfection of a security interest under or any amendment of any Security Document). 19.2 AMENDMENT COSTS If (a) the Borrower requests an amendment, waiver or consent or (b) an amendment is required pursuant to Clause 30.9 (Change of currency), the Borrower shall, within three (3) Business Days of demand, reimburse each Agent for the amount of all costs and expenses (including legal fees) reasonably incurred by it in responding to, evaluating, negotiating or complying with that request or requirement. 19.3 ENFORCEMENT COSTS The Borrower shall, within three (3) Business Days of demand, pay to each Finance Party the amount of all costs and expenses (including legal fees) incurred by that Finance Party in connection with the enforcement of, or the preservation of any rights under, any Finance Document. - 55 - SECTION 9 REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT 20. REPRESENTATIONS 20.1 REPRESENTATIONS The Borrower makes the representations and warranties set out in this Clause 20.1 to each Finance Party on the date of this Agreement and acknowledges that the Finance Parties have entered into this Agreement in reliance on such representations and warranties. 20.1.1 STATUS The Borrower is a corporation duly incorporated and validly existing under the laws of Slovenia and has the power and all necessary governmental and other material Authorisations under any applicable jurisdiction to own its property and assets and to carry on its business as currently conducted. 20.1.2 POWER AND AUTHORITY The Borrower has the power to enter into, perform and deliver, and has taken all necessary action to authorise its entry into, performance and delivery of, the Transaction Documents to which it is a party and the transactions contemplated by those Transaction Documents. 20.1.3 OWNERSHIP OF THE BORROWER Western Wireless International Corporation owns, directly or indirectly, at least 80% of the Shares. 20.1.4 BINDING OBLIGATIONS The Transaction Documents create (or will once executed) legal, valid and binding obligations of the Borrower and, to the Borrower's knowledge, the other parties thereto, enforceable (or in the case of the Security Documents will be enforceable once perfected) against such parties in accordance with the terms thereof subject to any general principles of law limiting such parties' obligations which are specifically referred to in any legal opinion delivered pursuant to Clause 4.1 (Conditions precedent to the first Utilisation under all Facilities). 20.1.5 COMPLIANCE The Borrower has duly performed and observed in all material respects all obligations under the applicable laws and the Material Contracts and has duly performed and observed all obligations under the Project Contracts except where failure to do so would not have a Material Adverse Effect. 20.1.6 AUTHORISATIONS (a) All Authorisations required: (i) to enable it lawfully to enter into, exercise the Borrower's rights and comply with its obligations in the Transaction Documents to which it is a party; (ii) to make the Transaction Documents to which the Borrower is a party admissible in evidence in Slovenia; (iii) to enable the Borrower to conduct its business according to the Business Plan; and - 56 - (iv) to enable the Borrower to create the Security to be created by it pursuant to any Security Document and to ensure that such Security has the priority and ranking it is expressed to have, have been obtained or effected and are in full force and effect except Authorisations which are not required to be obtained by the Borrower (based upon its then current operations) until a future date and (in the case of paragraphs (i) to (iii) above) Authorisations the failure of which to obtain would not have a Material Adverse Effect and. (b) The Borrower is in compliance in all material respects with all of the terms and conditions of such Authorisations and no circumstances exist which would entitle the granting authority to terminate or revoke such Authorisations. 20.1.7 GOVERNING LAW AND ENFORCEMENT (a) The choice of the governing law of each of the Material Contracts will be recognised and enforced in the jurisdiction applicable to that Material Contract. (b) Any judgment obtained in the jurisdiction applicable to each of the Material Contracts in relation to that Material Contract will be recognised and enforced in that jurisdiction. 20.1.8 TAXES; REGISTRATION OF TRANSACTION DOCUMENTS (a) All Taxes imposed on the Borrower have been paid and discharged duly and punctually within the time period allowed therefor without the imposition of penalties in excess of Euro 15,000 or its equivalent or the creation of encumbrances with priority to the Banks or any Security granted by or created pursuant to the Security Documents (save to the extent payment thereof is being contested in good faith by the Borrower and where payment thereof can be lawfully withheld and would not result in an encumbrance having priority to the Banks or any Security granted by or created pursuant to the Security Documents). (b) The Borrower is not required under the laws of Slovenia to make any deduction or withholding for or on account of Tax from any payment it may make under any Finance Document. (c) Under the laws of Slovenia it is not necessary: (i) that the Material Contracts be filed, recorded, registered or enrolled with any court or other authority in that jurisdiction (other than reporting the execution of this Agreement to Banka Slovenije); or (ii) that any stamp, registration or similar tax be paid on or in relation to the Material Contracts or the transactions contemplated by the Material Contracts. 20.1.9 NO DEFAULT (a) No Event of Default or Potential Event of Default has occurred and is continuing or is reasonably expected to occur to the best of the Borrower's knowledge and belief. (b) No other event or circumstance is outstanding which constitutes a default under any other agreement or instrument which is binding on the Borrower or to - 57 - which its assets are subject which would reasonably be expected to have a Material Adverse Effect. 20.1.10 NO WINDING-UP The Borrower has not taken any corporate action nor have any other steps been taken or legal proceedings been started or threatened against the Borrower for its winding-up, dissolution, administration or re-organisation or for the appointment of a receiver, administrator, administrator receiver, trustee or similar officer of it or of all of its assets or revenues. 20.1.11 NO MISLEADING INFORMATION (a) Any factual information provided by it for the purposes of the Initial Business Plan, Information Memorandum and/or the Legal Due Diligence Report is true, complete and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated. (b) The financial projections contained in the Initial Business Plan and Information Memorandum provided to the ECA in September 2001 have been prepared on the basis of information available as at such date and on the basis of reasonable assumptions. (c) Nothing has occurred or been omitted from the Initial Business Plan, Information Memorandum and/or the Legal Due Diligence Report and no information has been given or withheld that results in the information contained in the Initial Business Plan, Information Memorandum and/or the Legal Due Diligence Report being untrue or misleading in any material respect. (d) All of the information (other than the Initial Business Plan, the Information Memorandum and the Legal Due Diligence Report) supplied by the Borrower and the Sponsors to the Arrangers, the Banks and the Independent Technical Consultant is true, complete and accurate in all material respects as at the date such information was supplied and the Borrower and the Sponsors have not failed to disclose to the Arrangers, the Banks and to the Independent Technical Consultant any facts or circumstances the omission of which would render any such information misleading in any material aspects. 20.1.12 FINANCIAL STATEMENTS (a) The Borrower's Original Financial Statements were prepared in accordance with US GAAP and the Borrower' financial statements for the year ending 31 December 2001, which are stated to be in accordance with Slovenian Accounting Standards, were prepared in accordance with Slovenian Accounting Standards, in each case consistently applied (unless expressly disclosed to the Off Shore Facility Agent in writing to the contrary before the date of this Agreement). (b) The Borrower's Original Financial Statements fairly represent its financial condition and operations as at the end of and during the relevant financial year (unless expressly disclosed to the Off Shore Facility Agent in writing to the contrary before the date of this Agreement). (c) As at the date as of which the Original Financial Statements were prepared the Borrower had no liabilities (contingent or otherwise) which were not disclosed thereby (or by notes thereto) or reserved against therein nor any unrealised or anticipated losses arising from commitments entered into by it which were not - 58 - so disclosed or reserved against and which in each such case would reasonably be expected to have a material adverse effect on the Borrower's ability to perform its obligations hereunder. (d) There has been no material adverse change in the Borrower's business or financial condition since the date as at which the Original Financial Statements were delivered to the Banks. 20.1.13 ENCUMBRANCES No encumbrance exists over all or any of the assets of the Borrower other than Permitted Encumbrances. 20.1.14 FINANCIAL INDEBTEDNESS The Borrower has no Financial Indebtedness except for Permitted Indebtedness. 20.1.15 NO OBLIGATION TO CREATE SECURITY Except as provided in Clause 20.1.13 (Encumbrances), the Borrower's execution of the Transaction Documents and its exercise of its rights and performance of its obligations hereunder and thereunder will not result in the existence of nor oblige the Borrower to create an encumbrance over all or any of its present or future revenues or assets. 20.1.16 PARI PASSU RANKING The Borrower's payment obligations under the Finance Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally. 20.1.17 PROCEEDINGS AND MAJOR LABOUR UNREST No litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency which, if adversely determined, might reasonably be expected to have a Material Adverse Effect have been started or threatened against it nor are there or might reasonably be expected major labour unrests in the Borrower's business. 20.1.18 OWNERSHIP OF ASSETS The Borrower has good title to or valid leases or licences of all Material Assets necessary to conduct its business where failure to do so would be reasonably likely to have a Material Adverse Effect. 20.1.19 INTELLECTUAL PROPERTY (a) The Borrower owns or has the legal right to use all Intellectual Property and it does not infringe any Intellectual Property Rights of any third party except in the case of Intellectual Property Rights which are not necessary to the carrying on of its business where such infringement would not be reasonably likely to have a Material Adverse Effect. (b) No Intellectual Property is being infringed except in the case of Intellectual Property which is not necessary to the carrying on of its business where such infringement would not be reasonably likely to have a Material Adverse Effect nor is there any threatened infringement by any third party of any Intellectual Property. (c) All registered Intellectual Property owned by the Borrower is subsisting and all actions required to maintain the same in full force and effect have been taken. 20.1.20 ENVIRONMENTAL COMPLIANCE The Borrower has duly performed and observed in all material respects all Environmental Law, Environmental Permits and all other material covenants, - 59 - conditions, restrictions or agreements directly or indirectly concerned with any contamination, pollution or waste or the release or discharge of any toxic or hazardous substance in connection with any real property which is or was at any time owned, leased or occupied by the Borrower or on which it has conducted any activity where, in each case, failure to do so could reasonably be expected to have a Material Adverse Effect. 20.1.21 EXECUTION OF FINANCE DOCUMENTS Its execution of the Finance Documents and its exercise of its rights and performance of its obligation hereunder and thereunder do not and will not: (a) conflict with the Licence, or to the best of its knowledge having made all due enquiry any other agreement, mortgage, bond or other instrument or treaty to which it is party or which is binding upon it or any of its assets; (b) conflict with its constitutive documents; (c) conflict with any applicable law, regulation or official or judicial order. 20.1.22 NO IMMUNITY In any proceedings taken in Slovenia in relation to any of the Material Contracts it will not be entitled to claim for itself or any of its assets immunity from suit, execution, attachment or other legal process except for any property which is exempt from attachment and execution pursuant to the laws of Slovenia of general application to the extent that such exemption has not been validly waived pursuant to Clause 40.4 (Waiver of immunity). 20.1.23 DEALING ON OWN ACCOUNT For all matters related to the Transaction Documents the Borrower is dealing on its own account. 20.1.24 EASEMENTS The Borrower has all easements, rights of way, rights of ingress and egress necessary for the construction and operation of the Project except where the failure to do so would not have a Material Adverse Effect. 20.1.25 MATERIAL CONTRACTS All contracts required for the design, engineering, development, construction, installation, testing, operation and maintenance of the Network are in full force and effect, there are no other Material Contracts in existence which have not been disclosed to the Off Shore Facility Agent and it has no notice of any material breach by any person of its obligations thereunder. 20.1.26 AMENDMENTS TO MATERIAL CONTRACTS There have been no material amendments (other than those permitted under Clause 24.27 (Amendments) to any of the Material Contracts including those provided to the Off Shore Facility Agent in connection with the Legal Due Diligence Report. 20.1.27 CAPITAL As of the date hereof the registered Share Capital is SIT 7,000,000,000 comprising 2 Shares owned by the following Shareholders in the following percentages. Western Wireless International Slovenia Corporation 95% Western Wireless International Slovenia II Corporation 5% and no person will have any right to subscribe for any additional Shares in the Share Capital. - 60 - 20.1.28 ACCOUNTS The Borrower has no accounts other than those permitted, established or to be established in accordance with this Agreement. 20.1.29 SUBSIDIARIES The Borrower does not have any Subsidiaries (other than as permitted under Clause 24.33 (UMTS and other licences) or those created with the consent of the Banks, not to be unreasonably withheld or delayed) or any investments in any other person. 20.1.30 SERVICES AND FACILITIES All services, facilities and other materials necessary for the importation, construction, installation, operation and maintenance of the Network are or, to the best of the Borrower's knowledge after due inquiry, will be available to the Borrower when necessary for the construction, installation, testing, operation and maintenance of the Network, and to the extent necessary, arrangements have been made on commercially reasonable terms for such services, facilities and other materials, with respect to which arrangements the Borrower has no reason to believe such arrangements will not be made at the time so required, except where the failure of such services, facilities and other materials to be available or arranged would not reasonably be likely to have a Material Adverse Effect. 20.1.31 RANKING OF SECURITY Other than the ECA Cover Documents, each Security Document creates (or, once entered into, will create) in favour of the Finance Parties the Security which it is expressed to create over the secured assets referred to therein with first ranking and priority which are not subject to any prior or pari passu Security. 20.1.32 BUSINESS PLAN The projections and forecasts appearing in the most recent Business Plan are in accordance with the requirements of Clause 22 (Financial covenants and network milestones) and consistent with Clause 24 (General undertakings) and were made on the basis of grounds believed at the time to be correct. 20.1.33 PROHIBITED PAYMENTS None of the Borrower's officers, directors, employees and/or agents acting on its behalf have offered, given, insisted on, received or solicited any illegal payment or advantage to influence the action of any person in connection with the Project. 20.2 REPETITION The representations in Clause 20.1 (Representations) (other than in Clause 20.1.11 (No misleading information) and Clause 20.1.27 (Capital)) ("REPEATED REPRESENTATIONS") shall be expressly repeated by the Borrower by reference to the facts and circumstances then existing at: (a) the date of each Utilisation Request (including any SIT Facility Rollover Loan); and (b) each repayment date as determined under Clause 13 (Repayment). - 61 - 21. REPORTING REQUIREMENTS The undertakings in this Clause 21 remain in force from the date of this Agreement for so long as any amount is outstanding under the Finance Documents or any Commitment is in force. 21.1 FINANCIAL STATEMENTS AND OTHER INFORMATION The Borrower shall supply to the Off Shore Facility Agent in sufficient copies for all of the Banks: (a) as soon as the same become available, but in any event not later than 120 days after the end of each financial year one set of its audited annual financial statements for that financial year prepared in accordance with US GAAP and one set of its audited annual financial statements for that financial year prepared in accordance with Slovenian Accounting Standards; (b) as soon as the same becomes available, but in any event not later than three weeks after the commencement of a new financial year of the Borrower, the Updated Business Plan in respect of the following financial year which shall, without limitation: (i) be in the same format and comprise the same items as the most recent Business Plan and otherwise include a description of any changes and sufficient information, in form and substance as may be reasonably required by the Off Shore Facility Agent, to enable the Banks to make an accurate comparison between the most recent Business Plan and such Updated Business Plan; (ii) demonstrate that the Borrower is in compliance with the requirements of Clause 22 (Financial covenants and network milestones) and such Updated Business Plan is consistent with Clause 24 (General undertakings); and (iii) include a profit and loss statement, balance sheet, cash flow statement and details of investments in fixed assets, capital and operation expenditures updated to reflect the circumstances then existing and anticipated for the forthcoming financial year and any information relevant at such time that was not included in the Initial Business Plan; and (iv) include an outline of major future business plans; (c) as soon as the same becomes available but in any event not later than 45 days after the end of each Quarter and starting as at 31 December 2001, a management report for that Quarter, signed by the CFO, which shall include, without limitation: (i) a profit and loss statement, balance sheet, cash flow statement, details of investments in fixed assets, debt profile (including aggregate lease obligations) short term and long term; (ii) a list of all existing accounts of the Borrower identifying the financial institution with which those are held and the balances thereon; and (iii) a Project Status and Progress Report setting out in detail information addressing the matters referred to in Schedule 15 (Project Status and - 62 - Progress Report) (signed by the CFO and the chief technical officer of the Borrower); and (d) every week bank statements (in the form agreed between the Off Shore Facility Agent, the On Shore Facility Agent and Hypo Alpe-Adria-Bank d.d.) in respect of the Permitted Accounts and the Proceeds and Revenue Accounts and the Borrower authorises and instructs the On Shore Facility Agent and Hypo Alpe-Adria-Bank d.d. to provide such bank statements in respect of the Proceeds and Revenue Accounts to the Off Shore Facility Agent at such times. 21.2 REQUIREMENTS AS TO FINANCIAL STATEMENTS (a) Each set of financial statements delivered by the Borrower pursuant to Clause 21.1 (Financial statements and other information) shall be certified by the CFO as fairly representing its financial condition as at the end of and for the period up to the date as at which those financial statements were drawn up. (b) The Borrower shall procure that each set of financial statements delivered pursuant to Clause 21.1 (Financial statements and other information) or that is required to be in accordance with US GAAP is prepared using US GAAP, accounting practices and financial reference periods consistent with those applied in the preparation of the financial statements of the immediately preceding year unless, in relation to any set of financial statements delivered immediately after any change has taken place, it notifies the Off Shore Facility Agent that there has been a change in US GAAP or the accounting practices or reference periods and its auditors deliver to the Off Shore Facility Agent: (i) a description of any change necessary for those financial statements to reflect the US GAAP, accounting practices and reference periods upon which the financial statements for the immediately preceding year were prepared; and (ii) sufficient information, in form and substance as may be reasonably required by the Off Shore Facility Agent, to enable the Banks to determine whether Clause 22 (Financial covenants and network milestones) has been complied with and make an accurate comparison between the financial position indicated in those financial statements and the financial statements for the immediately preceding year. Any reference in this Agreement to those financial statements shall be construed as a reference to those financial statements as adjusted to reflect the basis upon which the financial statements for the immediately preceding year were prepared. (c) The Borrower shall procure that each set of financial statements delivered pursuant to Clause 21.1(a) (Financial statements and other information) that is to be prepared in accordance with Slovenian Accounting Standards or any other financial statements required to be prepared by applicable law are delivered to the Off Shore Facility Agent and in each case are prepared using Slovenian Accounting Standards, accounting practices and financial reference periods consistent with those applied in the preparation of the financial statements of the immediately preceding financial year unless, in relation to any set of financial statements delivered immediately after any change has taken place, it notifies the Off Shore Facility Agent that there has been a change in Slovenian Accounting Standards or the accounting practices or reference periods and its auditors deliver to the Off Shore Facility Agent: - 63 - (i) a description of any change necessary for those financial statements to reflect the Slovenian Accounting Standards, accounting practices and reference periods upon which the financial statements for the immediately preceding year were prepared; and (ii) sufficient information, in form and substance as may be reasonably required by the Off Shore Facility Agent, to enable the Banks to determine whether Clause 22 (Financial covenants and network milestones) has been complied with and make an accurate comparison between the financial position indicated in those financial statements and the financial statements for the immediately preceding year. Any reference in this Agreement to those financial statements shall be construed as a reference to those financial statements as adjusted to reflect the basis upon which the financial statements for the immediately preceding year were prepared. 21.3 COVENANT COMPLIANCE CERTIFICATE (a) The Borrower shall supply the Off Shore Facility Agent, with each set of financial statements prepared in accordance with US GAAP delivered pursuant to Clauses 21.1(a) and (c)(i) (Financial statements and other information), a Covenant Compliance Certificate setting out (in reasonable detail) computations as to compliance with Clause 22 (Financial covenants and network milestones) as at the date as at which those financial statements were drawn up and confirming compliance with the requirements of Clause 23.3 (Application of moneys on the Proceeds and Revenue Accounts). (b) Each Covenant Compliance Certificate shall be signed by the CFO and, if required to be delivered with the financial statements delivered pursuant to Clause 21.1(a) (Financial statements and other information), shall be reported on by the Borrower's auditors. 21.4 INFORMATION: MISCELLANEOUS The Borrower shall supply the Off Shore Facility Agent (in sufficient copies for all the Banks, if the Off Shore Facility Agent so requests) with: (a) all documents dispatched by the Borrower to its creditors generally at the same time as they are dispatched; (b) promptly upon becoming aware of them, the details of any litigation, arbitration or administrative proceedings against the Borrower (which are not considered to be frivolous or vexatious) which are current, threatened or pending, and which might, if adversely determined, have a Material Adverse Effect; (c) promptly, such further information regarding its financial condition, business and operations as any Finance Party (through the Agent) may reasonably request; and (d) any other information that from time to time may be reasonably asked for by the Off Shore Facility Agent and the Independent Technical Consultant. 21.5 NOTIFICATION OF DEFAULT AND CASH SHORTFALL (a) The Borrower shall notify the Off Shore Facility Agent of any Event of Default or Potential Event of Default or Cash Shortfall (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence. - 64 - (b) Promptly upon a request by the Off Shore Facility Agent (acting reasonably), the Borrower shall supply to the Off Shore Facility Agent a certificate signed by two of its directors or senior officers on its behalf certifying that no Event of Default or Potential Event of Default or Cash Shortfall is continuing (or if an Event of Default or Potential Event of Default or Cash Shortfall is continuing, specifying the Event of Default or Potential Event of Default or the extent of the Cash Shortfall and the steps, if any, being taken to remedy it). 21.6 BUSINESS PLAN REVIEW Within the earlier of: (a) 14 days from the receipt by the Off Shore Facility Agent of an Updated Business Plan; and (b) five weeks from the commencement of a financial year of the Borrower, the Borrower and the Off Shore Facility Agent shall meet and review the Updated Business Plan delivered in accordance with Clause 21.1(b) (Financial statements and other information). 22. FINANCIAL COVENANTS AND NETWORK MILESTONES The calculation of ratios and other amounts under this Clause 22 shall be made by reference to the most recent financial statements, Covenant Compliance Certificate and Project Status and Progress Report for the period or periods in relation to which the calculation or determination falls to be made. **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** - 65 - 22.4 CONFIRMATION BY INDEPENDENT TECHNICAL CONSULTANT The figures in Clauses 22.2(a) and (b) (Stage I covenants) and Clause 22.3(e) (Stage II covenants) shall be confirmed by the Independent Technical Consultant annually commencing on 31 December 2002 and ending on 31 December 2004. 23. ACCOUNTS AND PAYMENTS 23.1 PROCEEDS AND REVENUE ACCOUNTS The Borrower will open a transactional account with the On Shore Security Agent ("PROCEEDS AND REVENUE ACCOUNT #1") and Hypo Alpe-Adria-Bank d.d. Ljubljana ("PROCEEDS AND REVENUE ACCOUNT #2") prior to the first Utilisation Date (the "PROCEEDS AND REVENUE ACCOUNTS"), such accounts to be pledged by the Borrower in - 68 - favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. 23.2 PAYMENTS INTO THE PROCEEDS AND REVENUE ACCOUNTS (a) The Borrower will ensure that it pays into the Proceeds and Revenue Account #1 all loan, insurance, sale and other proceeds, receivables and Equity Contributions and proceeds of Subordinated Loans and Sponsors Unsecured Loans and revenues of any nature and all payments to be made to the Borrower other than as permitted by Clause 23.2(b). (b) The Borrower will use reasonable commercial efforts to have 30% of the revenues and payments to be made to the Borrower paid into the Proceeds and Revenue Account #2 (other than in respect of loan, insurance, sale proceeds, Equity Contributions, Subordinated Loans and Sponsors Unsecured Loans) provided that the balance standing to the credit of such account shall not exceed Euro 2,000,000 or its equivalent. (the payments into the Proceeds and Revenue Account #1 and the payments into the Proceeds and Revenue Account #2, together the "PROCEEDS AND REVENUES"). 23.3 APPLICATION OF MONEYS ON THE PROCEEDS AND REVENUE ACCOUNTS Subject to Clause 23.10 (Remedies on Potential Event of Default or Event of Default), the Borrower shall and, in the case of an Event of Default, only with the Off Shore Facility Agent's written consent (acting on the instructions of the Majority Banks) apply any moneys standing to the credit of the Proceeds and Revenue Accounts as follows: (a) any Proceeds and Revenues that constitute Insurance Proceeds shall be paid into the Insurance Proceeds Account in the applicable currency and applied in accordance with Clause 23.4 (Insurance Proceeds Account); (b) any Proceeds and Revenues arising from the sale, disposal or exchange of any asset shall be paid into the Sale Proceeds Account in the applicable currency and applied in accordance with Clause 23.5 (Sale Proceeds Account); (c) any Proceeds and Revenues that constitute Contributed Capital or Sponsors Unsecured Loans or the proceeds of any Loans payable to the Borrower under the Euro Facility shall be paid into the Loan Proceeds Account and applied in accordance with Clause 23.6 (Loan Proceeds Account) PROVIDED THAT in respect of any amounts contributed as Contributed Capital to permit the Borrower to make contributions to the UMTS Subsidiary in accordance with Clause 24.33(b)(ii) (UMTS and other licenses), the Borrower may transfer, after compliance with the provisions of Clause 24.33(b)(iii) (UMTS and other licenses), such amounts to the UMTS Subsidiary; and (d) subject to Clause 23.9 (Debt Service Reserve Account) and Clause 23.6.2 (Debt Service Account) all Proceeds and Revenues (other than those expressly referred to in paragraphs (a) to (c) above) shall be applied for the following purposes and exclusively in the following order: (i) first, in and towards payment of any Tax payment due and payable; (ii) second, in or towards payment of all due and payable operating costs as shown in the Initial Business Plan (including amounts in respect of direct costs payable under the Management Agreement which are - 69 - provided for in the Initial Business Plan but excluding any amounts payable under the Lucent Loan Agreement); (iii) third, in or towards payment of all due and payable on-going capital costs in relation to the build-out of the Network as shown in the Initial Business Plan and necessary to perform its business but excluding any amounts payable under the Lucent Loan Agreement; (iv) fourth, in and towards Debt Service Payments due and payable and payments to be made to the Debt Service Account in accordance with Clause 23.6 (Debt Service Account) which shall be applied: (1) towards payment of any unpaid costs and expenses of the Banks, the Agents, the Security Agents, with the exception of the payments mentioned under paragraphs (2) to (4) and (viii) below; (2) in or towards payment of any amount due and payable under the Hedging Agreements; (3) in or towards payment of any accrued interest and fees due and payable to the Banks hereunder and to the Sponsors under the Sponsors Unsecured Loan Agreement and Lucent Technologies Inc. under the Lucent Loan Agreement; (4) in or towards payment of any principal due and payable to the Banks under this Agreement and to the Sponsors under the Sponsors Unsecured Loan Agreement and Lucent Technologies Inc. under the Lucent Loan Agreement; (v) fifth, in or towards any payment of any amount due and payable into the Debt Service Reserve Account in accordance with Clause 23.9 (Debt Service Reserve Account); (vi) sixth, in and towards payment of all due and payable operating costs and expenses that have not been paid pursuant to Clause 23.3(d)(ii); (vii) seventh, in or towards payment of capital costs in the amounts and at the times set out in the Business Plan (other than the Initial Business Plan) and amounts in respect of any margin payable under the Management Agreement in an amount not exceeding (A) US Dollars 700,000 or its equivalent in the financial year ending 31 December 2002 and (B) in each financial year thereafter the lesser of (Y) 50% of any direct costs payable under the Management Agreement and (Z) US Dollars 700,000 or its equivalent; (viii) eighth, in payment of any amounts planned to be paid by the Borrower in the immediately following 12 month period in respect of capital expenditure to the Capital Expenditure Reserve Account; (ix) ninth, in prepayment of the Facilities in accordance with Clause 14.5 (Mandatory prepayments); and (x) tenth, in or towards any payment due and payable to the Shareholders (including any interest payable on any Subordinated Loans or other amounts payable under the Management Agreement that have not been - 70 - paid pursuant to Clauses 23.3(d)(ii) or (vii)) in an amount not to exceed 50% of the Excess Cash Flow. (e) The Borrower shall only be entitled to make the payments referred to in this Clause 23.3 out of the Proceeds and Revenue Accounts on the following basis: (i) amounts payable pursuant to paragraphs (d)(i) to (vii) above inclusive shall be paid when due; and (ii) amounts payable pursuant to paragraph (d)(x) above shall only be paid on satisfaction of the conditions set out in paragraph (f) below. (f) Payments by the Borrower from the Proceeds and Revenue Accounts to the Shareholders pursuant to paragraph (d)(x) above are permitted only: (i) from the expiry of the Availability Period of the Euro Facility; (ii) subject to the absence of an Event of Default or Potential Event of Default; (iii) upon provision of the most recent financial statements required in accordance with Clause 21 (Reporting requirements) covering the relevant period and showing a net profit before payments are made to the Shareholders; (iv) upon the provision of a Covenant Compliance Certificate confirming that the Borrower complies with the financial covenants and other requirements set out in the Covenant Compliance Certificate; (v) within a period of ten (10) Business Days following a Repayment Date of a Euro Facility Loan; and (vi) if the Debt Service Cover Ratio at any Repayment Date of a Euro Facility Loan is equal to or greater than 1.30. (g) Upon the occurrence and during the continuance of an Event of Default or Potential Event of Default the Borrower authorises the Agents (on behalf of the Senior Creditors) to debit: (i) the Proceeds and Revenue Accounts with all amounts referred to in paragraph (d)(iv) above when due; and (ii) if the funds in the Proceeds and Revenue Accounts are not sufficient to pay any amounts set out in paragraph (d) (iv) above, to debit the Debt Service Reserve Account with any such amount, and to apply any amount so debited in payment of the relevant amounts. 23.4 INSURANCE PROCEEDS ACCOUNT 23.4.1 The Borrower will open a transactional account with the On Shore Security Agent ("INSURANCE PROCEEDS ACCOUNT") prior to the first Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. - 71 - 23.4.2 Insurance Proceeds in an amount less than Euro 250,000 in respect of any single event may be withdrawn from the Insurance Proceeds Account to make payment in respect of the costs of repair or restoration of the Project, as determined by the Borrower. 23.4.3 Insurance Proceeds in an amount equal to or greater than Euro 250,000 in respect of any single event may be withdrawn from the Insurance Proceeds Account PROVIDED THAT: (a) funds so withdrawn are used to make payment in respect of the costs of repair or restoration of the Project; and (b) the Borrower has consulted with the Off Shore Facility Agent to the reasonable satisfaction of the Off Shore Facility Agent in respect of progress of the repair or restoration and the application of Insurance Proceeds. 23.4.4 All other Insurance Proceeds shall be applied in prepayment in accordance with Clause 14.5.1(b) (Mandatory prepayments). 23.4.5 Notwithstanding any other provisions of this Clause 23.4 and subject to Clause 23.10 (Remedies on Potential Event of Default or Event of Default) if: (a) an Event of Default has occurred and is continuing: (i) the On Shore Facility Agent shall have the right to take over sole conduct of the Borrower's claims under or in connection with the insurance policies of the Borrower; and (ii) the On Shore Facility Agent shall be entitled to require all Insurance Proceeds (including funds in the Borrower's Insurance Proceeds Account) to be applied by the Borrower in or towards the settlement of the Loans; and (b) a Potential Event of Default has occurred and is continuing the Off Shore Facility Agent and the Borrower shall agree on the conduct of any of the Borrower's claims under or in connection with the insurance policies of the Borrower. 23.5 SALE PROCEEDS ACCOUNT 23.5.1 The Borrower will open a transactional account with the On Shore Security Agent ("SALE PROCEEDS ACCOUNT") prior to the first Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. 23.5.2 Subject to the existence of no Event of Default or Potential Event of Default and Clause 23.10 (Remedies on Potential Event of Default or Event of Default), the Borrower may: (a) withdraw amounts standing to the credit of the Sale Proceeds Account for use in accordance with Clause 23.3(d) (Application of moneys on the Proceeds and Revenue Accounts): (i) up to a maximum aggregate per annum of Euro 100,000 or its equivalent; and (ii) in respect of sale proceeds from assets which are no longer required in connection with the Project; and - 72 - (b) except as provided in Clause 23.5.2(a), only use amounts standing to the credit of the Sale Proceeds Account in or towards purchases of replacement assets PROVIDED THAT: (i) the Borrower has furnished to the Off Shore Facility Agent an invoice, duly certified by the CFO and the relevant vendor, in respect of the replaced asset; and (ii) the Borrower purchases the replacement asset within: (1) in the case of replacements of Material Assets 180 days; and (2) in all other cases 360 days, of receipt of such sales proceeds. 23.5.3 Any amounts standing to the credit of the Sale Proceeds Account that are not used in accordance with Clause 23.5.1 (Sale Proceeds Account) shall be applied in prepayment in accordance with Clause 14.5.1(a) (Mandatory prepayments). 23.6 DEBT SERVICE ACCOUNT 23.6.1 The Borrower will open a debt service account (the "DEBT SERVICE ACCOUNT") with the On Shore Security Agent prior to the first Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. 23.6.2 The Borrower shall pay into the Debt Service Account on the last day of each Month pursuant to Clause 23.3(d)(iv) (Application of moneys on the Proceeds and Revenue Accounts) an amount equal: (a) to one third of the Debt Service Payments (other than in respect of the SIT Facility and other than as provided in paragraph (b) below) due and payable in respect of that Interest Period on the next Euro Facility Interest Payment Date; and (b) from the date falling six (6) Months prior to the first Repayment Date, one sixth of the Debt Service Payments (other than in respect of the SIT Facility and other than in respect of interest and amounts payable under the Hedging Agreements prior to their termination) due and payable on the next repayment date under the Euro Facility, the Sponsors Unsecured Loan Agreement and under the Lucent Loan Agreement. 23.6.3 Subject to Clause 23.10 (Remedies on Potential Event of Default or Event of Default) the Borrower shall be entitled to use the amount standing to the credit of the Debt Service Account on each Euro Facility Interest Payment Date or Repayment Date under the Euro Facility to satisfy its Debt Service Payment obligations to the Senior Creditors (other than the SIT Facility Banks), the Equipment Vendor under the Lucent Loan Agreement and the Sponsors under the Sponsors Unsecured Loan Agreement, in each case, pursuant to Clause 23.3(d)(iv) (Application of moneys on the Proceeds and Revenue Accounts). 23.7 CAPITAL EXPENDITURE RESERVE ACCOUNT 23.7.1 The Borrower will open a capital expenditure reserve account (the "CAPITAL EXPENDITURE RESERVE ACCOUNT") with the On Shore Security Agent prior to the first - 73 - Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. 23.7.2 The Borrower may pay into the Capital Expenditure Reserve Account pursuant to Clause 23.3(d)(viii) (Application of moneys on the Proceeds and Revenue Accounts) amounts that the Borrower plans to pay in respect of capital expenditure which may be withdrawn for the payment of such capital expenditure and shall be withdrawn to effect prepayments, in each case at the times and in the manner provided for in Clause 23.3 (Application of moneys on the Proceeds and Revenue Accounts). 23.8 LOAN PROCEEDS ACCOUNT 23.8.1 The Borrower will open a transactional account with the On Shore Security Agent ("LOAN PROCEEDS ACCOUNT") prior to the first Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Claims Assignment and Bills of Exchange Agreement. 23.8.2 The Borrower may withdraw amounts standing to the credit of the Loan Proceeds Account PROVIDED THAT funds so withdrawn are used to: (a) make payment in respect of Project Costs but in the case of the proceeds of any Loans, excluding any amounts payable to the Debt Service Reserve Account; and (b) after giving effect to the conversion of Euro 18,500,000 of Existing WWIC Loans into Sponsors Contributions and Euro 1,561,318.60 of Existing WWIC Loans into Sponsors Unsecured Loans, to repay any remaining Existing WWIC Loans which are outstanding in respect of agreed Project Costs PROVIDED THAT: (i) such repayment is made from the proceeds of a Utilisation of the Commercial Facility; (ii) no Event of Default or Potential Event of Default will be caused by such repayment; (iii) no Cash Shortfall will be caused by such repayment; (iv) no breach of the financial covenants set out in Clause 22 (Financial covenants and network milestones) will be caused by such repayment; (v) interest shall be payable thereon at the rate set out in the Existing WWIC Loan Agreement; and (vi) the Borrower has obtained the prior written approval of the Off Shore Facility Agent, which will not be withheld if the Off Shore Facility Agent is satisfied that conditions set out in this paragraph (b) are met and the Off Shore Facility Agent has received: (1) a certificate, in form and substance reasonably satisfactory to the Off Shore Facility Agent, signed by a director of the Borrower stating that the Existing WWIC Loans to be repaid were in respect of payments made for Project Costs; and (2) evidence of payment of the Existing WWIC Loans to the Borrower and payment by the Borrower of the respective Project Costs. - 74 - 23.9 DEBT SERVICE RESERVE ACCOUNT 23.9.1 The Borrower will open a debt service reserve account (the "DEBT SERVICE RESERVE ACCOUNT") with IKB International S.A., Luxembourg prior to the first Utilisation Date, such account to be pledged by the Borrower in favour of the Senior Creditors by entering into the Debt Service Reserve Account Pledge Agreement. 23.9.2 The Borrower shall pay into the Debt Service Reserve Account on the last day of each Month (other than in respect of the first payment which shall be within five (5) Business Days of the first Utilisation Date) pursuant to Clause 23.3(d)(v) (Application of moneys on the Proceeds and Revenue Accounts) and Clause 23.9.4 (Debt Service Reserve Account) an amount so that the amount standing to the credit of the Debt Service Reserve Account is no less than the aggregate of all Debt Service Payments falling due under the Facilities, the Hedging Agreements and the Lucent Loan Agreement during the immediately following six Month period as determined in accordance with Clause 23.9.3 (Debt Service Reserve Account) (or in the absence of a notification from the Off Shore Facility Agent, as notified by the Borrower pursuant to Clause 23.9.3(b) (Debt Service Reserve Account) ("DSRA REQUIRED BALANCE")). In no event shall the proceeds of any loan be used to fund the Debt Service Reserve Account. 23.9.3 (a) The On Shore Facility Agent shall, not less than ten (10) Business Days before the first day of each Month, notify the Off Shore Facility Agent of the SIT equivalent amount in Euro (calculated at the exchange rate (middle rate) of Banka Slovenije on the date of calculation) which is the aggregate of all Debt Service Payments falling due under the SIT Facility during the immediately following six (6) Month period commencing from the first day of such Month. (b) The Borrower shall, not less than ten (10) Business Days before the first day of each Month, notify the Off Shore Facility Agent of the amount which is the aggregate of the net amount in Euro of all Debt Service Payments falling due from the Borrower (or, as the case may be, the net amount of all amounts payable to the Borrower) under any Hedging Agreements, the Lucent Loan Agreement and the Facilities in the immediately following six (6) Month period commencing from the first day of such Month. The Borrower shall provide such information and such documents as the Off Shore Facility Agent may reasonably request in order to verify the amounts so stated by the Borrower. (c) The Off Shore Facility Agent shall, not less than five (5) Business Days before the first day of each Month determine the Debt Service Payments under the Facilities, the Hedging Agreements and the Lucent Loan Agreement payable by the Borrower for the immediately following six (6) Month period commencing from the first day of such Month based on information provided to the Off Shore Facility Agent by the On Shore Facility Agent and the Borrower and as determined by the Off Shore Facility Agent and shall notify the Borrower of the amount of such Debt Service Payments under the Facilities, the Hedging Agreements and the Lucent Loan Agreement. (d) Each Agent may assume: (i) for the purposes of calculating the Debt Service Payments (other than in respect of principal repayments) under the Facilities, the Hedging Agreements and the Lucent Loan Agreement that: (1) interest will accrue for the following six (6) Month period o under the relevant Facility and the Lucent Loan Agreement on - 75 - principal outstanding at the rate of interest which applies on the relevant date of calculation (including the Applicable Margin thereunder at such time); (2) the principal outstanding under the Facilities and the Lucent Loan Agreement during the following six (6) Month period is the principal amount outstanding on the relevant date of calculation taking into account any repayments that are required to be made in such period pursuant to Clause 13 (Repayment); and (3) any outstanding SIT Facility Loans on the relevant date of calculation will be refinanced with SIT Facility Rollover Loans; (ii) for the purposes of calculating the Debt Service Payments under the Facilities, the Hedging Agreements and the Lucent Loan Agreement in respect of principal repayments that fall due over the following six (6) Month period: (1) only those repayments and, in the case of the SIT Facility, reductions of the SIT Facility Commitment, required to be made under Clause 13 (Repayment) will be made; and (2) any outstanding SIT Facility Loans on the relevant date of calculation will be refinanced with SIT Facility Rollover Loans. 23.9.4 If following the application of proceeds standing to the credit of the Proceeds and Revenue Accounts in accordance with Clause 23.3(d) (Application of moneys on the Proceeds and Revenue Accounts) and Clause 23.9.1 (Debt Service Reserve Account) the DSRA-Required Balance is not achieved the Borrower shall request the Sponsors to make Sponsor Contributions in accordance with clause 3.3 (Contingent Equity) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee to ensure that the amount standing to the credit of the Debt Service Reserve Account is no less than the DSRA-Required Balance. 23.9.5 The Off Shore Facility Agent is entitled to set off the credit balance in the Debt Service Reserve Account against any obligations of the Borrower due and payable under the Finance Documents to the Senior Creditors if the Borrower fails in a timely manner to perform such obligations. 23.9.6 Upon any debit to the Debt Service Reserve Account, the Borrower is obliged to replenish the Debt Service Reserve Account up to the DSRA-Required Balance as soon as possible with moneys from the Proceeds and Revenue Accounts subject to the provisions contained in Clause 23.3(d) (Application of moneys on the Proceeds and Revenue Accounts). Provided that if no Potential Event of Default or Event of Default has occurred and is continuing, any amount standing to the credit of the Debt Service Reserve Account in excess of the DSRA-Required Balance shall be paid into a Proceeds and Revenue Account by the Off Shore Security Agent upon receipt of a written request from the Borrower. 23.10 REMEDIES ON POTENTIAL EVENT OF DEFAULT OR EVENT OF DEFAULT Without prejudice to any other rights under the Finance Documents available to the Senior Creditors, upon the occurrence and during the continuance of an Event of - 76 - Default or Potential Event of Default the Off Shore Facility Agent may require the Borrower to transfer amounts standing to the credit of the Insurance Proceeds Account, Loan Proceeds Account, Sale Proceeds Account, the Debt Service Account and/or the Capital Expenditure Reserve account to a different account, set up by the Off Shore Security Agent, in the name of or held on behalf of the Borrower and for such purpose may request the On Shore Facility Agent to make such payment. The Borrower hereby authorises the On Shore Facility Agent (without an obligation to make further inquiry) to pay such amounts to the Off Shore Security Agent upon receipt of request by the Off Shore Facility Agent hereunder. Such account shall be secured in favour of the Senior Creditors and the Senior Creditors shall be entitled upon the occurrence and during the continuance of an Event of Default to set off the amounts standing to the credit of the new account against amounts owing to the Senior Creditors under the Finance Documents. 24. GENERAL UNDERTAKINGS The undertakings in this Clause 24 remain in force from the date of this Agreement for so long as any amount is outstanding under the Finance Documents or any Commitment is in force. 24.1 MAINTENANCE OF LEGAL VALIDITY The Borrower shall: (a) do all that is necessary to maintain its existence as a legal person; and (b) promptly apply for and obtain, comply with and do all that is necessary to maintain in full force and effect any Authorisation required under any law or regulation of Slovenia to enable it to perform its obligations under the Transaction Documents and to ensure the legality, validity, enforceability or admissibility in evidence in its jurisdiction of incorporation of any Transaction Document in each case, except (other than in respect of the Security Documents) where failure to do so would not reasonably be expected to have a Material Adverse Effect. 24.2 AUTHORISATIONS TO CONDUCT BUSINESS The Borrower shall promptly: (a) apply for and obtain, comply with and do all that is necessary to maintain in full force and effect and supply certified copies to the Agent of the Licence and all Authorisations required under any law or regulation of each jurisdiction in which it conducts its business to enable it to carry on its business as it is then being conducted; and (b) report this Agreement to (and in any event within ten (10) Business Days from the date hereof), and report on the transactions undertaken in respect of the Debt Service Reserve Account and any other offshore bank accounts of the Borrower to and at the times required by, Banka Slovenije. 24.3 COMPLIANCE WITH LAWS The Borrower shall comply in all respects with all laws and regulations to which it may be subject, if failure so to comply would materially impair its ability to perform its obligations under the Material Contracts and shall perform and observe in all material respects its obligations under the Material Contracts. - 77 - 24.4 COMPLIANCE WITH BUSINESS PLAN The Borrower shall carry out the Project substantially in accordance with the Business Plan and shall promptly notify and consult with the Off Shore Facility Agent as soon as it becomes aware of any increases of 20% or more in the annual operating and/or capital expenditures contemplated in the Business Plan. 24.5 NETWORK The Borrower shall maintain, preserve, repair or replace its assets and subject to the terms of Clause 24.26 (New contracts) enter into such contracts as are, in each case, necessary to construct, install, test, maintain, develop and operate the Network in accordance with prudent industry practice. 24.6 INSURANCE The Borrower shall give effect to the insurance requirements set out in Schedule 11 (Insurance). 24.7 FINANCIAL SYSTEMS AND AUDITORS The Borrower shall maintain adequate billing, cash collection, accounting, management information and cost control systems and software and maintain the appointment of an independent and reputable firm of auditors acceptable to the Off Shore Facility Agent (acting reasonably). 24.8 UNTRUE REPRESENTATIONS The Borrower shall after the delivery of any Utilisation Request and before the making of a Loan or the issue of a SIT Facility Guarantee or LC as the case may be, requested therein, notify the Off Shore Facility Agent of the occurrence of any event which results in or may reasonably be expected to result in the Repeated Representations (or in the case of the first Utilisation of the Facilities the representations contained in Clause 20.1 (Representations)) being untrue at or before the time of the making of such Loan or SIT Facility Guarantee or LC, as the case may be. 24.9 SPONSOR AND SHAREHOLDER SUPPORT The Borrower shall request from the Sponsors such technical and managerial assistance as and when required to enable the Borrower to undertake technical design of the Network and implement and operate the Network and shall request the Sponsors to provide trained seconded staff in accordance with the assumptions in the Initial Business Plan at the times and in the numbers set out therein and the Borrower shall request all such financial support from the Sponsors as provided in the Sponsors' and Shareholders' Undertaking and Completion Guarantee. 24.10 TAXES The Borrower shall duly and punctually pay and discharge: (a) all Taxes imposed upon it or its assets within the time period allowed therefor without imposing penalties in excess of Euro 15,000 or its equivalent and without resulting in an encumbrance having priority to the Banks or any Security purported to be granted by or created pursuant to the Security Documents (save to the extent payment thereof is being contested in good faith by the Borrower, appropriate reserves have been made by the Borrower, and where payment thereof can lawfully be withheld and would not result in an encumbrance having priority to the Security created or evidenced by the Security Documents); and (b) all lawful claims which, if unpaid, would by law become encumbrances upon its assets. - 78 - 24.11 SECURITY PRESERVATION The Borrower shall at its own expense, take all such action at the times and in the manner specified as conditions subsequent to the making of any Loans under this Agreement set out in Schedule 9 (Security Documents - Conditions Precedent and Conditions Subsequent) and as the Security Agents may reasonably require for the purpose of perfecting or protecting the Banks' rights under and preserving the security interests intended to be created by any of the Security Documents and shall grant and perfect such additional Security over Material Assets as the Off Shore Security Agent may require. 24.12 INSPECTION RIGHTS (a) The Borrower shall permit the Agents and the Security Agents or any of their representatives, advisers or agents to, without unreasonably disrupting the Borrower's normal course of business, inspect its place of business and its books and records during normal business hours and upon ten (10) days prior notice and shall permit and authorise the Agents and Security Agents to directly contact and address questions to the auditors of the Borrower in the presence of representatives of the Borrower. (b) The Borrower shall permit the Off Shore Facility Agent and the Independent Technical Consultant full access, during normal business hours and upon five (5) Business Days' prior notice, to the Network and all data and information relating thereto to enable the Off Shore Facility Agent and the Banks to check the Borrower's compliance with the terms of this Agreement PROVIDED THAT such access does not unreasonably disrupt the Borrower's normal course of business. (c) The Borrower shall request counterparties to the Project Contracts to permit the Agents and the Security Agents or any of their representatives, advisors or agents to make appropriate inspections on the basis set out in paragraph (a) above. 24.13 PAYMENTS TO THE BORROWER The Borrower shall ensure that all monies received by it are paid into the Proceeds and Revenue Accounts. 24.14 NOTIFICATION OF DEFAULTS The Borrower shall promptly inform the Off Shore Facility Agent of the occurrence of any default under any Material Contract (howsoever called) upon becoming aware of it and, upon receipt of a written request to that effect from the Off Shore Facility Agent, confirm to the Off Shore Facility Agent that, save as previously notified to the Off Shore Facility Agent or as notified in such confirmation, no default under any Material Contract (howsoever called) has occurred. 24.15 CLAIMS PARI PASSU The Borrower shall ensure that at all times the claims of the Finance Parties against it under the Finance Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors save those whose claims are preferred by any bankruptcy, composition, insolvency, liquidation, reorganisation, moratorium or other similar laws of general application. 24.16 ENVIRONMENTAL COMPLIANCE The Borrower shall in all material respects: (a) comply with all Environmental Laws; and - 79 - (b) obtain and maintain any Environmental Permits required in connection with its business and take all reasonable steps in anticipation of known or expected future changes to or obligations under the same. 24.17 ENVIRONMENTAL CLAIMS The Borrower shall inform the Off Shore Facility Agent in writing as soon as reasonably practicable upon becoming aware of the same: (a) if any Environmental Claim has been commenced or (to the best of the Borrower's knowledge and belief) is threatened against the Borrower, or (b) of any facts or circumstances which will or are reasonably likely to result in any Environmental Claim being commenced or threatened against the Borrower. 24.18 REAL ESTATE SITE LEASES AND OTHER CONTRACTS RELATING TO THE USE OF LAND (a) The Borrower shall exercise all of its rights and/or options to extend the term of, and shall not exercise any options to terminate, any of the real estate site leases or other contracts relating to the use of land unless it would not: (i) cause an interruption to the operation of the Network; or (ii) be necessary to the operation of the Project; and (iii) affect the Security created under the Security Documents. (b) The Borrower shall validly register at the competent Slovenian land registry its rights of use and/or of entry against the respective owner obtained according to any real estate site lease upon which Material Assets subject to the Asset and Licence Pledge and Lease Contracts Assignment Agreement are situated within nine (9) Months from the date of this Agreement. (c) The Borrower shall obtain the consent of each of the owners of the land the subject of the lease agreements which are the subject of the Lease Agreement Assignments within nine (9) Months from the date of this Agreement. 24.19 NEGATIVE PLEDGE The Borrower shall not: (a) create or permit to subsist any Security over any of its assets. (b) (i) sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by the Borrower; (ii) sell, transfer or otherwise dispose of any of its receivables on recourse terms; (iii) enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or (iv) enter into any other preferential arrangement having a similar effect to the arrangements set out in paragraphs (i) to (iii) above, in circumstances where the arrangement or transaction is entered into primarily as a method of raising Financial Indebtedness or of financing the acquisition of an asset; - 80 - (c) Paragraphs (a) and (b) above do not apply to Permitted Encumbrances. 24.20 DISPOSAL (a) The Borrower shall not enter into a single transaction or a series of transactions (whether related or not) and whether voluntary or involuntary to sell, lease, transfer to a third party or otherwise dispose of any asset or remove any Material Asset which is subject to the Asset and Licence Pledge and Lease Contracts Assignment Agreement from its original site without the prior written consent of the Off Shore Facility Agent (such consent not to be unreasonably withheld or delayed). (b) Paragraph (a) above does not apply to Permitted Asset Sales PROVIDED THAT the proceeds of such sales are applied in accordance with Clause 23.5 (Sale Proceeds Account). 24.21 ARM'S LENGTH TERMS The Borrower shall not incur any liability to or enter into any contract with or for the benefit of any Sponsor or any of its Affiliates, (other than in relation to Subordinated Loans and the Management Agreement) otherwise than on terms no less favourable to the Borrower than arm's length terms in the ordinary course of business. 24.22 BANK ACCOUNTS The Borrower shall not open any bank accounts except: (a) as provided in this Agreement; (b) Permitted Accounts; or (c) with the prior written consent of the Off Shore Facility Agent and subject to the Borrower's compliance with any conditions attached thereto, PROVIDED THAT in each case such accounts are secured to the satisfaction of the Off Shore Facility Agent. 24.23 MERGER The Borrower shall not enter into any amalgamation, demerger, merger or corporate reconstruction without the consent of the Off Shore Facility Agent (in the case of a corporate reconstruction not to be unreasonably withheld or delayed). 24.24 LOANS AND GUARANTEES The Borrower shall not make or permit to subsist any loans, grant or permit to subsist any credit or give any guarantee or indemnity (except as required under any of the Finance Documents) to or for the benefit of any person or otherwise voluntarily assume any liability, whether actual or contingent, in respect of any obligation of any other person other than: (a) with the prior written consent of the Off Shore Facility Agent; (b) advances to or guarantees in respect of employees, in accordance with prudent industry practice, not to exceed in aggregate Euro 500,000 or its equivalent at any one time; or (c) trade credit to unrelated parties in the ordinary course of business of the Borrower PROVIDED THAT such trade credit is payable within 90 days. - 81 - 24.25 CHANGE OF BUSINESS The Borrower shall not make any material changes to the general nature of its business as carried on at the date hereof, or carry on any other business other than those defined in the Business Plan without the prior written consent of the Banks (such consent not to be unreasonably withheld or delayed). 24.26 NEW CONTRACTS The Borrower shall not without the prior written consent of the Off Shore Facility Agent enter into any Project Contract and/or Material Contract which could reasonably be expected to cause the Borrower to exceed its approved obligations as set out in the Business Plan. The Borrower shall promptly send a copy of all Material Contracts it enters into to the Off Shore Facility Agent. 24.27 AMENDMENTS The Borrower shall not terminate or consent to any modification, substitution or amendment of: (a) any Material Contract without the prior written consent of the Off Shore Facility Agent (acting on the instructions of the Majority Banks) which, in the case of the documents referred to in Clause 24.27(a)(iii), shall not be unreasonably withheld PROVIDED THAT (other than in respect of a Finance Document) no such consent shall be required if: (i) such modification, substitution or amendment relates to the same subject matter (and in the case of substitution such Material Contract is substituted by another contract) and does not result in: (1) an increase in the obligations of the Borrower; and (2) a deterioration of the rights of the Borrower; (ii) any Material Contract expires in accordance with its terms; or (iii) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** (b) any other Authorisation or other agreement where such amendment would materially adversely affect the Borrower's business or financial condition or on the ability of the Borrower to comply with its obligations hereunder. 24.28 APPLICATION OF UTILISATIONS The Borrower shall not use the Facilities other than in or towards the purposes described in Clause 3 (Purpose). 24.29 APPLICATION OF MONEYS ON PROCEEDS AND REVENUE ACCOUNTS The Borrower shall not make any distribution, dividend or payment (including under any Subordinated Loan) other than in accordance with Clause 23.3(d)(x) (Application of moneys on the Proceeds and Revenue Accounts). 24.30 SUBSIDIARIES Except as provided in Clause 24.33 (UMTS and other licences), the Borrower shall not create any Subsidiary or permit to exist any interest in any person (whether by shareholding, joint venture, partnership, whether any income or profits are, or would be, shared or transferred with any other party or otherwise) without the prior written consent of the Banks (such consent not be unreasonably withheld or delayed) and the - 82 - Borrower shall not dispose of, or liquidate, or do or permit to occur any of the corporate actions referred to in Clause 24.23 (Merger) in relation to any Subsidiary or interest in a person without the prior written consent of the Banks (such consent not to be unreasonably withheld or delayed). 24.31 INDEBTEDNESS The Borrower shall not create, assume, incur or otherwise permit to be outstanding any indebtedness for borrowed money (including Financial Indebtedness) other than: (a) indebtedness for borrowed money under the Finance Documents; (b) indebtedness for borrowed money under the Sponsors Unsecured Loan Agreement; (c) indebtedness for borrowed money under the Existing WWIC Loan Agreement up to an aggregate principal amount of US Dollars 25,000,000 or its equivalent PROVIDED THAT such indebtedness is converted to Sponsor Contributions and Sponsors Unsecured Loans in accordance with Schedule 6 and the amount remaining is repaid in accordance with Clause 23.8 (Loan Proceeds Account); (d) indebtedness for borrowed money to any of the Shareholders or Sponsors PROVIDED THAT such indebtedness for borrowed money is made by way of Subordinated Loan; (e) indebtedness for borrowed money other than under paragraphs (a) or (b) above which does not exceed Euro 1,000,000 in aggregate at any time other than Subordinated Loans; and (f) indebtedness incurred with the prior written consent of the Off Shore Facility Agent (acting on the instructions of the Majority Banks) (together "PERMITTED INDEBTEDNESS"). 24.32 CAPITAL The Borrower shall not decrease, buy-back or redeem its Share Capital or the rights or obligations applicable in respect of any Share or increase or alter its Share Capital unless Security in respect thereof is granted to the Senior Creditors. 24.33 UMTS AND OTHER LICENCES (a) The Borrower shall not, without the prior written consent of the Banks, engage in any UMTS Activities or other telecommunication service activities other than under the Licence. (b) Paragraph (a) above does not apply if all of the following conditions are satisfied and evidence of compliance with such conditions (in form and substance satisfactory to the Off Shore Facility Agent (acting reasonably) is provided to the Off Shore Facility Agent: (i) the purchase of any UMTS licence is carried out by a subsidiary of the Borrower the legal and economic interests in which are owned and controlled as to at least 50.1% by the Borrower (the "UMTS SUBSIDIARY") and pledged to the Senior Creditors; (ii) any contributions (whether by the purchase of shares, making of loans or otherwise) made by the Borrower to the UMTS Subsidiary shall only be permitted if such contributions are made by the Sponsors or Shareholders making Sponsor Contributions to the Borrower (in - 83 - addition to any payment obligations the Sponsors or Shareholders have pursuant to the Sponsors' and Shareholders' Undertaking and Completion Guarantee) as Equity Contributions or Subordinated Loans to enable the Borrower to make such contributions; (iii) at the time of making such contributions to the UMTS Subsidiary the Borrower has met all of its payment obligations, when due, in accordance with Clause 23.3(d)(i) to (vii) (Application of moneys on the Proceeds and Revenue Accounts); (iv) in no event shall the UMTS Subsidiary exploit or operate under any UMTS licence without the prior written consent of the Banks who shall be entitled to withhold such consent if, in such Banks' reasonable opinion, the Borrower would be unlikely to perform its obligations under the Finance Documents PROVIDED THAT if such consent is not provided by the Banks such UMTS licence may be sold by the UMTS Subsidiary on a commercial arm's length basis and the proceeds thereof may, provided no Event of Default has occurred and is continuing, be paid by the Borrower to the Sponsors notwithstanding the provisions of Clause 23.3 (Application of moneys on the Proceeds and Revenue Accounts); and (v) the shares or interests owned or held in the UMTS Subsidiary by any party (other than the Borrower) do not contain or are subject to terms that are more favourable to that party than the Borrower or conditions that are less onerous than those to which the Borrower is subject. The Borrower shall promptly notify the Off Shore Facility Agent if it or any of its Affiliates acquires any telecommunications business or any new licence (excluding any renewal of or addition to any existing telecommunications licence), in particular any UMTS licence. 24.34 HEDGING (a) The Borrower shall maintain interest rate hedging in accordance with the Hedging Letter. (b) The Borrower may hedge its interest rate exposure under this Agreement with a Bank and any indebtedness arising under any Hedging Agreement with such Bank shall be secured by the Security Documents pari passu with indebtedness arising pursuant to this Agreement. 24.35 TREASURY TRANSACTIONS The Borrower shall not enter into any swap, cap, ceiling, floor, collar, option, futures transaction, forward rate agreement, foreign exchange transaction or other treasury or derivative transaction or any similar instrument other than in accordance with Clause 24.34 (Hedging). 24.36 PROHIBITED PAYMENTS The Borrower will not and will ensure that its officers, directors, employees and agents acting on its behalf will not offer, give, insist on, receive or solicit any illegal payment or advantage to influence the action of any person in connection with the Project. 24.37 LICENCE ASSIGNMENT AGREEMENT The Borrower will in accordance with instructions reasonably given by the Off Shore Facility Agent use reasonable efforts to seek the consent of the Government to the - 84 - assignment of the rights of the Borrower under the Licence pursuant to the Licence Assignment Agreement. 24.38 BILLS OF EXCHANGE AND SECURITY DEPOSITS The Borrower may issue bills of exchange or security deposits to third parties in respect of Permitted Indebtedness provided that: (a) the liability secured by any Security including any bills of exchange and by any security deposit shall not exceed in aggregate Euro 1,000,000 or its equivalent; and (b) in the case of bills of exchange issued after the date of this Agreement, such bills of exchange are in the form set forth in Schedule 16 ("PERMITTED BILL OF EXCHANGE") and expressly state the liability of the Borrower to such third parties. 25. EVENTS OF DEFAULT 25.1 Each of the events or circumstances set out in this Clause 25.1 is an Event of Default. 25.1.1 NON-PAYMENT The Borrower does not pay on the due date any amount payable pursuant to a Finance Document at the place at and in the currency in which it is expressed to be payable unless payment is made within five (5) Business Days of its due date. 25.1.2 FINANCIAL COVENANTS AND NETWORK MILESTONES (a) At any time any of the requirements of Clause 22 (Financial covenants and network milestones) is not satisfied. (b) No Event of Default under paragraph (a) above will occur if failure to satisfy such requirement, if capable of remedy, is remedied within 30 Business Days (or, if and to the extent that any greater grace period applies under clause 2.3 (Failure of Milestone completion) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee, within such grace period), PROVIDED THAT in the event that any of the requirements of Clause 22 (Financial covenants and network milestones) (other than Clauses 22.2(a) and (b)) is not satisfied, then within five (5) Business Days of delivery of the Covenant Compliance Certificate, the Shareholders may, in addition to the Sponsors' obligations under the Sponsors' and Shareholders' Undertaking and Completion Guarantee, cure such failure to satisfy any such requirement by making Subordinated Loans and/or Equity Contributions to the Borrower which Subordinated Loans and/or Equity Contributions shall be treated as (i) having been contributed on the last day of the relevant Quarter and (ii) additional capital or revenues of the Borrower. 25.1.3 OBLIGATIONS (a) The Borrower fails duly to perform or comply: (i) with any of its obligations under the Security Documents; (ii) in any respect with its obligations under the Finance Documents that are stated to be subject to any materiality or Material Adverse Effect qualification or in any material respect with its other obligations under the Finance Documents; or - 85 - (iii) with any payment obligation in respect of which a bill of exchange has been issued or security deposit given and such bill of exchange is presented for payment or such security deposit is retained or set off. (b) No Event of Default under paragraph (a) above will occur if failure to comply is capable of remedy and is remedied within ten (10) Business Days. 25.1.4 BREACH OF MATERIAL CONTRACTS (a) Any Material Contract is modified or amended without the consent of the Off Shore Facility Agent or materially breached (other than a breach by a Finance Party of its obligations under the Finance Documents). (b) Any Material Contract is cancelled, revoked or terminated prior to the end of its term without the consent of the Off Shore Facility Agent. (c) No Event of Default under paragraph (a) above will occur if the relevant breach is capable of remedy and is remedied within any grace period applicable under such Material Contract. (d) No Event of Default under paragraph (a) or (b) above will occur if such Material Contract is permitted to be modified, amended, substituted, terminated or expire in accordance with the terms of Clause 24.27(a) (Amendments). 25.1.5 MISREPRESENTATION Any representation or statement made or deemed to be made by the Borrower in the Finance Documents or in any notice or other document or certificate delivered by or on behalf of the Borrower under or in connection with any Finance Document is or proves to have been incorrect or misleading in any material respect when made or deemed to be made. 25.1.6 CROSS DEFAULT/FINANCIAL INDEBTEDNESS (a) Any Financial Indebtedness of the Borrower or any of the Sponsors is not paid when due nor within any original applicable grace period. (b) Any Financial Indebtedness of the Borrower or any of the Sponsors is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (however described). (c) Any commitment for any Financial Indebtedness of the Borrower or any of the Sponsors is cancelled or suspended by a creditor of the Borrower or any of the Sponsors as a result of an event of default (however described). (d) Any creditor of the Borrower or any of the Sponsors becomes entitled to declare any Financial Indebtedness of the Borrower or any of the Sponsors due and payable prior to its specified maturity as a result of an event of default (however described). No Event of Default will occur under this Clause 25.1.6 if the aggregate amount of Financial Indebtedness or commitment for Financial Indebtedness falling within paragraphs (a) to (d) above is less than Euro 100,000 in the case of the Borrower and Euro 500,000 in the case of each Sponsor (or its equivalent in any other currency or currencies (which, in the case of SIT, shall be calculated at the exchange rate (middle rate) of Banka Slovenije on the calculation date)). - 86 - 25.1.7 AUTHORISATIONS The Borrower fails to comply with the terms and conditions of the Licence and/or any Authorisation necessary for the Borrower's business where (except in the case of the Licence) such failure to comply with the terms and conditions of such Authorisation would have a Material Adverse Effect or the Licence and/or such Authorisation is revoked or suspended where (except in the case of the Licence) such revocation or suspension of such Authorisation would have a Material Adverse Effect. 25.1.8 INSOLVENCY (a) The Borrower or any of the Sponsors (together the "DEBTORS") is unable or admits inability to pay its debts as they fall due, suspends making payments on any of its debts or, by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors with a view to rescheduling any of its indebtedness. (b) Under the laws of the jurisdiction to which the Debtor is subject, the Debtor is deemed to be insolvent or capable of being wound-up. (c) A moratorium is declared in respect of any indebtedness of any Debtor. 25.1.9 INSOLVENCY PROCEEDINGS Any corporate action, legal proceedings or other procedure or step is taken in relation to: (a) the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Borrower; (b) a composition, assignment or arrangement with any creditor (other than any arrangement made in the ordinary course of business) of the Borrower; (c) the appointment of a liquidator, receiver, administrator, administrative receiver, compulsory manager or other similar officer in respect of the Borrower or any of its assets; or (d) enforcement of any Security (other than Permitted Encumbrances) over any assets of the Borrower, or any analogous procedure or step is taken in any jurisdiction PROVIDED THAT no Event of Default will occur under this Clause 25.1.9 if any such event is, in the reasonable opinion of the Majority Banks, frivolous or vexatious or dismissed or discharged (if capable of being dismissed or discharged) within 20 days from the commencement of such event. 25.1.10 LITIGATION Any litigation, arbitration, administrative proceedings or governmental or regulatory investigations, proceedings or disputes are commenced or threatened against the Borrower or its respective assets or revenues or there are any circumstances likely to give rise to any such litigation, arbitration, administrative proceedings or governmental or regulatory investigations, proceedings or disputes where it would be reasonably likely to be adversely determined and have a Material Adverse Effect. 25.1.11 OWNERSHIP OF THE BORROWER Western Wireless International Corporation holds less than 80% of the Shares, directly or indirectly, without the prior written consent of the Off Shore Facility Agent (acting on the instructions of the Majority Banks). - 87 - 25.1.12 ILLEGALITY At any time it is or becomes unlawful for the Borrower to perform or comply with any of its material obligations under the Finance Documents or any of the material obligations of the Borrower hereunder or thereunder are not or cease to be legal, valid and binding. 25.1.13 SPONSORS' AND SHAREHOLDERS' UNDERTAKING AND COMPLETION GUARANTEE Any breach by a Sponsor or Shareholder of clauses 2 (Completion guarantee) to 11 (No subrogation) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee or any other breach that is likely to result in a Material Adverse Effect or at any time it is or becomes unlawful for a Sponsor or Shareholder to perform or comply with its material obligations thereunder or any of the material obligations of any of the Sponsors or Shareholders thereunder are not or cease to be legal, valid and binding. 25.1.14 SECURITY From and after the date required under this Agreement, any Security Document is not in full force and effect or does not create in favour of the parties thereto or the Security Agent for the benefit of the Secured Creditors the Security which it is expressed to create with the ranking and priority it is expressed to have. 25.1.15 GOVERNMENTAL INTERVENTION By or under the authority of any government, (a) the management of the Borrower is wholly or partially displaced or the authority of the Borrower in the conduct of its business is wholly or partially curtailed in any material respect or (b) all or a majority of the issued Shares or the whole or any part (the book value of which is five per cent. or more of the book value of the whole) of revenues or assets of the Borrower is seized, nationalised, expropriated or compulsorily acquired. 25.1.16 REPUDIATION The Borrower repudiates a Material Contract or evidences an intention to repudiate a Material Contract (otherwise than as permitted under Clause 24.27 (Amendments). 25.1.17 MATERIAL ADVERSE EFFECT Any event or series of events which have or could reasonably be expected to have a Material Adverse Effect. 25.1.18 COMPETITION Western Wireless Corporation or any of its Affiliates participates in any way in any telecommunication system in Slovenia except the Project or as provided and in accordance with the terms and conditions set out in Clause 24.33 (UMTS and other licences) or any of the conditions set out in Clause 24.33 (UMTS and other licences) do not remain satisfied. 25.2 ACCELERATION On and at any time after the occurrence and during the continuance of an Event of Default the Off Shore Facility Agent may, and shall if so directed by the Majority Banks, by notice to the Borrower: (a) cancel the Total Commitments whereupon they shall immediately be cancelled; (b) declare that all or part of the Loans, together with accrued interest, and all other amounts accrued or outstanding under the Finance Documents (other than the Lucent Loan Agreement and Sponsors Unsecured Loan Agreement) be immediately due and payable, whereupon they shall become immediately due and payable; - 88 - (c) declare that all or part of the Loans be payable on demand, whereupon they shall immediately become payable on demand by the Agent on the instructions of the Majority Banks; and/or (d) require the Borrower to procure that the Issuing Bank's actual or contingent obligations in relation to each SIT Facility Guarantee or LC are cancelled or discharged in full or provide 100% cash cover to the satisfaction of the Issuing Bank and the SIT Facility Banks together with an authorisation from the Borrower (in form and substance satisfactory to the Issuing Bank) to the Issuing Bank permitting such cash cover to be set off against any liability of the Issuing Bank and the SIT Facility Banks under such SIT Facility Guarantee or LC. - 89 - SECTION 10 CHANGES TO PARTIES 26. CHANGES TO THE PARTIES 26.1 ASSIGNMENTS AND TRANSFERS BY THE BANKS Subject to this Clause 26, a Bank (the "EXISTING BANK") may: (a) assign any of its claims against the Borrower in a minimum amount of, in the case of a Euro Facility Bank, Euro 5,000,000, or in the case of a SIT Facility Bank, SIT 600,000,000 provided that if a Bank has as its only remaining claim against the Borrower a claim in an amount which is less than the relevant amounts set out herein, it may assign such lesser amount; or (b) transfer any of its rights and obligations, to another bank or financial institution or to a trust, fund or other entity which is regularly engaged in or established for the purpose of making, purchasing or investing in loans, securities or other financial assets (the "NEW BANK"). 26.2 CONDITIONS OF ASSIGNMENT OR TRANSFER (a) The consent of the Borrower, the Off Shore Facility Agent and, in the case of an assignment or transfer by a SIT Facility Bank, the On Shore Facility Agent is required for an assignment or transfer by a Bank, unless the assignment or transfer is to another Bank or an Affiliate of a Bank or if an Event of Default has occurred and is continuing on the Transfer Date. (b) The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed. The Borrower will be deemed to have given its consent five (5) Business Days after the Borrower has received the Bank's written request for such consent unless consent is expressly refused by the Borrower within that time. (c) An assignment will only be effective on receipt by the Agent of written confirmation from the New Bank (in form and substance satisfactory to the Agent) that the New Bank will assume the same obligations to the other Finance Parties as it would be under if it were an Existing Bank. (d) A transfer will only be effective if the procedure set out in Clause 26.5 (Procedure for transfer) is complied with. (e) If: (i) a Bank assigns or transfers any of its rights or obligations under the Material Contracts or changes its Facility Office; and (ii) as a result of circumstances existing at the date the assignment, transfer or change occurs, the Borrower would be obliged to make a payment to the New Bank or Bank acting through its new Facility Office under Clause 15 (Tax gross-up and indemnities) or Clause 16 (Increased Costs), then the New Bank or Bank acting through its new Facility Office is only entitled to receive payment under those Clauses to the same extent as the Existing Bank or Bank acting through its previous Facility Office would have been if the assignment, transfer or change had not occurred. - 90 - 26.3 ASSIGNMENT OR TRANSFER FEE The New Bank shall, on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of Euro 1,000. 26.4 LIMITATION OF RESPONSIBILITY OF EXISTING BANKS (a) Unless expressly agreed to the contrary, an Existing Bank makes no representation or warranty and assumes no responsibility to a New Bank for: (i) the legality, validity, effectiveness, adequacy or enforceability of the Transaction Documents or any other documents; (ii) the financial condition of the Borrower; (iii) the performance and observance by the Borrower of its obligations under the Transaction Documents or any other documents; or (iv) the accuracy of any statements (whether written or oral) made in or in connection with any Transaction Document or any other document, and any representations or warranties implied by law are excluded to the broadest extent legally permissible. (b) Each New Bank confirms to the Existing Bank and the other Finance Parties that it: (i) has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of the Borrower and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Bank in connection with any Transaction Document; and (ii) will continue to make its own independent appraisal of the creditworthiness of the Borrower and its related entities whilst any amount is or may be outstanding under the Transaction Documents or any Commitment is in force. (c) Nothing in any Transaction Document obliges an Existing Bank to: (i) accept a re-transfer from a New Bank of any of the rights and obligations assigned or transferred under this Clause 26; or (ii) support any losses directly or indirectly incurred by the New Bank by reason of the non-performance by the Borrower of its obligations under the Transaction Documents or otherwise. 26.5 PROCEDURE FOR TRANSFER (a) Subject to the conditions set out in Clause 26.2 (Conditions of assignment or transfer) a transfer is effected in accordance with paragraph (b) below when the Agent executes an otherwise duly completed Transfer Certificate delivered to it by the Existing Bank and the New Bank. The Agent shall, as soon as reasonably practicable after receipt by it of a duly completed Transfer Certificate as set out in Schedule 10 (Form of Transfer Certificates) appearing on its face to comply with the terms of this Agreement and delivered in accordance with the terms of this Agreement, execute that Transfer Certificate. - 91 - (b) On the Transfer Date: (i) to the extent that in the Transfer Certificate the Existing Bank seeks to transfer its rights and obligations under the Finance Documents the Borrower and the Existing Bank shall be released from further obligations towards one another under the Finance Documents and their respective rights against one another shall be cancelled (being the "DISCHARGED RIGHTS AND OBLIGATIONS"); (ii) the Borrower and the New Bank shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as the Borrower and the New Bank have assumed and/or acquired the same in place of the Borrower and the Existing Bank; (iii) the Off Shore Facility Agent, the On Shore Facility Agent, the Off Shore Security Agent, the On Shore Security Agent, the Issuing Bank, each Arranger, the New Bank and other Banks shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the New Bank been an Original Bank with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Agent, the Arranger and the Existing Bank shall each be released from further obligations to each other under this Agreement; and (iv) the New Bank shall become a Party as a "Bank". For the avoidance of doubt, a transfer shall not constitute a novation. The identity of the transferred obligations and rights shall not be affected by the transfer. 26.6 DISCLOSURE OF INFORMATION 26.6.1 Any Bank may disclose to any of its Affiliates and any other person: (a) to (or through) whom that Bank assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement; (b) with (or through) whom that Bank enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or the Borrower; or (c) to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation, any information about the Borrower and the Transaction Documents as that Bank shall consider appropriate if, in relation to paragraphs (a) and (b) above, the person to whom the information is to be given has entered into a Confidentiality Undertaking. 26.6.2 Subject to Clause 26.6.1, each Bank shall keep confidential and not, without the prior written consent of the Borrower, use any information supplied by the Borrower or any Sponsor under any Finance Document. This Clause 26.6.2 shall not apply to disclosure of information: (a) that is in the public domain (other than as a result of a breach of the undertakings herein); - 92 - (b) that is required to be disclosed by applicable law, any court or tribunal of competent jurisdiction, rating agency, governmental body, banking or taxation authority or by any stock exchange upon which it is listed or intends to list; (c) in connection with any legal proceedings arising out of or in connection with the Finance Documents or the performance of its obligations under the Finance Documents; and/or (d) to its officers, employees, directors, auditors, legal or other professional advisors. 26.7 ASSIGNMENTS AND TRANSFER BY THE BORROWER The Borrower may not assign any of its rights or transfer any of its rights or obligations under the Finance Documents. - 93 - SECTION 11 THE FINANCE PARTIES 27. ROLE OF THE AGENT AND THE ARRANGER 27.1 APPOINTMENT OF THE AGENTS (a) Each other Finance Party appoints the Off Shore Facility Agent to act as its agent under and in connection with the Finance Documents in respect of the Euro Facility. (b) Each other Finance Party appoints the On Shore Facility Agent to act as its facility agent under and in connection with the Finance Documents in respect of the SIT Facility. (c) Each other Finance Party authorises the Agents to exercise the rights, powers, authorities and discretions specifically given to the respective Agent under or in connection with the Finance Documents together with any other incidental rights, powers, authorities and discretions. 27.2 DUTIES OF THE AGENTS (a) Each Agent shall promptly forward to a Party the original or a copy of any document which is delivered to such Agent for that Party by any other Party. (b) Except where a Finance Document specifically provides otherwise, an Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party. (c) If an Agent receives notice from a Party referring to this Agreement, describing a mandatory prepayment event set out in Clause 14.2 (Change of control, Withdrawal of the Licence and Abandonment of the Project), an Event of Default or Potential Event of Default and stating that the circumstance described is a mandatory prepayment event set out in Clause 14.2 (Change of control, Withdrawal of the Licence and Abandonment of the Project), an Event of Default or Potential Event of Default, it shall promptly notify the Finance Parties. (d) If an Agent is aware of the non-payment of any principal, interest, commitment fee or other fee payable to a Finance Party (other than an Agent or an Arranger) under this Agreement it shall promptly notify the other Finance Parties. (e) Each Agent's duties under the Finance Documents are solely mechanical and administrative in nature. 27.3 ROLE OF AN ARRANGER Except as specifically provided in the Finance Documents, an Arranger has no obligations of any kind to any other Finance Party under or in connection with any Finance Document. 27.4 NO FIDUCIARY DUTIES (a) Nothing in this Agreement constitutes an Agent or an Arranger as a trustee or fiduciary of any other person. (b) Neither an Agent nor an Arranger shall be bound to account to any Bank for any sum or the profit element of any sum received by it for its own account. - 94 - 27.5 RIGHTS AND DISCRETIONS OF THE AGENT (a) Each Agent may rely on: (i) any representation, notice or document believed by it to be genuine, correct and appropriately authorised; and (ii) any statement made by a director, authorised signatory or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify. (b) Each Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Banks) that: (i) no Event of Default or Potential Event of Default has occurred (unless it has actual knowledge of an Event of Default or Potential Event of Default arising under Clause 25.1.1 (Non-payment)); and (ii) any right, power, authority or discretion vested in any Party or the Majority Banks has not been exercised. (c) Each Agent may engage, pay for and rely on the advice or services of any lawyers, accountants, surveyors or other experts. (d) Each Agent may act in relation to the Finance Documents through its personnel and agents. (e) Each Agent may disclose to any other Party any information it reasonably believes it has received as agent under this Agreement. (f) Notwithstanding any other provision of any Finance Document to the contrary, neither an Agent nor an Arranger is obliged to do or omit to do anything if it would or might in its reasonable opinion constitute a breach of any law or a breach of a fiduciary duty or duty of confidentiality. 27.6 MAJORITY BANKS' INSTRUCTIONS (a) Unless a contrary indication appears in a Finance Document, an Agent shall (i) exercise any right, power, authority or discretion vested in it as Agent in accordance with any instructions given to it by the Majority Banks (or, if so instructed by the Majority Banks, refrain from exercising any right, power, authority or discretion vested in it as Agent) and (ii) not be liable for any act (or omission) if it acts (or refrains from taking any action) in accordance with an instruction of the Majority Banks. (b) Unless a contrary indication appears in a Finance Document, any instructions given by the Majority Banks will be binding on all the Finance Parties. (c) Each Agent may refrain from acting in accordance with the instructions of the Majority Banks (or, if appropriate, the Banks) until it has received such security as it may require for any cost, loss or liability (together with any associated VAT) which it may incur in complying with the instructions. (d) In the absence of instructions from the Majority Banks (or, if appropriate, the Banks), each Agent may act (or refrain from taking action) as it considers to be in the best interest of the Banks. - 95 - (e) An Agent is not authorised to act on behalf of a Bank (without first obtaining that Bank's consent) in any legal or arbitration proceedings relating to any Finance Document. 27.7 RESPONSIBILITY FOR DOCUMENTATION Neither an Agent nor an Arranger: (a) is responsible for the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by such Agent, such Arranger or any other person given in or in connection with any Finance Document, the Information Memorandum or the Legal Due Diligence Report; or (b) is responsible for the legality, validity, effectiveness, adequacy or enforceability of any Finance Document or any other agreement, arrangement or document entered into, made or executed in anticipation of or in connection with any Finance Document. 27.8 EXCLUSION OF LIABILITY (a) Without limiting paragraph (b) below, an Agent will not be liable for any action taken or omitted by it under or in connection with any Finance Document, unless directly caused by its gross negligence or wilful misconduct. (b) No Finance Party may take any proceedings against any officer, employee or agent of an Agent in respect of any claim it might have against such Agent or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Finance Document and any officer, employee or agent of such Agent may rely on this Clause 27.8. (c) An Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Finance Documents to be paid by such Agent if such Agent has taken all necessary steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by such Agent for that purpose. 27.9 BANKS' INDEMNITY TO THE AGENT Each Bank shall (in proportion to its share of the Total Commitments or, if the Total Commitments are then zero, to its share of the Total Commitments immediately prior to their reduction to zero) indemnify an Agent, within three (3) Business Days of demand, against any cost, loss or liability incurred by such Agent (otherwise than by reason of such Agent's gross negligence or wilful misconduct) in acting as Agent under the Finance Documents (unless such Agent has been reimbursed by the Borrower pursuant to a Finance Document). 27.10 RESIGNATION OF THE AGENT (a) Each Agent may resign and appoint one of its Affiliates acting through an office as successor by giving notice to the other Finance Parties and the Borrower. (b) Alternatively each Agent may resign by giving notice to the other Finance Parties and the Borrower, in which case the Majority Banks (after consultation with the Borrower) may appoint a successor Agent. (c) If the Majority Banks have not appointed a successor Agent in accordance with paragraph (b) above within thirty (30) days after notice of resignation was - 96 - given, a retiring Agent (after consultation with the Borrower) may appoint a successor Agent. (d) The retiring Agent shall, at its own cost, make available to the successor Agent such documents and records and provide such assistance as the successor Agent may reasonably request for the purposes of performing its functions as Agent under the Finance Documents. (e) An Agent's resignation notice shall only take effect upon the appointment of a successor. (f) Upon the appointment of a successor, the retiring Agent shall be discharged from any further obligation in respect of the Finance Documents but shall remain entitled to the benefit of this Clause 27. Its successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original Party. 27.11 CONFIDENTIALITY (a) In acting as agent for the Finance Parties, an Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from any other of its divisions or departments. (b) If information is received by another division or department of an Agent, it may be treated as confidential to that division or department and such Agent shall not be deemed to have notice of it. 27.12 RELATIONSHIP WITH THE BANKS Each Agent may treat each Bank as a Bank, entitled to payments under this Agreement and acting through its Facility Office unless it has received not less than five (5) Business Days prior notice from that Bank to the contrary in accordance with the terms of this Agreement. 27.13 CREDIT APPRAISAL BY THE BANKS Without affecting the responsibility of the Borrower for information supplied by it or on its behalf in connection with any Finance Document, each Bank confirms to an Agent and an Arranger that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with any Finance Document including but not limited to: (a) the financial condition, status and nature of the Borrower and each of the Sponsors and Shareholders; (b) the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document; (c) whether that Bank has recourse, and the nature and extent of that recourse, against any Finance Party or any of its respective assets under or in connection with any Transaction Document, the transactions contemplated by the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document; and (d) the adequacy, accuracy and/or completeness of the Initial Business Plan, the Information Memorandum, Legal Due Diligence Report and any other - 97 - information provided by an Agent, any Finance Party or by any other person under or in connection with any Transaction Document, the transactions contemplated by the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document. 27.14 REFERENCE BANKS If a Reference Bank (or, if a Reference Bank is not a Bank, the Bank of which it is an Affiliate) ceases to be a Bank, the Off Shore Facility Agent shall (in consultation with the Borrower) appoint another Bank or an Affiliate of a Bank to replace that Reference Bank. 27.15 DUTIES OF THE ON SHORE FACILITY AGENT TO THE OFF SHORE FACILITY AGENT The On Shore Facility Agent shall: (a) deliver to the Off Shore Facility Agent on the second Business Day of each Month, a report including the amount drawndown under the SIT Facility and the extent of the undrawn SIT Facility Commitment as at the last Business Day of that Month; (b) promptly forward to the Off Shore Facility Agent an original or a copy of any document which is delivered to the On Shore Facility Agent and/or the On Shore Security Agent by the Borrower or any party to any of the Transaction Documents; and (c) immediately upon becoming aware of any breach of any Transaction Document, Potential Event of Default, Event of Default or any Cash Shortfall, notify the Off Shore Facility Agent of such breach. 27.16 DEDUCTION FROM AMOUNTS PAYABLE BY THE AGENTS If any Party owes an amount to an Agent under the Finance Documents such Agent may, after giving notice to that Party, deduct an amount not exceeding that amount from any payment to that Party which such Agent would otherwise be obliged to make under the Finance Documents and apply the amount deducted in or towards satisfaction of the amount owed. For the purposes of the Finance Documents that Party shall be regarded as having received any amount so deducted. 28. CONDUCT OF BUSINESS BY THE FINANCE PARTIES No provision of this Agreement will: (a) interfere with the right of any Finance Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit; (b) oblige any Finance Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim except to the extent set forth in Clause 18 (Mitigation by the Banks); or (c) oblige any Finance Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax except to the extent set forth in Clause 15.3 (Tax indemnity) or Clause 15.4 (Tax Credit). - 98 - 29. SHARING AMONG THE FINANCE PARTIES 29.1 PAYMENTS TO FINANCE PARTIES If a Finance Party (a "RECOVERING FINANCE PARTY") receives or recovers any amount from the Borrower other than in accordance with Clause 30 (Payment mechanics) and applies that amount to a payment due under the Finance Documents then: (a) the Recovering Finance Party shall, within ten (10) Business Days, notify details of the receipt or recovery to the relevant Agent; (b) the Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Finance Party would have been paid had the receipt or recovery been received or made by the Agent and distributed in accordance with Clause 30 (Payment mechanics), without taking account of any Tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and (c) the Recovering Finance Party shall, within ten (10) Business Days of demand by the Agent, pay to the Agent an amount (the "SHARING PAYMENT") equal to such receipt or recovery less any amount which the Agent determines may be retained by the Recovering Finance Party as its share of any payment to be made, in accordance with Clause 30.5 (Partial payments). 29.2 REDISTRIBUTION OF PAYMENTS The Agent shall treat the Sharing Payment as if it had been paid by the relevant Finance Party and distribute it between the Finance Parties (other than the Recovering Finance Party) in accordance with Clause 30.5 (Partial payments). 29.3 RECOVERING FINANCE PARTY'S RIGHTS (a) On a distribution by the Agent under Clause 29.2 (Redistribution of payments), the Recovering Finance Party will be subrogated to the rights of the Finance Parties which have shared in the redistribution. (b) If and to the extent that the Recovering Finance Party is not able to rely on its rights under paragraph (a) above, the Borrower shall be liable to the Recovering Finance Party for a debt equal to the Sharing Payment which is immediately due and payable. 29.4 REVERSAL OF REDISTRIBUTION If any part of the Sharing Payment received or recovered by a Recovering Finance Party becomes repayable and is repaid by that Recovering Finance Party, then: (a) each Finance Party which has received a share of the relevant Sharing Payment pursuant to Clause 29.2 (Redistribution of payments) shall, upon request of the Agent, pay to the Agent for account of that Recovering Finance Party an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Finance Party for its proportion of any interest on the Sharing Payment which that Recovering Finance Party is required to pay); and (b) that Recovering Finance Party's rights of subrogation in respect of any reimbursement shall be cancelled and the Borrower will be liable to the reimbursing Finance Party for the amount so reimbursed. - 99 - 29.5 EXCEPTIONS (a) This Clause 29 shall not apply to the extent that the Recovering Finance Party would not, after making any payment pursuant to this Clause, have a valid and enforceable claim against the Borrower. (b) A Recovering Finance Party is not obliged to share with any other Finance Party any amount which the Recovering Finance Party has received or recovered as a result of taking legal or arbitration proceedings, if (i) it notified that other Finance Party of the legal or arbitration proceedings; and (ii) that other Finance Party had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings. (c) This Clause 29 shall not apply to any Excluded Proceeds (as defined in the Intercreditor Agreement) which shall be applied in accordance with the Intercreditor Agreement. 29.6 PERFECTION OF TRANSFERS Each Finance Party hereby undertakes vis-a-vis each of the other Finance Parties to enter into all additional agreements and to execute all additional documents, which might be required under the laws of each relevant jurisdiction for the perfection of the transfers and subrogations contemplated by this Clause 29. The Borrower hereby agrees to consent to all relevant transfers and it hereby undertakes vis-a-vis each of the Finance Parties to enter into all additional agreements and to execute all additional documents, which are required under the laws of each relevant jurisdiction for the perfection of the transfers and subrogations contemplated by this Clause 29. - 100 - SECTION 12 ADMINISTRATION 30. PAYMENT MECHANICS 30.1 PAYMENTS TO THE AGENT (a) On each date on which the Borrower or a Bank is required to make a payment under a Finance Document, the Borrower or Bank shall make the same available to the Off Shore Facility Agent in respect of a payment in Euro or the On Shore Facility Agent in respect of a payment in SIT (unless a contrary indication appears in a Finance Document) for value on the due date at the time and in such funds specified by the relevant Agent as being customary at the time for settlement of transactions in the relevant currency in the place of payment. (b) Payment shall be made to such account in Ljubljana if payment is to be made in SIT or in Dusseldorf if payment is to be made in Euro with such bank as the relevant Agent specifies. Each Bank shall promptly indemnify the relevant Agent against any cost, loss or liability incurred by such Agent as a result of late or non-performance by such Bank of any of its payment obligations under this Agreement. 30.2 DISTRIBUTIONS BY THE AGENT Each payment received by an Agent under the Finance Documents for another Party shall, subject to Clause 30.3 (Distributions to the Borrower) and Clause 30.4 (Clawback) be made available by such Agent as soon as practicable after receipt to the Party entitled to receive payment in accordance with this Agreement (in the case of a Bank, for the account of its Facility Office), to such account as that Party may notify to such Agent by not less than five (5) Business Days' notice. 30.3 DISTRIBUTIONS TO THE BORROWER The Agent may (with the consent of the Borrower or in accordance with Clause 31 (Set-off)) apply any amount received by it for the account of the Borrower in or towards payment (on the date and in the currency and funds of receipt) of any amount due from the Borrower under the Finance Documents, or in or towards purchase of any amount of any currency to be so applied. 30.4 CLAWBACK (a) Where a sum is to be paid to an Agent under the Finance Documents for another Party, such Agent is not obliged to pay that sum to that other Party (or to enter into or perform any related exchange contract) until it has been able to establish to its satisfaction that it has actually received that sum. (b) If an Agent pays an amount to another Party and it proves to be the case that such Agent had not actually received that amount, then the Party to whom that amount (or the proceeds of any related exchange contract) was paid by such Agent shall on demand refund the same to such Agent together with interest on that amount from the date of payment to the date of receipt by such Agent, calculated by such Agent to reflect its cost of funds. 30.5 PARTIAL PAYMENTS (a) If an Agent receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under the Finance Documents, such - 101 - Agent shall apply that payment towards the obligations of the Borrower under the Finance Documents in the following order: (i) first, in or towards payment pro rata of any unpaid fees, costs and expenses of the Agents under the Finance Documents; (ii) secondly, in or towards payment pro rata of any accrued default interest, interest, fee or commission due but unpaid under this Agreement; (iii) thirdly, in or towards payment pro rata of any principal due but unpaid under this Agreement; and (iv) fourthly, in or towards payment pro rata of any other sum due but unpaid under the Finance Documents. (b) Such Agent shall, if so directed by the Majority Banks, vary the order set out in paragraphs (a)(ii) to (iv) above and such direction shall also apply in respect of payments received by the other Agent. (c) Paragraphs (a) and (b) above will override any appropriation made by the Borrower. (d) This Clause 30.5 shall not apply to any Excluded Proceeds (as defined in the Intercreditor Agreement). 30.6 NO SET-OFF BY THE BORROWER All payments to be made by the Borrower under the Finance Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. 30.7 BUSINESS DAYS (a) Any payment which is due to be made on a day that is not a Business Day shall be made on the next Business Day and in the case of the Euro Facility such Business Day shall be in the same calendar month (if there is one) or the preceding Business Day (if there is not). (b) During any extension of the due date for payment of any principal or Unpaid Sum under this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on the original due date. 30.8 CURRENCY OF ACCOUNT (a) A repayment of a Loan or Unpaid Sum or a part of a Loan or Unpaid Sum shall be made in the currency in which that Loan or Unpaid Sum is denominated on its due date. (b) Each payment of interest shall be made in the currency in which the sum in respect of which the interest is payable was denominated when that interest accrued. (c) Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred. - 102 - 30.9 CHANGE OF CURRENCY (a) Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then: (i) any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the relevant Agent (after consultation with the Borrower); and (ii) any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the relevant Agent (acting reasonably) or in the case of any translation from or to SIT at the relevant exchange rate from the list of Nova Ljubljanska banka d.d., Ljubljana for the foreign exchange transactions with legal entities (Tecajna lista Nove Ljubljanske banka d.d., Ljubljana, za obracundeviznih prilivov in odlivov podjetij) or any other applicable document of Nova Ljubljanska banka d.d., Ljubljana with essentially similar substance. (b) If a change in any currency of a country occurs, this Agreement will, to the extent that the relevant Agent (acting reasonably and after consultation with the Borrower) specifies to be necessary, be amended to comply with any generally accepted conventions and market practice in the European Interbank Market and otherwise to reflect the change in currency. 31. SET OFF A Finance Party may set off any matured obligation due from the Borrower under the Finance Documents (to the extent beneficially owned by that Finance Party) against any matured obligation owed by that Finance Party to the Borrower, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Finance Party may for the purpose of the set off convert either obligation at a market rate of exchange in its usual course of business or, in the case of a SIT Facility Bank, at the relevant exchange rate from the list of Nova Ljubljanska banka d.d., Ljubljana for the foreign exchange transactions with legal entities (Tecajna lista Nove Ljubljanske banka d.d., Ljubljana, za obracundeviznih prilivov in odlivov podjetij) or any other applicable document of Nova Ljubljanska banka d.d., Ljubljana with essentially similar substance. 32. NOTICES 32.1 COMMUNICATIONS IN WRITING Any communication, demand or notice to be made under or in connection with the Finance Documents shall be made in writing and, unless otherwise stated, may be made by fax or letter. 32.2 ADDRESSES The address and fax number (and the department or officer, if any, for whose attention the communication is to be made) of each Party for any communication or document to be made or delivered under or in connection with the Finance Documents is: - 103 - (a) in case of the Borrower: WESTERN WIRELESS INTERNATIONAL D.O.O. Address: Brnciceva ulica 49 1231 Ljubljana, Slovenia Telephone: +386 1 5801 200 Fax: +386 1 5801 109 Attention of: Steven Fast Copy to: Western Wireless International Corporation Address: 3650 131st Avenue, S.E., Suite 400 Bellevue, Washington 98006, USA Telephone: +1 425 586 8161 Fax: +1 425 586 8777 Attention of: Scott Alderman (b) in case to the Borrower's process agent: FIDEUROP - TREUHANDGESELLSCHAFT FUR DEN GEMEINSAMEN MARKT MBH Address: Marie-Curie Strasse 30 60439 Frankfurt am Main, Germany Telephone: +49 69 95 870 Fax: +49 69 95 87 2584 Attention of: Dr. Klaus Zimmermann (c) in case of the Off Shore Facility Agent and the Off Shore Security Agent: IKB DEUTSCHE INDUSTRIEBANK AG Address: Wilhelm-Botzkes-Stra(beta)e 1 40474 Dusseldorf, Germany Telephone: +49 211 8221 4887 or +49 211 8221 4730 Fax: +49 211 8221 2887 or +49 211 8221 2730 Attention of: Martina Messing or Andreas Nestel, Structured Finance Department - 104 - (d) in case of the On Shore Facility Agent and the On Shore Security Agent: NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA Address: Smartinska 130, SI - 1520 Ljubljana, Slovenia Telephone: +386 1 520 7273 Fax: +386 1 425 60 02 Attention of: Ms. Jasna Istenic or Mr. Bostjan Kovac (e) in the case of a Bank, as identified with its signature below or in a Transfer Certificate, as the case may be, or any substitute address, fax number or department or officer as the relevant Party may notify to the relevant Agent (or an Agent may notify to the other Parties, if a change is made by the Agent) by not less than five (5) Business Days' notice. 32.3 DELIVERY (a) Any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective: (i) if by way of fax, when received in legible form; or (ii) if by way of letter, when it has been left at the relevant address or three (3) Business Days after being deposited with a reputable overnight courier service; or and, if a particular department or officer is specified as part of its address details provided under Clause 32.2 (Addresses), if addressed to that department or officer. (b) Any communication or document to be made or delivered to an Agent will be effective only when actually received by such Agent and then only if it is expressly marked for the attention of the department or officer identified with such Agent's signature below (or any substitute department or officer as such Agent shall specify for this purpose). (c) All notices from or to the Borrower shall be sent through an Agent. 32.4 NOTIFICATION OF ADDRESS AND FAX NUMBER Promptly upon receipt of notification of an address or fax number or change of address or fax number pursuant to Clause 32.2 (Addresses) or changing its own address or fax number, an Agent shall notify the other Parties. 32.5 ELECTRONIC COMMUNICATION (a) Any communication to be made between an Agent and a Bank under or in connection with the Finance Documents may be made by electronic mail or other electronic means, if such Agent and the relevant Bank: (i) agree that, unless and until notified to the contrary, this is to be an accepted form of communication; - 105 - (ii) notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and (iii) notify each other of any change to their address or any other such information supplied by them. (b) Any electronic communication made between an Agent and a Bank will be effective only when actually received in readable form and in the case of any electronic communication made by a Bank to such Agent only if it is addressed in such a manner as such Agent shall specify for this purpose. 32.6 ENGLISH LANGUAGE Any notice given or any other document provided under or in connection with: (i) the Finance Documents which is required by law or in accordance with standard banking practice to be made in Slovenian shall be made in Slovenian and in each case accompanied by an English translation thereof unless such notice or other document is identical (other than for calculation figures) in all material respects to those previously agreed with the Off Shore Facility Agent; (ii) the documentation related to the ECA Cover Documents shall be in the German language; and (iii) the Finance Documents shall be in English unless otherwise provided for under (i) and (ii) above. 33. CALCULATIONS AND CERTIFICATES 33.1 ACCOUNTS In any litigation or arbitration proceedings arising out of or in connection with a Finance Document, the entries made in the accounts maintained by a Finance Party are prima facie evidence of the matters to which they relate absent manifest error. 33.2 CERTIFICATES AND DETERMINATIONS Any certification or determination by a Finance Party of a rate or amount under any Finance Document is, in the absence of manifest error, conclusive evidence of the matters to which it relates. 33.3 DAY COUNT CONVENTION (a) In respect of the Euro Facility any interest, commission or fee accruing under a Finance Document will accrue from day to day and is calculated on the basis of the actual number of days elapsed and a year of 360 days or, in any case where the practice in the European Interbank Market differs, in accordance with that market practice. (b) In respect of the SIT Facility any interest, commission or fee accruing under a Finance Document will accrue from day to day and is calculated in accordance with the Resolution on Interest Rates of Nova Ljubljanska Banka d.d., Ljubljana using the conform method of calculating interest and TOM and on the basis of a year of 365 days. - 106 - 34. PARTIAL INVALIDITY If, at any time, any provision of the Finance Documents is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the law of any other jurisdiction will in any way be affected or impaired. 35. REMEDIES AND WAIVERS No failure to exercise, nor any delay in exercising, on the part of any Finance Party, any right or remedy under the Finance Documents shall operate as a waiver, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise or the exercise of any other right or remedy. The rights and remedies provided in this Agreement are cumulative and not exclusive of any rights or remedies provided by law. 36. AMENDMENTS AND WAIVERS 36.1 REQUIRED CONSENTS (a) Subject to Clause 36.2 (Exceptions) any term of the Finance Documents may be amended or waived only with the consent of the Majority Banks and the Borrower and any such amendment or waiver will be binding on all Parties. (b) The Off Shore Facility Agent may effect, on behalf of any Finance Party, any amendment or waiver permitted by this Clause. 36.2 EXCEPTIONS (a) An amendment or waiver that has the effect of changing or which relates to: (i) the definition of "Majority Banks" in Clause 1.1 (Definitions); (ii) an extension to the date of payment of any amount under the Finance Documents; (iii) a reduction in the Applicable Margin or a reduction in the amount of any payment of principal, interest, fees or commission payable; (iv) an increase in or an extension of any Commitment; (v) a change to the Borrower; (vi) any provision which expressly requires the consent of all the Banks; (vii) Clause 2.2 (Finance Parties' rights and obligations), Clause 21 (Reporting requirements), Clause 26 (Changes to the Parties) or this Clause 36, shall not be made without the prior consent of all the Banks. (b) An amendment or waiver which relates to the rights or obligations of an Agent, a Security Agent, the Issuing Bank or an Arranger may not be effected without the consent of such party. - 107 - 37. COUNTERPARTS Each Finance Document may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of the Finance Document. - 108 - SECTION 13 GOVERNING LAW AND ENFORCEMENT 38. GOVERNING LAW This Agreement shall be governed by, and shall be construed in accordance with, German law. 39. ARBITRATION 39.1 ARBITRATION Subject to Clause 39.4 (Agent's option), any dispute (a "DISPUTE") arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or the consequences of its nullity) shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce (the "RULES") by three arbitrators appointed in accordance with the Rules. 39.2 PROCEDURE FOR ARBITRATION The arbitral tribunal shall consist of three arbitrators. The place of arbitration shall be Paris and the language of the arbitration shall be English. 39.3 RECOURSE TO COURTS Save as provided in Clause 39.4 (Agent's option), the parties exclude the jurisdiction of the courts. 39.4 AGENT'S OPTION In the case of any Dispute in which the Agent for and on behalf of the Finance Parties is or the Finance Parties are the claimant, the Off Shore Facility Agent may (acting upon the instructions of the Majority Banks) prior to having initiated arbitral proceedings, by notice in writing to all other parties to this Agreement require that such Dispute be heard by a court of law. If the Off Shore Facility Agent gives such notice, the Dispute to which such notice refers shall be determined in accordance with Clause 40 (Jurisdiction). 40. JURISDICTION 40.1 GERMAN COURTS Each of the Parties irrevocably agrees for the benefit of each of the other Parties that the courts at Dusseldorf, Germany, shall have non-exclusive jurisdiction to settle any Dispute. 40.2 SERVICE OF PROCESS The Borrower agrees that the process by which any suit, action or proceedings in Germany is begun may be served on it by being delivered to the process agent in Germany appointed or to be appointed by the Borrower according to Schedule 13 (Process Agent Confirmation) for the time being. If the appointment of such process agent ceases to be effective in respect of the Borrower, the Borrower shall immediately appoint a further person in Germany to accept service of process on its behalf in Germany and, failing such appointment within fifteen (15) days, the Agent shall be entitled to appoint such a person by notice to the Borrower. Nothing contained herein shall affect the right to serve process in any other manner permitted by relevant law. 40.3 NON-EXCLUSIVE SUBMISSIONS The submission to the jurisdiction of the courts referred to in Clause 40.1 (German courts) shall not (and shall not be construed so as to) limit the right of an Agent, an Arranger and the Banks or any of them to take proceedings against the Borrower in any - 109 - other court of competent jurisdiction nor shall the taking of proceedings in any one or more jurisdiction preclude the taking or proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by applicable law. 40.4 WAIVER OF IMMUNITY To the extent that the Borrower may in any jurisdiction claim for itself or its assets immunity from suit, execution, attachment (whether in aid of execution, before judgement or otherwise) or other legal process and to the extent that in any such jurisdiction there may be attributed to itself or its assets such immunity (whether or not claimed), the Borrower hereby irrevocably agrees not to claim and hereby irrevocably waives such immunity to the full extent permitted by the laws of such jurisdiction. - 110 - SCHEDULE 1 COMMITMENTS PART I EURO FACILITY

ECA FACILITY COMMERCIAL FINANCIAL INSTITUTION COMMITMENT FACILITY COMMITMENT ECA FACILITY ECA FACILITY ECA FACILITY TRANCHE 1 TRANCHE 2 TRANCHE 3 COMMITMENT COMMITMENT COMMITMENT IKB Deutsche Industriebank AG Euro 15,328,263.11 Euro 689,916.66 Euro 1,415,895.49 Euro 13,910,000.00 Kreditanstalt fur Wiederaufbau Euro 15,328,263.11 Euro 689,916.66 Euro 1,415,895.48 Euro 13,910,000.00 Raiffeisenlandesbank Euro 7,234,745.16 Euro 325,631.89 Euro 668,284.65 Euro 8,560,000.00 Oberosterreich reg.Gen.m.b.H. Landesbank Euro 7,074,582.98 Euro 318,423.08 Euro 653,490.23 Euro 6,420,000.00 Schleswig-Holstein Girozentrale Hypo Alpe-Adria-Bank AG Euro 2,198,032.14 Euro 98,932.21 Euro 203,035.65 None

- 111 - PART II SIT FACILITY

FINANCIAL INSTITUTION SIT FACILITY COMMITMENT EQUIVALENT TO Nova Ljubljanska Banka d.d., Ljubljana SIT 3,400,000,000.00 Hypo Alpe-Adria-Bank d.d. SIT 1,000,000,000.00

- 112 - SCHEDULE 2 REPAYMENT DATES

REPAYMENT DATE / ECA FACILITY COMMERCIAL FACILITY SIT FACILITY REDUCTION DATE 30.05.2004 1.25% 0.00% 30.11.2004 1.25% 0.00% 30.05.2005 5.75% 5.75% 30.11.2005 5.75% 5.75% 5.00% 30.05.2006 8.00% 8.00% 30.11.2006 8.00% 8.00% 5.00% 30.05.2007 10.00% 12.50% 30.11.2007 10.00% 12.50% 10.00% 30.05.2008 12.00% 12.50% 30.11.2008 12.00% 12.50% 20.00% 30.05.2009 13.00% 14.00% 20.00% 30.11.2009 13.00% 8.50% 40.00% TOTAL 100.00% 100.00% 100.00%

- 113 - SCHEDULE 3 LMA FORM OF CONFIDENTIALITY UNDERTAKING From: [Seller]/[Seller's agent/broker] To: [Potential Purchaser]/[Purchaser's agent/broker] Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") BORROWER: DATE: AMOUNT: AGENT: We understand that you are considering [acquiring](a)/[arranging the acquisition of](b) an interest in the Agreement (the "Acquisition"). In consideration of us agreeing to make available to you certain information, by your signature of a copy of this letter you agree as follows: 1. Confidentiality Undertaking You undertake (a) to keep the Confidential Information confidential and not to disclose it to anyone except as provided for by paragraph 2 below and to ensure that the Confidential Information is protected with security measures and a degree of care that would apply to your own confidential information, (b) to use the Confidential Information only for the Permitted Purpose, (c) to use all reasonable endeavours to ensure that any person to whom you pass any Confidential Information (unless disclosed under paragraph 2[(c)/(d)](c) below) acknowledges and complies with the provisions of this letter as if that person were also a party to it, and (d) not to make enquiries of any member of the Group or any of their officers, directors, employees or professional advisers relating directly or indirectly to the Acquisition. 2. Permitted disclosure We agree that you may disclose Confidential Information: (a) to members of the Purchaser Group and their officers, directors, employees and professional advisers to the extent necessary for the Permitted Purpose and to any auditors of members of the Purchaser Group; (b) [subject to the requirements of the Agreement, in accordance with the Permitted Purpose so long as any prospective purchaser has delivered a letter to you in equivalent form to this letter;] [(b/c)](c) subject to the requirements of the Agreement, to any person to (or through) whom you assign or transfer (or may potentially assign or transfer) all or any of the rights, benefits and obligations which you may acquire under the Agreement or with (or through) whom you enter into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, the Agreement or the Borrower or - 114 - any member of the Group so long as that person has delivered a letter to you in equivalent form to this letter; and [(c/d)](c) (i) where requested or required by any court of competent jurisdiction or any competent judicial, governmental, supervisory or regulatory body, (ii) where required by the rules of any stock exchange on which the shares or other securities of any member of the Purchaser Group are listed or (iii) where required by the laws or regulations of any country with jurisdiction over the affairs of any member of the Purchaser Group. 3. Notification of required or unauthorised disclosure You agree (to the extent permitted by law) to inform us of the full circumstances of any disclosure under paragraph 2[(c)/(d)](c) or upon becoming aware that Confidential Information has been disclosed in breach of this letter. 4. Return of copies If we so request in writing, you shall return all Confidential Information supplied to you by us and destroy or permanently erase all copies of Confidential Information made by you and use all reasonable endeavours to ensure that anyone to whom you have supplied any Confidential Information destroys or permanently erases such Confidential Information and any copies made by them, in each case save to the extent that you or the recipients are required to retain any such Confidential Information by any applicable law, rule or regulation or by any competent judicial, governmental, supervisory or regulatory body or in accordance with internal policy, or where the Confidential Information has been disclosed under paragraph 2[(c)/(d)](c) above. 5. Continuing obligations The obligations in this letter are continuing and, in particular, shall survive the termination of any discussions or negotiations between you and us. Notwithstanding the previous sentence, the obligations in this letter shall cease (without in any way prejudicing the confidentiality obligations under the Agreement) (a) if you become a party to or otherwise acquire (by assignment or sub-participation) an interest, direct or indirect, in the Agreement or (b) twelve months after you have returned all Confidential Information supplied to you by us and destroyed or permanently erased all copies of Confidential Information made by you (other than any such Confidential Information or copies which have been disclosed under paragraph 2 above (other than sub-paragraph 2(a)) or which, pursuant to paragraph 4 above, are not required to be returned or destroyed). 6. No representation; consequences of breach, etc You acknowledge and agree that: (a) neither we, [nor our principal](d) nor any member of the Group nor any of our or their respective officers, employees or advisers (each a "RELEVANT PERSON") (i) make any representation or warranty, express or implied, as to, or assume any responsibility for, the accuracy, reliability or completeness of any of the Confidential Information or any other information supplied by us or the assumptions on which it is based or (ii) shall be under any obligation to update or correct any inaccuracy in the Confidential Information or any other information supplied by us or be otherwise liable to you or any other person in respect to the Confidential Information or any such information; and (b) we [or our principal](d) or members of the Group may be irreparably harmed by the breach of the terms hereof and damages may not be an adequate remedy; each Relevant Person may be granted an injunction or specific performance for any threatened or actual breach of the provisions of this letter by you. - 115 - 7. No waiver; amendments, etc This letter sets out the full extent of your obligations of confidentiality owed to us in relation to the information the subject of this letter. No failure or delay in exercising any right, power or privilege hereunder will operate as a waiver thereof nor will any single or partial exercise of any right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privileges hereunder. The terms of this letter and your obligations hereunder may only be amended or modified by written agreement between us. 8. Inside information You acknowledge that some or all of the Confidential Information is or may be price-sensitive information and that the use of such information may be regulated or prohibited by applicable legislation relating to insider dealing and you undertake not to use any Confidential Information for any unlawful purpose. 9. Nature of undertakings The undertakings given by you under this letter are given to us and (without implying any fiduciary obligations on our part) are also given for the benefit of [our principal,](d) the Borrower and each other member of the Group. 10. Third party rights (a) Subject to paragraph 6 and paragraph 9 the terms of this letter may be enforced and relied upon only by you and us. (b) Notwithstanding any provisions of this letter, the parties to this letter do not require the consent of any Relevant Person or any member of the Group to rescind or vary this letter at any time. 11. Governing Law and Jurisdiction This letter (including the agreement constituted by your acknowledgement of its terms) shall be governed by and construed in accordance with German law and the parties submit to the non-exclusive jurisdiction of the courts at Dusseldorf, Germany. 12. Definitions In this letter (including the acknowledgement set out below) terms defined in the Agreement shall, unless the context otherwise requires, have the same meaning and: "CONFIDENTIAL INFORMATION" means any information relating to the Borrower, the Group, the Agreement and/or the Acquisition provided to you by us or any of our affiliates or advisers, in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that (a) is or becomes public knowledge other than as a direct or indirect result of any breach of this letter or (b) is known by you before the date the information is disclosed to you by us or any of our affiliates or advisers or is lawfully obtained by you thereafter, other than from a source which is connected with the Group and which, in either case, as far as you are aware, has not been obtained in violation of, and is not otherwise subject to, any obligation of confidentiality; "GROUP" means the Borrower and each of its Affiliates; "PERMITTED PURPOSE" means [subject to the terms of this letter, passing on information to a prospective purchaser for the purpose of](b) considering and evaluating whether to enter into the Acquisition; and "PURCHASER GROUP" means you and each of your Affiliates. - 116 - Please acknowledge your agreement to the above by signing and returning the enclosed copy. Yours faithfully ---------------------------------------------- For and on behalf of [Seller/Seller's agent/broker] To: [Seller] [Seller's agent/broker] The Borrower and each other member of the Group We acknowledge and agree to the above: ---------------------------------------------- For and on behalf of [POTENTIAL PURCHASER/PURCHASER'S AGENT/BROKER] - ---------- (a) Delete if addressee is acting as broker or agent. (b) Delete if addressee is acting as principal. (c) Select applicable option. (d) Delete if letter is sent out by the Seller rather than the Seller's broker or agent. - 117 - SCHEDULE 4A UTILISATION REQUEST (BORROWER) From: Western Wireless International d.o.o To: [Off Shore Facility Agent/On Shore Facility Agent with copy to Off Shore Facility Agent] Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request. 2. UTILISATION OF A LOAN We wish to borrow a Loan on the following terms: Proposed Utilisation Date: [-] (or, if that is not a Business Day, the next Business Day) Facility to be utilised: [Commercial Facility]/ [SIT Facility] Currency of Loan: [Euro]/[SIT] Amount: [-] or, if less, the Available Facility Interest Period: [-] Account to which proceeds are payable: Proceeds and Revenue Account [account number] [for further transfer in respect of Euro Facility Loans to the Loan Proceeds Account] 3. UTILISATION UNDER THE SIT FACILITY GUARANTEE OR LC Please issue or open a SIT Facility Guarantee or LC on the following terms: Proposed Utilisation Date: [-] (or, if that is not a Business Day, the next Business Day) Issuance of: [a guarantee]/[a letter of credit]* Amount: SIT [-] Term of the [guarantee]/[letter of credit]: [-] Beneficiary: [-] * Select applicable option. - 118 - 4. We confirm that the [proceeds of the Loan]/[guarantee]/[letter of credit] [are]/[is] to be used [in payment of capital expenditure as provided for in the [Initial Business Plan][Updated Business Plan]]/[in payment of operational expenditure as provided for in the [Initial Business Plan][Updated Business Plan]]/[towards repayment of amounts owing under the Existing WWIC Loan Agreement]/[other]. 5. We confirm that each condition specified in Clause 4.2 (Further conditions precedent to all Utilisations) is satisfied on the date of this Utilisation Request and the Contributed Capital Ratio is or as a result of the requested Utilisation will be at least 0.4. 6. We confirm that each of the Repeated Representations is correct by reference to the facts and circumstances existing at the date of this Utilisation Request. 7. This Utilisation Request is irrevocable. Yours faithfully ------------------------------------- authorised signatory for Western Wireless International d.o.o. - 119 - SCHEDULE 4B UTILISATION REQUEST (PAYMENTS TO EQUIPMENT VENDOR) From: Lucent Technologies Network Systems GmbH To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request. 2. This is to confirm that (a) on [-] deliveries/services in the value of [-] (b) on [-] deliveries/services in the value of [-] (c) on [-] deliveries/services in the value of [-] TOTAL [-] were effected/rendered. A copy certified true and complete by us of an original invoice from us to the Borrower in respect of the above is enclosed herewith. 3. Our claim under the Delivery Contract in respect of: (a) the deliveries/services referred to in paragraph 2(a) above represent 85 % / 70 % / 10 % / 5 %* of the value of such deliveries/services and thus amounts to [-]; (b) the deliveries/services referred to in paragraph 2(b) above represent 85 % / 70 % / 10 % / 5 %* of the value of such deliveries/services and thus amounts to [-]; (c) the deliveries/services referred to in paragraph 2(c) above represents 85 % / 70 % / 10 % / 5 %* of the value of such deliveries/services and thus amounts to [-], TOTAL [-] 4. We ask you to disburse Euro [-] to our account number [-] with [insert name of bank]. * Select applicable option. - 120 - 5. We further confirm that: (a) [the Borrower has so far fulfilled all of its payment obligations to be performed pursuant to the Delivery Contract;]** (b) the goods/services covered by the present Utilisation Request are in conformity with the Delivery Contract; (c) the goods/services covered by the present Utilisation Request have been delivered/rendered in accordance with the Delivery Contract; and (d) the Equipment Vendor is, and the requests made hereunder are, in compliance with the Delivery Contract and the Delivery Contract remains in full force and effect as at the date hereof. 6. We attach a copy of a certificate executed by the Borrower and referring to the final acceptance of the Initial Configuration.*** Yours faithfully ---------------------------------------- authorised signatory for Lucent Technologies Network Systems GmbH ** To be included in all Utilisation Requests, except the first. *** Only in respect of a Utilisation Request completed with reference to Section 1.10.2 (b) (iii) of the Delivery Contract. - 121 - SCHEDULE 4C UTILISATION REQUEST (PAYMENTS TO ECA) From: Lucent Technologies Network Systems GmbH To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request. 2. This is to confirm that we have effected the payment of ECA Premium in the amount of Euro [-] to the ECA on [insert date] in accordance with the invoice issued by the ECA on [-], a copy of which is enclosed herewith. 3. We ask you to disburse 85 % of this amount being Euro [-] to account number [-] with [insert name of bank]. Yours faithfully ---------------------------------------- authorised signatory for Lucent Technologies Network Systems GmbH - 122 - SCHEDULE 5 SELECTION NOTICE APPLICABLE TO A LOAN UNDER THE EURO FACILITY From: Western Wireless International d.o.o. To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Selection Notice. Terms defined in the Agreement have the same meaning in this Selection Notice unless given a different meaning in this Section Notice. 2. We refer to the following Loan[s] under the Euro Facility with an Interest Period ending on [-].* 3. We request that the next Interest Period for the above Loan[s] is [-]. 4. This Selection Notice is irrevocable. Yours faithfully ------------------------------------- authorised signatory for Western Wireless International d.o.o. * Insert details of all Loans under the Euro Facility which have an Interest Period ending in the same date. - 123 - SCHEDULE 6 CONDITIONS PRECEDENT CONDITIONS PRECEDENT TO INITIAL UTILISATION REQUEST 1. BORROWER (a) A copy of the constitutional documents of the Borrower. (b) A copy of a resolution of the board of directors of the Borrower: (i) approving the terms of, and the transactions contemplated by, the Material Contracts to which it is a party and resolving that it execute the Finance Documents to which it is a party; (ii) authorising a specified person or persons to execute the Finance Documents to which it is a party on its behalf; and (iii) authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices (including, if relevant, any Utilisation Request and Selection Notice) to be signed and/or despatched by it under or in connection with the Finance Documents to which it is a party. (c) A specimen of the signature of each person authorised by the resolution referred to in paragraph (b) above. (d) A certificate of an authorised signatory of the Borrower certifying that all Material Contracts as at the date of the Agreement have been fully disclosed to the Off Shore Facility Agent and each copy document relating to it specified in this Schedule 6 is correct, complete and in full force and effect as at the date of this Agreement. (e) Evidence that all accounts required to be open prior to the first Utilisation under the Agreement have been duly opened. 2. SPONSORS AND SHAREHOLDERS (a) A copy of the constitutional documents of each of the Sponsors. (b) A copy of a resolution of the board of directors of each of the Sponsors: (i) approving the terms of, and the transactions contemplated by, the Material Contracts to which it is a party and resolving that it execute the Finance Documents to which it is a party; (ii) authorising a specified person or persons to execute the Finance Documents to which it is a party on its behalf; and (iii) authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices to be signed and/or despatched by it under or in connection with the Finance Documents to which it is a party. (c) A specimen of the signature of each person authorised by the resolution referred to in paragraph (b) above. - 124 - (d) A copy of a resolution of the Shareholders approving the terms of, and the transactions contemplated by, the Finance Documents to which the Borrower is a party. 3. LEGAL OPINIONS (a) Legal opinions of Clifford Chance, legal advisers to the Off Shore Facility Agent as to matters of German, New York and Luxembourg law, substantially in the form agreed with the Off Shore Facility Agent. (b) A legal opinion of the in-house counsel to the Borrower, confirming that all Material Contracts are in full force and effect and create legal, valid and binding obligations of the parties thereto in the form agreed with the Off Shore Facility Agent. (c) A legal opinion of Friedman Kaplan Seiler & Adelman LLP, legal advisers to the Sponsors, substantially in the form agreed between the Off Shore Facility Agent and the Sponsors. (d) A legal opinion of Selih, Selih, Janezic & Jarcovic, Ljubljana, the local legal advisers to the Off Shore Facility Agent, substantially in the form agreed with the Off Shore Facility Agent. (e) Legal opinions in form and substance satisfactory to the Off Shore Facility Agent addressing the matters set forth in clause 3(f) of the Lucent Loan Agreement. (f) Legal opinions in form and substance satisfactory to the Off Shore Facility Agent confirming that the direct agreement between the Equipment Vendor and the Off Shore Facility Agent and the guarantee and undertaking agreement between Lucent Technologies Inc. and the Off Shore Facility Agent are in full force and effect and create legal, valid and binding obligations on the parties thereto. 4. OTHER DOCUMENTS AND EVIDENCE (a) A confirmation from the process agent of each of the Borrower, the Sponsors and the Shareholders, as applicable, in Germany, New York and England and Wales. (b) A copy of any other Authorisation or other document, opinion or assurance which the Off Shore Facility Agent considers to be necessary or desirable (if it has notified the Borrower accordingly) in connection with the entry into and performance of the transactions contemplated by any Finance Document or for the validity and enforceability of any Finance Document. (c) A copy of the Original Financial Statements of the Borrower. (d) Evidence that the fees, costs and expenses then due from the Borrower pursuant to Clause 12 (Fees) and Clause 19 (Costs and expenses) have been paid or will be paid. (e) Confirmation that the ECA has given its final approval to the provision of cover and the Off Shore Facility Agent being satisfied that the Finance Documents conform to the requirements thereof. - 125 - (f) Evidence that the conditions precedent relating to the Security Documents set out in Schedule 9 have been satisfied. (g) Evidence that the Borrower holds the Licence which has been paid for in full by the Borrower in cash. (h) A set of ten (10) Bills of Exchange duly signed by the Borrower and with the date of issue inserted but otherwise left blank together with a duly notarised and apostilled power of attorney. (i) Evidence of the satisfactory completion of the due diligence including all consultant reports. (j) A copy of each Material Contract (other than the international roaming contracts and contracts in respect of leasing of lines) and evidence of due execution thereof. (k) A copy of the Initial Business Plan and the Updated Business Plan to be delivered by the Borrower. (l) A copy of the Hedging Letter and Hedging Agreement and, in each case, evidence of due execution thereof. (m) A copy of the Market Study to be delivered by the Borrower. (n) A copy of an initial report of the Independent Technical Consultant issued in the form set out in Schedule 19 (Initial report of Independent Technical Consultant). (o) A confirmation in writing from the Equipment Vendor in the form set out in Schedule 12 (Confirmation from the Equipment Vendor). (p) A letter of comfort from the Government in the form agreed with the Off Shore Facility Agent. (q) A confirmation in writing substantially in the form set out in Schedule 8 (Form of letter of confirmation) from each of MIBO Kommunikacije d.o.o., Reime NIS AS and Lehmer d.o.o. to the Off Shore Facility Agent. (r) Evidence that this Agreement and the Debt Service Reserve Account and any other offshore bank accounts of the Borrower have been reported to Banka Slovenije. (s) Duly notarised and apostiled powers of attorney from each of the Finance Parties (other than the SIT Facility Banks);. (t) A letter, in the form agreed, from Western Wireless Corporation addressed to the Off Shore Facility Agent on behalf of the Banks in relation to the ownership and funding of certain companies within the Western Wireless Group. (u) Evidence of a deposit, in an amount not less than SIT 320,000,000 or its equivalent as determined by the On Shore Facility Agent for the account of Nova Ljubljanska banka d.d., Ljubljana as applied or reduced in accordance with a SIT Facility syndication agreement to be agreed between the Borrower, the Sponsors and the On Shore Facility Agent. - 126 - (v) A copy of the direct agreement between the Equipment Vendor and the Off Shore Facility Agent and evidence of due execution thereof. (w) Evidence that at least ten (10) Business Days prior to the proposed first Utilisation Date Existing WWIC Loans have been converted into Sponsor Contributions, in an amount equivalent to Euro 18,500,000 and Sponsors Unsecured Loans, in an amount equivalent to Euro 1,561,318.60 and in each case that the Existing WWIC Loans in respect of such amounts are cancelled. (x) A copy of the guarantee and undertaking agreement between Lucent Technologies Inc. and the Off Shore Facility Agent and evidence of due execution thereof. (y) Audit report from PriceWaterhouseCoopers, Slovenia in relation to Capital Contributions, in the form agreed with the Off Shore Facility Agent. (z) A copy of the comfort letter from Western Wireless Corporation in the form agreed with the Off Shore Facility Agent and evidence of due execution thereof. (aa) The form of agreed bill of exchange to be used by the Borrower in accordance with Clause 24.38 (Bills of Exchange and Security Deposits) and included in the Agreement as Schedule 16. (bb) Evidence that the conditions set forth in clause 3(e) and (g) of the Lucent Loan Agreement have been satisfied. (cc) Evidence that all accounts of the Borrower other than those mentioned in Schedule 7 (Permitted Accounts) have been closed. - 127 - SCHEDULE 7 PERMITTED ACCOUNTS - - IKB International S.A., Luxembourg, Account Numbers: 66922 and 80601; - - IKB Deutsche Industriebank AG, Account Number: 2012894685 - - Nova Ljubljanska Banka d.d., Ljubljana, Account Number: 02922-0089881553, and all other accounts required to be opened in accordance with Clause 23; - - Hypo Alpe-Adria-Bank d.d., Ljubljana, Account Number: 33000-8993618346; - - Nova KBM d.d., Ljubljana, Account Number: 04302-0000348020 (This account is only permitted until 30 June 2002 and only on the condition that on the date of first Utilisation (a) there are no funds standing to the credit of this account or, should that not be permissible under the terms of the account, (b) there is not more than the minimum permissible amount under such terms standing to the credit of this account). - 128 - SCHEDULE 8 FORM OF LETTER OF CONFIRMATION From: [MIBO Kommunikacije d.o.o.] [Reime NIS AS] [Lehmer d.o.o.] To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a letter of confirmation. Terms defined in the Agreement have the same meaning in this letter of confirmation unless given a different meaning in this letter of confirmation. 2. We confirm that we have performed works or services in connection with [insert number of sites] sites details of which are listed in the schedule hereto (the "SITES") that: (a) we have received payment in full in respect of the works and services performed by us on or in connection with [insert number of sites] Sites the details of such works and services and amounts paid are set out in the schedule ; [and] (b) [we have received site acceptance certificates from the Borrower in respect of [insert number of sites] Sites the details of which are set out in the schedule; and]* (c) [title to the works performed by us on [insert number of sites] Sites has passed to the Borrower the details of which are set out in the schedule]*, in accordance with the terms of the agreement entered into between us and the Borrower. 3. We confirm that we have no liens in connection with any of the works or services performed by us on or in connection with the Sites, whether arising by operation of law or otherwise. Yours faithfully ---------------------------------------------------------- authorised signatory for [MIBO Kommunikacije d.o.o.] [Reime NIS AS] [Lehmer d.o.o.] * To be included only in respect of the agreements entered into with MIBO Kommunikacije d.o.o. and Lehmer d.o.o. - 129 - THE SCHEDULE

SITES FOR WHICH OR IN CONNECTION WITH WHICH WORKS AND SERVICES HAVE BEEN PERFORMED Number Address Works or Payment Received Site acceptance Transfer of Title to Services Certificate from the the Borrower Performed Borrower Yes No Yes (Date No Yes No (in the of Receipt) amount of) Total of [-] Sites Total of Total of Total of Total Total of Total of [-] Sites [-] Sites [-] Sites of [-] Sites [-] Sites [-] Sites

- 130 - SCHEDULE 9 SECURITY DOCUMENTS - CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT GENERAL

STEPS FOR PERFECTION -------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- -------------------- - - Translation of Facility Agreement into the Slovenian language - - Summary and Translation of Hedging Agreement into the Slovenian language - - Certified copies of the extract of commercial register for Borrower, Shareholders, Senior Creditors - - Legal opinion of Selih that all security documents - Once perfected an additional legal have been duly executed and are legal, valid and opinion of Selih that the security binding obligations documents create the security which they purport to create - - Power of Attorney (for signing of all on shore securities agreements) of Senior Creditors authorising representative of the Off Shore Facility Agent to sign all on shore security documents plus complete all formalities necessary for the perfection of the pledge where applicable - - Only for the Asset and Licence Pledge and Lease Contracts Assignment Agreement, Trade Mark Pledge Agreement and Share Pledge Agreement: Power of Attorney in the English language signed by each Senior Creditor, with a notarial confirmation of the authorisation of the person who signs on behalf of each Senior Creditor to sign on behalf of the particular Senior Creditor (Vertretungsbestatigung) and confirmation of its signature (Unterschriftenbeglaubigung) and apostilled, authorising Nina Selih/Rudi Selih to enter into notarial deeds in relation to all relevant security documents - - Such other requirements as may be reasonably required to complete, register and perfect the Security Documents

ON SHORE SECURITY DOCUMENTS

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- ASSET AND Pledged Equipment - Execution of Asset Pledge, LICENCE PLEDGE Licence Transfer, Licence AND LEASE Pledge and Lease Contracts CONTRACTS Assignment Agreement ASSIGNMENT AGREEMENT - Execution of notarial deed in respect of Pledged Equipment - Provide Schedule 1, 2 & 3 to - Competent court officer must the Asset and Licence Pledge take record of the pledged and Lease Contracts assets, make lists of pledged Assignment Agreement - assets per site and mark the provide missing addresses of pledged assets by putting sites and relevant court stickers on them (Court officer districts, as well as modify when visiting sites to be designation (description) of accompanied by WWI technical certain items (confirmed by staff) Borrower shall have Sami Ali and N. Selih) achieved 50% after 6 months following the date of signing of the Facility Agreement

- 131 -

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - Within 9 months of signing of the Facility Agreement, On Shore Security Agent to check conformity of Schedule 1 with the lists issued by the court; Nina Selih to give notice of receipt of the list - Application by Selih for registration of the Asset Pledge in respect of the Pledged Equipment with the competent court (depending on where each asset is located) - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement - Copies of the building permits for sites on which Pledged Equipment is situated Pledged Equipment - 1 month after first drawdown, II and under the Commercial Facility, Substitution confirm to Onshore Security Equipment Agent that title in respect of Pledged Equipment II has passed/ - During the first 5 Months after the date of signing of the Facility Agreement provide to the On Shore Security Agent 10 Business days after the end of each Month a list with those of the 41 sites for which a building permit has been issued. - Within 5 months after the date of signing of the Facility Agreement execution of notarial deed in respect of Pledged Equipment II and any Substitution Equipment, if applicable - Within 5 months after signing of the Facility Agreement filing of application for registration of Pledged Equipment II and any Substitution Equipment, if applicable - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) - Within 9 months of signing of Facility Agreement, competent court officer must take record of the Pledged Equipment II, make a list of pledged assets per site and mark the pledged assets by putting stickers on them - Within 9 months of signing of the Facility Agreement, On Shore Security Agent to check conformity of Schedule 2 with the lists issued by the court; Nina Selih to give notice of receipt of the list Licence - Copy of concession - Within 5 business days of issue of licence, inform On Shore and Off Shore Security Agent and send copy

- 132 -

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - Copy of application / bid - Within 1 month after issue of licence enter into the contractual pledge (as attached as a Schedule to Asset Pledge) - Certificate that as of the - Borrower to sign Power of date of signing of the Attorney as set out in Facility Agreement no Schedule 10 (once licence change/amendment of/to the granted) Concession Agreement has been made Leases - Evidence of filing of the - Borrower to provide originals applications for the of consent letter from registration of the 41 lease Landlords I, II and site agreements (except for Substitution Landlords the 11 leases entered with confirming the consent to the Elektro Slovenia and RTV) conditional assignment as with the competent courts in follows: accordance with clauses 11.4(f) and 12.4(b) of the Asset and Licence Pledge and Lease Contracts Assignment; Agreement - Within 3 Months from the date of signing of the Facility Agreement consent letters in respect of at least 15 sites, - Within 6 Months from the date of signing of the Facility Agreement consent letters in respect of at least 30 sites; and - Within 9 Months from the date of signing of the Facility Agreement consent letters in respect of all 41 sites and a list of all original consent letters - Copies of Leases I and II and Substitution Lease (as applicable) - File for registration of Substitution Leases (applicable only in case of substitution pledge) and, where applicable, provide the consent of the relevant Substitution Landlords to the Substitution Assignment within 9 Months from the date of signing of the Facility Agreement - Inform the On Shore Security Agent immediately of rejection of filed applications for registration of the relevant leases in respect of some of the 41 sites (except for the 11 sites) (eg where building permit missing) after becoming aware of such rejection and of refilling of the application - Within 9 Months from the date of signing of the Facility Agreement, register the relevant leases in respect of some of the 41 sites (with the exception of the 11 sites) with the Land Registers BORROWER'S Shares - Execution of agreement - Within 2 Months from the date SHARE PLEDGE of the signing of the AGREEMENT Facility Agreement to register the share pledge with the Register of Commercial Companies (there must be an obligation for the Borrower in the Facility Agreement to provide evidence for such registration) - Execution of notarial deed in - Provide evidence of registration respect of pledged equipment within 9 Months from the date of signing of the Facility Agreement

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DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - Submission to the competent court in Ljubljana of the application for the registration of the share pledge with the Register of Commercial Companies - Pay notary fees and application fees for registration of the pledge, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) and the escrow agreement relating to the holding of such envelope TRADEMARK Trademarks - Execution of agreement - Within 9 months from signing of PLEDGE AGREEMENT the Facility Agreement provide evidence of registration of the TM Pledge by the Patent Office - Withdraw 2 outstanding applications for registration of the trademarks "EHO" and "VIVA" and provide to the On Shore Security Agent evidence of such withdrawal at the latest 10 Business Days before it makes the first Utilisation Request under the Facility Agreement - Borrower's consent to registration of the pledge (Schedule 5) - Submission to the Patent Office of application to register the TM Pledge - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) SOFTWARE Oracle Software - Execution of agreement LICENSE License Agreement ASSIGNMENT AGREEMENT - Schedule 2 - Copy of Deed of Consent and Waiver - Schedule 1 (Oracle License Agreement) ASSIGNMENT OF Receivables - Signing of agreement RECEIVABLES AS SECURITY AND ASSIGNMENT OF INSURANCE POLICIES AGREEMENT - Borrower to provide Schedule 1 complete information - Sealed Envelope (containing details of all subscribers (natural persons) must be submitted to the notary, identified in the Assignment of Receivables as Security and Assignment of Insurance Policies Agreement

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DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- Insurance - Copies of the insurance policies as required under the Facility Agreement - Original vinculation certificates - Borrower to provide Schedule 2 (list of insurances, amounts, claims) CLAIMS Claims - Signing of agreement ASSIGNMENT AND BILLS OF EXCHANGE AGREEMENT - Notarised copies of account agreements (NLB + Hypo Alpe-Adria Bank) must be submitted to the Off Shore Facility Agent - Acknowledgement by NLB and Hypo Alpe-Adria Bank - Schedule 1 (account details) Bills of Exchange - Provide set of 10 bills of exchange duly signed and filled in only with the date of issuance (Schedule 5) - Confirmation by holders of bills of exchange that they will inform NLB at the latest 5 Business Days before presenting any bills of exchange to NLB

OFF SHORE SECURITY DOCUMENTS

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- INTERCREDITOR - Execution of the agreement AGREEMENT DELIVERY - Execution of the agreement CONTRACT CLAIMS AND ASSIGNMENT - Execution and provision of AGREEMENT the Security Interest Provision Permission Agreement SECURITY - Execution of the agreement ASSIGNMENT OF (in the form of a deed) and RIGHTS UNDER A evidence thereof SUPPLY AND LICENSE - Execution of the Deed of AGREEMENT Consent and Waiver and evidence thereof - Give notice of assignment to Protek Flagship (UK) Ltd SPONSOR CASH Cash Collateral - Execution of the pledge COLLATERAL Account agreement ACCOUNT PLEDGE AGREEMENT - Acknowledgement by the Account Bank (IKB International S.A.) - Required cash collateral to be paid into the account DEBT SERVICE Debt Service - Execution of the pledge - 5 business days after first RESERVE ACCOUNT Reserve Account agreement utilisation to be funded with PLEDGE AGREEMENT the DSRA-Required Balance - Acknowledgement by the Account Bank (IKB International S.A.)

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DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- PLEDGE - Execution of the pledge AGREEMENT (NY) Shares agreement; - Delivery of all original certificated shares to the Secured Party; - Delivery of a stock power endorsed in blank to the Secured Party; and - The filing of a UCC-1 Financing Statement

- 136 - SCHEDULE 10 FORM OF TRANSFER CERTIFICATES To: [Off Shore Facility Agent [and On Shore Facility Agent]] From: [The Existing Bank] (the "EXISTING BANK") and [The New Bank] (the "NEW BANK") Dated: FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement have the same meaning in this Transfer Certificate unless given a different meaning in this Transfer Certificate. 2. We refer to Clause 26.5 (Procedure for transfer): (a) The Existing Bank and the New Bank agree to the Existing Bank transferring to the New Bank all or part of the Existing Bank's Commitment, rights and obligations referred to in the schedule hereto in accordance with Clause 26.5 (Procedure for transfer). (b) The proposed Transfer Date is [-]. (c) The Facility Office and address, fax number and attention details for notices of the New Bank for the purposes of Clause 32.2 (Addresses) are set out in the schedule hereto. 3. The New Bank expressly acknowledges the limitations on the Existing Bank's obligations set out in paragraph (c) of Clause 26.4 (Limitation of responsibility of Existing Banks). [4/5]. This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate. [5/6] The Existing Bank hereby transfers in favour of the New Bank [all] [ %] of its interest in the amount of Euro [-] in the following Security Documents: [NOTE: INSERT DESCRIPTION OF ALL RELEVANT SECURITY DOCUMENTS] In respect of the transfer relating to the interest in [SPECIFY RELEVANT MOVEABLE PROPERTY SUBJECT TO THE ASSET AND LICENCE PLEDGE AND LEASE CONTRACTS ASSIGNMENT AGREEMENT], the Existing Bank hereby assents to and permits the registration of such transfer in favour of the New Bank in relevant court register(s) in Slovenia. The New Bank may apply to the competent court registrar for the registration of the transfer from the Existing Bank to the New Bank in accordance with this Transfer Certificate. [6/7] Save for the provisions of paragraph [5/6] above (which shall be governed by and construed in accordance with Slovenian law), this Transfer Certificate and the rights and obligations of the parties hereunder shall be governed by and construed in accordance with German law. - 137 - THE SCHEDULE COMMITMENT/RIGHTS AND OBLIGATIONS TO BE TRANSFERRED [insert relevant details] [Facility Office address, fax number and attention details for notices and account details for payments,] [Existing Bank] [New Bank] By: By: This Transfer Certificate is accepted by the Off Shore Facility Agent [and the On Shore Facility Agent] and the Transfer Date is confirmed as [-]. [Off Shore Facility Agent] By: [On Shore Facility Agent] By: - 138 - SCHEDULE 11 INSURANCE The Borrower shall comply with the insurance policies in force at the date of this Agreement and shall enter into, perform and execute the requirements of an insurance schedule to be agreed between the Borrower and the Off Shore Facility Agent (each acting in good faith) within two months from the date hereof, such schedule shall replace this Schedule 11. - 139 - SCHEDULE 12 CONFIRMATION FROM THE EQUIPMENT VENDOR From: Lucent Technologies Network Systems GmbH To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. Terms defined in the Agreement have the same meaning in this confirmation unless given a different meaning in this confirmation. 2. We hereby confirm that the Delivery Contract was concluded on [-] and amended on [-] and has come into force on [-] and is still in full force and effect, that all permissions necessary have been granted and that we have received a down payment in relation to 15 % of the Estimated Contract Value in an amount of Euro 9,082,245.40, which is evidenced by the enclosed bank receipts. Yours faithfully ---------------------------------------- authorised signatory for Lucent Technologies Network Systems GmbH - 140 - SCHEDULE 13 PROCESS AGENT CONFIRMATION From: [Process Agent] To: IKB Deutsche Industriebank AG as Off Shore Facility Agent Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. Terms defined in the Agreement have the same meaning in this process agent confirmation unless given a different meaning in this process agent confirmation. 2. Pursuant to Clauses [-] the Agreement, the Borrower has irrevocably designated, appointed and empowered us, in the case of any court proceedings or legal actions in connection with the Agreement and the other Finance Documents to receive for and on behalf of the Borrower service of process in respect of such proceedings or legal actions. 3. We hereby confirm that we irrevocably accept the appointment as German process agent upon the condition that we shall not be liable for any loss or delay in transit of any documents or for mutilation or errors in the transmission of any telecommunication and we agree that we will promptly forward any process documents served on the Borrower to the address of the Borrower set forth in the Agreement or such other address as the Borrower or the Off Shore Facility Agent may notify to us from time to time. Yours faithfully ---------------------------------------- authorised signatory for [Process Agent] - 141 - SCHEDULE 14 COVENANT COMPLIANCE CERTIFICATE To: IKB Deutsche Industriebank AG as Off Shore Facility Agent From: Western Wireless International d.o.o. Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Covenant Compliance Certificate. Terms defined in the Agreement have the same meaning in this Covenant Compliance Certificate unless given a different meaning in this Covenant Compliance Certificate. 2. We confirm that as at the date of the financial statements in respect of [-]: (a) all contributions required to be made by the Shareholders pursuant to the Sponsors' and Shareholders' Undertaking and Completion Guarantee have been made when due; (b) the Contributed Capital Ratio is [-]; (c) the number of Subscribers was [-]; (d) the Population Coverage was [-]; (e) the Service Revenues were [-]; (f) EBITDA was [-] and the variance from the Initial Business Plan of [-] was [-]; (g) the Total Leverage Ratio was [-]; (h) the Interest Coverage Ratio was [-]; (i) the Debt Service Cover Ratio was [-]; (j) the financial statements were prepared in accordance with [US GAAP] [and, if applicable, Slovenian Accounting Standards] consistently applied and represent a true and fair view of the Borrower and do not omit any material liability; (k) we have received Sponsors Unsecured Loans in the amount of [-], and attached hereto are detailed calculations and/or evidence thereof. 3. We confirm that as of the date hereof: - 142 - (a) no Potential Event of Default or Event of Default is continuing;(1) (b) [no Cash Shortfall] [a Cash Shortfall] exists [in an amount equal to [-]].(2) 4. As at the date of this Covenant Compliance Certificate the Repeated Representations are correct by reference to the facts and circumstances as at the date hereof except for representations which were made as of a specific date which shall be correct in all material respects as of such date. 5. We hereby request that the Applicable Margin in relation to the [state Facility] be adjusted from [insert] to [insert]. Signed:______________________________ ____________________________________ Director Director [insert applicable auditor certification language](3) __________________________________ for and on behalf of [name of auditors of the Borrower](4) (1) If this statement cannot be made, the certificate should identify any Event of Default or Potential Event of Default that is continuing and the steps, if any, being taken to remedy it. (2) Include if Cash Shortfall exists. (3) To be agreed with the Borrower's auditors and the Banks prior to signing the Agreement. Auditors must verify all of the above statements other than points 2(c), (d) or 3. (4) Only applicable if the Covenant Compliance Certificate accompanies the audited financial statements and is to be signed by the auditors. To be agreed with the Borrower's auditors prior to signing the Agreement. - 143 - SCHEDULE 15 PROJECT STATUS AND PROGRESS REPORT To: IKB Deutsche Industriebank AG as Off Shore Facility Agent From: Western Wireless International d.o.o. Dated: Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. We refer to the Agreement. This is a Project Status and Progress Report. Terms defined in the Agreement have the same meaning in this Project Status and Progress Report unless given a different meaning herein. 2. Set out below is: (1) with respect to the Eligible Expenditures under the ECA Facility a list of (i) all purchase orders placed, and (ii) deliveries received and/or services rendered during the Quarter together with copies of the relevant invoices from the Equipment Vendor; (2) a detailed and full description of the status of the installation of the Network in comparison to the most recent Business Plan and the status of all national roaming agreements; (3) a comparison of the Borrower's actual business and network development (including but not limited to network roll out and network quality measured in Population Coverage and dBm and services offered) with the Licence requirements and the Business Plan; (4) the information contained in the annex hereto; (5) a description of any non-compliance with delays in performance of, cost increases under or other issues arising out of any Material Contracts that could reasonably be expected to affect the Borrower's ability to perform its obligations under the Finance Documents; (6) a detailed description of any material financial, operational, construction, regulatory, administrative, legal or other issues that have had or could reasonably be expected to have a significant impact on the Borrower; (7) a list of all Material Contracts entered into, amended, terminated or substituted in the last Quarter; and (8) a description of any complaints received and correspondence from the Government or any governmental bodies or other authority in relation to the Project; and (9) details of all tariff plans and Subscriber acquisition costs (in total and per subscriber) including (without limitation) subsidies spent on the provision of handsets and any special offers to Subscribers; and - 144 - (10) an update of the sales and marketing strategy report comprised in the Initial Business Plan and covering subscriber acquisition cost, marketing cost and handset and other subsidies; and (11) a written outline of major market and business developments. Signed:______________________________ ____________________________________ Chief Financial Officer Chief Technical Officer I herewith confirm the accuracy of the statements made in respect of the items mentioned under paragraphs 2(2) and 2(4) above. Signed on: ____________________________________ Independent Technical Consultant* * In respect of (i) any Project Status and Progress Report delivered in connection with any request for a change in the Applicable Margin according to Clause 9.1(b)(i)(2) (Calculation of floating rate interest under the ECA Facility) and Clause 9.2(b)(i)(2) (Calculation of floating rate interest under the Commercial Facility); or (ii) any Project Status and Progress Report delivered as at 31.12.2002, 31.12.2003 or 31.12.2004. - 145 - ANNEX 1. USAGE STATISTICS In respect of each of post pay and prepay subscribers: 1.1 Number of active subscribers reported as at the last day of the Quarter; 1.2 Number of churned subscribers (subscribers who no longer have the status of active subscriber) from the last day of the previous Quarter up until the last day of the Quarter; 1.3 Average minutes of use per subscriber for Mobile Originated (MO) and Mobile Terminated (MT) calls reported during the Quarter; 1.4 Number of Busy Hour Call Attempts (BHCA) per subscriber averaged over each Month during the Quarter; 1.5 Percentage of calls for fax during the Quarter; 1.6 Percentage of calls for data during the Quarter; 1.7 Average minutes of use for fax for MO and MT calls during the Quarter; and 1.8 Average minutes of use for data for MO and MT calls during the Quarter. 2. PERFORMANCE AND QUALITY MEASUREMENT The following Network performance key performance indicators as measured on weekdays during busy hour and averaged over each Month during the Quarter: 2.1 Call Set-Up Success Rate; 2.2 Handover Success Rate; 2.3 Traffic Channel (TCH) blocking rate; 2.4 Standalone Dedicated Control Channel (SDDCH) blocking rate; 2.5 An interface blocking rate (point of interconnects, A interface and A(ter)); and 2.6 Overall network system drop call rate Base Station Subsystem (BSS) and Network Subsystem (NSS). 3. INTELLIGENT NETWORK In respect of each prepay subscriber during the Quarter: 3.1 Number of recharge attempts split into recharge method (such as voucher, ATM and credit card); 3.2 Number of successful recharges of account; and 3.3 Percentage blocking (busy hour) or call gapping at SCP's INAP (Service Control Point's Intelligent Network Application Part) interface during each Month in the Quarter. - 146 - 4. VOICE MAIL USAGE In respect of each prepay and per postpay subscriber during the quarter: 4.1 Average length (in minutes) of voice mail messages deposits per day; 4.2 Average number of Voice Mails per day; 4.3 Average number voice mail retrievals per day; 4.4 Average length of Interactive Voice Response (IVR) sessions that do not lead to a voice mail retrieval or voice mail message per day. 5. SHORT MESSAGE USAGE In respect of each prepay and per post pay subscriber: 5.1 Average busy Hour SMSs (Short Message Service) for MO and MT SMSs; 5.2 Average total SMSs per Quarter for the whole Network preferably broken down into: - MO SMS; - MT SMS; - SIM Toolkit SMS OTA (Over The Air) originated; - Voice mail notification; and - Other (such as fleet messaging). 6. GPRS USAGE Number of General Package Radio System (GPRS) subscribers measured in respect of the Quarter on the last day of the Quarter. Average number of kilo Bits for MO per GPRS subscriber per Quarter. Average number of kilo Bits for MT per GPRS subscriber per Quarter. 7. CALL DETAILS 7.1 The total number of minutes per Quarter for incoming (to the Network) calls from: - the Network (intra the Network); - PSTN (Public Switch Telephone Network - fixed line); - Other PLMN's (Public Land Mobile Networks); and - International gateway (preferably broken down into Country or tariff area). 7.2 The total number of minutes during the Quarter for outgoing (from the Network) minutes to: - the Network (intra the Network); - 147 - - PSTN (Public Switch Telephone Network - fixed line); - Other PLMNs (Public Land Mobile Networks); and - International gateway (preferably broken down into country or tariff area). 8. INTERNATIONAL ROAMING SUBSCRIBERS 8.1 Total duration (in minutes) during the Quarter of incoming calls. 8.2 Total duration (in minutes) during the Quarter of outgoing calls to: - the Network; - PSTN; - Other PLMNs; and - International Gateway (preferably broken down into country or tariff area). 9. NATIONAL ROAMING In respect of the Quarter: 9.1 Total Number of MO minutes; 9.2 Total Number of MT minutes; 9.3 Number of SMS MO; and 9.4 Number of SMS MT. - 148 - SCHEDULE 16 FORM OF PERMITTED BILL OF EXCHANGE To be agreed prior to first Utilisation - 149 - SCHEDULE 17 POPULATION COVERAGE VERIFICATION 1. DEFINITIONS "POPULATION COVERAGE" means coverage of the Slovenian population with the Borrower's own Network, unless otherwise indicated measured at a receive signal level of -100 dBm, as described below excluding any coverage derived from roaming agreements with other operators or the assistance of any other telecommunications system other than the Network. The total population number shall be calculated using recent substantive population density data issued or based on Slovenian national statistics bureau. 2. POPULATION COVERAGE MEASUREMENT 2.1 The Borrower shall present soft and hard copies of maps showing the Population Coverage based on detailed maps of Slovenia, area coverage based on a receive signal strength of -85 dBm, -95 dBm and -100 dBm and recent substantive Slovenian population density data imported into a Geographic Information System (GIS) software tool to display coverage maps and calculate the Population Coverage as defined in paragraph 3.4 below. 2.2 The coverage areas shall be based on the receive signal strength of -100 dBm and shall include the predicted Population Coverage for this area. The Borrower shall use the most recent substantive Slovenian population density data available on the market and the density of population distribution data shall be per one kilometre square grid (or denser) across the whole of the territory of Slovenia with a coordinate for each respective grid located in the most populated area within the one kilometre. Any further assumptions for this coverage shall be clearly stated. 2.3 EVIDENCE OF POPULATION COVERAGE The Borrower shall present to the Off Shore Facility Agent as soon as the same becomes available but in any event not later than 45 days after the respective date for the achievement of the Population Coverage covenant as indicated in Clause 22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent Technical Consultant) together with the respective Covenant Compliance Certificate the following evidences for the achievement of the respective Population Coverage as stipulated in Clause 22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent Technical Consultant), which shall be verified by the Independent Technical Consultant: 2.3.1 Detailed coverage maps showing the receive signal strength of -100 dBm and -95 dBm (best server) for its own GSM Network as well as the site locations, site references and central coordinates of population settlements. 2.3.2 Operation and Maintenance Centre (OMC) reports per site showing site names and cell status (on air, TRX (TRX - Transceiver or Transmitter Receiver) power levels, BCCH channels (Broadcast Control Channel)). 2.3.3 Drive tests' reports verifications of the Population Coverage as defined in paragraph 3.5 below. 2.4 By the measurement of the Population Coverage the Borrower shall not include coverage areas provided: 2.4.1 by any other network (such as for national roaming); - 150 - 2.4.2 temporary sites that have been established less than four weeks or any temporary site which are intended to be removed within 12 weeks after the milestone date without establishing a permanent site that gives equivalent coverage; and 2.4.3 by use of any temporary signal booster such as high power amplifier used to distort coverage. 3. VERIFICATION OF POPULATION COVERAGE 3.1 DRIVE TEST ROUTES AND TIMESCALES The Borrower shall present detailed data as defined in paragraph 2.3 above on the proposed coverage area maps of regions in Slovenia at the latest six weeks prior to any of the dates for achievement of a certain level of Population Coverage as indicated in Clause 22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent Technical Consultant). This shall be based on the Borrower's BTS (Base Transceiver Station) sites that are projected to be 'on air' on the respective date for achievement of the respective level of Population Coverage as indicated in Clause 22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent Technical Consultant). In order to verify the coverage areas, drive test routes shall be mutually agreed between the Borrower and the Independent Technical Consultant at the latest three weeks prior to the respective date for achievement of a certain level of Population Coverage as indicated in Clause 22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent Technical Consultant) in order to substantiate coverage areas. Sample routes shall focus on areas with minimal coverage (below -95dBm best server) shown on the coverage maps and just within the borders of contiguous areas of Population Coverage. The Independent Technical Consultant may accompany the Borrower whilst performing some of the tests. 3.2 DURATION OF DRIVE TESTING 3.2.1 Drive routes shall be limited to no more than 10 days duration in total per Population Coverage covenant as indicated in Clause 22.2(b) (Population Coverage) unless prolonged by repeat tests as described in paragraph 3.2.2 below. 3.2.2 However should EITHER a) the drive test reports (the format of which is as described in paragraph 3.5 below) show; OR b) during the performance of the drive test it is observed that one or more routes whereby there occurs several dropped calls or that the receive signal strength is indicated below -100 dBm for a distance of 400 metres or more (or for more than a total of five percent of the total distance of any drive route), THEN the associated drive route test shall be repeated with a nearby route in an area with higher receive signal strength until these criteria have been fulfilled. 3.3 FINALISATION OF THE POPULATION COVERAGE CALCULATION The final coverage maps, if amended by the drive tests reports according to measured coverage, shall be mutually agreed between the Independent Technical Consultant and the Borrower for the relevant Population Coverage covenant. Should the receive signal strength be -100 dBm or better for the majority of the land area within the grid (as defined in paragraph 2.2 above) and should the coordinate for the respective grid be also covered then the population number for this grid shall be considered to be covered. - 151 - 3.4 TOOLS AND TEST EQUIPMENT REQUIRED BY THE BORROWER The Borrower shall use commercially available proven tools and test equipment to establish evidence of Population Coverage. The Borrower shall notify the Independent Technical Consultant prior to revising the proposed tools (as mentioned herein). Any replacement tool shall conform to the requirements as set out herein. The following Clauses describe these tools. 3.4.1 The Geographic Information System (GIS) software tool is an information system that is designed to work with data referenced by spatial or geographic coordinates. GIS is both a database system with specific capabilities for spatially referenced data, as well as a set of operations for analysis of the data. The GIS tool shall import detailed maps of Slovenia; statistical population density data and radio coverage plots in order to calculate the Population Coverage for all Slovenia. The calculation shall be made according to the methodology presented in paragraph 3.3. The proposed tools which will be used to perform this function are called Logica Odyssey and Arc View. 3.4.2 The drive test equipment and software is used in a suitable vehicle to analyse parameters of the uplink and downlink radio path between the mobile terminal and the BTS during idle mode, during call set-up and whilst in call mode. This should work with a laptop personal computer, a GPS (Global Positioning System) receiver with external antenna and a compatible Global System for Mobile Communication (GSM) (1800 band) mobile terminal equipped with the manufacturer's test software. The handset shall preferably use an externally mounted GSM antenna on the vehicle along with suitable in line loss pad between the GSM antenna and the unit to compensate for external antenna gain. The proposed tool which will be used to perform this function is called Agilent E7475A with a Sagem mobile handset equipped with test software.(5) 3.4.3 A post processing software tool should be used to perform detailed analysis of the data produced by the drive testing. This shall be presented in the form of statistics and detailed drive test maps showing the routes and drive test reports for each route as defined in paragraph 3.5. The proposed tool which will be used to perform this function is called Actix Analyzer software version 4.1. 3.5 DRIVE TEST REPORTS For each route the Borrower shall prepare a report containing all relevant measured data. The report shall be made available in softcopy to the Independent Technical Consultant and the Off Shore Facility Agent. This report shall include a statistical summary of the field measurements (RXQUAL (Receive quality according to indicators reflecting the Bit Error Rate), RXLEV (Receive Signal level stated in dBm) distribution) and the plot of measured RXLEV and RXQUAL, as well as the location of call set-up failures and call drops on a map that shall also show the defined drive routes. RXQUAL and RXLEV shall be measured only whilst the mobile terminal is on a permanent call and not whilst in idle mode. The cell BCCH channel number shall also be detailed on the map. Actix UK company providing quality measurement and analysis software to the mobile industry. Headquartered in Hamlet House, 77 Fulham Palace Road, Hammersmith, London. (5) Outside antenna gives more accurate and consistent results. Up to 10 dB variations can be introduced due to exact location of handset (such as on passenger seat or clipped to dashboard) which is affected by losses from surrounding such as body-loss. - 152 - Agilent Technologies US company formerly owned by Hewlett Packard specialising in medical, test and communications equipment and software. Headquartered in 395 Page Mill Road, PO Box 10395, Palo Alto, California. ArcView GIS Software ArcView is a mapping and GIS software tool for the desktop PCs. Sagem French company specialising in communications, defence electronics and mobile terminals. Headquartered in Le Ponant de Paris, 27 rue Leblanc, 75512 Paris. - 153 - SCHEDULE 18 INITIAL REPORT OF THE INDEPENDENT TECHNICAL CONSULTANT To: IKB Deutsche Industriebank AG as Off Shore Facility Agent From: Independent Technical Consultant Dated: [-] Dear Sirs FACILITY AGREEMENT DATED [-] (THE "AGREEMENT") 1. I refer to the Agreement. This is an initial report as referred to in point 4 (n) of Schedule 6 (Conditions Precedent). Terms defined in the Agreement have the same meaning in this initial report unless given a different meaning in this initial report. 2. I certify that I have reviewed the information provided by the Borrower (attached hereto) and confirm, in all material respects (other than in relation to paragraph 2.1 below), the following. 2.1 As at [date], the: (a) Population Coverage has reached 65%; and (b) the number of Subscribers is 8,000. 2.2 The Network is operational, including Core Network elements [MSC (Mobile Switching Centre), HLR (Home Location Register), VLR (Visitor Location Register), AuC (Authentication Centre)], Value Added Services [Voice Mail System and Short Message Centre], Intelligent Network [prepay application], Base Station Subsystems [Transcoders, BSCs (Base Station Controllers) and BTSs (Base Station Transceiver)], OMCs [Operation and Maintenance Centre] and, as at the date mentioned in paragraph 2.1 above, [-] base stations are on air. 2.3 That other supporting systems for the operation of the Network are in place, including customer care, billing centre, critical IT infrastructure [_______________________________________________________________], power systems, and building control systems. 2.4 The National Roaming Agreement with Mobitel dated 9 November 2001 is in full force and effect. I confirm that the information provided by the Borrower is sufficient to make the confirmations set out in paragraphs 2.1 to 2.4 above. Yours faithfully _______________________________________ Independent Technical Consultant - 154 - SIGNATORIES TO THE FACILITY AGREEMENT THE BORROWER WESTERN WIRELESS INTERNATIONAL D.O.O. By: JULIEN COUSTAURY Name: Julien Coustaury Name: Title: General Director Title: Address: Brnciceva ulica 49, 1231 Ljubljana, Slovenia Telephone: +386 1 5801 200 Fax: +386 1 5801 109 Attention of: Steven Fast LEAD ARRANGER, OFF SHORE SECURITY AGENT, OFF SHORE FACILITY AGENT AND ORIGINAL EURO FACILITY BANK IKB DEUTSCHE INDUSTRIEBANK AG By: STEFAN ORTSEIFEN JAN-HENRIK RUFER Name: Stefan Ortseifen Name: Jan-Henrik Rufer Title: Member of the Title: Assistant Director Board of Directors Address: Wilhelm-Botzkes-Stra(beta)e 1, 40474 Dusseldorf, Germany Telephone: +49 211 8221 4887 or +49 211 8221 4730 Fax: +49 211 8221 2887 or +49 211 8221 2730 Attention of: Martina Messing or Andreas Nestel LEAD ARRANGER AND ORIGINAL EURO FACILITY BANK KREDITANSTALT FUR WIEDERAUFBAU By: REINER PROVE Name: Reiner Proeve Name: Title: Senior Project Manger Title: Address: Palmengartenstr(beta)e 5-9, 60325 Frankfurt am Main, Germany Telephone: +49 69 7431 3927 Fax: +49 69 7431 2258 Attention of: Reiner Prove SENIOR CO-ARRANGER AND ORIGINAL EURO FACILITY BANK RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. By: MARION POETSCHKE MANFRED ZIWEY Name: Marion Poetschke Name: Manfred Ziwey Title: Assistant Director Title: Director Address: Raiffeisenplatz 1, 4021 Linz, Austria Telephone: +43 732 6596 3170 Fax: +43 732 6596 3131 Attention of: Dr. Lambert Hofbauer SENIOR CO-ARRANGER, ON SHORE SECURITY AGENT, ON SHORE FACILITY AGENT AND ORIGINAL SIT FACILITY BANK NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA By: MATEVZ PIRNAT Name: Matevz Pirnat Name: Title: SVP and Resident Title: Representative Address: Smartinska 130, SI - 1520 Ljubljana, Slovenia Telephone: +386 1 520 7273 Fax: +386 1 425 60 02 Attention of: Ms. Jasna Istenie or Mr. Bostjan Kovae CO-ARRANGER AND ORIGINAL EURO FACILITY BANK LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE By: MARION POETSCHKE MANFRED ZIWEY Name: Marion Poetschke Name: Manfred Ziwey Title: Assistant Director Title: Director Address: Martensdamm 6, 24103 Kiel, Germany Telephone: +431 900 1572 Fax: +431 900 2744 Attention of: Klaus-Volker Lenk - 156 - CO-ARRANGER AND ORIGINAL EURO FACILITY BANK HYPO ALPE-ADRIA-BANK AG By: MARION POETSCHKE MANFRED ZIWEY Name: Marion Poetschke Name: Manfred Ziwey Title: Assistant Director Title: Director Address: Stock im Eisen-Platz 3, 1010 Wien, Austria Telephone: +43 1 512 8266 Fax: +43 1 512 8266 6990 Attention of: International Finance ORIGINAL SIT FACILITY BANK HYPO ALPE-ADRIA-BANK D.D. By: MARION POETSCHKE MANFRED ZIWEY Name: Marion Poetschke Name: Manfred Ziwey Title: Assistant Director Title: Director Address: Trg Osvobodilne fronte 12 PO Box 1601, SI - 1001 Ljubljana, Slovenia Telephone: +386 1 300 4400 Fax: +386 1 300 4401 Attention of: Mr. Harald Brunner EX-10.35 7 v88021exv10w35.txt EXHIBIT 10.35 Exhibit 10.35 CLIFFORD CHANCE PUNDER CONFORMED COPY DATED 28 OCTOBER 2002 WESTERN WIRELESS INTERNATIONAL D.O.O. IKB DEUTSCHE INDUSTRIEBANK AG KREDITANSTALT FUR WIEDERAUFBAU RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE HYPO ALPE-ADRIA-BANK AG HYPO ALPE-ADRIA-BANK D.D. and OTHERS in the presence of WESTERN WIRELESS INTERNATIONAL CORPORATION WESTERN WIRELESS INTERNATIONAL SLOVENIA CORPORATION WESTERN WIRELESS INTERNATIONAL SLOVENIA II CORPORATION - -------------------------------------------------------------------------------- FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT DATED 30 APRIL 2002 RELATING TO THE PROJECT FINANCING OF THE VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA - -------------------------------------------------------------------------------- CONTENTS CLAUSE PAGE 1. Definitions and Interpretation.................................. 2 2. Amendment of the Original Facility Agreement.................... 2 3. Representations................................................. 2 4. Continuity and Further Assurance................................ 3 5. Fees, Costs and Expenses........................................ 3 6. Miscellaneous................................................... 3 Schedule 1 Conditions Precedent.......................................... 5 Schedule 2 Amendments to Original Facility Agreement..................... 6 THIS AGREEMENT is dated 28 October 2002 and made between: (1) WESTERN WIRELESS INTERNATIONAL D.O.O., LJUBLJANA as borrower (the "BORROWER"); (2) IKB DEUTSCHE INDUSTRIEBANK AG AND KREDITANSTALT FUR WIEDERAUFBAU, as lead arrangers (the "LEAD ARRANGERS"); (3) RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. and NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as senior co-arrangers (the "SENIOR CO-ARRANGERS"); (4) LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as co-arrangers (the "CO-ARRANGERS"); (5) IKB DEUTSCHE INDUSTRIEBANK AG, KREDITANSTALT FUR WIEDERAUFBAU, RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as original lenders with regard to the Euro Facility (the "ORIGINAL EURO FACILITY BANKS"); (6) IKB DEUTSCHE INDUSTRIEBANK AG, as facility agent with regard to the Euro Facility and the SIT Facility (the "OFF SHORE FACILITY AGENT"); (7) IKB DEUTSCHE INDUSTRIEBANK AG, as security agent with regard to the Off Shore Security (the "OFF SHORE SECURITY AGENT"); (8) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as an original lender and issuing bank with regard to the SIT Facility and HYPO ALPE-ADRIA-BANK D.D. as original lender with regard to the SIT Facility (the "ORIGINAL SIT FACILITY BANKS"); (9) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as local facility agent with regard to the SIT Facility (the "ON SHORE FACILITY AGENT"); and (10) NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as security agent with regard to the On Shore Security (the "ON SHORE SECURITY AGENT"); in the presence of (11) WESTERN WIRELESS INTERNATIONAL CORPORATION, WESTERN WIRELESS INTERNATIONAL SLOVENIA CORPORATION, and WESTERN WIRELESS INTERNATIONAL SLOVENIA II CORPORATION (together the "SPONSORS"). WHEREAS (A) On 30 April 2002 the Borrower and the Finance Parties have entered into a facility agreement for the financing of the construction and operation of a wireless communication network in Slovenia. - 1 - (B) The Parties have agreed to make certain amendments to the Finance Documents. IT IS AGREED as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS In this Agreement: "AGREEMENT" means this agreement including all of its Schedules. "AMENDED FACILITY AGREEMENT" means the Original Facility Agreement, as amended by this Agreement. "EFFECTIVE DATE" means the date on which the Off Shore Facility Agent confirms to the Finance Parties and the Borrower that it has received each of the documents listed in Schedule 1 (Conditions Precedent) in a form and substance satisfactory to the Off Shore Facility Agent. "ORIGINAL FACILITY AGREEMENT" means the Facility Agreement dated 30 April 2002 between the Borrower, the Off Shore Facility Agent, and others. 1.2 INCORPORATION OF DEFINED TERMS Terms defined in the Original Facility Agreement shall, unless otherwise defined herein, have the same meaning herein and the principles of construction set out in the Original Facility Agreement shall have effect as if set out in this Agreement. 1.3 CLAUSES In this Agreement any reference to a "Clause" or "Schedule" is, unless the context otherwise requires, a reference to a Clause or Schedule hereof. Clause headings are for ease of reference only. 2. AMENDMENT OF THE ORIGINAL FACILITY AGREEMENT With effect from the Effective Date the Original Facility Agreement shall be amended as set out in Schedule 2 (Amendments to the Original Facility Agreement). 3. REPRESENTATIONS 3.1 The Borrower expressly repeats the Repeated Representations and makes the representation in Clause 20.1.11 (No misleading information) of the Facility Agreement as at the date of signing of this Agreement and upon the Effective Date as if the references therein to Initial Business Plan, Information Memorandum and Legal Due Diligence Report are to the 2002 Revised Business Plan. - 2 - 4. CONTINUITY AND FURTHER ASSURANCE 4.1 CONTINUING OBLIGATIONS The provisions of the Original Facility Agreement shall, save as amended hereby, continue in full force and effect. 4.2 FURTHER ASSURANCE The Borrower shall, at the request of the Off Shore Facility Agent and at its own expense, do all such acts and things necessary or desirable to give effect to the amendments effected or to be effected pursuant to this Agreement. 5. FEES, COSTS AND EXPENSES 5.1 TRANSACTION EXPENSES The Borrower shall, from time to time on demand of the Off Shore Facility Agent, reimburse the Senior Creditors for all costs and expenses (including legal fees) together with any VAT thereon reasonably incurred by it in connection with the negotiation, preparation and execution of this Agreement, any other document referred to in this Agreement any other Finance Document and the completion of the transactions herein contemplated. 5.2 PRESERVATION AND ENFORCEMENT OF RIGHTS The Borrower shall, from time to time on demand of the Off Shore Facility Agent, reimburse the Senior Creditors for all costs and expenses (including legal fees) on a full indemnity basis together with any VAT thereon incurred in or in connection with the preservation, performance and/or enforcement or protection and/or attempted enforcement or protection of any of the rights of the Senior Creditors under this Agreement, any other document referred to in this Agreement and any other Finance Document. 5.3 STAMP TAXES The Borrower shall pay all stamp, registration and other taxes to which this Agreement, any other document referred to in this Agreement any other Finance Document or any judgment given in connection herewith is or at any time may be subject and shall, from time to time on demand of the Off Shore Facility Agent, indemnify the Senior Creditors against any liabilities, costs, claims and expenses resulting from any failure to pay or any delay in paying any such tax. 6. MISCELLANEOUS 6.1 INCORPORATION OF TERMS The provisions of clause 32 (Notices), clause 34 (Partial Invalidity), clause 35 (Remedies and Waiver), clause 38 (Governing Law), clause 39 (Arbitration) and clause 40 (Jurisdiction) of the Original Facility Agreement shall be incorporated into this - 3 - Agreement as if set out in full herein and as if references therein to "this Agreement" or the Finance Documents are references to this Agreement. 6.2 COUNTERPARTS This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument. 6.3 FINANCE DOCUMENT This Agreement is intended to be a "Finance Document" within the meaning of the Facility Agreement. - 4 - SCHEDULE 1 CONDITIONS PRECEDENT 1. In relation to the Borrower: (a) a confirmation, given by an authorised signatory of the Borrower, certifying that, as at the date hereof, there has been no change to the constitutional documents delivered by the Borrower pursuant to the Original Facility Agreement; (b) a copy, certified as at the date of this Agreement a true and up-to-date copy by an authorised signatory of the Borrower, of a resolution of the board of directors of the Borrower approving the execution, delivery and performance of this Agreement and the terms and conditions hereof and authorising a named person or persons to sign this Agreement and any documents to be delivered by the Borrower pursuant hereto; and (c) a certificate of an authorised signatory of the Borrower setting out the names and signatures of the persons authorised to sign, on behalf of the Borrower, this Agreement and any documents to be delivered by the Borrower pursuant hereto. 2. A copy, certified a true copy by or on behalf of the Borrower, of each such law, decree, consent, licence, approval, registration or declaration as is, in the opinion of counsel to the Finance Parties, necessary to render this Agreement legal, valid, binding and enforceable, to make this Agreement admissible in evidence in the Borrower's and any Finance Party's jurisdiction of incorporation and to enable the Borrower to perform its obligations hereunder. 3. A legal opinion of Selih, Selih, Janezic and Jarcovic, Ljubljana, the local legal advisers to the Off Shore Facility Agent, substantially in the form agreed with the Off Shore Facility Agent. 4. The fees set out in the Restructuring Fee Letter addressed by the Borrower to the Off Shore Facility Agent, dated on or about the date of this Agreement, have been paid to the Finance Parties. - 5 - SCHEDULE 2 AMENDMENTS TO ORIGINAL FACILITY AGREEMENT 1. The cover page of the Original Facility Agreement is amended by deleting the title in its entirety and replacing it with the following: "FACILITY AGREEMENT (AS AMENDED ON 28 OCTOBER 2002) RELATING TO THE PROJECT FINANCING OF THE VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA" 2. The definition of "Business Plan" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such definition in its entirety and replacing it with the following definition: "BUSINESS PLAN" means, prior to the delivery of the 2002 Revised Business Plan, the Initial Business Plan, thereafter but prior to the delivery of the first Updated Business Plan, the 2002 Revised Business Plan and thereafter the most recently delivered Updated Business Plan." 3. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Claims Assignment and Bills of Exchange Agreement" and before the definition of "Co-Arrangers": "CLOSED LAC" has the meaning set out in Schedule 19 (Additional Coverage Requirements)." 4. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Confidentiality Undertaking " and before the definition of "Contributed Capital": "CONTIGUOUS ROAD COVERAGE" has the meaning set out in Schedule 19 (Additional Coverage Requirements)." 5. Sub-clause (a) of the definition of "EBITDA" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such sub-clause in its entirety and replacing it with the following definition: "(a) net income excluding any unrealised but including any realised foreign exchange gains or losses;" 6. The definition of "Estimated Contract Value" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such definition in its entirety and replacing it with the following definition: - 6 - "ESTIMATED CONTRACT VALUE" means the estimated value of the equipment and services for all phases of the Project (comprising the Initial Configuration and the Planned Network Expansion) payable under the Delivery Contract, being Euro 59,438,541." 7. The definition of "Fee Letter" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such definition in its entirety and replacing it with the following definition: "FEE LETTER" means any letter or letters dated on or about the date of this Agreement or such other date as set out therein between any of the Arrangers and the Borrower or any of the Agents and the Borrower setting out any of the fees referred to in Clause 12 (Fees) and the advisory agreement between the Borrower and the Off Shore Facility Agent dated 2 February 2001 as amended from time to time." 8. Sub-clause (a) of the definition of "Financial Indebtedness" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such sub-clause in its entirety and replacing it with the following definition: "(a) moneys borrowed (other than Subordinated Loans);" 9. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Financial Indebtedness" and before the definition of "3GPP": "FIRST FACILITY AGREEMENT AMENDMENT AGREEMENT" means the first amendment agreement relating to the Facility Agreement between the Borrower and the Banks, dated 28 October 2002." 10. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "ITU" and before the definition of "Lead Arrangers": "LAC" has the meaning set out in Schedule 19 (Additional Coverage Requirements)." 11. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Licence" and before the definition of "LMA": "LICENCE PLEDGE AGREEMENT" means the licence pledge agreement dated 28 June 2002 between the Borrower and the Senior Creditors." 12. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Repeated Representations" and before the definition of "Rollover SIT Facility Loan": "2002 REVISED BUSINESS PLAN" means a revised version of the Initial Business Plan accommodating the changed technical, economic and tax assumptions, agreed between the Parties and referred to as the excel spreadsheet named "Vega Base Case 0826.xls."." - 7 - 13. Sub-clause (d) of the definition of "Security Documents" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such sub-clause in its entirety and replacing it with the following definition: "(d) the Sponsors' Cash Collateral Account Pledge Agreement and the Sponsors' Cash Collateral Account #2 Pledge Agreement;" 14. Sub-clause (h) of the definition of "Security Documents" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such sub-clause in its entirety and replacing it with the following definition: "(h) the Asset and Licence Pledge and Lease Contracts Assignment Agreement and the Licence Pledge Agreement;" 15. Sub-clause (b) of the definition of "SMOM" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such sub-clause in its entirety and replacing it with the following definition: "(b) (if no SMOM Screen Rate is available for the Interest Period of that SIT Facility Loan) the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the On Shore Facility Agent at its request quoted by the SMOM Reference Banks to leading banks in the Slovenian Interbank Market, as of 11.00 a.m. (Ljubljana time) on the Quotation Day for the offering of deposits in SIT for a period comparable to the Interest Period of the relevant SIT Facility Loan." 16. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of "Sponsors' Cash Collateral Account" and before the definition of "Sponsors' Cash Collateral Account Pledge Agreement": "SPONSORS' CASH COLLATERAL ACCOUNT #2" has the meaning given to it in the Sponsors' and Shareholders' Undertaking and Completion Guarantee." 17. Clause 1.1 (Definitions) of the Original Facility Agreement is amended by including the following words after the definition of " Sponsors' Cash Collateral Account Pledge Agreement" and before the definition of "Sponsors Unsecured Loan Agreement": "SPONSORS' CASH COLLATERAL ACCOUNT #2 PLEDGE AGREEMENT" means the cash collateral account pledge agreement to be entered into between Western Wireless International Corporation and the Off Shore Security Agent acting on behalf of the Senior Creditors." 18. The definition of "Subordinated Loan" in Clause 1.1 (Definitions) of the Original Facility Agreement is amended by deleting such definition in its entirety and replacing it with the following definition: "SUBORDINATED LOAN" means a subordinated loan (other than a Sponsors Unsecured Loan) made to the Borrower in accordance with the Sponsors' and Shareholders' Undertaking and Completion Guarantee or amounts owing to the Sponsors that are to be treated as subordinated loans as expressly provided in this Agreement." - 8 - 19. Clause 4.2.1(a)(v) (Further conditions precedent to all Utilisations) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(v) in respect of the SIT Facility, evidence that at least 50% of the Total ECA Facility Commitments and Total Commercial Facility Commitments have been utilised;" 20. Clause 5.1.1 (Delivery of Utilisation Request) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "5.1.1 The Borrower may utilise a Facility if the Off Shore Facility Agent with regard to any Utilisation of the Euro Facility and the On Shore Facility Agent with regard to a Utilisation of the SIT Facility receives a duly completed Utilisation Request (together with all related documentation): (a) with regard to a Utilisation of a Euro Facility Loan, no later than 11.00 a.m. (Dusseldorf time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date; (b) with regard to a Utilisation of a SIT Facility Loan in an amount exceeding SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date; (c) with regard to a Utilisation of a SIT Facility Loan in an amount of up to SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time) two (2) Business Day prior to the proposed Utilisation Date; and (d) with regard to a SIT Facility Guarantee or LC, no later than 11:00 a.m. (Ljubljana time) five (5) Business Days (or in the case of the first Utilisation of the Facilities, three (3) Business Days) prior to the proposed Utilisation Date, PROVIDED THAT if the Borrower fails to issue a Utilisation Request in respect of a Rollover SIT Facility Loan such request shall, subject to compliance with Clause 4.2.2(a) (Further conditions precedent to all Utilisations) and any repayments necessary to comply with Clause 4.2.2(b) (Further conditions precedent to all Utilisations), be deemed to have been given by the Borrower to the On Shore Facility Agent." 21. Clause 5.2(a)(i)(1) (Completion of a Utilisation Request) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(1) in the case of a requested Loan in respect of ECA Facility Tranche 1, is in the form set out in Schedule 4B (Utilisation Request (Payments to Equipment - 9 - Vendor)), duly completed and executed by the Equipment Vendor and is accompanied by the following documents that in the reasonable opinion of the Off Shore Facility Agent are in accordance with the "Uniform Rules for Collection, 1995 Revision, ICC Publication no. 522" (i) an original invoice to the Borrower from the Equipment Vendor; and (ii) in respect of a Utilisation Request completed with reference to Clause 1.10.2(b)(iii) (Invoices and Terms of Payment) of the Delivery Contract a copy of a certificate executed by the Borrower and referring to the final acceptance of the Initial Configuration;" 22. Clause 9.1(b) (Calculation of floating rate interest under the ECA Facility) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(b) a margin (the "ECA FACILITY APPLICABLE MARGIN") in an amount of, initially, 1.25% per annum and thereafter the rate per annum set out in the column headed "Margin (% p.a.)" opposite the relevant Population Coverage (set out in the same line in the column headed "Population Coverage") and subject to the achievement of the relevant financial performance tests (set out in the same line in the column headed "Financial Performance") in the table below, in each case as at the end of the most recently ended Quarter:

POPULATION COVERAGE FINANCIAL PERFORMANCE MARGIN (% P.A.) ------------------- --------------------- --------------- 75% EBITDA for the immediately preceding two (2) 1.10 Quarters does not negatively deviate from the EBITDA in the 2002 Revised Business Plan. 80% EBITDA for the immediately preceding two (2) 1.00 Quarters is positive. 84% Total Leverage Ratio greater than 6.00 but 0.90 less than 11.00. 84% Total Leverage Ratio less than or equal to 0.80 6.00 and greater than 5.00. 84% Total Leverage Ratio less than or equal to 0.70 5.00 and greater than 4.00. 84% Total Leverage Ratio less than or equal to 0.60 4.00 and greater than 3.00. 84% Total Leverage Ratio less than or equal to 0.50 3.00 and greater than 2.00. 84% Total Leverage Ratio less than or equal to 0.40 2.00.

PROVIDED THAT: (i) any change to the ECA Facility Applicable Margin shall take place from the immediately following Euro Facility Interest Payment Date (the "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT DATE") (subject to Clause 9.1(b)(iii)) if: (1) the Borrower has requested a reduction in the Applicable Margin in the Covenant Compliance Certificate at least 15 Business Days prior to such Euro Facility Interest Payment Date or the Off Shore Facility Agent has notified the Borrower, based on the information referred to in (2) below, that there will be an increase in the Applicable Margin in accordance with the above provisions of this paragraph (b); (2) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to financial performance of the Borrower on the basis of the most recent information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate); (3) no Event of Default or Potential Event of Default is continuing; and (4) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to Population Coverage (on receipt of confirmation of such Population Coverage from the Independent Technical Consultant) or such confirmation has not been received by the date upon which the Borrower would be entitled to a change in the ECA Facility Applicable Margin (had such confirmation been received); (ii) if the Off Shore Facility Agent has not received the information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate) in respect of the relevant period by its due date for delivery pursuant to this Agreement, the Applicable Margin will be 1.25% per annum from that date until such time as the Borrower satisfies the conditions set out in this paragraph (b) and is in compliance with its obligations under Clause 21 (Reporting requirements); (iii) if after an ECA Facility Applicable Margin Adjustment Date the Independent Technical Consultant is of the opinion that the above conditions relating to Population Coverage have not been satisfied but the ECA Facility Applicable Margin has been changed by the Off Shore Facility Agent the ECA Facility Applicable Margin shall be readjusted to the applicable level in accordance with the above provisions of this paragraph (b) for the entire Interest Period from such ECA Facility Applicable Margin Adjustment Date." 23. Clause 9.2(b) (Calculation of floating rate interest under the Commercial Facility) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(b) a margin (the "COMMERCIAL FACILITY APPLICABLE MARGIN") in an amount of, initially, 3.25% per annum and thereafter the rate per annum set out in the column headed "Margin (% p.a.)" opposite the relevant Population Coverage (set out in the same line in the column headed "Population Coverage") and subject to the achievement of the relevant financial performance tests (set out in the same line in the column headed "Financial Performance") in the table below, in each case as at the end of the most recently ended Quarter:

POPULATION COVERAGE FINANCIAL PERFORMANCE MARGIN (% P.A.) ------------------- --------------------- --------------- 75% EBITDA for the immediately preceding two (2) 2.50 Quarters does not negatively deviate from the EBITDA in the 2002 Revised Business Plan. 80% EBITDA for the immediately preceding two (2) 2.25 Quarters is positive. 84% Total Leverage Ratio greater than 6.00 but 2.25 less than 11.00. 84% Total Leverage Ratio less than or equal to 2.00 6.00 and greater than 5.00. 84% Total Leverage Ratio less than or equal to 1.50 5.00 and greater than 4.00. 84% Total Leverage Ratio less than or equal to 1.25 4.00 and greater than 3.00. 84% Total Leverage Ratio less than or equal to 1.00 3.00 and greater than 2.00. 84% Total Leverage Ratio less than or equal to 0.75 2.00.

PROVIDED THAT: (i) any change to the Commercial Facility Applicable Margin shall take place from the immediately following Euro Facility Interest Payment Date (the "COMMERCIAL FACILITY APPLICABLE MARGIN ADJUSTMENT DATE") (subject to Clause 9.2(b)(iii)) if: (1) the Borrower has requested a reduction in the Applicable Margin in the Covenant Compliance Certificate at least 15 Business Days prior to such Euro Facility Interest Payment Date or the Off Shore Facility Agent has notified the Borrower, based on the information referred to in (2) below, that there will be an increase in the Applicable Margin in accordance with the above provisions of this paragraph (b); (2) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to financial performance of the Borrower on the basis of the most recent information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate); (3) no Event of Default or Potential Event of Default is continuing; and (4) the Off Shore Facility Agent has confirmed the satisfaction of the above conditions relating to Population Coverage (on receipt of confirmation of such Population Coverage from the Independent Technical Consultant) or such confirmation has not been received by the date upon which the Borrower would be entitled to a change in the Commercial Facility Applicable Margin (had such confirmation been received); (ii) if the Off Shore Facility Agent has not received the information required to be provided by the Borrower pursuant to Clauses 21.1(a) and (c) (Financial statements and other information) and Clause 21.3 (Covenant Compliance Certificate) in respect of the relevant period by its due date for delivery pursuant to this Agreement, the Applicable Margin will be 3.25% per annum from that date until such time as the Borrower satisfies the conditions set out in this paragraph (b) and is in compliance with its obligations under Clause 21 (Reporting requirements); (iii) if after a Commercial Facility Applicable Margin Adjustment Date the Independent Technical Consultant is of the opinion that the above conditions relating to Population Coverage have not been satisfied but the Commercial Facility Applicable Margin has been changed by the Off Shore Facility Agent, the Commercial Facility Applicable Margin shall be readjusted to the applicable level in accordance with the above provisions of this paragraph (b) for the entire Interest Period from such Commercial Facility Applicable Margin Adjustment Date." 24. Clause 12 (Fees) of the Original Facility Agreement is amended by including the following clause after clause 12.6 (Proceeds and Revenue Account #2) of the Original Facility Agreement: "12.7 OFF SHORE FACILITY AGENT FEE The Borrower shall pay to the Offshore Facility Agent for its services an annual fee as set out in a Fee Letter." 25. Clause 21 (Reporting Requirements) of the Original Facility Agreement is amended by including the following clause after Clause 21.6 (Business Plan Review) of the Original Facility Agreement: "21.7 BUILDING PERMIT REPORTS 21.7.1 All outstanding building permits are obtained within a period of 9 Months commencing on the date of the Facility Agreement; and 21.7.2 The Borrower shall provide to the Off Shore Facility Agent within 10 Business Days of the last day of each Month from the date of the First Facility Agreement Amendment Agreement until the date on which all building permits are obtained, a report indicating: (a) the number of sites for which building permits have been achieved; (b) the number of sites for which building permits remain outstanding; and (c) an explanation as to the status of applications for all outstanding permits including details of any problems encountered in relation to the obtaining of those permits and the steps taken by the Borrower to remedy such problems." 26. Clause 22.2 (Stage I covenants) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** 27. Clause 22.3(c) (Interest Coverage Ratio) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: (B) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** 28. Clause 22.3(d) (Debt Service Cover Ratio) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: (C) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** 29. Clause 22.3(e) (Population Coverage) of the Original Facility Agreement is deleted in its entirety. 30. Clause 22.4 (Confirmation by Independent Technical Consultant) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "22.4 CONFIRMATION BY INDEPENDENT TECHNICAL CONSULTANT The figures in Clauses 22.2(a) and (b) (Stage I covenants) shall be confirmed by the Independent Technical Consultant annually commencing on 31 December 2002 and ending on 31 December 2004. The accomplishment of the covenants set out in Clause 22.2(e)(i) and 22.2(e)(ii) (Stage I covenants) shall be confirmed by the Independent Technical Consultant within 15 Business Days after their respective due date." 31. Clause 23.3(c) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(c) any Proceeds and Revenues that constitute Contributed Capital or Sponsors Unsecured Loans or the proceeds of any Loans payable to the Borrower under the Euro Facility shall be paid into the Loan Proceeds Account and applied in accordance with Clause 23.8 (Loan Proceeds Account) PROVIDED THAT in respect of any amounts contributed as Contributed Capital to permit the Borrower to make contributions to the UMTS Subsidiary in accordance with Clause 24.33(b)(ii) (UMTS and other licenses), the Borrower may transfer, after compliance with the provisions of Clause 24.33(b)(iii) (UMTS and other licenses), such amounts to the UMTS Subsidiary; and" 32. Clause 23.3(d)(ii) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(ii) second, in or towards payment of all due and payable operating costs as shown in the 2002 Revised Business Plan (including amounts in respect of direct costs payable under the Management Agreement which are provided for in the Initial Business Plan but excluding any amounts payable under the Lucent Loan Agreement);" 33. Clause 23.3(d)(iii) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(iii) third, in or towards payment of all due and payable on-going capital costs in relation to the build-out of the Network as shown in the 2002 Revised Business Plan and necessary to perform its business but excluding any amounts payable under the Lucent Loan Agreement;" 34. Clause 23.3(d)(vii) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(vii) seventh, in or towards payment of capital costs in the amounts and at the times set out in the Business Plan (other than the Initial Business Plan and/or the 2002 Revised Business Plan) and subject to Clause 23.3(e)(ii) amounts in respect of any margin payable under the Management Agreement in an amount not exceeding (A) US Dollars 700,000 or its equivalent in the financial year ending 31 December 2002 and (B) in each financial year thereafter the lesser of (Y) 50% of any direct costs payable under the Management Agreement and (Z) US Dollars 700,000 or its equivalent;" 35. Clause 23.3(d)(x) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(x) tenth, in or towards any payment due and payable to the Shareholders (including any interest payable on any Subordinated Loans or other amounts payable under the Management Agreement that have not been paid pursuant to Clauses 0 or (vii) or any prepayment pursuant to the Sponsor Subordinated Loan Agreement #2) in an amount not to exceed 50% of the Excess Cash Flow." 36. Clause 23.3(e) (Application of money on the Proceeds and Revenue Accounts) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(e) The Borrower shall only be entitled to make the payments referred to in this Clause 23.3 out of the Proceeds and Revenue Accounts on the following basis: (i) subject to Clause 23.3(e)(ii), amounts payable pursuant to paragraphs (d)(i) to (vii) above inclusive shall be paid when due; (ii) in respect of the fees payable under the Management Agreement under Clause 23.3(d)(vii): (1) from the date of the First Facility Agreement Amendment Agreement until 1 January 2005 such fees (the "SUBORDINATED MANAGEMENT FEES") may only be paid, subject to Clause 23.3(e)(iii), in accordance with paragraph (x) above and the obligations of the Borrower to pay the Subordinated Management Fees outstanding between the date of the First Facility Agreement Amendment Agreement and 1 January 2005 shall be converted into and treated as Subordinated Loans; (2) after 1 January 2005 all such fees shall be paid in accordance with Clause 23.3(d)(vii); (iii) amounts payable pursuant to paragraph (d)(x) above shall only be paid on satisfaction of the conditions set out in paragraph (f) below." 37. Clause 23.5.3 (Sale Proceeds Account) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "23.5.3 Any amounts standing to the credit of the Sale Proceeds Account that are not used in accordance with Clause 23.5.2 (Sale Proceeds Account) shall be applied in prepayment in accordance with Clause 14.5.1(a) (Mandatory prepayments)." 38. Clause 23.6.2(b) (Debt Service Account) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(b) from the date falling six (6) Months prior to the first Repayment Date, one sixth of the Debt Service Payments (other than in respect of the SIT Facility and other than in respect of interest and amounts payable under the Hedging Agreements prior to their termination) due and payable on the next repayment date under the Euro Facility, the Sponsors Unsecured Loan Agreement and under the Lucent Loan Agreement; and" 39. Clause 23.6.2 (Debt Service Account) of the Original Facility Agreement is amended by including the following Clause 21.6.2(c) after Clause 21.6.2(b) (Debt Service Account) of the Original Facility Agreement: "(c) in respect of the Commitment Fees payable under Clause 12.1 (Commitment fees), one third of the amount due and payable on the next date for payment thereof." 40. Clause 24.37 (Licence Assignment Agreement) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "24.37 LICENCE PLEDGE AGREEMENT The Borrower will in accordance with instructions reasonably given by the Off Shore Facility Agent use reasonable efforts to seek the consent of the Government to the pledge of the rights of the Borrower under the Licence pursuant to the Licence Pledge Agreement." 41. Clause 24 (General Undertakings) of the Original Facility Agreement is amended by including the following Clause 24.39 after Clause 24.38 (Bills of Exchange and Security Deposits) of the Original Facility Agreement: (D) "24.39 ROAMING**CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT** 42. Clause 25.1.2 (Financial covenants and network milestones) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "25.1.2 FINANCIAL COVENANTS AND NETWORK MILESTONES (a) At any time any of the requirements of Clause 22 (Financial covenants and network milestones) is not satisfied. (b) No Event of Default under paragraph (a) above will occur if failure to satisfy such requirement, if capable of remedy, is remedied within 30 Business Days (or, if and to the extent that any greater grace period applies under clause 2.3 (Failure of Milestone completion) of the Sponsors' and Shareholders' Undertaking and Completion Guarantee, within such grace period), PROVIDED THAT in the event that any of the requirements of Clause 22 (Financial covenants and network milestones) (other than Clauses 22.2(a) and (b)) is not satisfied, then within five (5) Business Days of delivery of the Covenant Compliance Certificate, the Shareholders may, in addition to the Sponsors' rights and obligations under the Sponsors' and Shareholders' Undertaking and Completion Guarantee, cure such failure to satisfy any such requirement by making Subordinated Loans and/or Equity Contributions to the Borrower which Subordinated Loans and/or Equity Contributions shall be treated as (i) having been contributed on the last day of the relevant Quarter and (ii) additional capital or revenues of the Borrower." 43. Clause 27.13(d) (Credit appraisal by the Banks) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(d) the adequacy, accuracy and/or completeness of the Initial Business Plan, the 2002 Revised Business Plan, the Information Memorandum, Legal Due Diligence Report and any other information provided by an Agent, any Finance Party or by any other person under or in connection with any Transaction Document, the transactions contemplated by the Transaction Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Transaction Document." 44. Clause 27.13(d) (Credit appraisal by the Banks) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "7. Set Off A Finance Party may set off any matured obligation due from the Borrower under the Finance Documents (to the extent beneficially owned by that Finance Party) against any matured obligation owed by that Finance Party to the Borrower, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Finance Party may for the purpose of the set off convert either obligation at a market rate of exchange in its usual course of business or, in the case of a SIT Facility Bank, at the relevant exchange rate from the list of Nova Ljubljanska banka d.d., Ljubljana for the foreign exchange transactions with legal entities (Tecajna lista Nove Ljubljanske banka d.d., Ljubljana, za obracun deviznih prilivov in odlivov podjetij) or any other applicable document of Nova Ljubljanska banka d.d., Ljubljana with essentially similar substance." 45. Clause 2 (Utilisation of a Loan) of Schedule 4A (Utilisation Request (Borrower)) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "2. Utilisation of a Loan We wish to borrow a Loan on the following terms:

Proposed Utilisation Date: [-] (or, if that is not a Business Day, the next Business Day) Facility to be utilised: [Commercial Facility]/ [SIT Facility] Currency of Loan: [Euro]/[SIT] Amount: [-] or, if less, the Available Facility Interest Period: [-] (subject to Clause 10 of the Agreement) Account to which proceeds are payable: Proceeds and Revenue Account [account number] [for further transfer in respect of Euro Facility Loans to the Loan Proceeds Account]"

46. Clause 4 of Schedule 4A (Utilisation Request (Borrower)) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "4. We confirm that the [proceeds of the Loan]/[guarantee]/[letter of credit] [are]/[is] to be used [in payment of capital expenditure as provided for in the [Business Plan]]/[in payment of operational expenditure as provided for in the [Business Plan]]/[towards repayment of amounts owing under the Existing WWIC Loan Agreement]/[other]." 47. Clause 6 of Schedule 4B (Utilisation Request (Payments to Equipment Vendor)) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "6. We attach a copy of a certificate executed by the Borrower and referring to the final acceptance of the delivered systems (from the Initial Configuration).***" 48. Schedule 9 (Security Documents - Conditions Precedent and Conditions Subsequent) of the Original Facility Agreement is amended by deleting such schedule in its entirety and replacing it with the following: *** Only in respect of a Utilisation Request completed with reference to Section 1.10.2 (b) (iii) of the Delivery Contract. "SCHEDULE 9 SECURITY DOCUMENTS - CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT GENERAL

STEPS FOR PERFECTION CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- -------------------- - - Translation of Facility Agreement into the Slovenian language - - Summary and Translation of Hedging Agreement into the Slovenian language - - Certified copies of the extract of commercial register for Borrower, Shareholders, Senior Creditors - - Legal opinion of Selih that all security - Once perfected an additional legal opinion of documents have been duly executed and are legal, Selih that the security documents create the valid and binding obligations security which they purport to create - - Power of Attorney (for signing of all on shore securities agreements) of Senior Creditors authorising representative of the Off Shore Facility Agent to sign all on shore security documents plus complete all formalities necessary for the perfection of the pledge where applicable - - Only for the Asset and Licence Pledge and Lease Contracts Assignment Agreement, Trade Mark Pledge Agreement and Share Pledge Agreement: Power of Attorney in the English language signed by each Senior Creditor, with a notarial confirmation of the authorisation of the person who signs on behalf of each Senior Creditor to sign on behalf of the particular Senior Creditor (Vertretungsbestatigung) and confirmation of its signature (Unterschriftenbeglaubigung) and apostilled, authorising Nina Selih/Rudi Selih to enter into notarial deeds in relation to all relevant security documents - - Such other requirements as may be reasonably required to complete, register and perfect the Security Documents

ON SHORE DOCUMENTS

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- ASSET AND LICENCE Pledged - Execution of Asset Pledge, PLEDGE AND LEASE Equipment Licence Transfer, Licence CONTRACTS Pledge and Lease Contracts ASSIGNMENT Assignment Agreement AGREEMENT - Execution of notarial deed in respect of Pledged Equipment - Provide Schedule 1, 2 & 3 to - Competent court officer must the Asset and Licence Pledge take record of the pledged and Lease Contracts assets, make lists of pledged Assignment Agreement - assets per site and mark the provide missing addresses of pledged assets by putting sites and relevant court stickers on them (Court officer districts, as well as modify when visiting sites to be designation (description) of accompanied by WWI technical certain items (confirmed by staff) Borrower shall have Sami Ali and N. Selih) achieved 50% after 6 months following the date of signing of the Facility Agreement - Within 9 months of signing of the Facility Agreement, On Shore Security Agent to check conformity of Schedule 1 with the lists issued by the court; Nina Selih to give notice of receipt of the list - Application by Selih for registration of the Asset Pledge in respect of the Pledged Equipment with the competent court (depending on where each asset is located) - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement - Copies of the building permits for sites on which Pledged Equipment is situated Pledged - 1 month after first drawdown, Equipment II under the Commercial Facility, and confirm to On Shore Security Substitution Agent that title in respect of Equipment Pledged Equipment II has passed - During the first 9 Months after the date of signing of the Facility Agreement provide to the On Shore Security Agent 10 Business days after the end of each Month a list with those of the 41 sites for which a building permit has been issued.

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - Within 10 months after the date of signing of the Facility Agreement execution of notarial deed in respect of Pledged Equipment II and any Substitution Equipment, if applicable - Within 10 months after the signing of the Facility Agreement filing of application of Pledged Equipment II and any Substitution Equipment, if applicable - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) - Within 14 months of signing of Facility Agreement, competent court officer must take record of the Pledged Equipment II, make a list of pledged assets per site and mark the pledged assets by putting stickers on them - Within 14 months of signing of the Facility Agreement, On Shore Security Agent to check conformity of Schedule 2 with the lists issued by the court; Nina Selih to give notice of receipt of the list Licence - Copy of concession - Within 5 business days of issue of licence, inform On Shore and Off Shore Security Agent and send copy - Copy of application / bid - Within 2 month after issue of licence enter into the contractual pledge (as attached as a Schedule to Asset Pledge) - Certificate that as of the - Borrower to sign Power of date of signing of the Attorney as set out in Facility Agreement no Schedule 10 (once licence change/amendment of/to the granted) Concession Agreement has been made Leases - Evidence of filing of the - Borrower to provide originals applications for the of consent letter from registration of the 40 lease Landlords I, II and site agreements (except for Substitution Landlords the 13 leases entered with confirming the consent to the Elektro Slovenia and its conditional assignment within affiliates and RTV and its 9 Months from the date of affiliates) with the signing of the Facility competent courts in Agreement: accordance with Clauses 11.4(f) and 12.4(b) of the Asset and Licence Pledge and Lease Contracts Assignment; Agreement - Copies of Leases I and II and Substitution Lease (as applicable)

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - File for registration of Substitution Leases (applicable only in case of substitution pledge) and, where applicable, provide the consent of the relevant Substitution Landlords to the Substitution Assignment within 10 Months from the date of signing of the Facility Agreement - Inform the On Shore Security Agent immediately of rejection of filed applications for registration of the relevant leases in respect of the 40 site leases (except for the 13 site leases entered with Elektro Slovenia and its affiliates and RTV and its affiliates) (eg where building permit missing) after becoming aware of such rejection and of refilling of the application - Within 20 Months from the date of signing of the Facility Agreement, register the relevant leases in respect of the 40 site leases (with the exception of the 13 site leases entered with Elektro Slovenia and its affiliates and RTV and its affiliates) with the Land Registers BORROWER'S SHARE Shares - Execution of agreement - Within 2 Months from the date PLEDGE AGREEMENT of the signing of the Facility Agreement to register the share pledge with the Register of Commercial Companies (there must be an obligation for the Borrower in the Facility Agreement to provide evidence for such registration) - Execution of notarial deed in - Provide evidence of respect of pledged equipment registration within 9 Months from the date of signing of the Facility Agreement - Submission to the competent court in Ljubljana of the application for the registration of the share pledge with the Register of Commercial Companies - Pay notary fees and application fees for registration of the pledge, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) and the escrow agreement relating to the holding of such envelope TRADEMARK PLEDGE Trademarks - Execution of agreement - Within 9 months from signing of AGREEMENT the Facility Agreement provide evidence of registration of the TM Pledge by the Patent Office

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- - Withdraw 2 outstanding applications for registration of the trademarks "EHO" and "VIVA" and provide to the On Shore Security Agent evidence of such withdrawal at the latest 10 Business Days before it makes the first Utilisation Request under the Facility Agreement - Borrower's consent to registration of the pledge (Schedule 5) - Submission to the Patent Office of application to register the TM Pledge - Pay notary fees and application fees for registration, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) SOFTWARE LICENSE Oracle Software - Execution of agreement ASSIGNMENT License AGREEMENT Agreement - Schedule 2 - Copy of Deed of Consent and Waiver - Schedule 1 (Oracle License Agreement) ASSIGNMENT OF Receivables - Signing of agreement RECEIVABLES AS SECURITY AND ASSIGNMENT OF INSURANCE POLICIES AGREEMENT - Borrower to provide Schedule 1 complete information - Sealed Envelope (containing details of all subscribers (natural persons) must be submitted to the notary, identified in the Assignment of Receivables as Security and Assignment of Insurance Policies Agreement Insurance - Copies of the insurance policies as required under the Facility Agreement - Original vinculation certificates - Borrower to provide Schedule 2 (list of insurances, amounts, claims)

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- CLAIMS ASSIGNMENT Claims - Signing of agreement AND BILLS OF EXCHANGE AGREEMENT - Notarised copies of account agreements (NLB + Hypo Alpe-Adria Bank) must be submitted to the Off Shore Facility Agent - Acknowledgement by NLB and Hypo Alpe-Adria Bank - Schedule 1 (account details) Bills of - Provide set of 10 bills of Exchange exchange duly signed and filled in only with the date of issuance (Schedule 5) - Confirmation by holders of bills of exchange that they will inform NLB at the latest 5 Business Days before presenting any bills of exchange to NLB

OFF SHORE SECURITY DOCUMENTS

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- INTERCREDITOR - Execution of the agreement AGREEMENT DELIVERY CONTRACT - Execution of the agreement CLAIMS AND ASSIGNMENT - Execution and provision of AGREEMENT the Security Interest Provision Permission Agreement SECURITY - Execution of the agreement ASSIGNMENT OF (in the form of a deed) and RIGHTS UNDER A evidence thereof SUPPLY AND LICENSE AGREEMENT - Execution of the Deed of Consent and Waiver and evidence thereof - Give notice of assignment to Protek Flagship (UK) Ltd SPONSOR CASH Cash Collateral - Execution of the pledge COLLATERAL ACCOUNT Account agreement PLEDGE AGREEMENT - Acknowledgement by the Account Bank (IKB International S.A.) - Required cash collateral to be paid into the account DEBT SERVICE Debt Service - Execution of the pledge - 5 business days after first RESERVE ACCOUNT Reserve Account agreement utilisation to be funded with PLEDGE AGREEMENT the DSRA-Required Balance - Acknowledgement by the Account Bank (IKB International S.A.) PLEDGE AGREEMENT Shares - Execution of the pledge (NY) agreement; - Delivery of all original certificated shares to the Secured Party; - Delivery of a stock power endorsed in blank to the Secured Party; and - The filing of a UCC-1 Financing Statement

SUBSTITUTION CONDITIONS SUBSEQUENT FOR ON SHORE SECURITY DOCUMENTS In case under Slovenian law moveable assets may validly be pledged by registering the respective assets with an official register the following conditions subsequent shall, at the request of the Off Shore Security Agent, replace the conditions subsequent for the secured Assets "Pledged Equipment II and Substitution Equipment" under the Asset and Licence Pledge and Lease Contracts Assignment Agreement set out above in the table "On Shore Security Documents" in the column "Conditions Subsequent" and for such purpose the Borrower shall enter into all necessary documentation to give effect hereto.

DOCUMENT SECURED ASSETS STEPS FOR PERFECTION -------- -------------- --------------------------------------------------------------------------------- CONDITION PRECEDENT TO DRAWDOWN CONDITION SUBSEQUENT ------------------------------- ---------------------------------------- ASSET AND Pledged Equipment - 1 month after first drawdown, LICENCE PLEDGE II and under the Commercial Facility, AND LEASE Substitution confirm to On Shore Security CONTRACTS Equipment Agent that title in respect of ASSIGNMENT Pledged Equipment II has passed AGREEMENT - During the first 9 Months after the date of signing of the Facility Agreement provide to the On Shore Security Agent 10 Business days after the end of each Month a list with those of the 41 sites for which a building permit has been issued. - Within 10 months after the date of signing of the Facility Agreement execution of notarial deed in respect of Pledged Equipment II and any Substitution Equipment, if applicable - Within 7 months after establishment of the Slovenian Official Register of the Pledged Moveables and Pledges (Uradni Registar Zarubljenih Premicnin in Zastavnih Pravic) filing of application for registration of Pledged Equipment II and any Substitution Equipment, if applicable and provision of evidence of such filing to Nina Selih - Pay notary fees, Nina Selih to advise Steven Fast of bank account for fee to be paid into, Steven Fast to provide proof of payment (e.g. bank statement) "

49. Clauses 4 to 6 of Schedule 10 (Form of Transfer Certificates) of the Original Facility Agreement are amended by deleting such clauses in its entirety and replacing it with the following: "4. This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate. 5. The Existing Bank hereby transfers in favour of the New Bank [all] [%] of its interest in the amount of Euro [-] in the following Security Documents: [NOTE: INSERT DESCRIPTION OF ALL RELEVANT SECURITY DOCUMENTS] 6. Save for the provisions of paragraph 5 above (which shall be governed by and construed in accordance with Slovenian law), this Transfer Certificate and the rights and obligations of the parties hereunder shall be governed by and construed in accordance with German law." 50. Schedule 11 (Security Documents - Conditions Precedent and Conditions Subsequent) of the Original Facility Agreement is amended by deleting such schedule in its entirety and replacing it with the following: "SCHEDULE 11 INSURANCE The Borrower shall comply with the insurance policies in force at the date of this Agreement and shall enter into, perform and execute the requirements of an insurance schedule to be agreed between the Borrower and the Off Shore Facility Agent (each acting in good faith) by 30 November 2002, such schedule shall replace this Schedule 11." 51. Clause 2 of the letter of Schedule 12 (Confirmation from the Equipment Vendor) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "2. We hereby confirm that the Delivery Contract was concluded on [-] and amended on [-] and has come into force on [-] and is still in full force and effect, that all permissions necessary have been granted and that we have received a down payment in relation to 15 % of the Estimated Contract Value in an amount of Euro 9,138,427 which is evidenced by the enclosed bank receipts." 52. Clause 2.(f) of the letter of Schedule 14 (Covenant Compliance Certificate) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(f) EBITDA was [-] and the variance from the 2002 Revised Business Plan of [-] was [-];" 53. Clause 2.(2) of the letter of Schedule 15 (Project Status and Progress Report) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(2) a detailed and full description of the status of the installation of the Network in comparison to the most recent Business Plan (including information in respect of the two LACs in Ljubljana and one LAC in Maribor that are required by Clause 22.2(e) (Stage I covenants) to become Closed LACs and information on the road coverage of the highways as more particularly described in Schedule 19 of the Agreement) and the status of all national roaming agreements;" 54. Clause 2.(10) of the letter of Schedule 15 (Project Status and Progress Report) of the Original Facility Agreement is amended by deleting such clause in its entirety and replacing it with the following: "(10) an update of the sales and marketing strategy report comprised in the 2002 Revised Business Plan and covering subscriber acquisition cost, marketing cost and handset and other subsidies; and" 55. The Original Facility Agreement is amended by including the following Schedule 19 (Additional Coverage Requirement) including attachments and annex thereto after Schedule 18 (Initial Report of the Independent Technical Consultant) of the Original Facility Agreement: " SCHEDULE 19 ADDITIONAL COVERAGE REQUIREMENTS 1. DEFINITIONS "LAC" means a Location Area Code which is a fixed length code identifying a location area within Mobitel's(6) network, the geographical areas of each LAC within Slovenia are shown in Annex 1 (LAC codes in Slovenia )(7). "CONTIGUOUS ROAD COVERAGE" means coverage of the Slovenian roads (marked red in the map attached as Annex 2 (Slovenian roads coverage)), to the extent of at least 90% of the total length of such marked roads with the Borrower's own Network, unless otherwise indicated measured at a receive signal level of -100 dBm or better, excluding any coverage derived from roaming agreements. (6) Reference is made to the National Roaming Agreement, dated 9th November 2001, between the Borrower and Mobitel Telekomunikacijske storitve d.d.. (7) Annex 2 shall indicate the most up to date Mobitel coverage maps showing each LAC and corresponding code. "CLOSED LAC" means: (a) the coverage with the Borrower's own Network corresponding to the predicted coverage maps as shown in Annex 3 (LACs in Ljubljana) and 4 (LAC in Maribor), such prediction based on the base stations being "on air" as defined in Annex 5 (Base stations being "on air"); and (b) forbidding any of the Borrower's Subscribers from performing location updates on or handovers to any cells of BTS within the geographical areas of Mobitel's network corresponding to LAC codes 11, 14, 28 and 39 as shown in Annex 1 (LAC codes in Slovenia ). 2. LAC The Borrower shall ensure, by the dates set out in the Agreement, that the three LACs in Ljubljana and one LAC in Maribor, as indicated in Annex 3 (LACs in Ljubljana) and 4 (LAC in Maribor) respectively have become Closed LACs and shall provide evidence of the same to the satisfaction of the Independent Technical Consultant by the times provided for in the Agreement (together with such other information as the Off Shore Facility Agent and the Independent Technical Consultant may reasonably require). 3. CONTIGUOUS ROAD COVERAGE The Borrower shall provide to the Off Shore Facility Agent, at the times set forth in the Agreement, evidence of Contiguous Road Coverage in form and substance satisfactory to the Independent Technical Consultant. The Borrower shall perform drive tests using such tools as described in Schedule 17 (Population Coverage Verification) of the Facility Agreement to demonstrate that there is Contiguous Road Coverage (for the avoidance of doubt, measurements shall be valid only when the terminal is in dedicated mode). ANNEX 1 MAP OF LAC CODES IN SLOVENIA ANNEX 2 MAP OF SLOVENIAN ROADS COVERAGE ANNEX 3 MAP OF LACS IN LJUBLJANA ANNEX 4 MAP OF LAC IN MARIBOR ANNEX 5 MAP OF BASE STATIONS BEING "ON AIR" SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT THE BORROWER WESTERN WIRELESS INTERNATIONAL D.O.O. By: JULIEN COUSTAURY Name: Julien Coustaury Title: Director Address: Brnciceva ulica 49, 1231 Ljubljana, Slovenia Telephone: +386 1 5801 200 Fax: +386 1 5801 109 Attention of: Steven Fast LEAD ARRANGER, OFF SHORE SECURITY AGENT, OFF SHORE FACILITY AGENT AND ORIGINAL EURO FACILITY BANK IKB DEUTSCHE INDUSTRIEBANK AG By: JAN-HENRIK RUFER MANFRED ZIWEY ---------------- ------------- Name: Jan-Henrik Rufer Name: Manfred Ziwey Title: Assistant Director Title: Director Address: Wilhelm-Botzkes-Stra(beta)e 1, 40474 Dusseldorf, Germany Telephone: +49 211 8221 4887 or +49 211 8221 4730 Fax: +49 211 8221 2887 or +49 211 8221 2730 Attention of: Martina Messing or Andreas Nestel LEAD ARRANGER AND ORIGINAL EURO FACILITY BANK KREDITANSTALT FUR WIEDERAUFBAU By: MR. KASSEL MRS. SIMON ---------- ---------- Name: Mr. Kassel Name: Mrs. Simon Title: First Vice President Title: Senior Project Manager Address: Palmengartenstra(beta)e 5-9, 60325 Frankfurt am Main, Germany Telephone: +49 69 7431 3927 Fax: +49 69 7431 2258 Attention of: Reiner Prove SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT SENIOR CO-ARRANGER AND ORIGINAL EURO FACILITY BANK RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. By: DR. HELMUT SCHUTZENEDER DR. LAMBERT HOFBAUER ----------------------- -------------------- Name: Dr. Helmut Schutzeneder Name: Dr. Lambert Hofbauer Title: Member of the Board Title: Authorised Signatory Address: Raiffeisenplatz 1, 4021 Linz, Austria Telephone: +43 732 6596 3170 Fax: +43 732 6596 3131 Attention of: Dr. Lambert Hofbauer SENIOR CO-ARRANGER, ON SHORE SECURITY AGENT, ON SHORE FACILITY AGENT AND ORIGINAL SIT FACILITY BANK NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA By: TOMAZ JEZERC JOZE GASPER FILIPIC --------------- ----------------------- Name: Tomaz Jezerc Name: Joze Gasper Filipic Title: General Manager Title: Executive Director Address: Smartinska 130, SI - 1520 Ljubljana, Slovenia Telephone: +386 1 520 7273 Fax: +386 1 425 60 02 Attention of: Ms. Jasna Istenic or Mr. Bostjan Kovac CO-ARRANGER AND ORIGINAL EURO FACILITY BANK LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE By: GERHARD DITTMER HARALD PERSSON --------------- -------------- Name: Gerhard Dittmer Name: Harald Persson Title: Assistant Vice President Title: Vice President Address: Martensdamm 6, 24103 Kiel, Germany Telephone: +431 900 1572 Fax: +431 900 2744 Attention of: Klaus-Volker Lenk SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT CO-ARRANGER AND ORIGINAL EURO FACILITY BANK HYPO ALPE-ADRIA-BANK AG By: WALTER BLEYER ORTRUN SUPPANZ ------------- -------------- Name: Walter Bleyer Name: Ortrun Suppanz Title: Senior Vice President Title: Senior Lending Officer Address: Stock im Eisen-Platz 3, 1010 Wien, Austria Telephone: +43 1 512 8266 Fax: +43 1 512 8266 6990 Attention of: International Finance ORIGINAL SIT FACILITY BANK HYPO ALPE-ADRIA-BANK D.D. By: HARALD BRUNNER URBAN GOLOB -------------- ----------- Name: Harald Brunner Name: Urban Golob Title: Member of the Board Title: Prokurist, Corporate, Head of Division Address: Trg Osvobodilne fronte 12 PO Box 1601, SI - 1001 Ljubljana, Slovenia Telephone: +386 1 300 4400 Fax: +386 1 300 4401 Attention of: Mr. Harald Brunner SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT ACKNOWLEDGEMENT By signing hereunder, each Sponsor and Shareholder acknowledges and consents to the terms and conditions of this Agreement and of the amendments made to the Original Facility Agreement. Each Sponsor and Shareholder confirms that it is not aware of any circumstances which would prejudice the entry into, performance, validity and enforceability of this Agreement by any party hereto or of any transaction contemplated herein. Each Sponsor and Shareholder represents that no obligation of any Sponsor or Shareholder to any Senior Creditor under any Finance Document, in particular the Sponsor's and Shareholders' Undertaking and Completion Guarantee, is adversely affected by this Agreement, any amendment to the Original Facility Agreement or any transaction contemplated herein. THE SPONSORS WESTERN WIRELESS INTERNATIONAL CORPORATION By: SCOTT ALDERMAN Name: Scott Alderman Title: Vice President Address: 3650 131st Avenue, S.E., Suite 400, Bellevue, Washington 98006, USA Telephone: +1 425 586 8161 Fax: +1 425 586 8777 Attention of: Scott Alderman WESTERN WIRELESS INTERNATIONAL SLOVENIA CORPORATION By: SCOTT ALDERMAN Name: Scott Alderman Title: Vice President Address: 3650 131st Avenue, S.E., Suite 400, Bellevue, Washington 98006, USA Telephone: +1 425 586 8161 Fax: +1 425 586 8777 Attention of: Scott Alderman SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO THE FACILITY AGREEMENT WESTERN WIRELESS INTERNATIONAL SLOVENIA II CORPORATION By: SCOTT ALDERMAN Name: Scott Alderman Title: Vice President Address: 3650 131st Avenue, S.E., Suite 400, Bellevue, Washington 98006, USA Telephone: +1 425 586 8161 Fax: +1 425 586 8777 Attention of: Scott Alderman EX-21.1 8 v88021exv21w1.txt EXHIBIT 21.1 Exhibit 21.1 - Subsidiaries Subsidiary Jurisdiction of Incorporation/Organization - ---------- ----------------------------------------- Western Wireless Corporation Washington Western CLEC Corporation Delaware WWC CLEC Holding Corporation Delaware WWC Paging Corporation Washington WWC Systems Purchasing Corporation Delaware WWC License Holding LLC Delaware WWC License LLC Delaware WWC Texas RSA Holding Corporation Delaware WWC Texas RSA Limited Partnership Delaware WWC Holding Co., Inc. Delaware Western COG Corporation Delaware Cellular One L.L.C. Delaware Cellular One Group Delaware Western Wireless International Holding Corporation Delaware Western Wireless International Corporation Delaware Western Wireless International Ireland Corporation Delaware Western Wireless International Ghana Corporation Delaware Western Wireless International Haiti Corporation Delaware Western Wireless International Austria Corporation Delaware Western Wireless International Georgia Corporation Delaware Western Wireless International Iceland Corporation Delaware Western Wireless International SakSat Corporation Delaware Western Wireless International Bolivia Corporation Delaware Western Wireless International Bolivia II Corporation Delaware Western Wireless International Bolivia III Corporation Delaware Western Wireless International Ivory Coast Corporation Delaware Western Wireless International Ivory Coast II Corporation Delaware Western Wireless International Paraguay Corporation Delaware Western Wireless International Slovenia Corporation Delaware Western Wireless International Slovenia II Corporation Delaware Western Wireless International Croatia Corporation Delaware Western Wireless International Enterprises, Inc. Delaware Western Wireless International II Corporation Delaware CCIH, L.L.C. Delaware Meteor II Limited Ireland Meteor Mobile Holdings Limited Ireland Meteor Mobile Communications Ireland ACG Telesystems Ghana LLC Delaware Western Telesystems Ghana Limited Ghana Communications Cellulaire d'Haiti, S.A. Haiti EHG Einkaufs- und Handels GmbH Austria tele.ring Telekom Service GmbH & Co KEG Austria tele.ring Telekom Service GmbH Austria Ekom 3G GmbH Austria Telcell Wireless LLC Delaware Magticom GSM Georgia TAL hf Iceland Islandia ehf Iceland Lina Net Iceland SakSat, LLC Delaware SakSat-Georgia, Ltd. Georgia NuevaTel (PCS de Bolivia) S.A. Bolivia Cora de Comstar S.A. Republic of Cote d'Ivoire Western Wireless International d.o.o Slovenia VIP - Net GMS d.o.o Croatia EX-23.1 9 v88021exv23w1.txt EXHIBIT 23.1 Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTS We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-10421, No. 333-86437, No. 333-18137 and No. 333-28959) of Western Wireless Corporation of our report dated February 25, 2003 relating to the consolidated financial statements and financial statement schedules, which appears in this Form 10-K. PricewaterhouseCoopers LLP Seattle, Washington March 24, 2003 -----END PRIVACY-ENHANCED MESSAGE-----

EX-10.17

                                                                   Exhibit 10.17


January 3, 2003

Wayne Wisehart
2009 Viburnum Lane
Ashville, NC  28803

VIA FACSIMILE

Dear Wayne:

This letter (the "Letter Agreement") sets forth the terms of your employment
with Western Wireless Corporation ("WWC"), effective January 30, 2003.

1.    ROLE: Your title will be Executive Vice President and Chief Financial
      Officer. In that capacity you will report to the Chief Executive Officer
      of WWC (the "CEO").

2.    RESPONSIBILITIES: Your responsibilities will include supervision of all
      financial functions of WWC including accounting, tax, finance, treasury
      and investor relations together with such other duties as may be assigned
      to you by the CEO. You will work closely with the Vice Chairmen on certain
      financial issues. You will devote substantially all of your business time
      and attention to the obligations delineated in this Letter Agreement.

3.    CASH COMPENSATION: Your base compensation will be $240,000, payable in
      accordance with standard payroll practices of WWC. In addition, you will
      have an opportunity, as determined by WWC, to earn a performance bonus
      targeted at $120,000 per year, to be paid annually at year end. The bonus
      will be based on a formula based mutually developed objective and
      subjective criteria. It is understood that nothing contained herein will
      prevent WWC, in its sole and absolute discretion, from, at any time,
      increasing your compensation, either permanently or for a limited period,
      whether in base compensation, by bonus or otherwise, if WWC in its sole
      discretion, shall deem it advisable to do so in order to recognize and
      fairly compensate you for the value of your services to WWC; provided,
      however, that nothing contained in this paragraph three shall in any
      manner obligate WWC to make any such increase or provide any such
      additional compensation or benefits.

4.    STOCK OPTIONS: You will receive an option to purchase 75,000 shares of
      WWC's common stock at an exercise price per share as of the closing price
      of the stock as of the date of this offer or other mutually agreed upon
      date. Your options will have a 4-year vesting and shall contain Change of
      Control protection consistent with other officers of WWC. You will be
      eligible to continue, during the course of your employment, to participate
      in the option program at a level to be determined by the CEO and the
      Compensation Committee.

5.    RELOCATION: We will pay you a flat payment of $60,000, which is intended
      to cover your costs of relocation including moving your belongings,
      vehicles, the costs associated with buying and selling houses and any
      other costs associated with the move. This payment is intended to cover
      all costs of relocation except that it is understood that the company will
      separately reimburse you for the cost of travel to and from Seattle prior
      to your relocation, the cost of temporary housing in the Seattle area and
      the cost of house hunting trips for your family to come to the Seattle
      area.

6.    BENEFITS: You will also be eligible to participate in the WWC's Employee
      Benefit Programs upon eligibility, which includes a group health insurance
      program; life insurance and 401(k) plan with matching. You will be
      entitled to three weeks of vacation annually. We will waive the waiting
      period on the ESPP plan and will pay COBRA from your existing health care
      costs during the waiting period for our medical benefits.

Page 2

7.    EXPENSES: WWC will reimburse you for all reasonable out-of-pocket business
      expenses paid or incurred by you in connection with the performance of
      your duties, upon submission of signed, itemized lists of such expenses on
      general forms established for that purpose by WWC.

8.    INDEMNIFICATION: WWC will enter into an Indemnification Agreement with you
      pursuant to which WWC will agree to indemnify you against certain
      liabilities arising by reason of your affiliation with WWC.

9.    NON-DISCLOSURE: You agree not to disclose at any time, whether during the
      term of this Letter Agreement or thereafter, any secret or confidential
      information relating to WWC's or any of its subsidiaries' businesses,
      financial condition or prospects, which information you have obtained
      while employed by WWC or by any of its subsidiaries or any of the
      predecessors in interest of any of them, except (i) as may be required in
      furtherance of the businesses of WWC or of any of its subsidiaries, (ii)
      with WWC's express prior written consent, (iii) if such information is
      made generally available to the public through no fault of yours, or (iv)
      if such disclosure is required by applicable law or regulation or by legal
      process and then only with prompt written notice to WWC in advance of any
      such disclosure.

10.   NON-COMPETE: You agree that, during the term of your employment by WWC and
      for a period of one (1) year immediately following the termination of your
      employment with WWC for any reason whatsoever, you will not, either
      directly or indirectly, for compensation or any other consideration,
      individually or as an employee, broker, agent, consultant, lender,
      contractor, advisor, solicitor, stockholder (provided that ownership of 5%
      or less of the outstanding stock of any corporation listed on a national
      securities exchange is not prohibited), proprietor, partner, or person
      having any other material economic interest in, affiliated with or
      rendering services to any other entity, engage in or provide services to
      or for a business that is substantially the same as or similar to WWC's or
      its subsidiaries businesses and which competes within the applicable
      commercial mobile radio services markets serviced by WWC or its
      subsidiaries, directly or indirectly.

11.   EMPLOYMENT AT WILL: Notwithstanding any other provision of this Letter
      Agreement, your employment by WWC may be terminated by WWC at any time,
      with or without Cause, as defined below. In the event of a termination for
      Cause you will have no rights to severance payments. Termination for
      "Cause" means (i) your gross neglect or willful material breach of your
      principal employment responsibilities or duties, (ii) a final judicial
      adjudication that you are guilty of a felony, (iii) fraudulent conduct as
      determined by a court of competent jurisdiction in the course of your
      employment with WWC or any of its subsidiaries, (iv) the breach by you of
      the covenant set forth in paragraph nine, below, or (v) the material
      breach by you of any other provision of this Letter Agreement which
      continues uncured for a period of thirty (30) days after notice thereof by
      WWC. In the event of your voluntary termination of employment with WWC,
      you will have no rights to severance benefits.

      In the event of an involuntary termination for other than Cause (which
      shall include your resignation as a direct result of (i) a reduction in
      your base compensation and/or incentive bonus target percentage, or (ii)
      the material breach by the Company of any provision of this Letter
      Agreement which continues uncured for a period of thirty (30) days after
      notice thereof by you), then (A) you will be entitled to receive a
      severance payment in an amount equal to your accrued but unpaid existing
      annual targeted incentive bonus through the date of termination, twelve
      (12) months of your then base compensation and an amount equal to twelve
      (12) months of your existing annual targeted incentive bonus; (B) WWC
      will, at its expense, make all COBRA benefit payments on behalf of you and
      your dependents for twelve (12) months following such involuntary
      termination; and (C) with respect to any stock options previously granted
      to you by WWC which remain unvested at the time of the involuntary
      termination, notwithstanding the vesting language in the stock option
      agreement pursuant to which such options were granted, there shall be
      immediate vesting of that portion of each such grant of unvested stock
      options as equals the product of the total number of such options under
      such grant which remain unvested multiplied by a fraction the numerator of
      which is the

Page 3


      sum of (i) the number of days from the date on which the last vesting of
      options under such grant took place to and including the date on which the
      termination occurs plus (ii) 365 and the denominator of which is the
      number of days remaining from the date on which the last vesting of
      options under such grant took place to and including the date on which the
      final vesting under such grant would have occurred.

      Your death or permanent disability will be deemed an involuntary
      termination for other than Cause. "Permanent disability" shall mean your
      inability substantially to render the services required hereunder for
      eight (8) months in any eighteen (18) month period because of a physical
      or mental condition, it being understood that until you have received
      notice from WWC terminating this Letter Agreement, you will continue to
      receive your base compensation and all other benefits to which you are
      entitled under this Letter Agreement.

      You agree that upon termination of your employment by WWC for any reason
      you will surrender to WWC all proprietary records, lists and other
      documents obtained by you or entrusted to you during the course of your
      employment by WWC, together with all copies of all such documents. This
      Letter Agreement contains the entire agreement between you and WWC with
      respect to your employment by WWC, other than human resource and corporate
      policies, which are to be executed by all employees. This Letter Agreement
      may not be amended, waived, changed, modified or discharged except by an
      instrument in writing executed by or on behalf of you and WWC.

12.   NOTICES: All notices, requests, demands and other communications with
      respect to this Letter Agreement will be in writing and will be deemed to
      have been duly given if delivered by hand, registered or certified mail
      (first class postage and fees prepaid, return receipt requested),
      telecopier or overnight courier guaranteeing next-day delivery, as
      follows:

      Western Wireless Corporation
      3650 - 131st Avenue SE, #400
      Bellevue, Washington 98006
      Attention:  General Counsel
      Telecopy:  (425) 586-8102

      Wayne Wisehart
      2009 Viburnum Lane
      Ashville, NC  28803

      and to such other persons as either you or WWC has specified in writing to
      the other by notice as aforesaid.

14.   ENFORCEMENT: If any part of this Letter Agreement is hereafter construed
      to be invalid or unenforceable in any jurisdiction, the same will not
      affect the remainder of the Letter Agreement or the enforceability of such
      part in any other jurisdiction, which will be given full effect, without
      regard to the invalid portions or the enforceability in such other
      jurisdiction. If any part of this Letter Agreement is held to be
      unenforceable because of the scope thereof, you and WWC agree that the
      court making such determination will have the power to reduce the duration
      and/or area of such provision and, in its reduced form, said provision
      shall be enforceable; provided, however, that such court's determination
      will not affect the enforceability of this Letter Agreement in any other
      jurisdiction beyond such court's authority.

Page 4




15.   JURISDICTION: This Letter Agreement will be governed by and construed and
      interpreted in accordance with the laws of the State of Washington without
      reference to conflicts of laws principles.

Please signify your acceptance of the terms of this Letter Agreement by signing
where indicated below.

                                Sincerely yours,

                                WESTERN WIRELESS CORPORATION


                                By:
                                   -----------------------------------------
                                   John W. Stanton
                                   Chief Executive Officer

AGREED TO AND ACCEPTED:


- -----------------------
Wayne Wisehart

EX-10.28

                                                                   Exhibit 10.28

             WESTERN WIRELESS INTERNATIONAL HOLDING CORPORATION
                          1998 STOCK APPRECIATION PLAN
                           (Adopted September 9, 1998)
                             (As Amended July 2002)



      1. ESTABLISHMENT AND PURPOSE. This 1998 Stock Appreciation Plan was
established to provide an important inducement for management to generate
shareholder value by giving certain key personnel of Western Wireless
International Corporation and its Subsidiaries a stake in the equity value of
the Company. The Company believes that the managers participating in the, Plan
will seek to build personal financial security through creating and maintaining
value in the Company for all shareholders.

      2. DEFINITIONS. As used herein, the following definitions shall apply:

            "Account" means the account established and maintained in accordance
with Section 5 hereof.

            "Administrator" means the Board or any Committee designated by the
Board to Administer the Plan in accordance with Section 4 hereof.

            "Board" means the Board of Directors of the Company, as constituted
from time to time.

            "Code" means the Internal Revenue Code Of 1986, as amended.

            "Committee" means a committee appointed by the Board, in accordance
with Section 4 hereof. If no such committee has been appointed, "Committee"
means the full Board.-

            "Company" means Western Wireless International Corporation, a
Delaware corporation.

            "Consultant" shall mean any person engaged by the Company who is not
an Employee.

            "Director" means a member of the Board.

            "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.

            "Employee" means any person, including an Officer or Director, who
is an employee (within the meaning of Section 3401(c) of the Code and the
regulations thereunder) of the Company or a Subsidiary.

                                       1



            "Fair Market Value" means value determined pursuant to Section 8
hereof.

            "Participant" means an Employee, Director or Consultant who holds an
outstanding Performance Unit.

            "Performance Unit" means an interest in the rights awarded and
available for award under the Plan, as provided in Section 5 hereof.

            "Plan" means this 1998 Stock Appreciation Plan of Western Wireless
International Corporation, as it may be amended.

            "Subsidiary" means a "subsidiary corporation" (other than the
Company), whether now or hereafter existing, as defined in Section 424(f) of the
Code.

      3. GRANTS. Performance Units shall be granted to such Employees, Directors
and Consultants as the Administrator shall determine, who shall hereafter be
referred to as "Participants." The number of Performance Units that may be
awarded under the Plan shall not exceed an aggregate of 28,000. If any
Performance Units awarded under the Plan shall be forfeited or cancelled, such
Performance Units may again be awarded under the Plan. Performance Units shall
be granted at such time or times and shall be subject to such terms and
conditions, in addition to the terms and conditions set forth in the Plan, as
the Administrator shall determine.

      4. ADMINISTRATION OF THE PLAN. The Plan shall be administered by a
Committee appointed by the Board consisting of two or more members of the Board.
If no such Committee is appointed, the Plan shall be administered by the Board.
The members of the Committee will serve for such term as the Board may
determine. From time to time, the Board may increase the size of the Committee
and appoint additional members, remove members, fill vacancies (however caused),
and remove all members of the Committee and thereafter directly administer the
Plan. Decisions of the Committee made within the discretion delegated to it by
the Board will be final and binding on all persons who have an interest in the
Plan.

            (a) Authority of the Administrator. The Administrator of the Plan
will have full authority to administer the Plan within the scope of its
delegated responsibilities, consistent with the terms of the Plan, including
authority to interpret and construe any relevant provision of the Plan, to adopt
such rules and regulations as it may deem necessary, and to determine the terms
and conditions of Performance Unit grants made under the Plan (which need not be
identical). Without limiting the foregoing, the Administrator will have the
authority, in its discretion:

                (i) to determine whether and to what extent Performance Units
are granted hereunder;





                                       2




                (ii) to select the Employees. Directors and Consultants to whom
Performance Units may be granted hereunder;

                (iii) to determine the number of Performance Units to be granted
hereunder to any Employee, Director or Consultant, provided, that the maximum
number of Performance Units outstanding at any time shall not exceed 28,000;

                (iv) to determine the Fair Market Value of the Performance
Units;

                (v) to approve forms for notice of the grant of Performance
Units for use under the Plan;

                (vi) to determine the terms and conditions, not inconsistent
with those of the Plan, of any award of Performance Units granted hereunder,
including, but not limited to, all vesting provisions; any waiver of forfeiture
restrictions; and any restriction or limitation regarding any Performance Units
based on such factors as the Administrator, in its sole discretion, shall
determine;

                (vii) with the consent of the affected Participant, to effect,
at any time and from time to time, the cancellation of any or all outstanding
Performance Units under the Plan and to grant new Performance Units in
substitution therefor, in accordance with Section 13 hereof;

                (viii) to prescribe, amend and rescind rules and regulations
relating to the Plan;

                (ix) to modify, amend or waive the terms, conditions and
restrictions of any outstanding Performance Units; provided, however, no such
modification, amendment or waiver shall, without the written consent of the
Participant, impair the Participant's rights or increase the Participant's
obligations with respect to such Performance Units;

                (x) to institute a Performance Unit Exchange Program (as defined
in Section 13); and

                (xi) to make all other determinations deemed necessary or
advisable for administering the Plan.

            (b) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Participants.

      5. PERFORMANCE UNITS. Performance Units granted to a Participant shall be
credited to a Performance Unit Account (the "Account") established and
maintained for such participant. The Account of a Participant shall be the
record of Performance Units granted to him under the Plan, is solely for
accounting purposes and shall not require a segregation of any Company assets.
Each Performance Unit shall be valued at its fair market value by the

                                       3


Committee, in the manner provided in Section 8, as of the date of grant thereof.
Each grant of any Performance Units under the Plan to a Participant and the
value of such Performance Units as of the date of grant shall be communicated by
the Administrator, in writing to the Participant within thirty (30) days after
the date of grant.

      6. VESTING OF PERFORMANCE UNITS. Subject to any other vesting schedule
determined by the Administrator at the time of grant thereof, Performance Units
granted to a Participant shall vest according to the following schedule:



      Anniversary of Grant Date           Percentage of Performance Units Vested
      -------------------------           --------------------------------------
                                       
               First                                      25%
               Second                                     50%
               Third                                      75%
               Fourth                                    100%


      7. PAYMENT FOR PERFORMANCE UNITS.

            (a) (i) Upon receipt of written notice in the form acceptable to the
Committee from a Participant during the exercise window set by the Administrator
of his or her surrender of all or a portion of such Participant's vested
Performance Units and (ii) three months after the date of the termination of
employment of a Participant with the Company for any reason (other than as
provided in Section 7(c), below), the Participant shall be entitled to receive
from the Company with respect to each then vested Performance Unit in the
Participant's Account as to which the Participant has given a notice of
surrender, or with respect to each then vested Performance Unit in the
Participant's Account at the termination of employment, as the case may be, an
amount determined as follows: (x) the Fair Market Value of each such Performance
Unit in the Participant's Account as to which the Participant has given notice
of surrender or the Fair Market Value of all such Performance Units in the
Participant's Account at the date of termination of his employment with the
Company, as the case may be, reduced by (y) the Fair Market Value of such
Performance Unit as of the date of grant thereof to the Participant.

            (b) Payment to a Participant of the amount set forth in paragraph
(a) next above for Performance Units shall be made in cash either in a lump sum
or in equal bi-annual installments over a period not to exceed 3 years. The
Administrator shall have the sole discretion to determine the method of payment
under the Plan and the period over which such payment shall be made. Payment
will be made or commence within ninety (90) days after the applicable date
referred to in Section 7(a)(i) or (ii). A Participant will not be entitled to
receive any earnings on the value of his Performance Units with respect to the
period between the date referred to in Section 7(a)(i) or, if Participant's
entitlement arises under Section 7(a)(ii), the date of termination of employment
and the receipt of payments under the Plan.

      8. VALUATION OF PERFORMANCE UNITS. For all purposes of the Plan, the Fair
Market Value of a Performance Unit and of the common stock of the Company as of
the date of grant, as of the date of exercise and as of the date of termination
of employment shall be


                                       4


the Fair Market Value immediately preceding each such date, as determined by the
Administrator quarterly, as of a date determined by the Administrator but not
later than the 45th day of each quarter. For purposes of determining Fair Market
Value, the 28,000 Performance Units subject to the Plan shall have an aggregate
Fair Market Value at any time equal to 7% of the Fair Market Value at such time
of all the shares of common stock of the Company that were outstanding at
January 1, 1998. The aggregate Fair Market Value of all the outstanding common
stock of the Company at January 1, 1998 (without regard to Performance Units)
shall be deemed to be $80 million and the Fair Market Value of each Performance
Unit at that time shall be deemed to be $200.

      9. FORFEITURE OF PERFORMANCE UNITS. If (i) the employment of a Participant
with the Company is terminated for any reason or (ii) the owner of a majority of
shares of capital stock of the Company terminates the business of, or liquidates
or dissolves, the Company; (iii) substantially all of the assets of the Company
are sold, or (iv) the Company merges or consolidates with any other corporation
and either the Company is not the surviving corporation of such merger or
consolidation or the owners of the common stock of the Company immediately
before such merger or consolidation do not own, directly or indirectly, as a
result of such ownership, at least a majority of the common stock of the
surviving corporation of the merger or consolidation, then each Participant's
rights with respect to Performance Units which have not vested on or prior to
the date of the occurrence of such event will terminate and be forfeited and
neither the Participant nor his heirs, personal representatives, successors or
assigns shall have any future rights with respect to any such Performance Units.

      10. CHANGES IN CAPITAL AND CORPORATE STRUCTURE. In the event of any change
in the outstanding shares of common stock of the Company by reason of a
recapitalization, reclassification, reorganization, stock split, reverse stock
split, combination of shares, stock dividend or similar transaction, the
Administrator shall proportionately adjust, in an equitable manner, the number
of Performance Units held by Participants under the Plan to maintain the
relationship between 28,000 Performance Units and 7% of outstanding common stock
of the Company at January 1, 1998. The foregoing adjustment shall be made in a
manner that will cause the relationship between the aggregate appreciation in
outstanding common stock of the Company and the increase in value of each
Performance Unit granted hereunder to remain unchanged as a result of the
applicable transaction.

      11. NONTRANSFERABILITY. Performance Units granted under the Plan, and any
rights and privileges pertaining thereto, may not be transferred, assigned,
pledged or hypothecated in any manner, by operation of law or otherwise, other
than by will or by the laws of descent and distribution, and shall not be
subject to execution, attachment or similar process. In the event of a
Participant's death, payment of any amount due under the Plan shall be made to
the duly appointed and qualified executor or other personal representative of
the Participant to be distributed in accordance with the Participant's will or
applicable intestacy law, or in the event that there shall be no such
representative duly appointed and qualified within six (6) months after the date
of death of such deceased Participant, then to such persons as, at the date of
his death, would be entitled to share in the distribution of such deceased
Participant's personal estate under

                                       5


the provisions of the applicable statute then in force governing the descent of
intestate property, in the proportions specified in such statute.

      12. WITHHOLDING. The Company shall have the right to deduct from all
amounts paid pursuant to the Plan any taxes required by law to be withheld with
respect to such awards.

      13. PERFORMANCE UNIT EXCHANGE PROGRAM. The Administrator will have the
authority to effect, at any time and from time to time, with the consent of the
affected Participants, the cancellation of any or all outstanding Performance
Units under the Plan and to grant in substitution therefor new Performance Units
under the Plan.

      14. VOTING AND DIVIDEND RIGHTS. No Participant shall be entitled to any
voting rights, to receive any dividends, or, except as provided under Section
10, to have his Account credited or increased as a result of any dividends or
other distribution with respect to the common stock of the Company.

      15. MISCELLANEOUS PROVISIONS.

            (a) No Employee, Director, Consultant or other person shall have any
claim or right to be granted an award under the Plan.

            (b) The Plan shall at all times be entirely unfunded and no
provision shall at any time be made with respect to segregating assets of the
Company for payment of any benefits hereunder. No Participant or other person
shall have any interest in any particular assets of the Company by reason of the
right to receive a benefit under the Plan and any such Participant or other
person shall have only the rights of a general unsecured creditor of the Company
with respect to any rights under the Plan.

            (c) Except when otherwise required by the context, any masculine
terminology in this document shall include the feminine, and any singular
terminology shall include the plural.

      16. EFFECTIVENESS AND TERMS OF PLAN. The effective date of the Plan shall
be January 1, 1998. The Administrator may at any time terminate the Plan and
unless sooner terminated by the Committee, the Plan shall terminate on December
31, 2008. No Performance Units shall be granted pursuant to the Plan after the
date of termination of the Plan, although after such date payments shall be made
with respect to Performance Units granted prior to the date of termination.

      17. NO EMPLOYMENT RIGHTS. Neither the Plan nor any Performance Units shall
confer upon any Employee, Director or Consultant any right to continue in the
employ of the Company of any affiliate or constitute a contract or agreement of
employment or interfere in any way with any right that the Company or an
affiliate may have to reduce such person's compensation or to terminate such
person's employment at any time with or without cause; however, nothing
contained in the Plan or in any Performance Unit granted under the Plan shall

                                       6


affect any contractual rights of an Employee, Director or Consultant pursuant to
a written employment or other agreement.

      18. AMENDMENT AND TERMINATION OF THE PLAN.

            (a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan in whole or in part.

            (b) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights or increase the
obligations of any Participant, unless mutually agreed otherwise between the
Participant and the Administrator, which agreement must be in writing and signed
by the Participant and the Company.

      19. GOVERNING LAW. The Plan shall be governed by and construed in
accordance with the laws of the state of Delaware.



                                       7

EX-10.32

                                                                   Exhibit 10.32

                         TELE.RING TELEKOM SERVICE GmbH

                                   as Borrower

                                       and

                       EKOM TELECOMMUNICATIONS HOLDING AG

                                    as Lender

                     AMENDMENT NO. 1 TO TERM LOAN AGREEMENT

  Attention: No Original Signed Counterpart or True Copy of this Agreement May
                     Be Brought into Austria (See Clause 17)

      This Amendment No. 1 made on January 30, 2003, to the Term Loan Agreement
made on June 29, 2001.

      It is agreed as follows:

      BETWEEN:

      (1) TELE.RING TELEKOM SERVICE GmbH, a limited liability company
established and validly existing under the laws of Austria whose registered
number at the Vienna Commercial Court is FN 171112k (the "Borrower"); and

      (2) EKOM TELECOMMUNICATIONS HOLDING AG, a joint stock corporation
established and validly existing under the laws of Austria whose registered
number at the Vienna Commercial Court is FN 158908p (the "Lender").

      Whereas, the parties entered into the Term Loan Agreement on June 29, 2001
and the parties intend to modify the terms of the Term Loan Agreement as herein
set forth.

1.    Defined Terms

      1.1   All terms used herein and not otherwise defined shall have the
            meanings ascribed to them in the Agreement.

      1.2   The provisions of the Clauses listed below are amended by deleting
            such provisions as they currently exist in the Agreement and
            inserting the following provisions in lieu thereof or specifically
            amending such provisions pursuant to the instructions listed below,
            as the case may be:

      "Agreement" means the Term Loan Agreement dated June 29, 2001, as amended
by the Letter Agreement dated April 5, 2002, and as further amended by this
Amendment No. 1.

      "Commitment" means, at any time E185,000,000 (Euro one hundred eighty-five
million).

      "Commitment Period" means the period commencing on the date of the
Agreement and ending on the earlier of:

            (a)   June 30, 2004; and

            (b)   The date on which the Loan has been drawn down in full;

      "Repayment Date" means each of July 1, 2004, July 1, 2005, July 1, 2006
and December 31, 2006.

      2.1   The Lender, upon the terms and subject to the conditions hereof, and
            relying upon each of the representations and warranties in Clause 8,
            agrees to make available to the Borrower a term loan facility of up
            to E185,000,000. The

            claims of the Lender against the Borrower under this Agreement will
            rank at least pari passu with the claims of all its other unsecured
            creditors save those whose claims are preferred solely by any
            bankruptcy, insolvency, liquidation or other similar laws of general
            application.

            Subject to Sections 3 and 4, the Lender shall make available
            Advances to the Borrower for Drawdown in an aggregate amount not to
            exceed E185,000,000 less any prior Advances made, which Advances
            shall be used for the purposes described in or contemplated by the
            Business Plan. The Borrower agrees to apply all amounts raised by it
            hereunder in or towards satisfaction of the purposes of the Business
            Plan and the Lender shall not be obliged to concern itself with such
            application.

      2.2   - Intentionally deleted

      3.3; 3.3.1; 3.3.2; and 3.3.3 - intentionally deleted.

      3.4   In Clause 3.4, the reference to Clause 3.3 is deleted.

      4.1.2 In Clause 4.1.2, the date "April 1, 2003" is changed to "June 30,
            2004."

      6.1   The Borrower shall repay the Loan in installments on the Repayment
            Dates set forth below, which installments shall be calculated in the
            following manner:

      6.1.1 On July 1, 2004, an installment of principal equal to E83,333,333
            less the difference between E250,000,000 and the total principal
            amount of the Loan outstanding on June 30, 2004, together with
            interest in an amount calculated in accordance with Exhibit A to
            this Amendment No. 1. The remaining principal amount after the
            payment of the installment set forth in this Clause 6.1.1 shall be
            referred to below in this section as the "Remaining Principal
            Amount."

      6.1.2 On each of July 1, 2005 and July 1, 2006, one-third of the Remaining
            Principal Amount of the Loan (after the payment of the installment
            set forth in Clause 6.1.1 above) together with interest accrued on
            the principal amount of the Loan being repaid on such Repayment
            Dates as illustrated on Exhibit A to this Amendment No. 1.

      6.1.3 On December 31, 2006, one-third of the Remaining Principal Amount of
            the Loan (after the payment of the installment set forth in Clause
            6.1.1 above together with the balance of the outstanding interest,
            as illustrated on Exhibit A to this Amendment No. 1.

      6.1.4 For example, if on June 30, 2004 Borrower had borrowed a total of
            E185,000,000, the Repayments would be as follows:


                                       2

            (a)   July 1, 2004 - E83,333,333 less E65,000,000 equals a principal
                  payment of E18,333,333, plus interest in an amount calculated
                  in accordance with Exhibit A to this Amendment No. 1.

            (b)   July 1, 2005, July 1, 2006 and December 31, 2006 - E55,555,556
                  plus interest in an amount calculated in accordance with
                  Exhibit A to this Amendment No. 1.

            (c)   For the avoidance of doubt, the parties have agreed that (i)
                  interest will be compounded (i.e. interest on interest) only
                  for the period from the date of the first Advance through
                  December 31, 2002; thereafter, for the balance of the term of
                  the Loan, interest will not be compounded; (ii) the amount of
                  interest accrued and unpaid on the total outstanding principal
                  of the Loan as of December 31, 2002 (Euro 145 million) is Euro
                  8,834,800; (iii) the amount of interest to be paid on July 1,
                  2004 shall be one-half of the total amount of the interest
                  that is accrued and unpaid on the total amount of the
                  principal outstanding on June 30, 2004. (The amount of such
                  interest is currently estimated to be Euro 13,206,393 as set
                  forth on Exhibit A, based upon the assumptions contained in
                  Exhibit A as to the actual Interest Rates, the aggregate
                  amount of principal drawn and the dates on which Advances will
                  be made through June 30, 2004. The assumptions (Interest
                  Rates, amount of principal drawn and the dates on which
                  Advances will be made) shall not be binding and are made for
                  illustrative purposes only); (iv) the final payment to be made
                  on December 31, 2006 shall include the balance of the
                  principal outstanding and all remaining accrued but unpaid
                  interest; and (v) the rate used to calculate the interest
                  shall be the Interest Rate, as such term is defined in this
                  Agreement.

      6.2   The last sentence of Clause 6.2 is deleted in its entirety and the
            following is substituted in lieu thereof: "Commencing January 1,
            2003, Borrower shall, twice during each calendar year until the
            Facility and all accrued interest has been repaid in full, use
            commercially reasonable endeavors, in the same manner as it has done
            in the past and represented to the Lender, to refinance the
            Facility."

      9.4   In Clause 9.4, the date "July 1, 2006" is changed to "December 31,
            2006."

      13.1(c) In Clause 13.1(c), the reference to "E250,000,000" shall be
            deleted and "E185,000,000" shall be substituted in lieu thereof.

      16.1.2 Copies of all notices sent to the Borrower shall be sent to:

             Friedman Kaplan Seiler & Adelman LLP
             1633 Broadway, 46th Floor
             New York, NY 10019-6708


                                       3

             Attn.:  Barry A. Adelman and Richard M. Hoffman
             Fax: 212-833-1250

            17.2  The references in Clause 17.2 to "E250,000,000" shall be
                  deleted and "E185,000,000" substituted in lieu thereof.

2.    Full Force and Effect

      Except as specifically set forth herein, the Term Loan Agreement as
modified by the Letter Agreement dated April 5, 2002 and as amended hereby,
shall remain in full force and effect in accordance with its terms.

3.    Shareholder Consent

      By his signature below, Mr. Bradley Horwitz also gives his consent to this
Amendment No. 1 in his capacity as Managing Director (with sole power of
representation) of, and on behalf of, the Borrower's parent, EHG Einkaufs-und
Handels GmbH.


                                       4

IN WITNESS WHEREOF, the parties to this have caused this Amendment No. 1 to be
duly executed on the date first above written.

Borrower

SIGNED for and on behalf of
TELE.RING TELEKOM SERVICE GmbH


By:__________________________________


Lender

SIGNED for and on behalf of
EKOM TELECOMMUNICATIONS HOLDING AG


By: __________________________________


Shareholder (solely as to Clause 3)

SIGNED for and on behalf of
EHG EINKAUFS-und HANDELS GmbH


By:__________________________________
   Brad Horwitz
   Managing Director


                                       5

EX-10.34

CLIFFORD
CHANCE                                                            Exhibit 10.34
PUNDER

                               DATED 30 APRIL 2002

                      WESTERN WIRELESS INTERNATIONAL D.O.O.
                                   as Borrower

                          IKB DEUTSCHE INDUSTRIEBANK AG
                   as Lead Arranger, Off Shore Security Agent,
            Off Shore Facility Agent and Original Euro Facility Bank

                         KREDITANSTALT FUR WIEDERAUFBAU
                as Lead Arranger and Original Euro Facility Bank

               RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H.
              as Senior Co-Arranger and Original Euro Facility Bank

                     NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA
                 as Senior Co-Arranger, On Shore Security Agent,
             On Shore Facility Agent and Original SIT Facility Bank

                   LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE
                 as Co-Arranger and Original Euro Facility Bank

                             HYPO ALPE-ADRIA-BANK AG
                 as Co-Arranger and Original Euro Facility Bank

                            HYPO ALPE-ADRIA-BANK D.D.
                          as Original SIT Facility Bank

                                       and

                                     OTHERS

                ------------------------------------------------

                               FACILITY AGREEMENT
                    RELATING TO THE PROJECT FINANCING OF THE
                VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA

                ------------------------------------------------


                                    CONTENTS


                                                                         
CLAUSE                                                                      PAGE

1.       Definitions and Interpretation ...............................        2

2.       The Facilities ...............................................       27

3.       Purpose ......................................................       28

4.       Conditions of Utilisation ....................................       29

5.       Utilisation ..................................................       30

6.       Loans ........................................................       33

7.       Guarantees and Letters of credit .............................       33

8.       SIT Facility Guarantees and Letters of Credit ................       34

9.       Interest on Loans ............................................       36

10.      Interest Periods .............................................       41

11.      Changes to the Calculation of Interest .......................       42

12.      Fees .........................................................       43

13.      Repayment ....................................................       45

14.      Prepayment and Cancellation ..................................       46

15.      Tax Gross-Up and Indemnities .................................       50

16.      Increased Costs ..............................................       52

17.      Other Indemnities ............................................       53

18.      Mitigation by the Banks ......................................       54

19.      Costs and Expenses ...........................................       54

20.      Representations ..............................................       56

21.      Reporting Requirements .......................................       62

22.      Financial Covenants and Network Milestones ...................       65

23.      Accounts and Payments ........................................       68

24.      General Undertakings .........................................       77

25.      Events of Default ............................................       85

26.      Changes to the Parties .......................................       90




                                                                           
27.      Role Of The Agent And The Arranger ...........................       94

28.      Conduct Of Business By The Finance Parties ...................       98

29.      Sharing Among The Finance Parties ............................       99

30.      Payment Mechanics ............................................      101

31.      Set Off ......................................................      103

32.      Notices ......................................................      103

33.      Calculations and Certificates ................................      106

34.      Partial Invalidity ...........................................      107

35.      Remedies and Waivers .........................................      107

36.      Amendments and Waivers .......................................      107

37.      Counterparts .................................................      108

38.      Governing Law ................................................      109

39.      Arbitration ..................................................      109

40.      Jurisdiction .................................................      109





THIS AGREEMENT is dated 30 April 2002 and made between:

(1)   WESTERN WIRELESS INTERNATIONAL D.O.O., LJUBLJANA as borrower (the
      "BORROWER");

(2)   IKB DEUTSCHE INDUSTRIEBANK AG AND KREDITANSTALT FUR WIEDERAUFBAU, as lead
      arrangers (the "LEAD ARRANGERS");

(3)   RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. and NOVA LJUBLJANSKA
      BANKA D.D., LJUBLJANA as senior co-arrangers (the "SENIOR CO-ARRANGERS");

(4)   LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as
      co-arrangers (the "CO-ARRANGERS");

(5)   IKB DEUTSCHE INDUSTRIEBANK AG, KREDITANSTALT FUR WIEDERAUFBAU,
      RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. LANDESBANK
      SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as original
      lenders with regard to the Euro Facility (the "ORIGINAL EURO FACILITY
      BANKS");

(6)   IKB DEUTSCHE INDUSTRIEBANK AG, as facility agent with regard to the Euro
      Facility and the SIT Facility (the "OFF SHORE FACILITY AGENT");

(7)   IKB DEUTSCHE INDUSTRIEBANK AG, as security agent with regard to the Off
      Shore Security (the "OFF SHORE SECURITY AGENT");

(8)   NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as an original lender and issuing
      bank with regard to the SIT Facility and HYPO ALPE-ADRIA-BANK D.D. as
      original lender with regard to the SIT Facility (the "ORIGINAL SIT
      FACILITY BANKS");

(9)   NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as local facility agent with regard
      to the SIT Facility (the "ON SHORE FACILITY AGENT"); and

(10)  NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as security agent with regard to
      the On Shore Security (the "ON SHORE SECURITY AGENT").

WHEREAS

(A)   On November 16, 2000, the Borrower was selected to become the third mobile
      operator in Slovenia by the Slovenian telecommunications regulator and on
      3 January 2001 signed the Concession Agreement.

(B)   The Borrower intends to install and to operate a third wireless
      communication network in Slovenia.

(C)   For the financing of the construction and operation of such network the
      Original Euro Facility Banks have agreed to grant two term loan facilities
      in the amount of Euro 96,443,308.50 upon the terms and conditions set out
      below and the Original SIT Facility Banks have agreed to grant a revolving
      loan, guarantee and letter of credit facility in the amount of SIT
      4,400,000,000.


                                     - 1 -


IT IS AGREED as follows:

                                    SECTION 1
                                 INTERPRETATION

1.    DEFINITIONS AND INTERPRETATION

1.1   DEFINITIONS

      In this Agreement:

      "ABANDONMENT OF THE PROJECT" means that the Sponsors and/or Shareholders
      fail to provide the Borrower with:

      (a)   the assistance required pursuant to clause 3.2.2 (Technical and
            managerial capacity and assistance) of the Sponsors' and
            Shareholders' Undertaking and Completion Guarantee and/or the
            Management Agreement; and/or

      (b)   the Sponsor Contributions required in accordance with the Sponsors'
            and Shareholders' Undertaking and Completion Guarantee are not made
            at the times and in the manner required by the Sponsors' and
            Shareholders' Undertaking and Completion Guarantee.

      "AFFILIATE" means, in relation to any person, a Subsidiary of that person
      or a Holding Company of that person or any other Subsidiary of that
      Holding Company.

      "AGENT" means the Off Shore Facility Agent and/or the On Shore Facility
      Agent as the case may be.

      "AGREEMENT" means this agreement including all of its Schedules.

      "AMOUNT DEMANDED" has the meaning given to it in Clause 8.1 (Notification
      of demand).

      "ANNUALISED EBITDA" means twice the aggregate EBITDA in respect of the
      last two (2) Quarters immediately preceding the relevant calculation date.

      "APPLICABLE MARGIN" means the ECA Facility Applicable Margin, the
      Commercial Facility Applicable Margin or the SIT Facility Applicable
      Margin as the case may be.

      "ARRANGER" means any of the Lead Arrangers, the Senior Co-Arrangers and/or
      the Co-Arrangers as the case may be.

      "ASSET AND LICENCE PLEDGE AND LEASE CONTRACTS ASSIGNMENT AGREEMENT" means
      the asset and licence pledge and lease contracts assignment agreement to
      be entered into between the Borrower and the Senior Creditors.

      "ASSIGNMENT OF RECEIVABLES AS SECURITY AND ASSIGNMENT OF INSURANCE
      POLICIES AGREEMENT" means the assignment of receivables as security and
      assignment of insurance policies agreement to be entered into between the
      Borrower and the Senior Creditors.

      "AUTHORISATION" means an authorisation, consent, approval, resolution,
      licence, exemption, filing, notarisation or registration.


                                     - 2 -


      "AVAILABILITY PERIOD" means:

      (a)   in relation to the ECA Facility, the period from the date upon which
            the conditions precedent in Schedule 6 (Conditions Precedent) have
            been satisfied up to and including 31 December 2003;

      (b)   in relation to the Commercial Facility, the period from the date
            upon which the conditions precedent in Schedule 6 (Conditions
            Precedent) have been satisfied up to and including 31 December 2004;
            and

      (c)   in relation to the SIT Facility, the period from the date upon which
            the conditions precedent in Schedule 6 (Conditions Precedent) have
            been satisfied up to and including 31 October 2009.

      "AVAILABLE COMMITMENT" means, in relation to a Facility, a Bank's
      Commitment under that Facility minus:

      (a)   the amount of its participation under that Facility in any
            outstanding Loans and, if applicable, SIT Facility Guarantees or
            LCs; and

      (b)   in relation to any proposed Utilisation, the amount of its
            participation under that Facility in any Loans that are due to be
            made and, if applicable, SIT Facility Guarantees or LCs that are due
            to be issued or opened on or before the proposed Utilisation Date,

      other than, in relation to any proposed Utilisation under the SIT Facility
      only, that Bank's participation in any SIT Facility Loans and, if
      applicable, SIT Facility Guarantees or LCs that are due to be repaid or
      prepaid or expire on or before the proposed Utilisation Date.

      "AVAILABLE FACILITY" means:

      (a)   in relation to a Euro Facility, the aggregate of each Euro Facility
            Bank's Available Commitment; and

      (b)   in relation to the SIT Facility, the aggregate of each SIT Facility
            Bank's Available Commitment.

      "BANK" means:

      (a)   any of the Original Euro Facility Banks and any of the Original SIT
            Facility Banks; and

      (b)   any bank, financial institution, trust, fund or other entity which
            has become a Party in accordance with Clause 26 (Changes to the
            Parties),

      which in each case has not ceased to be a Party in accordance with the
      terms of this Agreement.

      "BENEFICIARY" means a beneficiary of a SIT Facility Guarantee or LC.

      "BILLS OF EXCHANGE" means ten (10) blank bills of exchange to be issued by
      the Borrower as collateral for the purpose of securing the obligations of
      the Borrower under this Agreement.

      "BORROWER" means Western Wireless International d.o.o.


                                     - 3 -


      "BORROWER'S SHARE PLEDGE AGREEMENT" means the agreement to be entered into
      by the Shareholders, the Borrower and the Senior Creditors for the purpose
      of pledging the Shareholders' interests in the Borrower to the Senior
      Creditors.

      "BREAK COSTS" means, in the case of any Euro Facility Loan, the amount (if
      any) in Euro or, in the case of any SIT Facility Loan, the amount (if any)
      in SIT by which:

      (i)   the interest which a Bank should have received for the period from
            the date of receipt of all or any part of its participation in a
            Loan or Unpaid Sum to the last day of the current Interest Period in
            respect of that Loan or Unpaid Sum, had the principal amount or
            Unpaid Sum received been paid on the last day of that Interest
            Period;

      exceeds:

      (ii)  the amount which that Bank would be able to obtain by placing an
            amount equal to the principal amount or Unpaid Sum received by it on
            deposit with a leading bank in the European Interbank Market or as
            the case may be the Slovenian Interbank Market for a period starting
            on the Business Day following receipt or recovery and ending on the
            last day of the current Interest Period

      in each case as determined and notified to the Borrower by the relevant
      Bank in accordance with Clause 11.4 (Break Costs) on the date the Borrower
      becomes liable for such costs in accordance with this Agreement.

      "BUSINESS DAY" means a day (other than a Saturday or Sunday) on which
      banks are open for general business in Ljubljana (in relation to any date
      for payment or a Utilisation under the SIT Facility) and in all other
      cases in Dusseldorf and Ljubljana and (in relation to any date for payment
      or purchase of Euro) any TARGET Day.

      "BUSINESS PLAN" means, prior to the delivery of the first Updated Business
      Plan, the Initial Business Plan and thereafter the most recently delivered
      Updated Business Plan.

      "CAPITAL EXPENDITURE RESERVE ACCOUNT" means the account established
      pursuant to Clause 23.7 (Capital Expenditure Reserve Account).

      "CASH FLOW" means, in respect of the relevant period, EBITDA plus the
      amount of any reductions in working capital and any realised foreign
      exchange gains less the amount of any increases in working capital, income
      tax and realised foreign exchange losses.

      "CASH INTEREST EXPENSE" means in relation to any period the total amount
      of all interest, fees and commissions due and payable in respect of
      Financial Indebtedness during such period.

      "CASH SHORTFALL" means the inability of the Borrower to meet its payment
      obligations when due in accordance with Clauses 23.3(d)(i) to (vii)
      (Application of moneys on the Proceeds and Revenue Accounts) at any time.

      "CFO" means the person holding the office of chief financial officer of
      the Borrower.

      "CLAIMS ASSIGNMENT AND BILLS OF EXCHANGE AGREEMENT" means the claims
      assignment and bills of exchange agreement to be entered into between the
      Borrower and the Senior Creditors.

      "CO-ARRANGERS" means Landesbank Schleswig-Holstein Girozentrale and Hypo
      Alpe-Adria-Bank AG.


                                     - 4 -


      "COMMERCIAL FACILITY" means the term loan facility made available under
      this Agreement as described in Clause 2 (The Facilities).

      "COMMERCIAL FACILITY APPLICABLE MARGIN" has the meaning given to it in
      Clause 9.2(b) (Calculation of floating rate interest under the Commercial
      Facility).

      "COMMERCIAL FACILITY APPLICABLE MARGIN ADJUSTMENT DATE" has the meaning
      given to it in Clause 9.2(b) (Calculation of floating rate interest under
      the Commercial Facility).

      "COMMERCIAL FACILITY COMMITMENT" means:

      (a)   in relation to an Original Euro Facility Bank, the amount set
            opposite its name under the heading "Commercial Facility Commitment"
            in Schedule 1 (Commitments) and the amount of any other Commercial
            Facility Commitment transferred to it under this Agreement; and

      (b)   in relation to any other Euro Facility Bank, the amount of any
            Commercial Facility Commitment transferred to it under this
            Agreement,

      to the extent not cancelled, reduced or transferred by it under this
      Agreement.

      "COMMERCIAL FACILITY LOAN" means a loan made or to be made under the
      Commercial Facility or the principal amount outstanding for the time being
      of that loan.

      "COMMERCIAL FACILITY REPAYMENT DATE" means the dates set out in Schedule 2
      (Repayment dates).

      "COMMITMENT" means a ECA Facility Commitment, Commercial Facility
      Commitment or SIT Facility Commitment.

      "CONCESSION AGREEMENT" means the concession agreement between the
      Government and the Borrower dated January 03, 2001 based on the
      Government's decision no. 347-16/99-6 dated 16 November 2000.

      "CONFIDENTIALITY UNDERTAKING" means a confidentiality undertaking
      substantially in a recommended form of the LMA as set out in Schedule 3
      (LMA Form of Confidentiality Undertaking) or in any other form agreed
      between the Borrower and the Off Shore Facility Agent.

      "CONTRIBUTED CAPITAL" means the sum of (a) Equity Contributions to the
      Borrower plus (b) Subordinated Loans (but excluding in each case any
      deferred interest or dividend amounts thereon).

      "CONTRIBUTED CAPITAL RATIO" means the ratio of Contributed Capital to the
      sum of Contributed Capital plus aggregate Financial Indebtedness.

      "COVENANT COMPLIANCE CERTIFICATE" means a certificate substantially in the
      form set out in Schedule 14 (Covenant Compliance Certificate).

      "DEBT SERVICE" means, in relation to any period, the sum of (a) Cash
      Interest Expense plus (b) the principal amount of any Financial
      Indebtedness due to be repaid in accordance with its terms during such
      period.

      "DEBT SERVICE COVER RATIO" OR "DSCR" means the Cash Flow calculated by
      reference to the last two (2) Quarters immediately preceding the relevant
      calculation date divided


                                     - 5 -


      by the Debt Service calculated by reference to the last two (2) Quarters
      immediately preceding the relevant calculation date.

      "DEBT SERVICE PAYMENTS" means any interest, principal, fees and any other
      financing costs payable by the Borrower under the Facilities, the Hedging
      Agreements, the Sponsors Unsecured Loan Agreement and the Lucent Loan
      Agreement.

      "DEBT SERVICE RESERVE ACCOUNT" means the account to be set up and funded
      by the Borrower in accordance with Clause 23.9 (Debt Service Reserve
      Account).

      "DEBT SERVICE RESERVE ACCOUNT PLEDGE AGREEMENT" means the debt service
      reserve account pledge agreement to be entered into between the Borrower
      and the Off Shore Security Agent acting on behalf of the Senior Creditors.

      "DEBT SERVICE ACCOUNT" means the account established pursuant to Clause
      23.6 (Debt Service Account).

      "DEBTOR" has the meaning given to it in Clause 25.1.8 (Insolvency).

      "DELIVERY CONTRACT" means the delivery contract between the Equipment
      Vendor and the Borrower dated 15 March 2001 and signed on 21 March 2001
      and 30 April 2001 as amended from time to time.

      "DELIVERY CONTRACT CLAIMS AND LICENCE ASSIGNMENT AGREEMENT" means the
      delivery contract claims and licence assignment agreement to be entered
      into between the Equipment Vendor and the Off Shore Facility Agent acting
      on behalf of the Senior Creditors.

      "DISCHARGED RIGHTS AND OBLIGATIONS" has the meaning given to it in Clause
      26.5(b)(i) (Procedure for transfer).

      "DISPUTE" has the meaning given to it in Clause 39.1 (Arbitration).

      "DSRA-REQUIRED BALANCE" has the meaning given to it in Clause 23.9.2 (Debt
      Service Reserve Account).

      "EBITDA" means in relation to the relevant period, the sum of:

      (a)   net income;

      (b)   the sum of interest expense in respect of Financial Indebtedness
            minus interest earnings;

      (c)   taxes;

      (d)   depreciation and amortisation; and

      (e)   other finance and non-cash charges.

      "ECA" means Hermes Kreditversicherungs AG-, Hamburg.

      "ECA COVER DOCUMENTS" means the documentation issued by the ECA in
      connection with a "Guarantee of Finance Credit" under the terms of which
      the ECA guarantees the repayment of 95% of the ECA Facility upon the
      occurrence of certain political and/or commercial risk events.


                                     - 6 -


      "ECA FACILITY" means the term loan facility made available under this
      Agreement as described in Clause 2 (The Facilities) (divided into ECA
      Facility Tranche 1, ECA Facility Tranche 2 and ECA Facility Tranche 3) and
      which is covered by the ECA pursuant to the ECA Cover Documents.

      "ECA FACILITY APPLICABLE MARGIN" has the meaning given to it in Clause
      9.1(b) (Calculation of floating rate interest under the ECA Facility).

      "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT DATE" has the meaning given to
      it in Clause 9.1(b) (Calculation of floating rate interest under the ECA
      Facility).

      "ECA FACILITY COMMITMENT" means:

      (a) in relation to an Original Euro Facility Bank, the aggregate amount
      set opposite its name under the heading "ECA Facility Commitment" in
      Schedule 1 (Commitments) and the amount of any other ECA Facility
      Commitment transferred to it under this Agreement; and

      (b)   in relation to any other Euro Facility Bank, the amount of any ECA
            Facility Commitment transferred to it under this Agreement,

      to    the extent not cancelled, reduced or transferred by it under this
            Agreement.

      "ECA FACILITY LOAN" means a loan made or to be made under the ECA Facility
      or the principal amount outstanding for the time being of that loan.

      "ECA FACILITY TRANCHE 1" has the meaning given to it in Clause 2.1(a)(i)
      (The Facilities).

      "ECA FACILITY TRANCHE 2" has the meaning given to it in Clause 2.1(a)(i)
      (The Facilities).

      "ECA FACILITY TRANCHE 3" has the meaning given to it in Clause 2.1(a)(i)
      (The Facilities).

      "ECA FACILITY TRANCHE 1 COMMITMENT" means:

      (a)   in relation to an Original Euro Facility Bank, the amount set
            opposite its name under the heading "ECA Facility Tranche 1
            Commitment" in Schedule 1 (Commitments) and the amount of any other
            ECA Facility Tranche 1 Commitment transferred to it under this
            Agreement; and

      (b)   in relation to any other Euro Facility Bank, the amount of any ECA
            Facility Tranche 1 Commitment transferred to it under this
            Agreement,

      to the extent not cancelled, reduced or transferred by it under this
      Agreement.

      "ECA FACILITY TRANCHE 2 COMMITMENT" means:

      (a)   in relation to an Original Euro Facility Bank, the amount set
            opposite its name under the heading "ECA Facility Tranche 2
            Commitment" in Schedule 1 (Commitments) and the amount of any other
            ECA Facility Tranche 2 Commitment transferred to it under this
            Agreement; and

      (b)   in relation to any other Euro Facility Bank, the amount of any ECA
            Facility Tranche 2 Commitment transferred to it under this
            Agreement,


                                     - 7 -


      to the extent not cancelled, reduced or transferred by it under this
      Agreement.

      "ECA FACILITY TRANCHE 3 COMMITMENT" means:

      (a)   in relation to an Original Euro Facility Bank, the amount set
            opposite its name under the heading "ECA Facility Tranche 3
            Commitment" in Schedule 1 (Commitments) and the amount of any other
            ECA Facility Tranche 3 Commitment transferred to it under this
            Agreement; and

      (b)   in relation to any other Euro Facility Bank, the amount of any ECA
            Facility Tranche 3 Commitment transferred to it under this
            Agreement,

      to the extent not cancelled, reduced or transferred by it under this
      Agreement.

      "ECA PREMIUM" means the fee payable to the ECA by the Off Shore Facility
      Agent pursuant to the ECA Cover Documents and by the Equipment Vendor
      pursuant to any additional cover granted by the ECA to the Equipment
      Vendor in connection with the Delivery Contract.

      "ELIGIBLE EXPENDITURE" means expenditures which do not exceed and may be
      applied in respect of:

      (a)   85 per cent. of the Estimated Contract Value;

      (b)   85 per cent. of the ECA Premium due to the ECA (or to the Equipment
            Vendor in reimbursement of amounts paid by the Equipment Vendor to
            the ECA in respect of the ECA Premium) under the terms of the ECA
            Cover Documents; and

      (c)   85 per cent. of interest due on the ECA Facility during the
            Availability Period.

      "ENVIRONMENTAL CLAIM" means any claim, proceeding or investigation by any
      person in respect of any Environmental Law.

      "ENVIRONMENTAL LAW" means any applicable law, regulation, court decision
      or administrative decision binding on the Borrower in any jurisdiction in
      which the Borrower conducts business which relates to the pollution or
      protection of the environment or harm to or the protection of human health
      or the health of animals or plants.

      "ENVIRONMENTAL PERMITS" means any Authorisation and the filing of any
      notification, report or assessment required under any Environmental Law
      for the operation of the business of the Borrower conducted on or from the
      properties owned or used by the Borrower.

      "EQUIPMENT REVENUES" means revenues deriving from the sale of hand-sets.

      "EQUIPMENT VENDOR" means Lucent Technologies Network Systems GmbH,
      Nurnberg, Germany.

      "EQUITY CONTRIBUTION" means a cash contribution in the Share Capital or
      subsequent payments in cash or in kind towards the capital (Naknadna
      vplaeila).

      "ESTIMATED CONTRACT VALUE" means the estimated value of the equipment and
      services for all phases of the Project (comprising the Initial
      Configuration and the Planned Network Expansion) payable under the
      Delivery Contract, being Euro 60,548,303.


                                     - 8 -


      "ETSI" means the European Telecommunications Standards Institute.

      "EURIBOR" means, in relation to any Loan in Euro:

      (a)   the applicable Screen Rate; or

      (b)   (if no Screen Rate is available for the Interest Period of that
            Loan) the arithmetic mean of the rates (rounded upwards to four
            decimal places) as supplied to the Off Shore Facility Agent at its
            request quoted by the Reference Banks to leading banks in the
            European Interbank Market, as of 11:00 am (Central European time) on
            the Quotation Day for the offering of deposits in Euro for a period
            comparable to the Interest Period of the relevant Loan.

      "EURO" means the single currency unit of the European Union as constituted
      by the Treaty on European Union as referred to in European Monetary Union
      legislation.

      "EURO FACILITY" means the ECA Facility and/or the Commercial Facility.

      "EURO FACILITY BANK" means any Bank which has become a Party in accordance
      with the terms of this Agreement, which will participate in the Euro
      Facility and which, in any case, has not ceased to be a Party to this
      Agreement.

      "EURO FACILITY INTEREST PAYMENT DATE" means the last day of an Interest
      Period or where an Interest Period is longer than 3 Months, the last day
      of each consecutive period of 3 Months from (and including) the first day
      of that Interest Period.

      "EURO FACILITY LOAN" means a loan made or to be made under a Euro Facility
      or the principal amount outstanding for the time being of that loan.

      "EVENT OF DEFAULT" means any event or circumstance specified as such in
      Clause 25 (Events of Default).

      "EXCESS CASH FLOW" means any amount available for further distribution
      from time to time following the application of any amounts from time to
      time standing to the credit of the Proceeds and Revenue Accounts pursuant
      to Clauses 23.3(d)(i) to (vii) (Application of moneys on the Proceeds and
      Revenue Accounts) excluding the following amounts, as at the date of
      prepayment pursuant to Clause 14.5.1(Mandatory prepayments):

      (a)   the amount of any Contributed Capital:

            (i)   in addition to that required to be provided by the Sponsors or
                  the Shareholders under the Sponsors' and Shareholders'
                  Undertaking and Completion Guarantee; and/or

            (ii)  made by a Sponsor under clause 3.3 (Contingent Equity) of the
                  Sponsors' and Shareholders' Undertaking and Completion
                  Guarantee, which exceeds the amount of the Cash Shortfall,

            in each case contributed in the immediately preceding Quarter;

      (b)   the amount of any Insurance Proceeds standing to the credit of the
            Insurance Proceeds Account;

      (c)   the amount of any Proceeds and Revenues standing to the credit of
            the Sale Proceeds Account;


                                     - 9 -


      (d)   the amounts planned to be paid by the Borrower in accordance with
            Clause 23.3(d)(iii) and (vii) (Application of moneys on the Proceeds
            and Revenue Accounts) within the next twelve (12) month period which
            are provided for in the Business Plan and which are standing to the
            credit of the Capital Expenditure Reserve Account; and

      (e)   the principal amount of any outstanding Permitted Indebtedness
            (other than indebtedness for borrowed money under the Finance
            Documents or the Subordinated Loans).

      "EXISTING BANK" has the meaning given to it in Clause 26.1 (Assignments
      and transfers by the Banks).

      "EXISTING WWIC LOAN" means the unsecured loan made to the Borrower by
      Western Wireless International Corporation in an aggregate principal
      amount not exceeding US Dollars 25,000,000.

      "EXISTING WWIC LOAN AGREEMENT" means the loan agreement, amended on 15
      April 2002 and as further amended on 30 April 2002 setting forth the terms
      of the Existing WWIC Loan to the Borrower.

      "FACILITY" means the ECA Facility, the Commercial Facility and/or the SIT
      Facility.

      "FACILITY OFFICE" means the office or offices notified by a Bank to the
      Off Shore Facility Agent in writing on or before the date it becomes a
      Bank (or, following that date, by not less than five (5) Business Days
      written notice) as the office or offices through which it will perform its
      obligations under this Agreement.

      "FEE LETTER" means any letter or letters dated on or about the date of
      this Agreement between any of the Arrangers and the Borrower or any of the
      Agents and the Borrower setting out any of the fees referred to in Clause
      12 (Fees) and the advisory agreement between the Borrower and the Off
      Shore Facility Agent dated 2 February 2001 as amended from time to time.

      "FINANCE DOCUMENTS" means each of:

      (a)   this Agreement;

      (b)   any Fee Letter;

      (c)   the Security Documents;

      (d)   any Hedging Agreement;

      (e)   the Intercreditor Agreement;

      (f)   the Sponsors' and Shareholders' Undertaking and Completion
            Guarantee;

      (g)   the Lucent Loan Agreement;

      (h)   the Sponsors Unsecured Loan Agreement; and

      (i)   any other document designated as such by the Off Shore Facility
            Agent, the On Shore Facility Agent and the Borrower.

      "FINANCE PARTY" means any of the Agents, the Security Agents, the Issuing
      Bank, the Arrangers or the Banks.


                                     - 10 -


      "FINANCIAL INDEBTEDNESS" means, without duplication, any indebtedness for
      or in respect of:

      (a)   moneys borrowed;

      (b)   any amount raised by acceptance under any acceptance credit
            facility;

      (c)   any amount raised pursuant to any note purchase facility or the
            issue of bonds, notes, debentures, loan stock or any similar
            instrument;

      (d)   the amount of any liability in respect of any lease or hire purchase
            contract which would, in accordance with US GAAP, be treated as a
            finance or capital lease;

      (e)   receivables sold or discounted (other than any receivables to the
            extent they are sold on a non-recourse basis);

      (f)   any amount raised under any other transaction (including any forward
            sale or purchase agreement) having the commercial effect of a
            borrowing but excluding trade indebtedness arising in the normal
            course of business paid within 45 days from the date of invoice;

      (g)   any derivative transaction entered into in connection with
            protection against or benefit from fluctuation in any rate or price
            (and, when calculating the value of any derivative transaction, only
            the marked to market value shall be taken into account PROVIDED THAT
            in respect of calculating the value of any interest rate or currency
            exchange rate derivative transaction entered into pursuant to a
            Hedging Agreement no account shall be taken of such transaction);

      (h)   any counter-indemnity obligation (including a reimbursement
            obligation) in respect of a guarantee, indemnity, bond, standby or
            documentary letter of credit or any other instrument issued by a
            bank or financial institution; and

      (i)   the amount of any liability in respect of any guarantee or indemnity
            for any of the items referred to in paragraphs (a) to (h) above.

      "3GPP" means the 3G Partnership Project.

      "GOVERNMENT" means the Government of the Republic of Slovenia.

      "GSM" means Global System For Mobile Communications, a standard for
      digital mobile telephone transmissions.

      "GSM ACTIVITIES" means all activities relating to or in connection with
      the use of GSM technology in relation to the Project.

      "HEDGING AGREEMENT" means any hedging agreement between the Borrower and
      any Hedging Counterparty designated as a Hedging Agreement by the Borrower
      and the Hedging Counterparty and notified to the Off Shore Facility Agent,
      in each case, in accordance with the terms of the Intercreditor Agreement.

      "HEDGING COUNTERPARTY" means the Original Hedging Counterparty and any
      bank or financial institution which accedes to the terms of the
      Intercreditor Agreement in accordance with the terms thereof.

      "HEDGING LETTER" means a letter from the Borrower to the Off Shore
      Facility Agent setting out its interest rate hedging strategy.


                                     - 11 -


      "HOLDING COMPANY" means, in relation to a company or corporation, any
      other company or corporation in respect of which it is a Subsidiary.

      "INCREASED COSTS" has the meaning given to it in Clause 16.1 (Increased
      costs).

      "INDEPENDENT TECHNICAL CONSULTANT" means Mr Sami Ali of Teleconsultants
      and Associates Limited, who shall assist the Banks in connection with the
      Project or any replacement consulting firm nominated by the Majority Banks
      after consultation with the Borrower.

      "INFORMATION MEMORANDUM" means the document dated September 2001 prepared
      by the Off Shore Facility Agent and approved by the Borrower in relation
      to the Project, distributed to the Banks and the ECA prior to the date
      hereof.

      "INITIAL BUSINESS PLAN" means a statement of the technical, economic and
      tax assumptions in the form of the financial model agreed between the
      Parties and referred to as the excel spreadsheet named "Base Case 12 July
      01.xls".

      "INITIAL CONFIGURATION" means such part of the deliveries and services as
      agreed as at the date of the Delivery Contract to be made or rendered
      under the terms of the Delivery Contract for which the Borrower has placed
      a firm order with the Equipment Vendor.

      "INSURANCE" means any of the contracts of insurance which the Borrower is
      required from time to time to procure and maintain pursuant to Schedule 11
      (Insurance).

      "INSURANCE PROCEEDS" means all proceeds of insurance payable to or
      received by the Borrower in relation to the Project but excluding third
      party insurance proceeds.

      "INSURANCE PROCEEDS ACCOUNT" means the account established pursuant to
      Clause 23.4 (Insurance Proceeds Account).

      "INTELLECTUAL PROPERTY" means the Intellectual Property Rights (i)
      required by the Borrower to carry on its business as it is then being
      conducted or (ii) any other Intellectual Property Rights which are
      material to the business of the Borrower.

      "INTELLECTUAL PROPERTY RIGHTS" means all know-how, patents, trademarks,
      designs, trading names, copyrights and other intellectual property rights
      (in each case whether registered or not and including all applications for
      the same).

      "INTERCREDITOR AGREEMENT" means the intercreditor agreement to be entered
      into between the Senior Creditors and the Borrower.

      "INTEREST COVERAGE RATIO" means the ratio of Cash Flow (calculated by
      reference to the last two (2) Quarters immediately preceding the relevant
      calculation date) to Cash Interest Expense for the same period.

      "INTEREST PAYMENT DATE" means a Euro Facility Interest Payment Date and/or
      a SIT Facility Interest Payment Date.

      "INTEREST PERIOD" means, in relation to a Loan, each period determined in
      accordance with Clause 10 (Interest Periods) and, in relation to an Unpaid
      Sum, each period determined in accordance with Clause 9.5 (Default
      interest).

      "INTERNATIONAL MOBILE SUBSCRIBER IDENTITY" means a number allocated by a
      mobile operator which uniquely identifies a Subscriber. The number format
      and allocation methodology is stipulated within the relevant ETSI
      standards.


                                     - 12 -


      "ISSUING BANK" means Nova Ljubljanska banka d.d., Ljubljana or such other
      financial institution or bank from time to time which issues a SIT
      Facility Guarantee or LC.

      "ITU" means the International Telecommunications Union.

      "LEAD ARRANGERS" means IKB Deutsche Industriebank AG and Kreditanstalt fur
      Wiederaufbau.

      "LEGAL DUE DILIGENCE REPORT" means the due diligence report dated 28 March
      2002 prepared by counsel to the Banks based on certain information
      provided by the Borrower.

      "LICENCE" means the GSM-1800 licence issued by the Government to the
      Borrower (including the Concession Agreement) and any renewal, extension
      or replacement thereof.

      "LMA" means the Loan Market Association.

      "LOAN" means a Euro Facility Loan or a SIT Facility Loan.

      "LOAN PROCEEDS ACCOUNT" means the account established pursuant to Clause
      23.6 (Loan Proceeds Account).

      "LUCENT LOAN AGREEMENT" means the loan agreement to be entered into
      between Lucent Technologies Inc., the Equipment Vendor, the Borrower, and
      the Off Shore Facility Agent acting on behalf of the Senior Creditors.

      "MAJORITY BANKS" means:

      (a)   if there are no Loans then outstanding and, if applicable, no SIT
            Facility Guarantees or LCs issued or opened, a Bank or Banks whose
            Commitments aggregate more than 66 2/3% of the Total Commitments
            (or, if the Total Commitments have been reduced to zero, aggregated
            more than 66 2/3% of the Total Commitments immediately prior to the
            reduction); or

      (b)   at any other time a Bank or Banks whose participations in the Loans
            then outstanding and, if applicable, SIT Facility Guarantees or LCs,
            on issue or opened aggregate more than 66 2/3% of all Loans then
            outstanding and SIT Facility Guarantees or LCs then on issue or
            opened

      "MAJORITY SENIOR CREDITORS" has the meaning given to it in the
      Intercreditor Agreement.

      "MANAGEMENT AGREEMENT" means the management agreement to be entered into
      between the Borrower and Western Wireless International Corporation.

      "MARKET DISRUPTION EVENT" has the meaning given to it in Clause 11.2(c)
      (Market disruption).

      "MARKET STUDY" means the evaluation by DETECON GmbH, Bonn of the Business
      Plan for the Borrower dated 10 May 2001 with the update dated 27 July
      2001.

      "MATERIAL ADVERSE EFFECT" means any event, occurrence or condition which
      has or could reasonably be expected to have a material adverse effect on:

      (a)   the business, operation, property (taken as a whole) and/or
            financial condition of the Borrower and/or the Shareholders;


                                     - 13 -


      (b)   the ability of the Borrower and/or the Sponsors to perform a payment
            obligation or other material obligation under a Transaction Document
            to which it is a party;

      (c)   except as permitted under this Agreement, the validity or
            enforceability of a Material Contract; or

      (d)   the validity or enforceability of any of the Security purported to
            be granted under the Security Documents (as and when such Security
            is required to be valid and enforceable).

      "MATERIAL ASSET" means any asset of the Borrower:

      (a)   subject to or required to become subject to the Security Documents;

      (b)   with a book value in excess of Euro 100,000; or

      (c)   that is necessary in any material respect for the design,
            functionality or operability of the Network or for charging or
            maintenance of Subscribers of the Network and which the Off Shore
            Facility Agent (acting reasonably) notifies the Borrower (acting on
            the advice of the Independent Technical Consultant) is a Material
            Asset.

      "MATERIAL CONTRACTS" means each of:

      (a)   the Licence and all material related documents;

      (b)   the Software Licences;

      (c)   the Delivery Contract;

      (d)   the Finance Documents;

      (e)   **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
            SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
            CONFIDENTIAL TREATMENT**

      (f)   **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
            SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
            CONFIDENTIAL TREATMENT**

      (g)   the contracts for the procurement of or support services in relation
            to Material Assets;

      (h)   the lease agreement in respect of the Borrower's premises at
            Brnciceva ulica 49, 1231 Ljubljana and those lease agreements in
            respect of property upon which the assets subject to the Asset and
            Licence Pledge and Lease Contracts Assignment Agreement are
            situated;

      (i)   the contracts in respect of the leasing of lines or sharing of
            infrastructure;

      (j)   the Management Agreement;

      (k)   the Existing WWIC Loan Agreement;

      (l)   the documents entitled "General Terms and Conditions" relating to
            pre-paid and post-paid Subscribers which have been approved by the
            Ministry of Information Society or any substitute of such documents;


                                     - 14 -


      (m)   any other document or agreement which the Off Shore Facility Agent
            and the Borrower agree to be a Material Contract; and

      (n)   any replacement or substituted contract in respect of any of the
            above documents.

      "MONTH" means a period starting on one day in a calendar month and ending
      on the numerically corresponding day in the next calendar month, except
      that:

      (a)   (subject to paragraph (c) below) if the numerically corresponding
            day is not a Business Day, that period shall end on the next
            Business Day in that calendar month in which that period is to end
            if there is one, or if there is not, on the immediately preceding
            Business Day;

      (b)   if there is no numerically corresponding day in the calendar month
            in which that period is to end, that period shall end on the last
            Business Day in that calendar month;

      (c)   if an Interest Period begins on the last Business Day of a calendar
            month, that Interest Period shall end on the last Business Day in
            the calendar month in which that Interest Period is to end.

      The above rules will only apply to the last Month of any period.

      "NETWORK" means the Borrower's telecommunication network including,
      without limitation, all associated hardware, software, infrastructure,
      civil works, tower, masts and antenna systems, links and interconnection
      in Slovenia using the GSM ETSI standards and any evolution of these
      standards to 3GPP standards, or otherwise, and any equipment conforming to
      ITU standards and shall include all hardware, licensed software and
      documentation, services and support procured under the Delivery Contract.

      "NEW BANK" has the meaning given to it in Clause 26.1 (Assignments and
      transfers by the Banks).

      "OFF SHORE FACILITY AGENT" means IKB Deutsche Industriebank AG.

      "OFF SHORE SECURITY" has the meaning given to it in the definition of
      Security Documents in this Clause 1.1.

      "OFF SHORE SECURITY AGENT" means IKB Deutsche Industriebank AG.

      "ON SHORE FACILITY AGENT" means Nova Ljubljanska banka d.d., Ljubljana.

      "ON SHORE SECURITY" has the meaning given to it in the definition of
      Security Documents in this Clause 1.1.

      "ON SHORE SECURITY AGENT" means Nova Ljubljanska banka d.d., Ljubljana.

      "ORACLE SOFTWARE ASSIGNMENT AGREEMENT" means the assignment agreement
      relating to the Oracle software licence to be entered into between the
      Borrower and the Senior Creditors.

      "ORIGINAL EURO FACILITY BANK" means each of IKB Deutsche Industriebank AG,
      Kreditanstalt fur Wiederaufbau, Raiffeisenlandesbank Oberosterreich
      reg.Gen.m.b.H., Landesbank Schleswig-Holstein Girozentrale and Hypo
      Alpe-Adria-Bank AG.


                                     - 15 -


      "ORIGINAL FINANCIAL STATEMENTS" means in relation to the Borrower, its
      audited financial statements for the financial year ended 31 December 2001
      prepared in accordance with US GAAP.

      "ORIGINAL HEDGING COUNTERPART" means IKB International S.A., Luxembourg.

      "ORIGINAL SIT FACILITY BANK" means each of Nova Ljubljanska banka d.d. and
      Hypo Alpe-Adria-Bank d.d..

      "PARTICIPATING MEMBER STATE" means any member state of the European
      Community that adopts or has adopted the Euro as its lawful currency in
      accordance with legislation of the European Community relating to Economic
      and Monetary Union.

      "PARTY" means a party to this Agreement.

      "PERMITTED ACCOUNTS" means the accounts listed in Schedule 7 (Permitted
      Accounts), those accounts required to be opened by the Borrower under
      Clause 23 (Accounts and Payments) and/or such other accounts agreed with
      the Off Shore Facility Agent pursuant to Clause 24.22 (Bank accounts).

      "PERMITTED ASSET SALES" means any sale, lease, transfer or disposal of any
      assets (including obsolete surplus assets) of the Borrower in the ordinary
      course of business (other than sales of Material Assets) on arm's length
      terms.

      "PERMITTED ENCUMBRANCES" means:

      (a)   Security created pursuant to any of the Security Documents;

      (b)   Security which does not affect or impair the Security created
            pursuant to the Security Documents or the assets subject to the
            Security created pursuant to the Security Documents, in each case
            arising out of retention of title provisions relating to the supply
            of goods in the ordinary course of business, payment for which is
            discharged when due;

      (c)   any lien arising by operation of law in the ordinary course of the
            Borrower's business and securing an amount which is being contested
            in good faith or for which appropriate reserves have been made;

      (d)   rights of set off arising by operation of law in the ordinary course
            of the Borrower's business which are being contested in good faith
            or for which appropriate reserves have been made;

      (e)   Security created in accordance with Clause 24.33 (UMTS and other
            licences) and/or Clause 24.38 (Bills of Exchange and Security
            Deposits); and

      (f)   Security created with the consent of the Banks.

      "PERMITTED INDEBTEDNESS" has the meaning given to it in Clause 24.31
      (Indebtedness).

      "PLANNED NETWORK EXPANSION" means such part of the deliveries and services
      as agreed as at the date of the Delivery Contract to be made or rendered
      under the terms of the Delivery Contract for which the Borrower has been
      granted an option to place a firm order with the Equipment Vendor.

      "POPULATION COVERAGE" has the meaning given to it in Schedule 18
      (Population Coverage Verification).


                                     - 16 -


      "POTENTIAL EVENT OF DEFAULT" means any event or circumstance specified in
      Clause 25 (Events of Default) which would (with the expiry of a grace
      period, the giving of notice, the making of any determination under the
      Finance Documents or any combination of any of the foregoing) be an Event
      of Default.

      "PROCEEDS AND REVENUES" has the meaning given to it in Clause 23.2
      (Payments into the Proceeds and Revenue Accounts).

      "PROCEEDS AND REVENUE ACCOUNT" means any of the accounts set up in
      accordance with Clause 23.1 (Proceeds and Revenue Accounts).

      "PROJECT" means the design, construction, testing, completion and
      operation of the Network.

      "PROJECT CONTRACTS" means any agreement entered into by the Borrower from
      time to time (other than a Material Contract).

      "PROJECT COSTS" means all costs and expenses for the design, construction,
      testing, financing and completion of the Project as set out in the Initial
      Business Plan and operation of the Project in accordance with the Business
      Plan.

      "PROJECT STATUS AND PROGRESS REPORT" means a report required pursuant to
      Clause 21.1(c)(iii) (Financial statements and other information)
      substantially in the form set out in Schedule 15 (Project Status and
      Progress Report).

      "QUARTER" means each period of three months in a financial year of the
      Borrower, the first such period of any financial year commencing on the
      first day of such financial year.

      "QUOTATION DAY" means:

      (a)   in relation to any period for which an interest rate is to be
            determined in Euro two TARGET Days before the first day of that
            period unless market practice differs in the European Interbank
            Market for a currency, in which case the Quotation Day for that
            currency will be determined by the Off Shore Facility Agent in
            accordance with market practice in the European Interbank Market
            (and if quotations would normally be given by leading banks in the
            European Interbank Market on more than one day, the Quotation Day
            will be the last of those days); and

      (b)   in relation to any period for which an interest rate is to be
            determined in SIT two (2) Business Days before the first day of that
            period.

      "RECOVERING FINANCE PARTY" has the meaning given to it in Clause 29.1
      (Payments to Finance Parties).

      "REFERENCE BANKS" means, in relation to EURIBOR, the principal office in
      Frankfurt am Main of Deutsche Bank AG, the principal office in Dusseldorf
      of Westdeutsche Landesbank Girozentrale and the principal office in London
      of JP Morgan Chase or such other banks as may be appointed by the Off
      Shore Facility Agent in consultation with the Borrower.

      "REFERENCE INTEREST RATE" means, on any Quotation Day, the highest
      interest rate used by the On Shore Facility Agent for long term deposits
      of legal entities in SIT with maturities longer than two (2) years and
      shorter than 3 years and one day in accordance with the applicable
      "Resolution on Interest Rates of Nova Ljubljanska banka d.d., Ljubljana
      (Sklep o obrestnih merah Nove Ljubljanske banke d.d., Ljubljana)" or any


                                     - 17 -


      other applicable document of the On Shore Facility Agent containing
      substantially similar terms.

      "REPAYMENT DATE" means in relation to a Facility the dates specified for
      repayment in Schedule 2 (Repayment dates).

      "REPEATED REPRESENTATIONS" has the meaning given to it in Clause 20.2
      (Repetition).

      "ROLLOVER SIT FACILITY LOAN" means one or more SIT Facility Loans:

      (a)   made or to be made on the same day that a maturing SIT Facility Loan
            is due to be repaid;

      (b)   the aggregate amount of which is equal to or less than the maturing
            SIT Facility Loan in SIT; and

      (c)   made or to be made to the Borrower for the purpose of refinancing a
            maturing SIT Facility Loan.

      "RULES" has the meaning given to it in Clause 39.1 (Arbitration).

      "SALE PROCEEDS ACCOUNT" means the account established pursuant to Clause
      23.5 (Sale Proceeds Account).

      "SCREEN RATE" means, in relation to EURIBOR, the percentage rate per annum
      determined by the Banking Federation of the European Union for the
      relevant period, displayed on the appropriate page of the Reuters screen
      as of 11:00 a.m. (Brussels time) on the Quotation Day. If the agreed page
      is replaced or service ceases to be available, the Off Shore Facility
      Agent may specify another page or service displaying the appropriate rate
      after consultation with the Borrower and the Euro Facility Banks.

      "SECURITY" means a mortgage, charge, pledge, lien, bill of exchange,
      security deposit or other security interest securing any obligation of any
      person or any other agreement or arrangement having a similar effect.

      "SECURITY AGENT" means the Off Shore Security Agent and/or the On Shore
      Security Agent.

      "SECURITY ASSIGNMENT OF RIGHTS UNDER A SUPPLY AND LICENSE AGREEMENT" means
      the security assignment of rights under a supply and license agreement to
      be entered into between the Borrower and the Off Shore Facility Agent
      acting on behalf of the Senior Creditors.

      "SECURITY DOCUMENTS" means each of:

      (a)   the ECA Cover Documents;

      (b)   the Security Assignment of Rights under a Supply and License
            Agreement;

      (c)   the Delivery Contract Claims and Licence Assignment Agreement;

      (d)   the Sponsors' Cash Collateral Account Pledge Agreement;

      (e)   the Shareholders Pledge Agreement; and

      (f)   the Debt Service Reserve Account Pledge Agreement;


                                     - 18 -


            (together the "OFF SHORE SECURITY"); and

      (g)   the Borrower's Share Pledge Agreement;

      (h)   the Asset and Licence Pledge and Lease Contracts Assignment
            Agreement;

      (i)   the Claims Assignment and Bills of Exchange Agreement;

      (j)   the Bills of Exchange;

      (k)   the Assignment of Receivables as Security and Assignment of
            Insurance Policies Agreement;

      (l)   the Trademark Pledge Agreement; and

      (m)   the Oracle Software Assignment Agreement

            (together the "ON SHORE SECURITY"); and

      (n)   any other document or agreement which the Off Shore Facility Agent
            and the Borrower agree to be a Security Document.

      "SELECTION NOTICE" means a notice substantially in the form set out in
      Schedule 5 (Selection Notice) given in accordance with Clause 10 (Interest
      Periods) in relation to a Euro Facility.

      "SENIOR CO-ARRANGERS" means Raiffeisenlandesbank Oberosterreich
      reg.Gen.m.b.H. and Nova Ljubljanska banka d.d., Ljubljana.

      "SENIOR CREDITORS" means the Finance Parties, the Hedging Counterparties
      and Lucent Technologies Inc.

      "SERVICE REVENUES" means Total Revenues minus Equipment Revenues.

      "SHARE" means an ordinary fully paid up share in the Share Capital.

      "SHARE CAPITAL" means the share capital of the Borrower as increased from
      time to time in accordance with the Sponsors' and Shareholders'
      Undertaking and Completion Guarantee.

      "SHAREHOLDERS" means Western Wireless International Slovenia Corporation
      and Western Wireless International Slovenia II Corporation and any
      permitted transferee in accordance with and pursuant to the Sponsors' and
      Shareholders' Undertaking and Completion Guarantee.

      "SHAREHOLDERS PLEDGE AGREEMENT" means the shareholder pledge agreement to
      be entered into by Western Wireless International Corporation for the
      purposes of pledging its interests in the Shareholders to the Off Shore
      Security Agent acting on behalf of the Senior Creditors.

      "SHARING PAYMENT" has the meaning given to it in Clause 29.1 (Payments to
      Finance Parties).

      "SIM" means a subscriber identity module.

      "SIT" means the lawful monetary unit of the Republic of Slovenia from time
      to time.


                                     - 19 -


      "SIT FACILITY" means the revolving loan, guarantee and letter of credit
      issuance facility made available under this Agreement as described in
      Clause 2 (The Facilities).

      "SIT FACILITY APPLICABLE MARGIN" has the meaning set out in Clause
      9.3.1(b) (Calculation of floating rate interest under the SIT Facility).

      "SIT FACILITY BANK" means any Bank which has become a Party in accordance
      with the terms of this Agreement, which will participate in the SIT
      Facility and which, in any case, has not ceased to be a Party to this
      Agreement.

      "SIT FACILITY COMMITMENT" means:

      (a)   in relation to an Original SIT Facility Bank, the amount set
            opposite its name under the heading "SIT Facility Commitment" in
            Schedule 1 (Commitments) and the amount of any other SIT Facility
            Commitment transferred to it under this Agreement; and

      (b)   in relation to any other SIT Facility Bank, the amount of any SIT
            Facility Commitment transferred to it under this Agreement,

      to the extent not cancelled, reduced or transferred by it under this
      Agreement.

      "SIT FACILITY GUARANTEE OR LC" means any guarantee issued or to be issued
      or letter of credit opened or to be opened by the Issuing Bank upon
      request of the Borrower.

      "SIT FACILITY GUARANTEE OR LC PERCENTAGE" means, in relation to a SIT
      Facility Bank and a SIT Facility Guarantee or LC, the proportion
      (expressed as a percentage) borne by such SIT Facility Bank's Available
      Commitment to the Available Facility, immediately prior to the date of
      issue or opening of the SIT Facility Guarantee or LC.

      "SIT FACILITY INTEREST PAYMENT DATE" has the meaning given to it in Clause
      9.4.2 (Payment of interest).

      "SIT FACILITY LOAN" means a loan made or to be made under the SIT Facility
      or the principal amount outstanding for the time being of that loan (as
      such amount may be revalued in accordance with Clause 6.3) (Revaluation of
      SIT Facility Loans).

      "SLOVENIAN ACCOUNTING STANDARDS" means Slovenian Accounting Standards,
      issued by the Association of Accountants, Treasurers and Auditors of
      Slovenia (Zveza Racunovodij, Financnikov In Revizorjev Slovenije).

      "SMOM" means, in relation to any SIT Facility Loan:

      (a)   the applicable SMOM Screen Rate; or

      (b)   (if no Screen Rate is available for the Interest Period of that SIT
            Facility Loan) the arithmetic mean of the rates (rounded upwards to
            four decimal places) as supplied to the On Shore Facility Agent at
            its request quoted by the SMOM Reference Banks to leading banks in
            the Slovenian Interbank Market, as of 11.00 a.m. (Ljubljana time) on
            the Quotation Day for the offering of deposits in SIT for a period
            comparable to the Interest Period of the relevant SIT Facility Loan.

      "SMOM REFERENCE BANKS" means Hypo Alpe-Adria-Bank d.d., Ljubljana, SKB
      Banka d.d., Ljubljana and Nova Ljubljanska banka d.d., Ljubljana or such
      other banks as may be appointed by the On Shore Facility Agent in
      consultation with the Borrower.


                                     - 20 -


      "SMOM SCREEN RATE" means, in relation to SMOM, the percentage rate per
      annum determined by the Slovenian Banking Association for the relevant
      period displayed on its website (www.zbs-giz.si) as of 11.00 a.m.
      (Ljubljana time) on the Quotation Day. If the website is replaced or
      service ceases to be available, the On Shore Facility Agent may specify
      another website or service displaying the appropriate rate after
      consultation with the Borrower and the SIT Facility Banks.

      "SOFTWARE LICENCES" means:

      (a)   the software licence granted to the Borrower by the Equipment Vendor
            according to the Delivery Contract;

      (b)   the software licence granted to the Borrower by Protek Flagship (UK)
            Ltd in relation to customer care and billing software systems; and

      (c)   the software licence granted by Oracle Software d.o.o., Ljubljana to
            the Borrower.

      "SPONSOR CONTRIBUTIONS" means contributions made to the Borrower by way of
      Equity Contributions or Subordinated Loans.

      "SPONSORS" means Western Wireless International Corporation, Western
      Wireless International Slovenia Corporation and Western Wireless
      International Slovenia II Corporation.

      "SPONSORS' AND SHAREHOLDERS' UNDERTAKING AND COMPLETION GUARANTEE" means
      the Sponsors' and Shareholders' undertaking and completion guarantee
      agreement on or about the date of this Agreement between the Borrower, the
      Sponsors, the Shareholders and the Off Shore Facility Agent acting on
      behalf of the Senior Creditors.

      "SPONSORS' CASH COLLATERAL ACCOUNT" has the meaning given to it in the
      Sponsors' and Shareholders' Undertaking and Completion Guarantee.

      "SPONSORS' CASH COLLATERAL ACCOUNT PLEDGE AGREEMENT" means the cash
      collateral account pledge agreement to be entered into between Western
      Wireless International Corporation and the Off Shore Security Agent acting
      on behalf of the Senior Creditors.

      "SPONSORS UNSECURED LOAN AGREEMENT" means the credit agreement to be
      entered into between the Sponsors and the Borrower in respect of Sponsors
      Unsecured Loans.

      "SPONSORS UNSECURED LOANS" means any loans made by the Sponsors in
      accordance with the Sponsors Unsecured Loan Agreement up to a maximum
      principal amount of Euro 1,561,318.60 and upon the terms approved by the
      Off Shore Facility Agent prior to the date of this Agreement.

      "SUBORDINATED LOAN" means a subordinated loan (other than a Sponsors
      Unsecured Loan) made to the Borrower in accordance with the Sponsors' and
      Shareholders' Undertaking and Completion Guarantee.

      "SUBSCRIBER" means an entity or individual with an International Mobile
      Subscriber Identity belonging to the Network who is not disconnected or
      barred from making and receiving calls on the respective date of the
      reporting of the figure EXCLUDING the Borrower's employees, subscribers
      with any test SIM cards, any SIM cards used for demonstration purposes and
      any SIM cards used for international roaming tests and any contractors
      that are given terms or conditions preferable to those generally provided
      to other subscribers and:


                                     - 21 -


      (a)   For the purpose of counting the number of postpaid Subscribers, the
            Subscriber must have generated revenue of an equivalent amount of at
            least Euro 5 (excluding VAT) within the last Quarter immediately
            preceding the relevant calculation date:

      (b)   For the purposes of determining the revenue per postpaid Subscriber,
            such revenue shall be determined as follows:

            (i)   the initial connection fee depreciated on a straight line
                  basis over the minimum duration (and if not stipulated within
                  the contract, then 12 months shall be assumed) of the
                  Subscriber's contract (totalled for the relevant Quarter).

            (ii)  rental fee or periodic subscription fee of that Subscriber for
                  the relevant Quarter;

            (iii) any other periodic, one time and regular fees levied during
                  the relevant Quarter;

            (iv)  call. SMS and any usage related fees (excluding any credits
                  given to the Subscriber by the Borrower) for calls made by
                  that Subscriber during the relevant Quarter; plus

            (v)   interconnect revenue (interconnect income from other
                  operators) calculated per Subscriber during the relevant
                  Quarter.

      (c)   Handset and SIM fees charged to the Subscriber shall not be included
            in the calculation.

      (d)   For the purpose of counting the number of prepaid Subscribers, the
            Subscriber must have generated five decremented events in a given
            Quarter. A decremented event is a call, SMS or any other usage
            related fee that is decremented from the Subscriber's prepaid
            balance, (excluding any credits given to the Subscriber by the
            Borrower).

      (e)   For both post-paid and prepaid Subscribers, the 5 Euro or five
            decremented events respectively shall not apply for Subscribers that
            have been activated in the most recently reported Quarter.

      "SUBSIDIARY" means, in relation to any company or corporation, any
      company, corporation or partnership:

      (a)   which is controlled, directly or indirectly, by the first-mentioned
            company or corporation and, for these purposes, a company,
            corporation or partnership shall be treated as being controlled by a
            company or corporation if that other company or corporation is able
            to direct its affairs and/or to control the composition of its board
            of directors or equivalent body;

      (b)   more than half the issued share capital or partnership interest of
            which is beneficially owned, directly or indirectly, by the
            first-mentioned company or corporation; or

      (c)   which is a subsidiary of another subsidiary of the first-mentioned
            company or corporation.

      "TARGET" means Trans-European Automated Real-time Gross Settlement Express
      Transfer payment system.


                                     - 22 -


      "TARGET DAY" means any day on which TARGET is open for the settlement of
      payments in Euro.

      "TAX" means any tax, levy, impost, duty or other charge or withholding of
      a similar nature (including any penalty or interest payable in connection
      with any failure to pay or any delay in paying any of the same).

      "TERMINATION DATE" means 30 November 2009.

      "TOM" means the applicable base rate in accordance with the Slovenian Law
      on Prescribed Interest Rates for Late Payment and on the Base Rate
      (Official Gazettes of the Republic of Slovenia No. 45/1995 and 109/2001)
      and published by Banka Slovenije in accordance with the Decree on Base
      Interest Rate (Official Gazettes of the Republic of Slovenia No. 61/1996,
      3/1997, 23/1997 and 81/1997).

      "TOTAL COMMERCIAL FACILITY COMMITMENTS" means the aggregate of the
      Commercial Facility Commitments, being Euro 42,800,000 at the date of this
      Agreement.

      "TOTAL COMMITMENTS" means the aggregate of the Total ECA Facility
      Commitments, the Total Commercial Facility Commitments and the Total SIT
      Facility Commitments.

      "TOTAL ECA FACILITY COMMITMENTS" means the aggregate of the ECA Facility
      Commitments, being Euro 53,643,308.50 at the date of this Agreement.

      "TOTAL ECA FACILITY TRANCHE 1 COMMITMENTS" means the aggregate of the ECA
      Facility Tranche 1 Commitments.

      "TOTAL ECA FACILITY TRANCHE 2 COMMITMENTS" means the aggregate of the ECA
      Facility Tranche 2 Commitments.

      "TOTAL ECA FACILITY TRANCHE 3 COMMITMENTS" means the aggregate of the ECA
      Facility Tranche 3 Commitments.

      "TOTAL LEVERAGE RATIO" means the ratio of aggregate Financial Indebtedness
      to Annualised EBITDA of the Borrower at the relevant calculation date.

      "TOTAL REVENUES" means all revenues as determined in accordance with US
      GAAP.

      "TOTAL SIT FACILITY COMMITMENTS" means the aggregate of the SIT Facility
      Commitment, being SIT 4,400,000,000 at the date of this Agreement and
      which, at no time shall exceed the Euro equivalent amount of Euro
      20,000,000 as reduced in accordance with the terms hereof.

      "TRADEMARK PLEDGE AGREEMENT" means the trademark pledge agreement to be
      entered into between the Borrower and the Senior Creditors.

      "TRANSACTION DOCUMENTS" means:

      (a)   the Project Contracts; and

      (b)   the Material Contracts.

      "TRANSFER CERTIFICATE" means a certificate substantially in the form set
      out in Schedule 10 (Form of Transfer Certificates) or any other form
      agreed between the Off Shore Facility Agent and the Borrower.


                                     - 23 -


      "TRANSFER DATE" means, in relation to a transfer, the later of:

      (a)   the proposed transfer date specified in the Transfer Certificate;
            and

      (b)   the date on which the Agent executes the Transfer Certificate.

      "UMTS" means a Universal Mobile Telecommunications System, being the third
      generation communications system based on the standards delivered by the
      ITU and the ETSI.

      "UMTS ACTIVITIES" means all activities relating to or in connection with
      the use of UMTS technology and for the avoidance of doubt excludes any
      activities conducted using GSM 1800 frequencies.

      "UMTS SUBSIDIARY" has the meaning given to it in Clause 24.33 (UMTS and
      other licences).

      "UNPAID SUM" means any sum due and payable but unpaid under the Finance
      Documents by the Borrower.

      "UPDATED BUSINESS PLAN" means an update of the Business Plan in a manner
      consistent with the most recent financial statements delivered and
      reviewed in accordance with Clause 21 (Reporting requirements).

      "US GAAP" means generally accepted accounting principles, standards and
      practices in the United States of America consistently applied.

      "UTILISATION" means a utilisation of a Facility.

      "UTILISATION DATE" means the date of a Utilisation, being the date on
      which the relevant Loan is to be made or, as the case may be, SIT Facility
      Guarantee or LC is to be issued or opened or, in the case of a Rollover
      SIT Facility Loan, the date on which the maturing SIT Facility Loan in
      respect of which it is made is due to be repaid.

      "UTILISATION REQUEST" means a notice substantially in the form set out in
      Schedule 4A (Utilisation Request (Borrower)), Schedule 4B (Utilisation
      Request (Payments to Equipment Vendor)) or Schedule 4C (Utilisation
      Request (Payments to ECA)) as the case may be.

      "VAT" means value added tax as provided for in the Law on Value Added Tax
      published in the Official Gazettes of the Republic of Slovenia, no. 89/98,
      17/2000 - decision of Constitution Court, 30/2001 and any other tax of a
      similar nature.

      "WITHDRAWAL OF THE LICENCE" means the Licence is withdrawn or measures
      have been taken or court proceedings have been commenced which, in the
      opinion of the Majority Banks (acting reasonably), are reasonably likely
      to result in an order to withdraw the Licence as a consequence of the
      construction, coverage provided by or technical performance of the Network
      failing to meet the specifications of the Licence.

1.2   CONSTRUCTION

1.2.1 Unless a contrary indication appears, any reference in this Agreement to:

      (a)   the "OFF SHORE FACILITY AGENT", the "OFF SHORE SECURITY AGENT", the
            "ON SHORE FACILITY AGENT", the "ON SHORE SECURITY AGENT", the
            "ISSUING BANK", any "ARRANGER", any "FINANCE PARTY", any "BANK", the
            "BORROWER", any "SENIOR Creditor", any "HEDGING COUNTERPARTY" or any
            "PARTY" shall be


                                     - 24 -


            construed so as to include its successors in title, permitted
            assigns and permitted transferees;

      (b)   "ASSETS" includes present and future properties, revenues and rights
            of every description;

      (c)   "DBM" means decibel above or below 1 milliwatt;

      (d)   except as expressly provided in this Agreement, the "EQUIVALENT" on
            any given date in one currency (the "FIRST CURRENCY") of an amount
            denominated in another currency (the "SECOND CURRENCY") is a
            reference to the amount of the first currency which could be
            purchased with the amount of the second currency at the mean spot
            rate of exchange quoted to the Off Shore Facility Agent at or about
            11.00 a.m. (Dusseldorf time) on such date for the purpose of the
            purchase of the first currency with the second currency;

      (e)   the "EUROPEAN INTERBANK MARKET" means the interbank market for Euro
            operating in Participating Member States;

      (f)   a "TRANSACTION DOCUMENT" or any other agreement or instrument is a
            reference to that Transaction Document or other agreement or
            instrument as amended or novated;

      (g)   "INDEBTEDNESS" includes any obligation (whether incurred as
            principal or as surety) for the payment or repayment of money,
            whether present or future, actual or contingent;

      (h)   a "PERSON" includes any person, firm, company, corporation,
            government, state or agency of a state or any association, trust or
            partnership (whether or not having separate legal personality) or
            two or more of the foregoing;

      (i)   a "REGULATION" includes any regulation, rule, official directive,
            request or guideline (whether or not having the force of law) of any
            governmental, intergovernmental or supranational body, agency,
            department or regulatory, self-regulatory or other authority or
            organisation;

      (j)   a provision of law is a reference to that provision as amended or
            re-enacted; and

      (k)   Section, Clause and Schedule headings are for ease of reference
            only.

      (l)   unless a contrary indication appears, a term used in any other
            Finance Document or in any notice given under or in connection with
            any Finance Document has the same meaning in that Finance Document
            or notice as in this Agreement.

1.2.2 In this Agreement:

      (a)   A Potential Event of Default is continuing if it has not been
            remedied or waived.

      (b)

            (i)   An Event of Default can be assumed to be continuing unless the
                  Borrower has satisfied the Agents or Security Agents (in each
                  case acting on the instructions of the Majority Banks acting
                  reasonably) that such Event of Default has been cured or
                  waived.


                                     - 25 -


            (ii)  If any enforcement action as directed by the Majority Senior
                  Creditors in accordance with the Intercreditor Agreement,
                  permitted to be taken upon an Event of Default, has been
                  commenced, the Borrower may not subsequently cure such Event
                  of Default without the prior written consent of the Agents or
                  Security Agents (in each case acting on the instructions of
                  the Majority Senior Creditors).


                                     - 26 -


                                    SECTION 2
                                 THE FACILITIES

2.  THE FACILITIES

2.1 THE FACILITIES

      Subject to the terms of this Agreement:

      (a)   the Euro Facility Banks make available to the Borrower:

            (i)   a term loan facility in an aggregate principal amount of up to
                  the Total ECA Facility Commitments on the following basis:

                  (1)   the Total ECA Facility Tranche 1 Commitments (being no
                        more than 85% of the Estimated Contract Value being an
                        amount of not more than Euro 47,163,886.50) payable
                        directly by the Off Shore Facility Agent to the
                        Equipment Vendor subject to the conditions set out in
                        this Agreement ("ECA FACILITY TRANCHE 1"); and

                  (2)   the Total ECA Facility Tranche 2 Commitments (being no
                        more than 85% of the ECA Premium being an amount of not
                        more than Euro 2,122,820.50) payable directly by the Off
                        Shore Facility Agent to the ECA for payment of the ECA
                        Premium and/or to the Equipment Vendor in reimbursement
                        of amounts paid to the ECA in respect of the ECA Premium
                        ("ECA FACILITY TRANCHE 2"),

                  (3)   the Total ECA Facility Tranche 3 Commitments (being no
                        more than 85% of scheduled interest due on the ECA
                        Facility during the Availability Period being an amount
                        of not more than Euro 4,356,601.50) payable directly to
                        the Off Shore Facility Agent for the account of the Euro
                        Facility Banks subject to the conditions set out in this
                        Agreement ("ECA FACILITY TRANCHE 3"); and

            (ii)  a term loan facility in an aggregate principal amount of up to
                  the Total Commercial Facility Commitments; and

      (b)   the SIT Facility Banks make available to the Borrower a revolving
            loan, guarantee and letter of credit issuance facility in an
            aggregate principal amount of up to the Total SIT Facility
            Commitments.

2.2 FINANCE PARTIES' RIGHTS AND OBLIGATIONS

      (a)   The obligations of each Finance Party under the Finance Documents
            are several. Failure by a Finance Party to perform its obligations
            under the Finance Documents does not affect the obligations of any
            other party under the Finance Documents. No Finance Party is
            responsible for the obligations of any other Finance Party under the
            Finance Documents.

      (b)   The rights of each Finance Party under or in connection with the
            Finance Documents are separate and independent rights and any debt
            arising under the Finance Documents to a Finance Party from the
            Borrower shall be a separate and independent debt.


                                     - 27 -


      (c)   A Finance Party may, except as otherwise stated in the Finance
            Documents where a Finance Party must first comply with a Majority
            Banks or all Bank decision, separately enforce its rights under the
            Finance Documents.

3.    PURPOSE

3.1   PURPOSE

      (a)   The Borrower shall apply all ECA Facility Loans in payment of
            Eligible Expenditures.

      (b)   The Borrower shall apply all Commercial Facility Loans towards
            Project Costs (other than those which are financed by the ECA
            Facility) and the repayment of principal, interest and other amounts
            owing under the Existing WWIC Loan Agreement (in accordance with
            Clause 23.8 (Loan Proceeds Account)).

      (c)   The Borrower shall apply all SIT Facility Loans towards and only
            request SIT Facility Guarantees or LCs in respect of:

            (i)   Project Costs; and

            (ii)  for such other purposes as set out in this Agreement.

      In no event shall any amounts made available under this Agreement be used
      by the Borrower in connection with any UMTS Activities or for any other
      purpose than those relating to the GSM Activities unless such amounts have
      been expressly listed in the Business Plan.

3.2   MONITORING

      No Finance Party is bound to monitor or verify the application of any
      amount borrowed pursuant to this Agreement.


                                     - 28 -


                                    SECTION 3
                          UTILISATION OF THE FACILITIES

4.    CONDITIONS OF UTILISATION

4.1   CONDITIONS PRECEDENT TO THE FIRST UTILISATION UNDER ALL FACILITIES

      The Borrower may only deliver a Utilisation Request and the Banks will
      only be obliged to comply with Clause 6 (Loans) and Clause 7.1 (SIT
      Facility Banks' participation in SIT Facility Guarantees or LCs) if the
      Off Shore Facility Agent has received all of the documents and other
      evidence listed in Schedule 6 (Conditions Precedent) in form and substance
      satisfactory to the Off Shore Facility Agent (acting reasonably) or in the
      case of the funding of the Sponsors' Cash Collateral Account, the Off
      Shore Facility Agent is satisfied that contemporaneous with the first
      Utilisation such condition shall be satisfied. The Off Shore Facility
      Agent shall notify the Borrower and the Banks promptly upon being so
      satisfied.

4.2   FURTHER CONDITIONS PRECEDENT TO ALL UTILISATIONS

4.2.1 Subject to Clause 4.2.2 and other than in the case of Rollover SIT
      Facility Loans, the Banks will only be obliged to comply with Clause 6
      (Loans) and Clause 7.1 (SIT Facility Banks' participation in SIT Facility
      Guarantees or LCs) if on the date of the Utilisation Request and on the
      proposed Utilisation Date:

      (a)   the conditions set out below have been satisfied in form and
            substance satisfactory to the Off Shore Facility Agent (acting
            reasonably):

            (i)   the proposed aggregate amount of a Loan or, as the case may
                  be, SIT Facility Guarantee or LC will not exceed the Available
                  Facility under the relevant Facility;

            (ii)  the Sponsors have complied with their obligations to provide
                  Sponsor Contributions pursuant to, and the Borrower and the
                  Sponsors and/or Shareholders have complied with clause 3.4.20
                  (Confirmation of contributions) of the Sponsors' and
                  Shareholders' Undertaking and Completion Guarantee;

            (iii) the Contributed Capital Ratio is or as a result of such
                  Utilisation will be at least 0.4;

            (iv)  in respect of the SIT Facility, the aggregate SIT Facility
                  Loans and reimbursement obligations under the SIT Facility
                  Guarantees or LCs will not exceed an equivalent amount of Euro
                  20,000,000 at the exchange rate (middle rate) of Banka
                  Slovenije on the date of calculation on or before the proposed
                  Utilisation Date; and

            (v)   in respect of the SIT Facility, evidence that at least 50% of
                  the Total ECA Facility Commitments has been utilised;

      (b)   in respect of a proposed Utilisation by way of an issue or opening
            of a SIT Facility Guarantee or LC, the form of the proposed SIT
            Facility Guarantee or LC has been agreed with the Issuing Bank (in
            each case acting reasonably);

      (c)   no Event of Default or Potential Event of Default is continuing or
            would result from the proposed Loan or, as the case may be, SIT
            Facility Guarantee or LC; and


                                     - 29 -


      (d)   the Repeated Representations to be made by the Borrower are true in
            all material respects.

4.2.2 The Banks will only be obliged to comply with Clause 6 (Loans) in relation
      to a Rollover SIT Facility Loan if on the Utilisation Date:

      (a)   no Event of Default is continuing or would result from the Rollover
            SIT Facility Loan; and

      (b)   the aggregate SIT Facility Loans and reimbursement obligations under
            the SIT Facility Guarantees or LCs will not exceed the lesser of:

            (i)   an equivalent amount of Euro 20,000,000 at the exchange rate
                  (middle rate) of Banka Slovenije on the proposed Utilisation
                  Date; and

            (ii)  the amount to which the SIT Facility Commitment is to be
                  reduced in accordance with Clause 13.3 (Reduction of the SIT
                  Facility Commitment) on or before the proposed Utilisation
                  Date.

5.    UTILISATION

5.1   DELIVERY OF UTILISATION REQUEST

5.1.1 The Borrower may utilise a Facility if the Off Shore Facility Agent with
      regard to any Utilisation of the Euro Facility and the On Shore Facility
      Agent with regard to a Utilisation of the SIT Facility receives a duly
      completed Utilisation Request (together with all related documentation):

      (a)   with regard to a Utilisation of a Euro Facility Loan, no later than
            11.00 a.m. (Dusseldorf time) five (5) Business Days (or in the case
            of the first Utilisation of the Facilities, three (3) Business Days)
            prior to the proposed Utilisation Date;

      (b)   with regard to a Utilisation of a SIT Facility Loan in an amount
            exceeding SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time)
            five (5) Business Days (or in the case of the first Utilisation of
            the Facilities, three (3) Business Days) prior to the proposed
            Utilisation Date;

      (c)   with regard to a Utilisation of a SIT Facility Loan in an amount of
            up to SIT 500,000,000, no later than 11:00 a.m. (Ljubljana time) two
            (2) Business Day prior to the proposed Utilisation Date; and

      (d)   with regard to a SIT Facility Guarantee or LC, no later than 11:00
            a.m. (Ljubljana time) five (5) Business Days (or in the case of the
            first Utilisation of the Facilities, three (3) Business Days) prior
            to the proposed Utilisation Date,

      PROVIDED THAT if the Borrower fails to issue a Utilisation Request in
      respect of a Rollover SIT Facility Loan such request shall, subject to
      compliance with Clause 4.2.2(a) (Further conditions precedent to all
      Utilisations) and any repayments necessary to comply with Clause 4.2.2(b),
      be deemed to have been given by the Borrower to the On Shore Facility
      Agent.

5.1.2 If a Utilisation Request is required to be issued pursuant to Clause 5.1.1
      (Delivery of Utilisation Request) and PROVIDED THAT the Agent has received
      such Utilisation Request, the Agent shall:

      (a)   in the case of the Euro Facility, notify each Euro Facility Bank no
            later than 11:00 a.m. (Dusseldorf time) three (3) Business Days
            prior to the proposed


                                     - 30 -


            Utilisation Date of the amount of the Loan and its participation in
            that Loan; and

      (b)   in the case of the SIT Facility, notify each SIT Facility Bank no
            later than 11:00 a.m. (Ljubljana time) two (2) Business Days prior
            to the proposed Utilisation Date of the amount of the Loan, or as
            the case may be, the face amount of the SIT Facility Guarantee or LC
            and its participation therein.

5.2   COMPLETION OF A UTILISATION REQUEST

      (a)   Each Utilisation Request is irrevocable and will not be regarded as
            having been duly completed unless:

            (i)   it identifies the Facility to be utilised, and:

                  (1)   in the case of a requested Loan in respect of ECA
                        Facility Tranche 1, is in the form set out in Schedule
                        4B (Utilisation Request (Payments to Equipment Vendor)),
                        duly completed and executed by the Equipment Vendor and
                        is accompanied by the following documents that in the
                        reasonable opinion of the Off Shore Facility Agent are
                        in accordance with the "Uniform Rules for Collection,
                        1995 Revision, ICC Publication no. 522" (i) an original
                        invoice to the Borrower from the Equipment Vendor; and
                        (ii) in respect of a Utilisation Request completed with
                        reference to clause 1.10.2(b)(iii) of the Delivery
                        Contract a copy of a certificate executed by the
                        Borrower and referring to the final acceptance of the
                        Initial Configuration;

                  (2)   in the case of a requested Loan in respect of ECA
                        Facility Tranche 2 where such Loan shall be payable to
                        the Equipment Vendor in reimbursement of amounts paid to
                        the ECA in respect of the ECA Premium, is in the form
                        set out in Schedule 4C (Utilisation Request (Payments to
                        ECA)), duly completed and executed by the Equipment
                        Vendor, together with an original invoice to the
                        Equipment Vendor from the ECA that is due and payable
                        pursuant to the ECA Cover Documents; and

                  (3)   in the case of a requested Loan in respect of the
                        Commercial Facility or a request for a SIT Facility Loan
                        or SIT Facility Guarantee or LC in the form set out in
                        Schedule 4A (Utilisation Request (Borrower)) duly
                        completed and executed by the Borrower;

            (ii)  the proposed Utilisation Date is a Business Day within the
                  Availability Period applicable to that Facility;

            (iii) the amount of the Utilisation:

                  (1)   in the case of a Utilisation of the ECA Facility, is a
                        minimum amount of Euro 500,000 (except in the case of a
                        Utilisation in respect of the ECA Facility Tranche 2 or
                        ECA Facility Tranche 3) or in respect of the last
                        payment under the Delivery Contract such lesser amount
                        payable thereunder and relates to Eligible Expenditures;


                                     - 31 -


                  (2)   in the case of a Utilisation of the Commercial Facility,
                        is a minimum amount of Euro 3,000,000 or, if less, the
                        amount of Available Facility; and

                  (3)   in the case of a Utilisation of the SIT Facility, is a
                        minimum amount of SIT 100,000,000 or, if less, the
                        amount of Available Facility;

            (iv)  in the case of a Loan, the proposed Interest Period complies
                  with Clause 10 (Interest Periods).

      (b)   Only one Loan or, as the case may be, SIT Facility Guarantee or LC
            may be requested in each Utilisation Request.

      (c)   Each Utilisation Request shall be accompanied by the documentation
            and evidence as required by such Utilisation Request, in form and
            substance satisfactory to the Off Shore Facility Agent (acting
            reasonably) and, in the case of a Utilisation Request for the SIT
            Facility, the On Shore Facility Agent (acting reasonably).

5.3   AUTHORISATION

      The Off Shore Facility Agent is irrevocably authorised and instructed by
      the Borrower:

      (a)   in respect of a Utilisation Request received pursuant to:

            (i)   Clause 5.2(a)(i)(1) (Completion of a Utilisation Request) in
                  relation to a loan in respect of ECA Facility Tranche 1; or

            (ii)  Clause 5.2(a)(i)(2) (Completion of a Utilisation Request) in
                  relation to a Loan in respect of ECA Facility Tranche 2 where
                  such Loan shall be payable to the Equipment Vendor in
                  reimbursement of amounts paid to the ECA in respect of the ECA
                  Premium,

            pay the proceeds of each such Loan to, or into an account designated
            by, the Equipment Vendor;

      (b)   in respect of an amount payable:

            (i)   to the ECA in respect of the ECA Premium for which the Off
                  Shore Facility Agent has been invoiced by the ECA and in
                  respect of which a reimbursement is not payable to the
                  Equipment Vendor; or

            (ii)  under ECA Facility Tranche 3, in respect of the payment of
                  interest on the ECA Facility during the Availability Period,

            to make Loans at such times and in such manner for the payment of
            such amounts and pay the proceeds of such Loans to:

            (1)   in the case of the ECA Premium, directly to the ECA; and

            (2)   in the case of the payment of interest on the ECA Facility
                  directly to the Off Shore Facility Agent for the account of
                  the Euro Facility Banks.

      Notwithstanding that the Borrower does not issue any Utilisation Request
      in respect of such payments, the Borrower acknowledges that such payments
      made by the Off Shore Facility Agent constitute Loans under this
      Agreement. The Off Shore Facility Agent


                                     - 32 -


      will promptly notify the Borrower of the details of any Loans made under
      the ECA Facility.

6.    LOANS

6.1   EURO FACILITY BANKS' PARTICIPATION IN EURO FACILITY LOANS

      (a)   If the conditions set out in this Agreement have been met, each Euro
            Facility Bank shall make its participation in each Euro Facility
            Loan available by the Utilisation Date through its Facility Office
            to the account designated for such purpose by the Off Shore Facility
            Agent to the other Finance Parties.

      (b)   The amount of each Euro Facility Bank's participation in each Euro
            Facility Loan will be equal to the proportion borne by its Available
            Commitment to such Available Facility immediately prior to making
            the Euro Facility Loan.

6.2   SIT FACILITY BANKS' PARTICIPATION IN SIT FACILITY LOANS

      (a)   If the conditions set out in this Agreement have been met, each SIT
            Facility Bank shall make its participation in each SIT Facility Loan
            available by the Utilisation Date through its Facility Office to the
            account designated for such purpose by the On Shore Facility Agent
            to the other Finance Parties.

      (b)   The amount of each SIT Facility Bank's participation in each SIT
            Facility Loan will be equal to the proportion borne by its Available
            Commitment to such Available Facility immediately prior to making
            the SIT Facility Loan.

6.3   REVALUATION OF SIT FACILITY LOANS

      On the first day of each calendar month ("TOM DETERMINATION DATE"), the
      principal amount of the SIT Facility Loans outstanding shall be adjusted
      for inflation by the On Shore Facility Agent applying the then current
      rate of TOM in accordance with the applicable resolutions relating thereto
      and the On Shore Facility Agent's standard procedures and advise the
      Borrower and the SIT Facility Banks of any adjustments to the principal
      amount of the SIT Facility Loans outstanding for that month. The Borrower
      shall repay to the SIT Facility Banks the amount of such adjustment (if
      any) on the 8th Business Day of the calendar month immediately following
      the calendar month in which the TOM Determination Date occurred.

7.    GUARANTEES AND LETTERS OF CREDIT

7.1   SIT FACILITY BANKS' PARTICIPATION IN SIT FACILITY GUARANTEES OR LCS

      If the conditions set out in this Agreement have been met, on the
      Utilisation Date on which a SIT Facility Guarantee or LC is to be issued
      or opened, the Borrower and each SIT Facility Bank hereby authorises the
      Issuing Bank to issue or open such SIT Facility Guarantee or LC on behalf
      of the SIT Facility Banks by completing the issue or opening date and
      executing and delivering such SIT Facility Guarantee or LC to the
      Beneficiary so that each SIT Facility Bank shall be liable for its
      relevant SIT Facility Guarantee or LC Percentage of each claim thereunder
      PROVIDED THAT no SIT Facility Bank's liability to the Issuing Bank will
      exceed its Available Commitment.

7.2   SIT FACILITY GUARANTEE AND LC FEES

      The Borrower shall pay to the On Shore Facility Agent for the benefit of
      each SIT Facility Bank a fee equivalent to the SIT Facility Applicable
      Margin calculated on that SIT Facility Bank's exposure under each SIT
      Facility Guarantee or LC outstanding from time to time and pay such fee at
      the times required for the payment of interest under the SIT Facility
      Loans in accordance with Clause 9.4 (Payment of interest).


                                     - 33 -


                                    SECTION 4
                  SIT FACILITY GUARANTEES AND LETTERS OF CREDIT

8.       SIT FACILITY GUARANTEES AND LETTERS OF CREDIT

8.1   NOTIFICATION OF DEMAND

      If, at any time, a demand for payment (the amount so demanded being herein
      referred to as the "AMOUNT DEMANDED") is made by a Beneficiary to the
      Issuing Bank under any SIT Facility Guarantee or LC, the Issuing Bank
      shall notify the Borrower of such demand and provide to the Borrower a
      copy of such demand promptly and in any event by 5:00 p.m. (Ljubljana
      time) on the Business Day following receipt by the Issuing Bank of the
      demand from the Beneficiary.

8.2   DEMAND ON SIT FACILITY BANKS

      The Issuing Bank shall (at the same time as notifying the Borrower
      pursuant to Clause 8.1 (Notification of demand)) make demand of each SIT
      Facility Bank for an amount equal to its relevant SIT Facility Guarantee
      or LC Percentage of the Amount Demanded, whereupon each SIT Facility Bank
      shall pay to the Issuing Bank promptly upon receipt of a demand made on it
      by the Issuing Bank, and in any event no later than 11.00 a.m. (Ljubljana
      time) on the second Business Day following receipt of the demand, the
      amount so demanded by the Issuing Bank.

8.3   PAYMENT TO BENEFICIARIES

8.3.1 Upon receipt of all or any of the Amount Demanded pursuant to Clause 8.2
      (Demand on SIT Facility Banks), the Issuing Bank shall pay the relevant
      amount to each Beneficiary in accordance with the terms of the relevant
      SIT Facility Guarantee or LC.

8.3.2 Any payment by the Issuing Bank of the Amount Demanded made pursuant to
      Clause 8.3 (Payment to Beneficiaries) shall be deemed to be a SIT Facility
      Loan made to the Borrower by the SIT Facility Banks in an amount equal to
      the Amount Demanded PROVIDED THAT the provisions of Clause 4.2.1 (Further
      conditions precedent to all Utilisations) will not apply to such
      Utilisation.

8.3.3 The Utilisation Date of any SIT Facility Loan made under Clause 8.3.2
      (Payment to Beneficiaries) will be the date of payment of the Amount
      Demanded by the Issuing Bank under Clause 8.3.1 (Payment to
      Beneficiaries).

8.4   INDEMNIFICATION

      The Borrower hereby irrevocably and unconditionally agrees to indemnify
      and keep indemnified each SIT Facility Bank against each and every sum
      paid or payable by any such SIT Facility Bank under any SIT Facility
      Guarantee or LC and against all liabilities, costs, claims, losses,
      damages and expenses which each SIT Facility Bank may at any time incur or
      sustain in connection with or arising out of any third party actions or
      proceedings relating to such SIT Facility Guarantee or LC.

8.5   PAYMENTS UNDER THE SIT FACILITY GUARANTEES OR LCS

      The Issuing Bank and each SIT Facility Bank shall be entitled to make any
      payment under any SIT Facility Guarantee or LC for which a demand in the
      manner required by such SIT Facility Guarantee or LC has been made without
      any reference to or further authority from the Borrower or any other
      investigation or enquiry, need not concern themselves with the propriety
      of any demand made under and in the manner required by the terms of such
      SIT Facility Guarantee or LC and shall be entitled to assume that any
      person expressed in such SIT Facility Guarantee or LC or in any notice
      served pursuant to such SIT Facility Guarantee or LC to be entitled to
      make demand is so entitled and that such person is duly authorised to do
      so; accordingly, it shall not be a defence to any demand made of the
      Borrower, nor shall the Borrower's obligations hereunder be


                                     - 34 -


      impaired by the fact (if it be the case), that any SIT Facility Bank or
      the Issuing Bank was or might have been justified in refusing payment, in
      whole or in part, of the amounts so demanded.

8.6   ACTS OR OMISSIONS

      The obligations of the Borrower to the Issuing Bank and each SIT Facility
      Bank under this Clause 8.6 shall not be discharged, lessened or impaired
      by any act, omission or circumstance whatsoever which, but for this
      provision, might operate to release or exonerate the Borrower from all or
      part of such obligations or in any other way discharge, lessen or impair
      the same.

8.7   CONCLUSIVE CERTIFICATE

      A certificate of the Issuing Bank as to the amount paid out by the Issuing
      Bank or any SIT Facility Bank under any SIT Facility Guarantee or LC
      shall, save for manifest error, be conclusive and binding upon the
      Borrower for the purposes of this Agreement and prima facie evidence of
      the payment of such amounts in any legal action or proceedings arising in
      connection therewith.

8.8   CASH COLLATERAL

      In respect of any SIT Facility Guarantee or LC which has a date of expiry
      after the Termination Date, the Borrower shall at least five (5) Business
      Days before the Termination Date procure that the Issuing Bank's and SIT
      Facility Banks' actual or contingent obligations in relation to each SIT
      Facility Guarantee or LC are cancelled or discharged in full or provide
      100% cash cover to the satisfaction of the Issuing Bank and the SIT
      Facility Banks together with an authorisation from the Borrower (in form
      and substance satisfactory to the Issuing Bank) to the Issuing Bank
      permitting such cash cover to be set off against any liability of the
      Issuing Bank and the SIT Facility Banks under such SIT Facility Guarantee
      or LC.


                                     - 35 -


                                    SECTION 5
                              COSTS OF UTILISATION

9.    INTEREST ON LOANS

9.1   CALCULATION OF FLOATING RATE INTEREST UNDER THE ECA FACILITY

      The rate of interest on each ECA Facility Loan for each Interest Period is
      the percentage rate per annum which is the aggregate of the applicable:

      (a)   EURIBOR;

      (b)   a margin (the "ECA FACILITY APPLICABLE MARGIN") in an amount of,
            initially, 1.25% per annum and thereafter the rate per annum set out
            in the column headed "Margin (% p.a.)" opposite the relevant
            Population Coverage (set out in the same line in the column headed
            "Population Coverage") and subject to the achievement of the
            relevant financial performance tests (set out in the same line in
            the column headed "Financial Performance") in the table below, in
            each case as at the end of the most recently ended Quarter:



            POPULATION                                                               MARGIN
            COVERAGE              FINANCIAL PERFORMANCE                              (% P.A.)
            ----------            ---------------------                              -------
                                                                               
            75%                   EBITDA for the immediately preceding two (2)       1.10
                                  Quarters does not negatively deviate by more
                                  than 10% from the EBITDA in the Initial
                                  Business Plan.

            80%                   EBITDA for the immediately preceding two (2)       1.00
                                  Quarters does not negatively deviate by more
                                  than 10% from the EBITDA in the Initial
                                  Business Plan.

            87%                   Total Leverage Ratio greater than 6.00.            0.90

            87%                   Total Leverage Ratio less than or equal to         0.80
                                  6.00 and greater than 5.00.

            87%                   Total Leverage Ratio less than or equal to         0.70
                                  5.00 and greater than 4.00.

            87%                   Total Leverage Ratio less than or equal to         0.60
                                  4.00 and greater than 3.00.

            87%                   Total Leverage Ratio less than or equal to         0.50
                                  3.00 and greater than 2.00.

            87%                   Total Leverage Ratio less than or equal to         0.40
                                  2.00.


            PROVIDED THAT:

            (i)   any change to the ECA Facility Applicable Margin shall take
                  place from the immediately following Euro Facility Interest
                  Payment Date (the "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT
                  DATE") (subject to Clause 9.1(b)(iii)) if:

                  (1)   the Borrower has requested a reduction in the Applicable
                        Margin in the Covenant Compliance Certificate at least
                        15 Business Days prior to such Euro Facility Interest
                        Payment Date or the Off Shore Facility Agent has
                        notified the Borrower, based on the information referred
                        to in (2) below, that there will be an increase in the
                        Applicable Margin in accordance with the above
                        provisions of this paragraph (b);


                                     - 36 -


                  (2)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        financial performance of the Borrower on the basis of
                        the most recent information required to be provided by
                        the Borrower pursuant to Clauses 21.1(a) and (c)
                        (Financial statements and other information) and Clause
                        21.3 (Covenant Compliance Certificate);

                  (3)   no Event of Default or Potential Event of Default is
                        continuing; and

                  (4)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        Population Coverage (on receipt of confirmation of such
                        Population Coverage from the Independent Technical
                        Consultant) or such confirmation has not been received
                        by the date upon which the Borrower would be entitled to
                        a change in the ECA Facility Applicable Margin (had such
                        confirmation been received);

            (ii)  if the Off Shore Facility Agent has not received the
                  information required to be provided by the Borrower pursuant
                  to Clauses 21.1(a) and (c) (Financial statements and other
                  information) and Clause 21.3 (Covenant Compliance Certificate)
                  in respect of the relevant period by its due date for delivery
                  pursuant to this Agreement, the Applicable Margin will be
                  1.25% per annum from that date until such time as the Borrower
                  satisfies the conditions set out in this paragraph (b) and is
                  in compliance with its obligations under Clause 21 (Reporting
                  requirements);

            (iii) if after an ECA Facility Applicable Margin Adjustment Date the
                  Independent Technical Consultant is of the opinion that the
                  above conditions relating to Population Coverage have not been
                  satisfied but the ECA Facility Applicable Margin has been
                  changed by the Off Shore Facility Agent the ECA Facility
                  Applicable Margin shall be readjusted to the applicable level
                  in accordance with the above provisions of this paragraph (b)
                  for the entire Interest Period from such ECA Facility
                  Applicable Margin Adjustment Date.

9.2   CALCULATION OF FLOATING RATE INTEREST UNDER THE COMMERCIAL FACILITY

      The rate of interest on each Commercial Facility Loan for each Interest
      Period is the percentage rate per annum which is the aggregate of the
      applicable:

      (a)   EURIBOR;

      (b)   a margin (the "COMMERCIAL FACILITY APPLICABLE MARGIN") in an amount
            of, initially, 3.25% per annum and thereafter the rate per annum set
            out in the column headed "Margin (% p.a.)" opposite the relevant
            Population Coverage (set out in the same line in the column headed
            "Population Coverage") and subject to the achievement of the
            relevant financial performance tests (set out in the same line in
            the column headed "Financial Performance") in the table below, in
            each case as at the end of the most recently ended Quarter:

                                     - 37 -




                 POPULATION COVERAGE   FINANCIAL PERFORMANCE                                  MARGIN (% P.A.)
                 -------------------   ---------------------                                  ---------------
                                                                                        
                 75%                   EBITDA for the immediately preceding two (2)           2.50
                                       Quarters does not negatively deviate by more
                                       than 10% from the
                                       EBITDA in the Initial Business Plan.

                 80%                   EBITDA for the immediately preceding two (2)           2.25
                                       Quarters does not negatively deviate by more
                                       than 10% from the EBITDA in the Initial
                                       Business Plan.

                 87%                   Total Leverage Ratio greater than 6.00 or              2.25
                                       EBITDA for the immediately preceding two (2)
                                       Quarters is negative.

                 87%                   Total Leverage Ratio less than or equal to             2.00
                                       6.00 and greater than 5.00.

                 87%                   Total Leverage Ratio less than or equal to             1.50
                                       5.00 and greater than 4.00.

                 87%                   Total Leverage Ratio less than or equal to             1.25
                                       4.00 and greater than 3.00.

                 87%                   Total Leverage Ratio less than or equal to             1.00
                                       3.00 and greater than 2.00.

                 87%                   Total Leverage Ratio less than or equal to             0.75
                                       2.00.


            PROVIDED THAT:

            (i)   any change to the Commercial Facility Applicable Margin shall
                  take place from the immediately following Euro Facility
                  Interest Payment Date (the "COMMERCIAL FACILITY APPLICABLE
                  MARGIN ADJUSTMENT DATE") (subject to Clause 9.2(b)(iii)) if:

                  (1)   the Borrower has requested a reduction in the Applicable
                        Margin in the Covenant Compliance Certificate at least
                        15 Business Days prior to such Euro Facility Interest
                        Payment Date or the Off Shore Facility Agent has
                        notified the Borrower, based on the information referred
                        to in (2) below, that there will be an increase in the
                        Applicable Margin in accordance with the above
                        provisions of this paragraph (b);

                  (2)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        financial performance of the Borrower on the basis of
                        the most recent information required to be provided by
                        the Borrower pursuant to Clauses 21.1(a) and (c)
                        (Financial statements and other information) and Clause
                        21.3 (Covenant Compliance Certificate);

                  (3)   no Event of Default or Potential Event of Default is
                        continuing; and

                  (4)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        Population Coverage (on receipt of confirmation of such
                        Population Coverage from the Independent Technical
                        Consultant) or such confirmation has not been received
                        by the date upon which the Borrower would be entitled to
                        a change in the Commercial Facility Applicable Margin
                        (had such confirmation been received);

            (ii)  if the Off Shore Facility Agent has not received the
                  information required to be provided by the Borrower pursuant
                  to Clauses 21.1(a)


                                     - 38 -


                  and (c) (Financial statements and other information) and
                  Clause 21.3 (Covenant Compliance Certificate) in respect of
                  the relevant period by its due date for delivery pursuant to
                  this Agreement, the Applicable Margin will be 3.25% per annum
                  from that date until such time as the Borrower satisfies the
                  conditions set out in this paragraph (b) and is in compliance
                  with its obligations under Clause 21 (Reporting requirements);

            (iii) if after a Commercial Facility Applicable Margin Adjustment
                  Date the Independent Technical Consultant is of the opinion
                  that the above conditions relating to Population Coverage have
                  not been satisfied but the Commercial Facility Applicable
                  Margin has been changed by the Off Shore Facility Agent, the
                  Commercial Facility Applicable Margin shall be readjusted to
                  the applicable level in accordance with the above provisions
                  of this paragraph (b) for the entire Interest Period from such
                  Commercial Facility Applicable Margin Adjustment Date.

9.3   CALCULATION OF FLOATING RATE INTEREST UNDER THE SIT FACILITY

9.3.1 The rate of interest on each SIT Facility Loan for each Interest Period is
      the aggregate sum of:

      (a)   the Reference Interest Rate; and

      (b)   a margin (the "SIT FACILITY APPLICABLE MARGIN") in an amount of,
            initially, 1.50% per annum and thereafter the rate per annum set out
            in the column headed "Margin (% p.a.)" subject to the achievement,
            as at the end of the most recently ended Quarter, of the relevant
            financial performance tests set out in the same line in the column
            headed "Financial Performance" in the table below:



                 FINANCIAL PERFORMANCE                                        MARGIN (% P.A.)
                 ---------------------                                        ---------------

                                                                           
                 Total Leverage Ratio greater than 4.00 or EBITDA for         1.50
                 the immediately preceding two (2) Quarters is negative

                 Total Leverage Ratio less than or equal to 4.00 and          1.25
                 greater than 2.00

                 Total Leverage Ratio less than or equal to 2.00              1.00


            PROVIDED THAT:

            (i)   any change to the SIT Facility Applicable Margin shall take
                  place from the first day of the immediately following Interest
                  Period if:

                  (1)   the Borrower has requested a reduction in the Applicable
                        Margin in the Covenant Compliance Certificate at least
                        15 Business Days prior to such Interest Period or the
                        Off Shore Facility Agent has notified the Borrower,
                        based on the information referred to in (2) below, that
                        there will be an increase in the Applicable Margin in
                        accordance with the above provisions of this paragraph
                        (b);

                  (2)   the On Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        financial performance of the Borrower on the basis of
                        the most recent information required to be provided by
                        the Borrower pursuant to Clauses 21.1(a) and


                                     - 39 -


                        (c)   (Financial statements and other information) and
                              Clause 21.3 (Covenant Compliance Certificate); and

                  (3)   no Event of Default or Potential Event of Default is
                        continuing;

            (ii)  if the On Shore Facility Agent has not received the
                  information required to be provided by the Borrower pursuant
                  to Clauses 21.1(a) and (c) (Financial statements and other
                  information) and Clause 21.3 (Covenant Compliance Certificate)
                  in respect of the relevant period by its due date for delivery
                  pursuant to this Agreement, the Applicable Margin will be
                  1.50% per annum from that date until such time as the Borrower
                  satisfies the conditions set out in this paragraph (b) and is
                  in compliance with its obligations under Clause 21 (Reporting
                  requirements).

9.4   PAYMENT OF INTEREST

9.4.1 The Borrower shall pay accrued interest on each Euro Facility Loan on each
      Euro Facility Interest Payment Date.

9.4.2 The Borrower shall pay on each SIT Facility Loan interest accrued in
      respect of an Interest Period on the 8th Business Day of the calendar
      month immediately following the calendar month in which the last day of
      that Interest Period (a "SIT FACILITY INTEREST PAYMENT DATE") occurred.

9.5   DEFAULT INTEREST

9.5.1 If the Borrower fails to pay any amount (other than interest) payable by
      it hereunder on its due date, interest will accrue on the overdue amount
      from the due date up to the date of actual payment at a rate of 2 per
      cent. per annum above:

      (a)   in relation to an amount becoming due and payable before expiration
            of the Interest Period applicable thereto, for the period until the
            expiration of such Interest Period the rate applicable to such
            overdue amount immediately prior to the due date; and

      (b)   in all other cases, the interest rate on the most recent Quotation
            Day for such periods as the Agent may designate, PROVIDED THAT such
            Interest Period will not exceed three (3) months,

      All interest accrued hereunder shall be paid at the end of each month.

9.5.2 If the Borrower fails to pay any interest payable by it hereunder on its
      due date, it will make, at the time of payment of all arrears of interest
      and in any event on a monthly basis, a lump sum payment for all arrears of
      interest in the amount of 2 per cent. above, in the case of the Euro
      Facility, EURIBOR for such periods as the Agent may designate or, in the
      case of the SIT Facility, SMOM applicable to an interest period of one (1)
      month.

9.5.3 The rights of the Banks to compensation for any loss (in addition to those
      set out in Clauses 9.5.1 and 9.5.2) arising from the default remain
      unaffected.

9.5.4 The Agent will promptly notify the Borrower and the Banks of the
      determination of any default interest. Each determination by the Agent
      will, in the absence of a manifest error, be conclusive and binding on the
      Borrower and the Banks.


                                     - 40 -


9.6   NOTIFICATION OF INTEREST RATES

      The Off Shore Facility Agent shall promptly notify the relevant Banks and
      the Borrower of the determination of a rate of interest in respect of the
      ECA Facility or the Commercial Facility and the On Shore Facility Agent
      shall promptly notify the Off Shore Facility Agent, the relevant Banks and
      the Borrower of the determination of a rate of interest in respect of the
      SIT Facility.

10.   INTEREST PERIODS

10.1  INTEREST PERIODS FOR THE EURO FACILITY LOANS

      (a)   The first Interest Period for the first Euro Facility Loan shall
            begin on the Utilisation Date therefor and shall end on the last day
            of the calendar month in which such Utilisation is made. The first
            Interest Period for any subsequent Euro Facility Loan shall begin on
            the Utilisation Date therefor and shall end on the last day of the
            then applicable Interest Period relating to the first Euro Facility
            Loan.

      (b)   The Borrower may select an Interest Period for a Loan under the Euro
            Facility in a Selection Notice.

      (c)   Each Selection Notice for a Loan under the Euro Facility is
            irrevocable and must be delivered to the Off Shore Facility Agent by
            the Borrower no later than 11.00 a.m. (Dusseldorf time) five (5)
            Business Days prior to the first day of the relevant Interest
            Period. Upon receipt of a Selection Notice from the Borrower the Off
            Shore Facility Agent shall notify each Euro Facility Bank no later
            than 11.00 a.m. (Dusseldorf time) three (3) Business Days prior to
            the first day of the relevant Interest Period.

      (d)   If the Borrower fails to deliver a Selection Notice to the Off Shore
            Facility Agent in accordance with paragraph (c) above, the relevant
            Interest Period will be three (3) Months and the Off Shore Facility
            Agent shall notify each Euro Facility Bank accordingly.

      (e)   Subject to this Clause 10, the Borrower may select an Interest
            Period of 3, 6 or 12 Months or any other period agreed between the
            Borrower and the Off Shore Facility Agent (acting on the
            instructions of all Euro Facility Banks) PROVIDED THAT the Borrower
            shall select Interest Periods to ensure that the Interest Period
            immediately preceding a Repayment Date under the Euro Facility ends
            on such Repayment Date.

10.2  INTEREST PERIODS FOR THE SIT FACILITY LOANS

      (a)   Each Interest Period under the SIT Facility, other than the first
            Interest Period for each SIT Facility Loan, shall begin on the first
            day and end on the last day of each calendar month.

      (b)   The first Interest Period for each Loan under the SIT Facility shall
            begin on the Utilisation Date of a SIT Facility Loan and end on the
            last day of the calendar month during which the drawdown occurred.

10.3  DURATION OF INTEREST PERIODS An Interest Period for a Loan shall not
      extend beyond the Termination Date.

10.4  NON-BUSINESS DAYS Except as provided in Clause 10.2 (Interest Periods for
      the SIT Facility Loans), if an Interest Period would otherwise end on a
      day which is not a Business Day, that Interest


                                     - 41 -


      Period will instead end on the next Business Day in that calendar month
      (if there is one) or the preceding Business Day (if there is not).

10.5  CONSOLIDATION

      If two or more Interest Periods relate to a Loan in the same currency and
      end on the same date those Loans will, unless the Borrower specifies to
      the contrary, be consolidated into, and treated as, a single Loan on the
      last day of the Interest Period.

11.   CHANGES TO THE CALCULATION OF INTEREST

11.1  ABSENCE OF QUOTATIONS

      Subject to Clause 11.2 (Market disruption), if EURIBOR is to be determined
      by reference to the Reference Banks but a Reference Bank does not supply a
      quotation by 11:00 a.m. (Brussels Time) on the Quotation Day, the
      applicable EURIBOR shall be determined on the basis of the quotations of
      the remaining Reference Banks.

11.2  MARKET DISRUPTION

      (a)   If a Market Disruption Event occurs in relation to a Euro Facility
            Loan for any Interest Period, then the rate of interest on each Euro
            Facility Bank's share of that Euro Facility Loan for the Interest
            Period shall be the rate per annum which is the sum of:

            (i)   the Applicable Margin; and

            (ii)  the rate notified to the Off Shore Facility Agent by that Bank
                  as soon as practicable and in any event before interest is due
                  to be paid in respect of that Interest Period, to be that
                  which expresses as a percentage rate per annum the cost to
                  that Euro Facility Bank of funding its participation in that
                  Euro Facility Loan from whatever source it may reasonably
                  select.

      (b)   The Off Shore Facility Agent shall, upon becoming aware of a Market
            Disruption Event, notify the Borrower thereof.

      (c)   In this Agreement "MARKET DISRUPTION EVENT" means:

            (i)   at or about noon on the Quotation Day for the relevant
                  Interest Period the Screen Rate is not available and none or
                  only one of the Reference Banks supplies a rate to the Off
                  Shore Facility Agent to determine EURIBOR for the relevant
                  currency and Interest Period; or

            (ii)  before close of business in Dusseldorf on the Quotation Day
                  for the relevant Interest Period, the Off Shore Facility Agent
                  receives notifications from a Euro Facility Bank or Euro
                  Facility Banks (whose participations in a Euro Facility Loan
                  in aggregate exceed 66 2/3 per cent. of that Euro Facility
                  Loan) that the cost to it of obtaining matching deposits in
                  the European Interbank Market would be in excess of EURIBOR.

11.3  ALTERNATIVE BASIS OF INTEREST OR FUNDING

(a)   If a Market Disruption Event occurs and the Off Shore Facility Agent or
      the Borrower so requires, the Off Shore Facility Agent and the Borrower
      shall enter into negotiations (for a period of not more than thirty days)
      with a view to agreeing a substitute basis for determining the rate of
      interest.


                                     - 42 -


      (b)   Any alternative basis agreed pursuant to paragraph (a) above shall,
            with the prior consent of all the Euro Facility Banks and the
            Borrower, be binding on all Parties.

11.4  BREAK COSTS

      (a)   The Borrower shall, within three (3) Business Days of demand by a
            Finance Party, pay to that Finance Party its Break Costs
            attributable to all or any part of a Loan or Unpaid Sum being paid
            by that Borrower on a day other than the last day of an Interest
            Period for that Loan or Unpaid Sum.

      (b)   Each Bank shall, as soon as reasonably practicable after a demand by
            the Off Shore Facility Agent, provide a certificate confirming the
            amount of its Break Costs for any Interest Period in which they
            accrue.

12.   FEES

12.1  COMMITMENT FEES

      (a)   The Borrower shall pay to the Off Shore Facility Agent (for the
            account of each Euro Facility Bank) a fee computed at the rate of:

            (i)   0.75% per annum on each Bank's Available Commitment under the
                  Euro Facility until 75% of the ECA Facility Commitment and the
                  Commercial Facility Commitment has been disbursed; and

            (ii)  thereafter 0.50% per annum on that Bank's Available Commitment
                  under the Euro Facility for the Availability Period applicable
                  to the Euro Facility.

      (b)   The Borrower shall pay to the On Shore Facility Agent (for the
            account of each SIT Facility Bank) a fee computed at the rate of
            0.10% per annum on the Available Commitment under the SIT Facility.

      (c)   The fees under paragraphs (a) and (b) above shall be payable
            quarterly in arrears from the date of execution of this Agreement.

12.2  UNDERWRITING FEE

      The Borrower shall pay to the Off Shore Facility Agent (for the account of
      each of the Arrangers) within ten (10) Business Days after execution of
      this Agreement an underwriting fee as set out in a Fee Letter.

12.3  ON SHORE SECURITY AGENT FEE

      The Borrower shall pay to the On Shore Security Agent for its services an
      annual fee as set out in a Fee Letter.

12.4  SIT FACILITY GUARANTEE OR LC ISSUANCE FEES

      The Borrower shall pay to the Issuing Bank for its own account a fronting
      fee, at the rates set out in the Fee Letter and payable at the times and
      in the manner set forth therein.

12.5  ECA PREMIUM

      The Borrower shall pay or reimburse the Off Shore Facility Agent and/or
      the Equipment Vendor for payment of any ECA Premium to the ECA.


                                     - 43 -


12.6  PROCEEDS AND REVENUE ACCOUNT #2

      The Borrower shall pay to Hypo Alpe-Adria-Bank d.d., for its own account,
      fees in relation to the opening and handling of the Proceeds and Revenue
      Account #2 as set out in the Fee Letter and payable at the times and in
      the manner set forth therein.


                                     - 44 -


                                    SECTION 6
                                    REPAYMENT

13.    REPAYMENT

13.1   REPAYMENT OF THE EURO FACILITY LOANS

13.1.1 Each Euro Facility Loan shall be repaid on the dates and in the amounts
       which correspond to the percentage rates set out in Schedule 2 (Repayment
       dates).

13.1.2 The Borrower may not re-borrow any part of a Euro Facility Loan which is
       repaid.

13.2   REPAYMENT OF THE SIT FACILITY LOANS

       Each SIT Facility Loan shall be repaid on the last day of its Interest
       Period PROVIDED THAT if the conditions set out in Clause 4.2.2 (Further
       conditions precedent to all Utilisations) are satisfied or the proviso in
       Clause 5.1.1 (Delivery of Utilisation Request) applies the Borrower may
       refinance any outstanding SIT Facility Loans with SIT Facility Rollover
       Loans.

13.3   REDUCTION OF THE SIT FACILITY COMMITMENT

       The SIT Facility Commitment shall be reduced on the dates and in the
       amounts which correspond to the percentage rates set out in Schedule 2
       (Repayment Dates).


                                     - 45 -


                                    SECTION 7
                           PREPAYMENT AND CANCELLATION

14.   PREPAYMENT AND CANCELLATION

14.1  ILLEGALITY

       If it becomes unlawful in any applicable jurisdiction for a Bank to
       perform any of its obligations as contemplated by this Agreement:

      (a)   that Bank shall promptly notify the Off Shore Facility Agent upon
            becoming aware of that event;

      (b)   the Off Shore Facility Agent shall, upon becoming aware of the same,
            notify the Borrower thereof;

      (c)   upon the Off Shore Facility Agent notifying the Borrower and if
            necessary the On Shore Facility Agent, the Commitment of that Bank
            will be immediately cancelled;

      (d)   the Borrower shall repay that Bank's participation in the Loans made
            to the Borrower on the last day of the Interest Period for each Loan
            occurring after the Off Shore Facility Agent has notified the
            Borrower or, if earlier, the date specified by the Bank in the
            notice delivered to the Off Shore Facility Agent (being no earlier
            than the last day of any applicable grace period permitted by law);
            and

      (e)   if such Bank is the Issuing Bank or a SIT Facility Bank guaranteeing
            the Issuing Bank, the Borrower shall procure that the Issuing Bank's
            or SIT Facility Bank's actual or contingent obligations in relation
            to each SIT Facility Guarantee or LC are cancelled or discharged in
            full or within 30 days from the date of the notification mentioned
            in (d) above provide 100% cash cover to the satisfaction of the
            Issuing Bank and the SIT Facility Banks together with an
            authorisation from the Borrower (in form and substance satisfactory
            to the Issuing Bank, acting reasonably) to the Issuing Bank
            permitting such cash cover to be set off against any liability of
            the Issuing Bank and the SIT Facility Banks under such SIT Facility
            Guarantee or LC.

14.2  CHANGE OF CONTROL, WITHDRAWAL OF THE LICENCE AND ABANDONMENT OF THE
      PROJECT

      If:

      (a)   Western Wireless International Corporation's direct or indirect
            shareholding in the Borrower at any time falls below 80% of the
            Share Capital without the prior written consent of the Majority
            Banks;

      (b)   there is a Withdrawal of the Licence; or

      (c)   there is an Abandonment of the Project,

            then:

            (i)   the Borrower shall promptly notify the Off Shore Facility
                  Agent upon becoming aware of that event;

            (ii)  the Borrower shall not request a Utilisation (except for a
                  Rollover SIT Facility Loan) unless otherwise agreed by the
                  Majority Banks;


                                     - 46 -


            (iii) the Off Shore Facility Agent may (acting on the instructions
                  of the Majority Banks), by not less than 30 days notice to the
                  Borrower, declare all outstanding Loans, together with accrued
                  interest, and all other amounts accrued under the Finance
                  Documents immediately due and payable;

            (iv)  the Off Shore Facility Agent may (acting on the instructions
                  of the Majority Banks), instruct each Bank to cancel its
                  Available Commitment; and

            (v)   the Borrower shall procure that the Issuing Bank's actual or
                  contingent obligations in relation to each SIT Facility
                  Guarantee or LC are cancelled or discharged in full or within
                  30 days from the date of the declaration mentioned in (iii)
                  above provide 100% cash cover to the satisfaction of the
                  Issuing Bank and the SIT Facility Banks together with an
                  authorisation from the Borrower (in form and substance
                  satisfactory to the Issuing Bank, acting reasonably) to the
                  Issuing Bank permitting such cash cover to be set off against
                  any liability of the Issuing Bank and the SIT Facility Banks
                  under such SIT Facility Guarantee or LC.

14.3   CANCELLATION BY THE BORROWER

       The Borrower may, if it gives the Off Shore Facility Agent and, in
       respect of a cancellation of the SIT Facility Commitment, the On Shore
       Facility Agent not less than five (5) Business Days' prior notice and has
       satisfied the Off Shore Facility Agent (acting reasonably) that it has
       sufficient funds to pay all relevant Project Costs, cancel the whole or
       any part (being a minimum amount of Euro 1,000,000 or the equivalent
       amount in SIT at the exchange rate (middle rate) of Banka Slovenije on
       the relevant calculation date) of an Available Facility in respect of the
       SIT Facility or the Commercial Facility. Subject to Clause 14.6.1 (Right
       of repayment and cancellation in relation to a single Bank), the Borrower
       may only cancel any part of an Available Facility in respect of the ECA
       Facility with the prior written consent of the ECA, the Equipment Vendor
       and the Off Shore Facility Agent. Any cancellation under this Clause 14.3
       shall reduce the Commitments of the Banks rateably under that Facility.

14.4   VOLUNTARY PREPAYMENT OF EURO FACILITY LOANS

       In addition to the Borrower's rights set forth in Clause 14.6 (Right of
       repayment and cancellation in relation to a single Bank) the Borrower
       may, after the end of the Availability Period and if it gives the Off
       Shore Facility Agent not less than five (5) Business Days' (or such
       shorter period as the Majority Banks may agree) prior notice, prepay any
       part of any ECA Facility Loan and any Commercial Facility Loan in minimum
       amounts of Euro 1,000,000.

14.5   MANDATORY PREPAYMENTS

14.5.1 The Borrower shall:

      (a)   on the immediately following Interest Payment Date, apply all
            proceeds of sale or exchange of any assets required to be repaid in
            accordance with Clause 23.5 (Sale Proceeds Account);

      (b)   on the immediately following Interest Payment Date, apply proceeds
            of insurance policies required to be prepaid in accordance with
            Clause 23.4 (Insurance Proceeds Account);


                                     - 47 -


      (c)   on the last Interest Payment Date of each Quarter of the Borrower
            apply 50% of the Excess Cash Flow; and

      (d)   on the last Interest Payment Date of each Quarter, apply all amounts
            that have been standing to the credit of the Capital Expenditure
            Reserve Account for a period of more than twelve (12) months,

       towards the mandatory prepayment of the Euro Facility Loans and the
       Lucent Loan Agreement and, at the option of the On Shore Facility Agent,
       a reduction of the SIT Facility Commitments.

14.5.2 Prepayments under Clause 14.5.1 (Mandatory prepayments) will be applied
       in an inverse order of maturity to the amounts outstanding under the Euro
       Facility Loans and the Lucent Loan Agreement, and, if the On Shore
       Facility Agent has requested reduction of the SIT Facility Commitments or
       prepayment of SIT Facility Loans, under the SIT Facility pro rata across
       the relevant Facilities. If the On Shore Facility Agent elects such
       reduction in the SIT Facility Commitments, the Available Commitment in
       respect of the SIT Facility shall be cancelled by the amount which is
       applied in reduction thereof.

14.6   RIGHT OF REPAYMENT AND CANCELLATION IN RELATION TO A SINGLE BANK

14.6.1 If:

      (a)   any sum payable to any Bank by the Borrower is required to be
            increased under Clause 15.2(c) (Tax gross-up); or

      (b)   any Bank claims indemnification from the Borrower under Clause 15.3
            (Tax indemnity) or Clause 16.1 (Increased Costs);

       and the steps, if any, taken by the relevant Finance Party in accordance
       with Clause 18 (Mitigation by the Banks) have not successfully mitigated
       the circumstance giving rise to the requirement or indemnification, the
       Borrower may, whilst the circumstance giving rise to the requirement or
       indemnification continues, give the Agent notice of cancellation of the
       Commitment of that Bank and its intention to procure the repayment of
       that Bank's participation in the Loans.

14.6.2 On receipt of a notice referred to in Clause 14.6.1(a) (Right of
       repayment and cancellation in relation to a single Bank), the Commitment
       of that Bank shall immediately be reduced to zero.

14.6.3 On the last day of each Interest Period which ends after the Borrower has
       given notice under Clause 14.6.1(a) (Right of repayment and cancellation
       in relation to a single Bank) (or, if earlier, the date specified by the
       Borrower in that notice), the Borrower shall repay that Bank's
       participation in the Loans.

14.7   RESTRICTIONS

14.7.1 Any notice of cancellation or prepayment given by any Party under this
       Clause 14 shall be irrevocable and, unless a contrary indication appears
       in this Agreement, shall specify the date or dates upon which the
       relevant cancellation or prepayment is to be made and the amount of that
       cancellation or prepayment.

14.7.2 Any prepayment under this Agreement shall be made together with accrued
       interest on the amount prepaid and, subject to any Break Costs, without
       premium or penalty.


                                     - 48 -


14.7.3 The Borrower shall not repay or prepay all or any part of the Loans or
       cancel all or any part of the Commitments except at the times and in the
       manner expressly provided for in this Agreement.

14.7.4 If the Off Shore Facility Agent receives a notice under this Clause 14 it
       shall promptly forward a copy of that notice to either the Borrower or
       the affected Bank, as appropriate.

14.7.5 Unless a contrary indication appears in this Agreement, amounts prepaid
       may not be reborrowed.

14.7.6 No amount of the Total Commitments cancelled under this Agreement may be
       subsequently reinstated.

14.7.7 Any prepayment under Clause 14.4 (Voluntary prepayment of Euro Facility
       Loans) and Clause 14.5 (Mandatory prepayments) shall satisfy the
       obligations under Clause 13 (Repayment) in inverse chronological order.


                                     - 49 -


                                    SECTION 8
                         ADDITIONAL PAYMENT OBLIGATIONS

15.    TAX GROSS-UP AND INDEMNITIES

15.1   DEFINITIONS

15.1.1 In this Clause 15:

       "PROTECTED PARTY" means a Finance Party which is or will be, for or on
       account of Tax, subject to any liability or required to make any payment
       in relation to a sum received or receivable (or any sum deemed for the
       purposes of Tax to be received or receivable) under a Finance Document.

       "TAX CREDIT" means a credit against, relief or remission for, or
       repayment of any Tax.

       "TAX DEDUCTION" means a deduction or withholding for or on account of Tax
       from a payment under a Finance Document.

       "TAX PAYMENT" means an increased payment made by the Borrower to a
       Finance Party under Clause 15.2 (Tax gross-up) or a payment under Clause
       15.3 (Tax indemnity).

15.1.2 In this Clause 15 a reference to "determines" or "determined" means a
       determination made in the absolute discretion of the person making the
       determination and the determination may be on an affiliated group basis.

15.2   TAX GROSS-UP

      (a)   The Borrower shall make all payments to be made by it without any
            Tax Deduction, unless a Tax Deduction is required by law.

      (b)   The Borrower or a Bank shall promptly upon becoming aware that the
            Borrower must make a Tax Deduction (or that there is any change in
            the rate or the basis of a Tax Deduction) notify the Off Shore
            Facility Agent accordingly. If the Off Shore Facility Agent receives
            such notification from a Bank it shall promptly notify the Borrower.

      (c)   If a Tax Deduction is required by law to be made by the Borrower in
            one of the circumstances set out in paragraph (d) below, unless
            paragraph (g) below applies, the amount of the payment due from the
            Borrower shall be increased to an amount which (after making any Tax
            Deduction) leaves an amount equal to the payment which would have
            been due if no Tax Deduction had been required.

      (d)   The circumstances referred to in paragraph (c) above are where a
            person entitled to the payment is an Agent, an Arranger or a
            Security Agent, Issuing Bank or a Bank.

      (e)   If the Borrower is required to make a Tax Deduction, the Borrower
            shall make that Tax Deduction and any payment required in connection
            with that Tax Deduction within the time allowed and in the minimum
            amount required by law.

      (f)   Within thirty days of making either a Tax Deduction or any payment
            required in connection with that Tax Deduction, the Borrower making
            that Tax Deduction shall deliver to the Off Shore Facility Agent for
            the Finance Party entitled to the payment evidence reasonably
            satisfactory to that Finance Party


                                     - 50 -


            that the Tax Deduction has been made or (as applicable) any
            appropriate payment paid to the relevant taxing authority.

      (g)   The Borrower is not obliged to make a Tax Payment under paragraph
            (c) above in respect of any Tax Deduction which would not have been
            required had the Finance Party concerned co-operated in completing
            any declaration, claim, exemption or other form reasonably requested
            by the Borrower which it is able to complete or provide unless the
            Finance Party determines in good faith to do so would prejudice its
            legal or commercial position.

15.3  TAX INDEMNITY

      (a)   The Borrower shall (within five (5) Business Days of demand by the
            Off Shore Facility Agent) pay to a Protected Party an amount equal
            to the loss, liability or cost which that Protected Party determines
            will be or has been (directly or indirectly) suffered for or on
            account of Tax by that Protected Party in connection with the
            transactions contemplated under the Finance Documents. Such demand
            shall include reasonable details of such loss, liability or cost
            which the Protected Party determined will be or has been suffered.

      (b)   Paragraph (a) above shall not apply with respect to any Tax assessed
            on a Finance Party:

            (i)   under the law of the jurisdiction in which that Finance Party
                  is incorporated or, if different, the jurisdiction (or
                  jurisdictions) in which that Finance Party is treated as
                  resident for tax purposes; or

            (ii)  under the law of the jurisdiction in which that Finance
                  Party's Facility Office is located in respect of amounts
                  received or receivable in that jurisdiction,

            if that Tax is imposed on or calculated by reference to the net
            income received or receivable (but not any sum deemed to be received
            or receivable) by that Finance Party.

      (c)   A Protected Party making, or intending to make, a claim pursuant to
            paragraph (a) above shall promptly notify the Agent of the event
            which will give, or has given, rise to the claim, following which
            the Agent shall notify the Borrower.

      (d)   A Protected Party shall, on receiving a payment from the Borrower
            under this Clause 15.3, notify the Agent.

15.4  TAX CREDIT

      If the Borrower makes a Tax Payment and the relevant Finance Party
      determines that:

      (a)   a Tax Credit is attributable to that Tax Payment; and

      (b)   that Finance Party has obtained, utilised and retained that Tax
            Credit,

      the Finance Party shall pay an amount to the Borrower which that Finance
      Party determines will leave it (after that payment) in the same after-tax
      position as it would have been in had the Tax Payment not been made by the
      Borrower. The Finance Party will provide to the Borrower reasonable
      details of the calculation of the amounts it has determined to be payable
      to the Borrower.


                                     - 51 -


15.5  STAMP TAXES

      The Borrower shall pay and, within five (5) Business Days of demand,
      indemnify each Finance Party against any cost, loss or liability that
      Finance Party incurs in relation to all stamp duty, registration and other
      similar Taxes payable in respect of any Finance Document.

15.6  VALUE ADDED TAX

      (a)   All consideration payable under a Finance Document by the Borrower
            to a Finance Party shall be deemed to be exclusive of any VAT. If
            VAT is chargeable, the Borrower shall pay to the Finance Party (in
            addition to and at the same time as paying the consideration) an
            amount equal to the amount of the VAT on receipt of a copy of a VAT
            invoice.

      (b)   Where a Finance Document requires the Borrower to reimburse a
            Finance Party for any costs or expenses, the Borrower shall also at
            the same time pay and indemnify that Finance Party on receipt of a
            copy of a VAT invoice against all VAT incurred by that Finance Party
            in respect of the costs or expenses save to the extent that that
            Finance Party is entitled to repayment or credit in respect of the
            VAT.

16.   INCREASED COSTS

16.1  INCREASED COSTS

      (a)   Subject to Clause 16.3 (Exceptions) the Borrower shall, within five
            (5) Business Days of a demand by the Off Shore Facility Agent
            (setting forth in reasonable detail the amounts so payable), pay for
            the account of a Finance Party the amount of any Increased Costs
            incurred by that Finance Party or any of its Affiliates as a result
            of (i) the introduction of or any change in (or in the
            interpretation, administration or application of) any law or
            regulation after the date of this Agreement or (ii) compliance with
            any law or regulation made after the date of this Agreement
            (including the New Basle Capital Accord known as "Basle II" and any
            replacement thereof).

      (b)   In this Agreement "INCREASED COSTS" means:

            (i)   a reduction in the rate of return from the Facility or on a
                  Finance Party's (or its Affiliate's) overall capital;

            (ii)  an additional or increased cost; or

            (iii) a reduction of any amount due and payable under any Finance
                  Document,

            which is incurred or suffered by a Finance Party or any of its
            Affiliates to the extent that it is attributable to that Finance
            Party having entered into its Commitment or funding or performing
            its obligations under any Finance Document.

16.2  INCREASED COSTS CLAIMS

      (a)   A Finance Party intending to make a claim pursuant to Clause 16.1
            (Increased Costs) shall notify the Off Shore Facility Agent of the
            event giving rise to the claim, following which the Off Shore
            Facility Agent shall promptly notify the Borrower.


                                     - 52 -


      (b)   Each Finance Party shall, as soon as practicable after a demand by
            the Off Shore Facility Agent, provide a certificate confirming the
            amount of its Increased Costs.

16.3  EXCEPTIONS

      (a)   Clause 16.1 (Increased Costs) does not apply to the extent any
            Increased Cost is:

            (i)   attributable to a Tax Deduction required by law to be made by
                  the Borrower;

            (ii)  compensated for by Clause 15.3 (Tax indemnity) (or would have
                  been compensated for under Clause 15.3 (Tax indemnity) but was
                  not so compensated solely because the exclusion in Clause
                  15.3(b) (Tax indemnity) applied); or

            (iii) attributable to the wilful breach by the relevant Finance
                  Party or its Affiliates of any law or regulation.

      (b)   In this Clause 16.3, a reference to "Tax Deduction" has the same
            meaning given to the term in Clause 15.1 (Definitions).

17.   OTHER INDEMNITIES

17.1  CURRENCY INDEMNITY

      (a)   If any sum due from the Borrower under the Finance Documents (a
            "SUM"), or any order, judgment or award given or made in relation to
            a Sum, has to be converted from the currency (the "FIRST CURRENCY")
            in which that Sum is payable into another currency (the "SECOND
            CURRENCY") for the purpose of:

            (i)   making or filing a claim or proof against the Borrower; or

            (ii)  obtaining or enforcing an order, judgment or award in relation
                  to any litigation or arbitration proceedings,

            the Borrower shall as an independent obligation, within five (5)
            Business Days of demand, indemnify each Finance Party to whom that
            Sum is due against any cost, loss or liability arising out of or as
            a result of the conversion including any discrepancy between (1) the
            rate of exchange used to convert that Sum from the First Currency
            into the Second Currency and (2) the rate or rates of exchange
            available to that person at the time of its receipt of that Sum.

      (b)   The Borrower waives any right it may have in any jurisdiction to pay
            any amount under the Finance Documents in a currency or currency
            unit other than that in which it is expressed to be payable.

17.2  OTHER INDEMNITIES

      The Borrower shall, within five (5) Business Days of demand, indemnify
      each Finance Party against any cost, loss or liability reasonably incurred
      by that Finance Party as a result of:

      (a)   the occurrence of any Event of Default or Potential Event of Default
            and any costs reasonably incurred by any of the Banks in attending
            any meetings to consider any Event of Default or Potential Event of
            Default or the investigation of any Event of Default or Potential
            Event of Default;



                                     - 53 -


      (b)   a failure by the Borrower to pay any amount due under a Finance
            Document on its due date including, without limitation, any cost,
            loss or liability arising as a result of Clause 29 (Sharing among
            the Finance Parties);

      (c)   funding, or making arrangements to fund, its participation in a Loan
            requested by the Borrower in a Utilisation Request but not made by
            reason of the operation of any one or more of the provisions of this
            Agreement (other than by reason of default or negligence by that
            Finance Party); or

      (d)   a Loan (or part of a Loan) not being prepaid in accordance with a
            notice of prepayment given by the Borrower.

17.3  INDEMNITY TO THE AGENTS

      The Borrower shall promptly indemnify each Agent against any cost, loss or
      liability incurred by the relevant Agent (acting reasonably) as a result
      of:

      (a)   investigating any event which it reasonably believes is an Event of
            Default or Potential Event of Default;

      (b)   except as expressly provided in this Agreement, the Agent performing
            and discharging its obligations in accordance with the requirements
            of the Finance Documents; and/or

      (c)   acting or relying on any notice, request or instruction which it
            reasonably believes to be genuine, correct and appropriately
            authorised.

18.   MITIGATION BY THE BANKS

18.1  MITIGATION

      (a)   Each Finance Party shall, in consultation with the Borrower, take
            all reasonable steps to mitigate any circumstances which arise and
            which would result in any amount becoming payable under or pursuant
            to, or cancelled pursuant to, any of Clause 14.1 (Illegality),
            Clause 15 (Tax gross-up and indemnities) or Clause 16 (Increased
            Costs) including (but not limited to) transferring its rights and
            obligations under the Finance Documents to another Affiliate or
            Facility Office.

      (b)   Paragraph (a) above does not in any way limit the obligations of the
            Borrower under the Finance Documents.

18.2  LIMITATION OF LIABILITY

      (a)   The Borrower shall indemnify each Finance Party for all costs and
            expenses reasonably incurred by that Finance Party as a result of
            steps taken by it under Clause 18.1 (Mitigation).

      (b)   A Finance Party is not obliged to take any steps under Clause 18.1
            (Mitigation) if, in the opinion of that Finance Party (acting
            reasonably), to do so might be prejudicial to it.

19.   COSTS AND EXPENSES

19.1  TRANSACTION EXPENSES

      The Borrower shall promptly on demand pay the Off Shore Facility Agent
      (for the account of the Agents, the Security Agents, the Issuing Bank, the
      ECA and the Arrangers) the amount of all out of pocket costs and expenses
      (including but not limited to the fees of the Independent Technical
      Consultant, insurance consultant and legal fees


                                     - 54 -


      of Slovenian law counsel to the Banks (Selih, Selih, Janezic &
      Jarcovic) and German, New York and Luxembourg law counsel to the Banks
      (Clifford Chance)) reasonably incurred by any of them in connection with
      the negotiation, preparation, execution, registration, implementation,
      preservation, and syndication of the Finance Documents irrespective of
      whether this financing is completed or any Utilisation is made (including,
      without limitation in connection with any perfection of a security
      interest under or any amendment of any Security Document).

19.2  AMENDMENT COSTS

      If (a) the Borrower requests an amendment, waiver or consent or (b) an
      amendment is required pursuant to Clause 30.9 (Change of currency), the
      Borrower shall, within three (3) Business Days of demand, reimburse each
      Agent for the amount of all costs and expenses (including legal fees)
      reasonably incurred by it in responding to, evaluating, negotiating or
      complying with that request or requirement.

19.3  ENFORCEMENT COSTS

      The Borrower shall, within three (3) Business Days of demand, pay to each
      Finance Party the amount of all costs and expenses (including legal fees)
      incurred by that Finance Party in connection with the enforcement of, or
      the preservation of any rights under, any Finance Document.


                                     - 55 -


                                    SECTION 9
               REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

20.    REPRESENTATIONS

20.1   REPRESENTATIONS

       The Borrower makes the representations and warranties set out in this
       Clause 20.1 to each Finance Party on the date of this Agreement and
       acknowledges that the Finance Parties have entered into this Agreement in
       reliance on such representations and warranties.

20.1.1 STATUS

       The Borrower is a corporation duly incorporated and validly existing
       under the laws of Slovenia and has the power and all necessary
       governmental and other material Authorisations under any applicable
       jurisdiction to own its property and assets and to carry on its business
       as currently conducted.

20.1.2 POWER AND AUTHORITY

       The Borrower has the power to enter into, perform and deliver, and has
       taken all necessary action to authorise its entry into, performance and
       delivery of, the Transaction Documents to which it is a party and the
       transactions contemplated by those Transaction Documents.

20.1.3 OWNERSHIP OF THE BORROWER

       Western Wireless International Corporation owns, directly or indirectly,
       at least 80% of the Shares.

20.1.4 BINDING OBLIGATIONS

       The Transaction Documents create (or will once executed) legal, valid and
       binding obligations of the Borrower and, to the Borrower's knowledge, the
       other parties thereto, enforceable (or in the case of the Security
       Documents will be enforceable once perfected) against such parties in
       accordance with the terms thereof subject to any general principles of
       law limiting such parties' obligations which are specifically referred to
       in any legal opinion delivered pursuant to Clause 4.1 (Conditions
       precedent to the first Utilisation under all Facilities).

20.1.5 COMPLIANCE

       The Borrower has duly performed and observed in all material respects all
       obligations under the applicable laws and the Material Contracts and has
       duly performed and observed all obligations under the Project Contracts
       except where failure to do so would not have a Material Adverse Effect.

20.1.6 AUTHORISATIONS

       (a)   All Authorisations required:

            (i)   to enable it lawfully to enter into, exercise the Borrower's
                  rights and comply with its obligations in the Transaction
                  Documents to which it is a party;

            (ii)  to make the Transaction Documents to which the Borrower is a
                  party admissible in evidence in Slovenia;

            (iii) to enable the Borrower to conduct its business according to
                  the Business Plan; and


                                     - 56 -


            (iv)  to enable the Borrower to create the Security to be created by
                  it pursuant to any Security Document and to ensure that such
                  Security has the priority and ranking it is expressed to have,

            have been obtained or effected and are in full force and effect
            except Authorisations which are not required to be obtained by the
            Borrower (based upon its then current operations) until a future
            date and (in the case of paragraphs (i) to (iii) above)
            Authorisations the failure of which to obtain would not have a
            Material Adverse Effect and.

       (b)  The Borrower is in compliance in all material respects with all of
            the terms and conditions of such Authorisations and no
            circumstances exist which would entitle the granting authority to
            terminate or revoke such Authorisations.

20.1.7 GOVERNING LAW AND ENFORCEMENT

       (a)    The choice of the governing law of each of the Material Contracts
              will be recognised and enforced in the jurisdiction applicable to
              that Material Contract.

       (b)    Any judgment obtained in the jurisdiction applicable to each of
              the Material Contracts in relation to that Material Contract will
              be recognised and enforced in that jurisdiction.

20.1.8 TAXES; REGISTRATION OF TRANSACTION DOCUMENTS

       (a)    All Taxes imposed on the Borrower have been paid and discharged
              duly and punctually within the time period allowed therefor
              without the imposition of penalties in excess of Euro 15,000 or
              its equivalent or the creation of encumbrances with priority to
              the Banks or any Security granted by or created pursuant to the
              Security Documents (save to the extent payment thereof is being
              contested in good faith by the Borrower and where payment thereof
              can be lawfully withheld and would not result in an encumbrance
              having priority to the Banks or any Security granted by or created
              pursuant to the Security Documents).

       (b)    The Borrower is not required under the laws of Slovenia to make
              any deduction or withholding for or on account of Tax from any
              payment it may make under any Finance Document.

       (c)    Under the laws of Slovenia it is not necessary:

              (i)    that the Material Contracts be filed, recorded, registered
                     or enrolled with any court or other authority in that
                     jurisdiction (other than reporting the execution of this
                     Agreement to Banka Slovenije); or

              (ii)   that any stamp, registration or similar tax be paid on or
                     in relation to the Material Contracts or the transactions
                     contemplated by the Material Contracts.

20.1.9 NO DEFAULT

       (a)    No Event of Default or Potential Event of Default has occurred and
              is continuing or is reasonably expected to occur to the best of
              the Borrower's knowledge and belief.

       (b)    No other event or circumstance is outstanding which constitutes a
              default under any other agreement or instrument which is binding
              on the Borrower or to


                                     - 57 -


            which its assets are subject which would reasonably be expected to
            have a Material Adverse Effect.

20.1.10 NO WINDING-UP

       The Borrower has not taken any corporate action nor have any other steps
       been taken or legal proceedings been started or threatened against the
       Borrower for its winding-up, dissolution, administration or
       re-organisation or for the appointment of a receiver, administrator,
       administrator receiver, trustee or similar officer of it or of all of its
       assets or revenues.

20.1.11 NO MISLEADING INFORMATION

       (a)    Any factual information provided by it for the purposes of the
              Initial Business Plan, Information Memorandum and/or the Legal Due
              Diligence Report is true, complete and accurate in all material
              respects as at the date it was provided or as at the date (if any)
              at which it is stated.

       (b)    The financial projections contained in the Initial Business Plan
              and Information Memorandum provided to the ECA in September 2001
              have been prepared on the basis of information available as at
              such date and on the basis of reasonable assumptions.

       (c)    Nothing has occurred or been omitted from the Initial Business
              Plan, Information Memorandum and/or the Legal Due Diligence Report
              and no information has been given or withheld that results in the
              information contained in the Initial Business Plan, Information
              Memorandum and/or the Legal Due Diligence Report being untrue or
              misleading in any material respect.

       (d)    All of the information (other than the Initial Business Plan, the
              Information Memorandum and the Legal Due Diligence Report)
              supplied by the Borrower and the Sponsors to the Arrangers, the
              Banks and the Independent Technical Consultant is true, complete
              and accurate in all material respects as at the date such
              information was supplied and the Borrower and the Sponsors have
              not failed to disclose to the Arrangers, the Banks and to the
              Independent Technical Consultant any facts or circumstances the
              omission of which would render any such information misleading in
              any material aspects.

20.1.12 FINANCIAL STATEMENTS

       (a)    The Borrower's Original Financial Statements were prepared in
              accordance with US GAAP and the Borrower' financial statements for
              the year ending 31 December 2001, which are stated to be in
              accordance with Slovenian Accounting Standards, were prepared in
              accordance with Slovenian Accounting Standards, in each case
              consistently applied (unless expressly disclosed to the Off Shore
              Facility Agent in writing to the contrary before the date of this
              Agreement).

       (b)    The Borrower's Original Financial Statements fairly represent its
              financial condition and operations as at the end of and during the
              relevant financial year (unless expressly disclosed to the Off
              Shore Facility Agent in writing to the contrary before the date of
              this Agreement).

       (c)    As at the date as of which the Original Financial Statements were
              prepared the Borrower had no liabilities (contingent or otherwise)
              which were not disclosed thereby (or by notes thereto) or reserved
              against therein nor any unrealised or anticipated losses arising
              from commitments entered into by it which were not


                                     - 58 -


              so disclosed or reserved against and which in each such case would
              reasonably be expected to have a material adverse effect on the
              Borrower's ability to perform its obligations hereunder.

       (d)    There has been no material adverse change in the Borrower's
              business or financial condition since the date as at which the
              Original Financial Statements were delivered to the Banks.

20.1.13 ENCUMBRANCES

        No encumbrance exists over all or any of the assets of the Borrower
        other than Permitted Encumbrances.

20.1.14 FINANCIAL INDEBTEDNESS

        The Borrower has no Financial Indebtedness except for Permitted
        Indebtedness.

20.1.15 NO OBLIGATION TO CREATE SECURITY

        Except as provided in Clause 20.1.13 (Encumbrances), the Borrower's
        execution of the Transaction Documents and its exercise of its rights
        and performance of its obligations hereunder and thereunder will not
        result in the existence of nor oblige the Borrower to create an
        encumbrance over all or any of its present or future revenues or assets.

20.1.16 PARI PASSU RANKING

        The Borrower's payment obligations under the Finance Documents rank at
        least pari passu with the claims of all its other unsecured and
        unsubordinated creditors, except for obligations mandatorily preferred
        by law applying to companies generally.

20.1.17 PROCEEDINGS AND MAJOR LABOUR UNREST

        No litigation, arbitration or administrative proceedings of or before
        any court, arbitral body or agency which, if adversely determined, might
        reasonably be expected to have a Material Adverse Effect have been
        started or threatened against it nor are there or might reasonably be
        expected major labour unrests in the Borrower's business.

20.1.18 OWNERSHIP OF ASSETS

        The Borrower has good title to or valid leases or licences of all
        Material Assets necessary to conduct its business where failure to do so
        would be reasonably likely to have a Material Adverse Effect.

20.1.19 INTELLECTUAL PROPERTY

       (a)    The Borrower owns or has the legal right to use all Intellectual
              Property and it does not infringe any Intellectual Property Rights
              of any third party except in the case of Intellectual Property
              Rights which are not necessary to the carrying on of its business
              where such infringement would not be reasonably likely to have a
              Material Adverse Effect.

       (b)    No Intellectual Property is being infringed except in the case of
              Intellectual Property which is not necessary to the carrying on of
              its business where such infringement would not be reasonably
              likely to have a Material Adverse Effect nor is there any
              threatened infringement by any third party of any Intellectual
              Property.

       (c)    All registered Intellectual Property owned by the Borrower is
              subsisting and all actions required to maintain the same in full
              force and effect have been taken.

20.1.20  ENVIRONMENTAL COMPLIANCE

         The Borrower has duly performed and observed in all material respects
         all Environmental Law, Environmental Permits and all other material
         covenants,


                                     - 59 -


         conditions, restrictions or agreements directly or indirectly concerned
         with any contamination, pollution or waste or the release or discharge
         of any toxic or hazardous substance in connection with any real
         property which is or was at any time owned, leased or occupied by the
         Borrower or on which it has conducted any activity where, in each case,
         failure to do so could reasonably be expected to have a Material
         Adverse Effect.

20.1.21  EXECUTION OF FINANCE DOCUMENTS

         Its execution of the Finance Documents and its exercise of its rights
         and performance of its obligation hereunder and thereunder do not and
         will not:

       (a)    conflict with the Licence, or to the best of its knowledge having
              made all due enquiry any other agreement, mortgage, bond or other
              instrument or treaty to which it is party or which is binding upon
              it or any of its assets;

       (b)    conflict with its constitutive documents;

       (c)    conflict with any applicable law, regulation or official or
              judicial order.

20.1.22 NO IMMUNITY

       In any proceedings taken in Slovenia in relation to any of the Material
       Contracts it will not be entitled to claim for itself or any of its
       assets immunity from suit, execution, attachment or other legal process
       except for any property which is exempt from attachment and execution
       pursuant to the laws of Slovenia of general application to the extent
       that such exemption has not been validly waived pursuant to Clause 40.4
       (Waiver of immunity).

20.1.23  DEALING ON OWN ACCOUNT

         For all matters related to the Transaction Documents the Borrower is
         dealing on its own account.

20.1.24  EASEMENTS

         The Borrower has all easements, rights of way, rights of ingress and
         egress necessary for the construction and operation of the Project
         except where the failure to do so would not have a Material Adverse
         Effect.

20.1.25  MATERIAL CONTRACTS

         All contracts required for the design, engineering, development,
         construction, installation, testing, operation and maintenance of the
         Network are in full force and effect, there are no other Material
         Contracts in existence which have not been disclosed to the Off Shore
         Facility Agent and it has no notice of any material breach by any
         person of its obligations thereunder.

20.1.26  AMENDMENTS TO MATERIAL CONTRACTS

         There have been no material amendments (other than those permitted
         under Clause 24.27 (Amendments) to any of the Material Contracts
         including those provided to the Off Shore Facility Agent in connection
         with the Legal Due Diligence Report.

20.1.27  CAPITAL

         As of the date hereof the registered Share Capital is SIT 7,000,000,000
         comprising 2 Shares owned by the following Shareholders in the
         following percentages.

         Western Wireless International Slovenia Corporation 95%

         Western Wireless International Slovenia II Corporation 5%

         and no person will have any right to subscribe for any additional
         Shares in the Share Capital.


                                     - 60 -


20.1.28  ACCOUNTS

         The Borrower has no accounts other than those permitted, established or
         to be established in accordance with this Agreement.

20.1.29  SUBSIDIARIES

         The Borrower does not have any Subsidiaries (other than as permitted
         under Clause 24.33 (UMTS and other licences) or those created with the
         consent of the Banks, not to be unreasonably withheld or delayed) or
         any investments in any other person.

20.1.30  SERVICES AND FACILITIES

         All services, facilities and other materials necessary for the
         importation, construction, installation, operation and maintenance of
         the Network are or, to the best of the Borrower's knowledge after due
         inquiry, will be available to the Borrower when necessary for the
         construction, installation, testing, operation and maintenance of the
         Network, and to the extent necessary, arrangements have been made on
         commercially reasonable terms for such services, facilities and other
         materials, with respect to which arrangements the Borrower has no
         reason to believe such arrangements will not be made at the time so
         required, except where the failure of such services, facilities and
         other materials to be available or arranged would not reasonably be
         likely to have a Material Adverse Effect.

20.1.31  RANKING OF SECURITY

         Other than the ECA Cover Documents, each Security Document creates (or,
         once entered into, will create) in favour of the Finance Parties the
         Security which it is expressed to create over the secured assets
         referred to therein with first ranking and priority which are not
         subject to any prior or pari passu Security.

20.1.32  BUSINESS PLAN

         The projections and forecasts appearing in the most recent Business
         Plan are in accordance with the requirements of Clause 22 (Financial
         covenants and network milestones) and consistent with Clause 24
         (General undertakings) and were made on the basis of grounds believed
         at the time to be correct.

20.1.33  PROHIBITED PAYMENTS

         None of the Borrower's officers, directors, employees and/or agents
         acting on its behalf have offered, given, insisted on, received or
         solicited any illegal payment or advantage to influence the action of
         any person in connection with the Project.

20.2     REPETITION

         The representations in Clause 20.1 (Representations) (other than in
         Clause 20.1.11 (No misleading information) and Clause 20.1.27
         (Capital)) ("REPEATED REPRESENTATIONS") shall be expressly repeated by
         the Borrower by reference to the facts and circumstances then existing
         at:

      (a)   the date of each Utilisation Request (including any SIT Facility
            Rollover Loan); and

      (b)   each repayment date as determined under Clause 13 (Repayment).


                                     - 61 -


21.   REPORTING REQUIREMENTS

      The undertakings in this Clause 21 remain in force from the date of this
      Agreement for so long as any amount is outstanding under the Finance
      Documents or any Commitment is in force.

21.1  FINANCIAL STATEMENTS AND OTHER INFORMATION

      The Borrower shall supply to the Off Shore Facility Agent in sufficient
      copies for all of the Banks:

      (a)   as soon as the same become available, but in any event not later
            than 120 days after the end of each financial year one set of its
            audited annual financial statements for that financial year prepared
            in accordance with US GAAP and one set of its audited annual
            financial statements for that financial year prepared in accordance
            with Slovenian Accounting Standards;

      (b)   as soon as the same becomes available, but in any event not later
            than three weeks after the commencement of a new financial year of
            the Borrower, the Updated Business Plan in respect of the following
            financial year which shall, without limitation:

            (i)   be in the same format and comprise the same items as the most
                  recent Business Plan and otherwise include a description of
                  any changes and sufficient information, in form and substance
                  as may be reasonably required by the Off Shore Facility Agent,
                  to enable the Banks to make an accurate comparison between the
                  most recent Business Plan and such Updated Business Plan;

            (ii)  demonstrate that the Borrower is in compliance with the
                  requirements of Clause 22 (Financial covenants and network
                  milestones) and such Updated Business Plan is consistent with
                  Clause 24 (General undertakings); and

            (iii) include a profit and loss statement, balance sheet, cash flow
                  statement and details of investments in fixed assets, capital
                  and operation expenditures updated to reflect the
                  circumstances then existing and anticipated for the
                  forthcoming financial year and any information relevant at
                  such time that was not included in the Initial Business Plan;
                  and

            (iv)  include an outline of major future business plans;

      (c)   as soon as the same becomes available but in any event not later
            than 45 days after the end of each Quarter and starting as at 31
            December 2001, a management report for that Quarter, signed by the
            CFO, which shall include, without limitation:

            (i)   a profit and loss statement, balance sheet, cash flow
                  statement, details of investments in fixed assets, debt
                  profile (including aggregate lease obligations) short term and
                  long term;

            (ii)  a list of all existing accounts of the Borrower identifying
                  the financial institution with which those are held and the
                  balances thereon; and

            (iii) a Project Status and Progress Report setting out in detail
                  information addressing the matters referred to in Schedule 15
                  (Project Status and


                                     - 62 -


                  Progress Report) (signed by the CFO and the chief technical
                  officer of the Borrower); and

      (d)   every week bank statements (in the form agreed between the Off Shore
            Facility Agent, the On Shore Facility Agent and Hypo Alpe-Adria-Bank
            d.d.) in respect of the Permitted Accounts and the Proceeds and
            Revenue Accounts and the Borrower authorises and instructs the On
            Shore Facility Agent and Hypo Alpe-Adria-Bank d.d. to provide such
            bank statements in respect of the Proceeds and Revenue Accounts to
            the Off Shore Facility Agent at such times.

21.2  REQUIREMENTS AS TO FINANCIAL STATEMENTS

      (a)   Each set of financial statements delivered by the Borrower pursuant
            to Clause 21.1 (Financial statements and other information) shall be
            certified by the CFO as fairly representing its financial condition
            as at the end of and for the period up to the date as at which those
            financial statements were drawn up.

      (b)   The Borrower shall procure that each set of financial statements
            delivered pursuant to Clause 21.1 (Financial statements and other
            information) or that is required to be in accordance with US GAAP is
            prepared using US GAAP, accounting practices and financial reference
            periods consistent with those applied in the preparation of the
            financial statements of the immediately preceding year unless, in
            relation to any set of financial statements delivered immediately
            after any change has taken place, it notifies the Off Shore Facility
            Agent that there has been a change in US GAAP or the accounting
            practices or reference periods and its auditors deliver to the Off
            Shore Facility Agent:

            (i)   a description of any change necessary for those financial
                  statements to reflect the US GAAP, accounting practices and
                  reference periods upon which the financial statements for the
                  immediately preceding year were prepared; and

            (ii)  sufficient information, in form and substance as may be
                  reasonably required by the Off Shore Facility Agent, to enable
                  the Banks to determine whether Clause 22 (Financial covenants
                  and network milestones) has been complied with and make an
                  accurate comparison between the financial position indicated
                  in those financial statements and the financial statements for
                  the immediately preceding year.

            Any reference in this Agreement to those financial statements shall
            be construed as a reference to those financial statements as
            adjusted to reflect the basis upon which the financial statements
            for the immediately preceding year were prepared.

      (c)   The Borrower shall procure that each set of financial statements
            delivered pursuant to Clause 21.1(a) (Financial statements and other
            information) that is to be prepared in accordance with Slovenian
            Accounting Standards or any other financial statements required to
            be prepared by applicable law are delivered to the Off Shore
            Facility Agent and in each case are prepared using Slovenian
            Accounting Standards, accounting practices and financial reference
            periods consistent with those applied in the preparation of the
            financial statements of the immediately preceding financial year
            unless, in relation to any set of financial statements delivered
            immediately after any change has taken place, it notifies the Off
            Shore Facility Agent that there has been a change in Slovenian
            Accounting Standards or the accounting practices or reference
            periods and its auditors deliver to the Off Shore Facility Agent:


                                     - 63 -


            (i)   a description of any change necessary for those financial
                  statements to reflect the Slovenian Accounting Standards,
                  accounting practices and reference periods upon which the
                  financial statements for the immediately preceding year were
                  prepared; and

            (ii)  sufficient information, in form and substance as may be
                  reasonably required by the Off Shore Facility Agent, to enable
                  the Banks to determine whether Clause 22 (Financial covenants
                  and network milestones) has been complied with and make an
                  accurate comparison between the financial position indicated
                  in those financial statements and the financial statements for
                  the immediately preceding year.

      Any reference in this Agreement to those financial statements shall be
      construed as a reference to those financial statements as adjusted to
      reflect the basis upon which the financial statements for the immediately
      preceding year were prepared.

21.3  COVENANT COMPLIANCE CERTIFICATE

      (a)   The Borrower shall supply the Off Shore Facility Agent, with each
            set of financial statements prepared in accordance with US GAAP
            delivered pursuant to Clauses 21.1(a) and (c)(i) (Financial
            statements and other information), a Covenant Compliance Certificate
            setting out (in reasonable detail) computations as to compliance
            with Clause 22 (Financial covenants and network milestones) as at
            the date as at which those financial statements were drawn up and
            confirming compliance with the requirements of Clause 23.3
            (Application of moneys on the Proceeds and Revenue Accounts).

      (b)   Each Covenant Compliance Certificate shall be signed by the CFO and,
            if required to be delivered with the financial statements delivered
            pursuant to Clause 21.1(a) (Financial statements and other
            information), shall be reported on by the Borrower's auditors.

21.4  INFORMATION: MISCELLANEOUS

      The Borrower shall supply the Off Shore Facility Agent (in sufficient
      copies for all the Banks, if the Off Shore Facility Agent so requests)
      with:

      (a)   all documents dispatched by the Borrower to its creditors generally
            at the same time as they are dispatched;

      (b)   promptly upon becoming aware of them, the details of any litigation,
            arbitration or administrative proceedings against the Borrower
            (which are not considered to be frivolous or vexatious) which are
            current, threatened or pending, and which might, if adversely
            determined, have a Material Adverse Effect;

      (c)   promptly, such further information regarding its financial
            condition, business and operations as any Finance Party (through the
            Agent) may reasonably request; and

      (d)   any other information that from time to time may be reasonably asked
            for by the Off Shore Facility Agent and the Independent Technical
            Consultant.

21.5  NOTIFICATION OF DEFAULT AND CASH SHORTFALL

      (a)   The Borrower shall notify the Off Shore Facility Agent of any Event
            of Default or Potential Event of Default or Cash Shortfall (and the
            steps, if any, being taken to remedy it) promptly upon becoming
            aware of its occurrence.


                                     - 64 -


      (b)   Promptly upon a request by the Off Shore Facility Agent (acting
            reasonably), the Borrower shall supply to the Off Shore Facility
            Agent a certificate signed by two of its directors or senior
            officers on its behalf certifying that no Event of Default or
            Potential Event of Default or Cash Shortfall is continuing (or if an
            Event of Default or Potential Event of Default or Cash Shortfall is
            continuing, specifying the Event of Default or Potential Event of
            Default or the extent of the Cash Shortfall and the steps, if any,
            being taken to remedy it).

21.6  BUSINESS PLAN REVIEW

      Within the earlier of:

      (a)   14 days from the receipt by the Off Shore Facility Agent of an
            Updated Business Plan; and

      (b)   five weeks from the commencement of a financial year of the
            Borrower, the Borrower and the Off Shore Facility Agent shall meet
            and review the Updated Business Plan delivered in accordance with
            Clause 21.1(b) (Financial statements and other information).

22.   FINANCIAL COVENANTS AND NETWORK MILESTONES

      The calculation of ratios and other amounts under this Clause 22 shall be
      made by reference to the most recent financial statements, Covenant
      Compliance Certificate and Project Status and Progress Report for the
      period or periods in relation to which the calculation or determination
      falls to be made.

      **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES
      AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT**

                                     - 65 -

22.4  CONFIRMATION BY INDEPENDENT TECHNICAL CONSULTANT

      The figures in Clauses 22.2(a) and (b) (Stage I covenants) and Clause
      22.3(e) (Stage II covenants) shall be confirmed by the Independent
      Technical Consultant annually commencing on 31 December 2002 and ending on
      31 December 2004.

23.   ACCOUNTS AND PAYMENTS

23.1  PROCEEDS AND REVENUE ACCOUNTS

      The Borrower will open a transactional account with the On Shore Security
      Agent ("PROCEEDS AND REVENUE ACCOUNT #1") and Hypo Alpe-Adria-Bank d.d.
      Ljubljana ("PROCEEDS AND REVENUE ACCOUNT #2") prior to the first
      Utilisation Date (the "PROCEEDS AND REVENUE ACCOUNTS"), such accounts to
      be pledged by the Borrower in


                                     - 68 -


      favour of the Senior Creditors by entering into the Claims Assignment and
      Bills of Exchange Agreement.

23.2  PAYMENTS INTO THE PROCEEDS AND REVENUE ACCOUNTS

      (a)   The Borrower will ensure that it pays into the Proceeds and Revenue
            Account #1 all loan, insurance, sale and other proceeds, receivables
            and Equity Contributions and proceeds of Subordinated Loans and
            Sponsors Unsecured Loans and revenues of any nature and all payments
            to be made to the Borrower other than as permitted by Clause
            23.2(b).

      (b)   The Borrower will use reasonable commercial efforts to have 30% of
            the revenues and payments to be made to the Borrower paid into the
            Proceeds and Revenue Account #2 (other than in respect of loan,
            insurance, sale proceeds, Equity Contributions, Subordinated Loans
            and Sponsors Unsecured Loans) provided that the balance standing to
            the credit of such account shall not exceed Euro 2,000,000 or its
            equivalent.

            (the payments into the Proceeds and Revenue Account #1 and the
            payments into the Proceeds and Revenue Account #2, together the
            "PROCEEDS AND REVENUES").

23.3  APPLICATION OF MONEYS ON THE PROCEEDS AND REVENUE ACCOUNTS

      Subject to Clause 23.10 (Remedies on Potential Event of Default or Event
      of Default), the Borrower shall and, in the case of an Event of Default,
      only with the Off Shore Facility Agent's written consent (acting on the
      instructions of the Majority Banks) apply any moneys standing to the
      credit of the Proceeds and Revenue Accounts as follows:

      (a)   any Proceeds and Revenues that constitute Insurance Proceeds shall
            be paid into the Insurance Proceeds Account in the applicable
            currency and applied in accordance with Clause 23.4 (Insurance
            Proceeds Account);

      (b)   any Proceeds and Revenues arising from the sale, disposal or
            exchange of any asset shall be paid into the Sale Proceeds Account
            in the applicable currency and applied in accordance with Clause
            23.5 (Sale Proceeds Account);

      (c)   any Proceeds and Revenues that constitute Contributed Capital or
            Sponsors Unsecured Loans or the proceeds of any Loans payable to the
            Borrower under the Euro Facility shall be paid into the Loan
            Proceeds Account and applied in accordance with Clause 23.6 (Loan
            Proceeds Account) PROVIDED THAT in respect of any amounts
            contributed as Contributed Capital to permit the Borrower to make
            contributions to the UMTS Subsidiary in accordance with Clause
            24.33(b)(ii) (UMTS and other licenses), the Borrower may transfer,
            after compliance with the provisions of Clause 24.33(b)(iii) (UMTS
            and other licenses), such amounts to the UMTS Subsidiary; and

      (d)   subject to Clause 23.9 (Debt Service Reserve Account) and Clause
            23.6.2 (Debt Service Account) all Proceeds and Revenues (other than
            those expressly referred to in paragraphs (a) to (c) above) shall be
            applied for the following purposes and exclusively in the following
            order:

            (i)   first, in and towards payment of any Tax payment due and
                  payable;

            (ii)  second, in or towards payment of all due and payable operating
                  costs as shown in the Initial Business Plan (including amounts
                  in respect of direct costs payable under the Management
                  Agreement which are


                                     - 69 -


            provided for in the Initial Business Plan but excluding any amounts
            payable under the Lucent Loan Agreement);

      (iii) third, in or towards payment of all due and payable on-going capital
            costs in relation to the build-out of the Network as shown in the
            Initial Business Plan and necessary to perform its business but
            excluding any amounts payable under the Lucent Loan Agreement;

      (iv)  fourth, in and towards Debt Service Payments due and payable and
            payments to be made to the Debt Service Account in accordance with
            Clause 23.6 (Debt Service Account) which shall be applied:

            (1)   towards payment of any unpaid costs and expenses of the Banks,
                  the Agents, the Security Agents, with the exception of the
                  payments mentioned under paragraphs (2) to (4) and (viii)
                  below;

            (2)   in or towards payment of any amount due and payable under the
                  Hedging Agreements;

            (3)   in or towards payment of any accrued interest and fees due and
                  payable to the Banks hereunder and to the Sponsors under the
                  Sponsors Unsecured Loan Agreement and Lucent Technologies Inc.
                  under the Lucent Loan Agreement;

            (4)   in or towards payment of any principal due and payable to the
                  Banks under this Agreement and to the Sponsors under the
                  Sponsors Unsecured Loan Agreement and Lucent Technologies Inc.
                  under the Lucent Loan Agreement;

      (v)   fifth, in or towards any payment of any amount due and payable into
            the Debt Service Reserve Account in accordance with Clause 23.9
            (Debt Service Reserve Account);

      (vi)  sixth, in and towards payment of all due and payable operating costs
            and expenses that have not been paid pursuant to Clause 23.3(d)(ii);

      (vii) seventh, in or towards payment of capital costs in the amounts and
            at the times set out in the Business Plan (other than the Initial
            Business Plan) and amounts in respect of any margin payable under
            the Management Agreement in an amount not exceeding (A) US Dollars
            700,000 or its equivalent in the financial year ending 31 December
            2002 and (B) in each financial year thereafter the lesser of (Y) 50%
            of any direct costs payable under the Management Agreement and (Z)
            US Dollars 700,000 or its equivalent;

      (viii) eighth, in payment of any amounts planned to be paid by the
            Borrower in the immediately following 12 month period in respect of
            capital expenditure to the Capital Expenditure Reserve Account;

      (ix)  ninth, in prepayment of the Facilities in accordance with Clause
            14.5 (Mandatory prepayments); and

      (x)   tenth, in or towards any payment due and payable to the Shareholders
            (including any interest payable on any Subordinated Loans or other
            amounts payable under the Management Agreement that have not been


                                     - 70 -


            paid pursuant to Clauses 23.3(d)(ii) or (vii)) in an amount not to
            exceed 50% of the Excess Cash Flow.

      (e)   The Borrower shall only be entitled to make the payments referred to
            in this Clause 23.3 out of the Proceeds and Revenue Accounts on the
            following basis:

            (i)   amounts payable pursuant to paragraphs (d)(i) to (vii) above
                  inclusive shall be paid when due; and

            (ii)  amounts payable pursuant to paragraph (d)(x) above shall only
                  be paid on satisfaction of the conditions set out in paragraph
                  (f) below.

      (f)   Payments by the Borrower from the Proceeds and Revenue Accounts to
            the Shareholders pursuant to paragraph (d)(x) above are permitted
            only:

            (i)   from the expiry of the Availability Period of the Euro
                  Facility;

            (ii)  subject to the absence of an Event of Default or Potential
                  Event of Default;

            (iii) upon provision of the most recent financial statements
                  required in accordance with Clause 21 (Reporting requirements)
                  covering the relevant period and showing a net profit before
                  payments are made to the Shareholders;

            (iv)  upon the provision of a Covenant Compliance Certificate
                  confirming that the Borrower complies with the financial
                  covenants and other requirements set out in the Covenant
                  Compliance Certificate;

            (v)   within a period of ten (10) Business Days following a
                  Repayment Date of a Euro Facility Loan; and

            (vi)  if the Debt Service Cover Ratio at any Repayment Date of a
                  Euro Facility Loan is equal to or greater than 1.30.

      (g)   Upon the occurrence and during the continuance of an Event of
            Default or Potential Event of Default the Borrower authorises the
            Agents (on behalf of the Senior Creditors) to debit:

            (i)   the Proceeds and Revenue Accounts with all amounts referred to
                  in paragraph (d)(iv) above when due; and

            (ii)  if the funds in the Proceeds and Revenue Accounts are not
                  sufficient to pay any amounts set out in paragraph (d) (iv)
                  above, to debit the Debt Service Reserve Account with any such
                  amount,

            and to apply any amount so debited in payment of the relevant
            amounts.

23.4  INSURANCE PROCEEDS ACCOUNT

23.4.1 The Borrower will open a transactional account with the On Shore Security
      Agent ("INSURANCE PROCEEDS ACCOUNT") prior to the first Utilisation Date,
      such account to be pledged by the Borrower in favour of the Senior
      Creditors by entering into the Claims Assignment and Bills of Exchange
      Agreement.


                                     - 71 -


23.4.2 Insurance Proceeds in an amount less than Euro 250,000 in respect of any
      single event may be withdrawn from the Insurance Proceeds Account to make
      payment in respect of the costs of repair or restoration of the Project,
      as determined by the Borrower.

23.4.3 Insurance Proceeds in an amount equal to or greater than Euro 250,000 in
      respect of any single event may be withdrawn from the Insurance Proceeds
      Account PROVIDED THAT:

      (a)   funds so withdrawn are used to make payment in respect of the costs
            of repair or restoration of the Project; and

      (b)   the Borrower has consulted with the Off Shore Facility Agent to the
            reasonable satisfaction of the Off Shore Facility Agent in respect
            of progress of the repair or restoration and the application of
            Insurance Proceeds.

23.4.4 All other Insurance Proceeds shall be applied in prepayment in accordance
      with Clause 14.5.1(b) (Mandatory prepayments).

23.4.5 Notwithstanding any other provisions of this Clause 23.4 and subject to
      Clause 23.10 (Remedies on Potential Event of Default or Event of Default)
      if:

      (a)   an Event of Default has occurred and is continuing:

            (i)   the On Shore Facility Agent shall have the right to take over
                  sole conduct of the Borrower's claims under or in connection
                  with the insurance policies of the Borrower; and

            (ii)  the On Shore Facility Agent shall be entitled to require all
                  Insurance Proceeds (including funds in the Borrower's
                  Insurance Proceeds Account) to be applied by the Borrower in
                  or towards the settlement of the Loans; and

      (b)   a Potential Event of Default has occurred and is continuing the Off
            Shore Facility Agent and the Borrower shall agree on the conduct of
            any of the Borrower's claims under or in connection with the
            insurance policies of the Borrower.

23.5  SALE PROCEEDS ACCOUNT

23.5.1 The Borrower will open a transactional account with the On Shore Security
      Agent ("SALE PROCEEDS ACCOUNT") prior to the first Utilisation Date, such
      account to be pledged by the Borrower in favour of the Senior Creditors by
      entering into the Claims Assignment and Bills of Exchange Agreement.

23.5.2 Subject to the existence of no Event of Default or Potential Event of
      Default and Clause 23.10 (Remedies on Potential Event of Default or Event
      of Default), the Borrower may:

      (a)   withdraw amounts standing to the credit of the Sale Proceeds Account
            for use in accordance with Clause 23.3(d) (Application of moneys on
            the Proceeds and Revenue Accounts):

            (i)   up to a maximum aggregate per annum of Euro 100,000 or its
                  equivalent; and

            (ii)  in respect of sale proceeds from assets which are no longer
                  required in connection with the Project; and


                                     - 72 -


      (b)   except as provided in Clause 23.5.2(a), only use amounts standing to
            the credit of the Sale Proceeds Account in or towards purchases of
            replacement assets PROVIDED THAT:

            (i)   the Borrower has furnished to the Off Shore Facility Agent an
                  invoice, duly certified by the CFO and the relevant vendor, in
                  respect of the replaced asset; and

            (ii)  the Borrower purchases the replacement asset within:

                  (1)   in the case of replacements of Material Assets 180 days;
                        and

                  (2)   in all other cases 360 days,

                  of receipt of such sales proceeds.

23.5.3 Any amounts standing to the credit of the Sale Proceeds Account that are
      not used in accordance with Clause 23.5.1 (Sale Proceeds Account) shall be
      applied in prepayment in accordance with Clause 14.5.1(a) (Mandatory
      prepayments).

23.6  DEBT SERVICE ACCOUNT

23.6.1 The Borrower will open a debt service account (the "DEBT SERVICE
      ACCOUNT") with the On Shore Security Agent prior to the first Utilisation
      Date, such account to be pledged by the Borrower in favour of the Senior
      Creditors by entering into the Claims Assignment and Bills of Exchange
      Agreement.

23.6.2 The Borrower shall pay into the Debt Service Account on the last day of
      each Month pursuant to Clause 23.3(d)(iv) (Application of moneys on the
      Proceeds and Revenue Accounts) an amount equal:

      (a)   to one third of the Debt Service Payments (other than in respect of
            the SIT Facility and other than as provided in paragraph (b) below)
            due and payable in respect of that Interest Period on the next Euro
            Facility Interest Payment Date; and

      (b)   from the date falling six (6) Months prior to the first Repayment
            Date, one sixth of the Debt Service Payments (other than in respect
            of the SIT Facility and other than in respect of interest and
            amounts payable under the Hedging Agreements prior to their
            termination) due and payable on the next repayment date under the
            Euro Facility, the Sponsors Unsecured Loan Agreement and under the
            Lucent Loan Agreement.

23.6.3 Subject to Clause 23.10 (Remedies on Potential Event of Default or Event
      of Default) the Borrower shall be entitled to use the amount standing to
      the credit of the Debt Service Account on each Euro Facility Interest
      Payment Date or Repayment Date under the Euro Facility to satisfy its Debt
      Service Payment obligations to the Senior Creditors (other than the SIT
      Facility Banks), the Equipment Vendor under the Lucent Loan Agreement and
      the Sponsors under the Sponsors Unsecured Loan Agreement, in each case,
      pursuant to Clause 23.3(d)(iv) (Application of moneys on the Proceeds and
      Revenue Accounts).

23.7  CAPITAL EXPENDITURE RESERVE ACCOUNT

23.7.1 The Borrower will open a capital expenditure reserve account (the
      "CAPITAL EXPENDITURE RESERVE ACCOUNT") with the On Shore Security Agent
      prior to the first


                                     - 73 -


      Utilisation Date, such account to be pledged by the Borrower in favour of
      the Senior Creditors by entering into the Claims Assignment and Bills of
      Exchange Agreement.

23.7.2 The Borrower may pay into the Capital Expenditure Reserve Account
      pursuant to Clause 23.3(d)(viii) (Application of moneys on the Proceeds
      and Revenue Accounts) amounts that the Borrower plans to pay in respect of
      capital expenditure which may be withdrawn for the payment of such capital
      expenditure and shall be withdrawn to effect prepayments, in each case at
      the times and in the manner provided for in Clause 23.3 (Application of
      moneys on the Proceeds and Revenue Accounts).

23.8  LOAN PROCEEDS ACCOUNT

23.8.1 The Borrower will open a transactional account with the On Shore Security
      Agent ("LOAN PROCEEDS ACCOUNT") prior to the first Utilisation Date, such
      account to be pledged by the Borrower in favour of the Senior Creditors by
      entering into the Claims Assignment and Bills of Exchange Agreement.

23.8.2 The Borrower may withdraw amounts standing to the credit of the Loan
      Proceeds Account PROVIDED THAT funds so withdrawn are used to:

      (a)   make payment in respect of Project Costs but in the case of the
            proceeds of any Loans, excluding any amounts payable to the Debt
            Service Reserve Account; and

      (b)   after giving effect to the conversion of Euro 18,500,000 of Existing
            WWIC Loans into Sponsors Contributions and Euro 1,561,318.60 of
            Existing WWIC Loans into Sponsors Unsecured Loans, to repay any
            remaining Existing WWIC Loans which are outstanding in respect of
            agreed Project Costs PROVIDED THAT:

            (i)   such repayment is made from the proceeds of a Utilisation of
                  the Commercial Facility;

            (ii)  no Event of Default or Potential Event of Default will be
                  caused by such repayment;

            (iii) no Cash Shortfall will be caused by such repayment;

            (iv)  no breach of the financial covenants set out in Clause 22
                  (Financial covenants and network milestones) will be caused by
                  such repayment;

            (v)   interest shall be payable thereon at the rate set out in the
                  Existing WWIC Loan Agreement; and

            (vi)  the Borrower has obtained the prior written approval of the
                  Off Shore Facility Agent, which will not be withheld if the
                  Off Shore Facility Agent is satisfied that conditions set out
                  in this paragraph (b) are met and the Off Shore Facility Agent
                  has received:

                  (1)   a certificate, in form and substance reasonably
                        satisfactory to the Off Shore Facility Agent, signed by
                        a director of the Borrower stating that the Existing
                        WWIC Loans to be repaid were in respect of payments made
                        for Project Costs; and

                  (2)   evidence of payment of the Existing WWIC Loans to the
                        Borrower and payment by the Borrower of the respective
                        Project Costs.


                                     - 74 -


23.9  DEBT SERVICE RESERVE ACCOUNT

23.9.1 The Borrower will open a debt service reserve account (the "DEBT SERVICE
      RESERVE ACCOUNT") with IKB International S.A., Luxembourg prior to the
      first Utilisation Date, such account to be pledged by the Borrower in
      favour of the Senior Creditors by entering into the Debt Service Reserve
      Account Pledge Agreement.

23.9.2 The Borrower shall pay into the Debt Service Reserve Account on the last
      day of each Month (other than in respect of the first payment which shall
      be within five (5) Business Days of the first Utilisation Date) pursuant
      to Clause 23.3(d)(v) (Application of moneys on the Proceeds and Revenue
      Accounts) and Clause 23.9.4 (Debt Service Reserve Account) an amount so
      that the amount standing to the credit of the Debt Service Reserve Account
      is no less than the aggregate of all Debt Service Payments falling due
      under the Facilities, the Hedging Agreements and the Lucent Loan Agreement
      during the immediately following six Month period as determined in
      accordance with Clause 23.9.3 (Debt Service Reserve Account) (or in the
      absence of a notification from the Off Shore Facility Agent, as notified
      by the Borrower pursuant to Clause 23.9.3(b) (Debt Service Reserve
      Account) ("DSRA REQUIRED BALANCE")). In no event shall the proceeds of any
      loan be used to fund the Debt Service Reserve Account.

23.9.3

      (a)   The On Shore Facility Agent shall, not less than ten (10) Business
            Days before the first day of each Month, notify the Off Shore
            Facility Agent of the SIT equivalent amount in Euro (calculated at
            the exchange rate (middle rate) of Banka Slovenije on the date of
            calculation) which is the aggregate of all Debt Service Payments
            falling due under the SIT Facility during the immediately following
            six (6) Month period commencing from the first day of such Month.

      (b)   The Borrower shall, not less than ten (10) Business Days before the
            first day of each Month, notify the Off Shore Facility Agent of the
            amount which is the aggregate of the net amount in Euro of all Debt
            Service Payments falling due from the Borrower (or, as the case may
            be, the net amount of all amounts payable to the Borrower) under any
            Hedging Agreements, the Lucent Loan Agreement and the Facilities in
            the immediately following six (6) Month period commencing from the
            first day of such Month. The Borrower shall provide such information
            and such documents as the Off Shore Facility Agent may reasonably
            request in order to verify the amounts so stated by the Borrower.

      (c)   The Off Shore Facility Agent shall, not less than five (5) Business
            Days before the first day of each Month determine the Debt Service
            Payments under the Facilities, the Hedging Agreements and the Lucent
            Loan Agreement payable by the Borrower for the immediately following
            six (6) Month period commencing from the first day of such Month
            based on information provided to the Off Shore Facility Agent by the
            On Shore Facility Agent and the Borrower and as determined by the
            Off Shore Facility Agent and shall notify the Borrower of the amount
            of such Debt Service Payments under the Facilities, the Hedging
            Agreements and the Lucent Loan Agreement.

      (d)   Each Agent may assume:

            (i)   for the purposes of calculating the Debt Service Payments
                  (other than in respect of principal repayments) under the
                  Facilities, the Hedging Agreements and the Lucent Loan
                  Agreement that:

                  (1)   interest will accrue for the following six (6) Month
                        period o under the relevant Facility and the Lucent Loan
                        Agreement on


                                     - 75 -


                        principal outstanding at the rate of interest which
                        applies on the relevant date of calculation (including
                        the Applicable Margin thereunder at such time);

                  (2)   the principal outstanding under the Facilities and the
                        Lucent Loan Agreement during the following six (6) Month
                        period is the principal amount outstanding on the
                        relevant date of calculation taking into account any
                        repayments that are required to be made in such period
                        pursuant to Clause 13 (Repayment); and

                  (3)   any outstanding SIT Facility Loans on the relevant date
                        of calculation will be refinanced with SIT Facility
                        Rollover Loans;

            (ii)  for the purposes of calculating the Debt Service Payments
                  under the Facilities, the Hedging Agreements and the Lucent
                  Loan Agreement in respect of principal repayments that fall
                  due over the following six (6) Month period:

                  (1)   only those repayments and, in the case of the SIT
                        Facility, reductions of the SIT Facility Commitment,
                        required to be made under Clause 13 (Repayment) will be
                        made; and

                  (2)   any outstanding SIT Facility Loans on the relevant date
                        of calculation will be refinanced with SIT Facility
                        Rollover Loans.

23.9.4 If following the application of proceeds standing to the credit of the
      Proceeds and Revenue Accounts in accordance with Clause 23.3(d)
      (Application of moneys on the Proceeds and Revenue Accounts) and Clause
      23.9.1 (Debt Service Reserve Account) the DSRA-Required Balance is not
      achieved the Borrower shall request the Sponsors to make Sponsor
      Contributions in accordance with clause 3.3 (Contingent Equity) of the
      Sponsors' and Shareholders' Undertaking and Completion Guarantee to ensure
      that the amount standing to the credit of the Debt Service Reserve Account
      is no less than the DSRA-Required Balance.

23.9.5 The Off Shore Facility Agent is entitled to set off the credit balance in
      the Debt Service Reserve Account against any obligations of the Borrower
      due and payable under the Finance Documents to the Senior Creditors if the
      Borrower fails in a timely manner to perform such obligations.

23.9.6 Upon any debit to the Debt Service Reserve Account, the Borrower is
      obliged to replenish the Debt Service Reserve Account up to the
      DSRA-Required Balance as soon as possible with moneys from the Proceeds
      and Revenue Accounts subject to the provisions contained in Clause 23.3(d)
      (Application of moneys on the Proceeds and Revenue Accounts). Provided
      that if no Potential Event of Default or Event of Default has occurred and
      is continuing, any amount standing to the credit of the Debt Service
      Reserve Account in excess of the DSRA-Required Balance shall be paid into
      a Proceeds and Revenue Account by the Off Shore Security Agent upon
      receipt of a written request from the Borrower.

23.10 REMEDIES ON POTENTIAL EVENT OF DEFAULT OR EVENT OF DEFAULT

      Without prejudice to any other rights under the Finance Documents
      available to the Senior Creditors, upon the occurrence and during the
      continuance of an Event of


                                     - 76 -


      Default or Potential Event of Default the Off Shore Facility Agent may
      require the Borrower to transfer amounts standing to the credit of the
      Insurance Proceeds Account, Loan Proceeds Account, Sale Proceeds Account,
      the Debt Service Account and/or the Capital Expenditure Reserve account to
      a different account, set up by the Off Shore Security Agent, in the name
      of or held on behalf of the Borrower and for such purpose may request the
      On Shore Facility Agent to make such payment. The Borrower hereby
      authorises the On Shore Facility Agent (without an obligation to make
      further inquiry) to pay such amounts to the Off Shore Security Agent upon
      receipt of request by the Off Shore Facility Agent hereunder. Such account
      shall be secured in favour of the Senior Creditors and the Senior
      Creditors shall be entitled upon the occurrence and during the continuance
      of an Event of Default to set off the amounts standing to the credit of
      the new account against amounts owing to the Senior Creditors under the
      Finance Documents.

24.   GENERAL UNDERTAKINGS

      The undertakings in this Clause 24 remain in force from the date of this
      Agreement for so long as any amount is outstanding under the Finance
      Documents or any Commitment is in force.

24.1  MAINTENANCE OF LEGAL VALIDITY

      The Borrower shall:

      (a)   do all that is necessary to maintain its existence as a legal
            person; and

      (b)   promptly apply for and obtain, comply with and do all that is
            necessary to maintain in full force and effect any Authorisation
            required under any law or regulation of Slovenia to enable it to
            perform its obligations under the Transaction Documents and to
            ensure the legality, validity, enforceability or admissibility in
            evidence in its jurisdiction of incorporation of any Transaction
            Document in each case, except (other than in respect of the Security
            Documents) where failure to do so would not reasonably be expected
            to have a Material Adverse Effect.

24.2  AUTHORISATIONS TO CONDUCT BUSINESS

      The Borrower shall promptly:

      (a)   apply for and obtain, comply with and do all that is necessary to
            maintain in full force and effect and supply certified copies to the
            Agent of the Licence and all Authorisations required under any law
            or regulation of each jurisdiction in which it conducts its business
            to enable it to carry on its business as it is then being conducted;
            and

      (b)   report this Agreement to (and in any event within ten (10) Business
            Days from the date hereof), and report on the transactions
            undertaken in respect of the Debt Service Reserve Account and any
            other offshore bank accounts of the Borrower to and at the times
            required by, Banka Slovenije.

24.3  COMPLIANCE WITH LAWS

      The Borrower shall comply in all respects with all laws and regulations to
      which it may be subject, if failure so to comply would materially impair
      its ability to perform its obligations under the Material Contracts and
      shall perform and observe in all material respects its obligations under
      the Material Contracts.


                                     - 77 -


24.4  COMPLIANCE WITH BUSINESS PLAN

      The Borrower shall carry out the Project substantially in accordance with
      the Business Plan and shall promptly notify and consult with the Off Shore
      Facility Agent as soon as it becomes aware of any increases of 20% or more
      in the annual operating and/or capital expenditures contemplated in the
      Business Plan.

24.5  NETWORK

      The Borrower shall maintain, preserve, repair or replace its assets and
      subject to the terms of Clause 24.26 (New contracts) enter into such
      contracts as are, in each case, necessary to construct, install, test,
      maintain, develop and operate the Network in accordance with prudent
      industry practice.

24.6  INSURANCE

      The Borrower shall give effect to the insurance requirements set out in
      Schedule 11 (Insurance).

24.7  FINANCIAL SYSTEMS AND AUDITORS

      The Borrower shall maintain adequate billing, cash collection, accounting,
      management information and cost control systems and software and maintain
      the appointment of an independent and reputable firm of auditors
      acceptable to the Off Shore Facility Agent (acting reasonably).

24.8  UNTRUE REPRESENTATIONS

      The Borrower shall after the delivery of any Utilisation Request and
      before the making of a Loan or the issue of a SIT Facility Guarantee or LC
      as the case may be, requested therein, notify the Off Shore Facility Agent
      of the occurrence of any event which results in or may reasonably be
      expected to result in the Repeated Representations (or in the case of the
      first Utilisation of the Facilities the representations contained in
      Clause 20.1 (Representations)) being untrue at or before the time of the
      making of such Loan or SIT Facility Guarantee or LC, as the case may be.

24.9  SPONSOR AND SHAREHOLDER SUPPORT

      The Borrower shall request from the Sponsors such technical and managerial
      assistance as and when required to enable the Borrower to undertake
      technical design of the Network and implement and operate the Network and
      shall request the Sponsors to provide trained seconded staff in accordance
      with the assumptions in the Initial Business Plan at the times and in the
      numbers set out therein and the Borrower shall request all such financial
      support from the Sponsors as provided in the Sponsors' and Shareholders'
      Undertaking and Completion Guarantee.

24.10 TAXES

      The Borrower shall duly and punctually pay and discharge:

      (a)   all Taxes imposed upon it or its assets within the time period
            allowed therefor without imposing penalties in excess of Euro 15,000
            or its equivalent and without resulting in an encumbrance having
            priority to the Banks or any Security purported to be granted by or
            created pursuant to the Security Documents (save to the extent
            payment thereof is being contested in good faith by the Borrower,
            appropriate reserves have been made by the Borrower, and where
            payment thereof can lawfully be withheld and would not result in an
            encumbrance having priority to the Security created or evidenced by
            the Security Documents); and

      (b)   all lawful claims which, if unpaid, would by law become encumbrances
            upon its assets.


                                     - 78 -


24.11 SECURITY PRESERVATION

      The Borrower shall at its own expense, take all such action at the times
      and in the manner specified as conditions subsequent to the making of any
      Loans under this Agreement set out in Schedule 9 (Security Documents -
      Conditions Precedent and Conditions Subsequent) and as the Security Agents
      may reasonably require for the purpose of perfecting or protecting the
      Banks' rights under and preserving the security interests intended to be
      created by any of the Security Documents and shall grant and perfect such
      additional Security over Material Assets as the Off Shore Security Agent
      may require.

24.12 INSPECTION RIGHTS

      (a)   The Borrower shall permit the Agents and the Security Agents or any
            of their representatives, advisers or agents to, without
            unreasonably disrupting the Borrower's normal course of business,
            inspect its place of business and its books and records during
            normal business hours and upon ten (10) days prior notice and shall
            permit and authorise the Agents and Security Agents to directly
            contact and address questions to the auditors of the Borrower in the
            presence of representatives of the Borrower.

      (b)   The Borrower shall permit the Off Shore Facility Agent and the
            Independent Technical Consultant full access, during normal business
            hours and upon five (5) Business Days' prior notice, to the Network
            and all data and information relating thereto to enable the Off
            Shore Facility Agent and the Banks to check the Borrower's
            compliance with the terms of this Agreement PROVIDED THAT such
            access does not unreasonably disrupt the Borrower's normal course of
            business.

      (c)   The Borrower shall request counterparties to the Project Contracts
            to permit the Agents and the Security Agents or any of their
            representatives, advisors or agents to make appropriate inspections
            on the basis set out in paragraph (a) above.

24.13 PAYMENTS TO THE BORROWER

      The Borrower shall ensure that all monies received by it are paid into the
      Proceeds and Revenue Accounts.

24.14 NOTIFICATION OF DEFAULTS

      The Borrower shall promptly inform the Off Shore Facility Agent of the
      occurrence of any default under any Material Contract (howsoever called)
      upon becoming aware of it and, upon receipt of a written request to that
      effect from the Off Shore Facility Agent, confirm to the Off Shore
      Facility Agent that, save as previously notified to the Off Shore Facility
      Agent or as notified in such confirmation, no default under any Material
      Contract (howsoever called) has occurred.

24.15 CLAIMS PARI PASSU

      The Borrower shall ensure that at all times the claims of the Finance
      Parties against it under the Finance Documents rank at least pari passu
      with the claims of all its other unsecured and unsubordinated creditors
      save those whose claims are preferred by any bankruptcy, composition,
      insolvency, liquidation, reorganisation, moratorium or other similar laws
      of general application.

24.16 ENVIRONMENTAL COMPLIANCE

      The Borrower shall in all material respects:

      (a)   comply with all Environmental Laws; and


                                     - 79 -


      (b)   obtain and maintain any Environmental Permits required in connection
            with its business and take all reasonable steps in anticipation of
            known or expected future changes to or obligations under the same.

24.17 ENVIRONMENTAL CLAIMS

      The Borrower shall inform the Off Shore Facility Agent in writing as soon
      as reasonably practicable upon becoming aware of the same:

      (a)   if any Environmental Claim has been commenced or (to the best of the
            Borrower's knowledge and belief) is threatened against the Borrower,
            or

      (b)   of any facts or circumstances which will or are reasonably likely to
            result in any Environmental Claim being commenced or threatened
            against the Borrower.

24.18 REAL ESTATE SITE LEASES AND OTHER CONTRACTS RELATING TO THE USE OF LAND

      (a)   The Borrower shall exercise all of its rights and/or options to
            extend the term of, and shall not exercise any options to terminate,
            any of the real estate site leases or other contracts relating to
            the use of land unless it would not:

            (i)   cause an interruption to the operation of the Network; or

            (ii)  be necessary to the operation of the Project; and

            (iii) affect the Security created under the Security Documents.

      (b)   The Borrower shall validly register at the competent Slovenian land
            registry its rights of use and/or of entry against the respective
            owner obtained according to any real estate site lease upon which
            Material Assets subject to the Asset and Licence Pledge and Lease
            Contracts Assignment Agreement are situated within nine (9) Months
            from the date of this Agreement.

      (c)   The Borrower shall obtain the consent of each of the owners of the
            land the subject of the lease agreements which are the subject of
            the Lease Agreement Assignments within nine (9) Months from the date
            of this Agreement.

24.19 NEGATIVE PLEDGE

      The Borrower shall not:

      (a)   create or permit to subsist any Security over any of its assets.

      (b)   (i) sell, transfer or otherwise dispose of any of its assets on
            terms whereby they are or may be leased to or re-acquired by the
            Borrower;

            (ii)  sell, transfer or otherwise dispose of any of its receivables
                  on recourse terms;

            (iii) enter into any arrangement under which money or the benefit of
                  a bank or other account may be applied, set-off or made
                  subject to a combination of accounts; or

            (iv)  enter into any other preferential arrangement having a similar
                  effect to the arrangements set out in paragraphs (i) to (iii)
                  above,

            in circumstances where the arrangement or transaction is entered
            into primarily as a method of raising Financial Indebtedness or of
            financing the acquisition of an asset;


                                     - 80 -


      (c)   Paragraphs (a) and (b) above do not apply to Permitted Encumbrances.

24.20 DISPOSAL

      (a)   The Borrower shall not enter into a single transaction or a series
            of transactions (whether related or not) and whether voluntary or
            involuntary to sell, lease, transfer to a third party or otherwise
            dispose of any asset or remove any Material Asset which is subject
            to the Asset and Licence Pledge and Lease Contracts Assignment
            Agreement from its original site without the prior written consent
            of the Off Shore Facility Agent (such consent not to be unreasonably
            withheld or delayed).

      (b)   Paragraph (a) above does not apply to Permitted Asset Sales PROVIDED
            THAT the proceeds of such sales are applied in accordance with
            Clause 23.5 (Sale Proceeds Account).

24.21 ARM'S LENGTH TERMS

      The Borrower shall not incur any liability to or enter into any contract
      with or for the benefit of any Sponsor or any of its Affiliates, (other
      than in relation to Subordinated Loans and the Management Agreement)
      otherwise than on terms no less favourable to the Borrower than arm's
      length terms in the ordinary course of business.

24.22 BANK ACCOUNTS

      The Borrower shall not open any bank accounts except:

      (a)   as provided in this Agreement;

      (b)   Permitted Accounts; or

      (c)   with the prior written consent of the Off Shore Facility Agent and
            subject to the Borrower's compliance with any conditions attached
            thereto,

      PROVIDED THAT in each case such accounts are secured to the satisfaction
      of the Off Shore Facility Agent.

24.23 MERGER

      The Borrower shall not enter into any amalgamation, demerger, merger or
      corporate reconstruction without the consent of the Off Shore Facility
      Agent (in the case of a corporate reconstruction not to be unreasonably
      withheld or delayed).

24.24 LOANS AND GUARANTEES

      The Borrower shall not make or permit to subsist any loans, grant or
      permit to subsist any credit or give any guarantee or indemnity (except as
      required under any of the Finance Documents) to or for the benefit of any
      person or otherwise voluntarily assume any liability, whether actual or
      contingent, in respect of any obligation of any other person other than:

      (a)   with the prior written consent of the Off Shore Facility Agent;

      (b)   advances to or guarantees in respect of employees, in accordance
            with prudent industry practice, not to exceed in aggregate Euro
            500,000 or its equivalent at any one time; or

      (c)   trade credit to unrelated parties in the ordinary course of business
            of the Borrower PROVIDED THAT such trade credit is payable within 90
            days.


                                     - 81 -


24.25 CHANGE OF BUSINESS

      The Borrower shall not make any material changes to the general nature of
      its business as carried on at the date hereof, or carry on any other
      business other than those defined in the Business Plan without the prior
      written consent of the Banks (such consent not to be unreasonably withheld
      or delayed).

24.26 NEW CONTRACTS

      The Borrower shall not without the prior written consent of the Off Shore
      Facility Agent enter into any Project Contract and/or Material Contract
      which could reasonably be expected to cause the Borrower to exceed its
      approved obligations as set out in the Business Plan. The Borrower shall
      promptly send a copy of all Material Contracts it enters into to the Off
      Shore Facility Agent.

24.27 AMENDMENTS

      The Borrower shall not terminate or consent to any modification,
      substitution or amendment of:

      (a)   any Material Contract without the prior written consent of the Off
            Shore Facility Agent (acting on the instructions of the Majority
            Banks) which, in the case of the documents referred to in Clause
            24.27(a)(iii), shall not be unreasonably withheld PROVIDED THAT
            (other than in respect of a Finance Document) no such consent shall
            be required if:

            (i)   such modification, substitution or amendment relates to the
                  same subject matter (and in the case of substitution such
                  Material Contract is substituted by another contract) and does
                  not result in:

                  (1)   an increase in the obligations of the Borrower; and

                  (2)   a deterioration of the rights of the Borrower;

            (ii)  any Material Contract expires in accordance with its terms; or

            (iii) **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
                  SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
                  CONFIDENTIAL TREATMENT**

      (b)   any other Authorisation or other agreement where such amendment
            would materially adversely affect the Borrower's business or
            financial condition or on the ability of the Borrower to comply with
            its obligations hereunder.

24.28 APPLICATION OF UTILISATIONS

      The Borrower shall not use the Facilities other than in or towards the
      purposes described in Clause 3 (Purpose).

24.29 APPLICATION OF MONEYS ON PROCEEDS AND REVENUE ACCOUNTS

      The Borrower shall not make any distribution, dividend or payment
      (including under any Subordinated Loan) other than in accordance with
      Clause 23.3(d)(x) (Application of moneys on the Proceeds and Revenue
      Accounts).

24.30 SUBSIDIARIES

      Except as provided in Clause 24.33 (UMTS and other licences), the Borrower
      shall not create any Subsidiary or permit to exist any interest in any
      person (whether by shareholding, joint venture, partnership, whether any
      income or profits are, or would be, shared or transferred with any other
      party or otherwise) without the prior written consent of the Banks (such
      consent not be unreasonably withheld or delayed) and the


                                     - 82 -


      Borrower shall not dispose of, or liquidate, or do or permit to occur any
      of the corporate actions referred to in Clause 24.23 (Merger) in relation
      to any Subsidiary or interest in a person without the prior written
      consent of the Banks (such consent not to be unreasonably withheld or
      delayed).

24.31 INDEBTEDNESS

      The Borrower shall not create, assume, incur or otherwise permit to be
      outstanding any indebtedness for borrowed money (including Financial
      Indebtedness) other than:

      (a)   indebtedness for borrowed money under the Finance Documents;

      (b)   indebtedness for borrowed money under the Sponsors Unsecured Loan
            Agreement;

      (c)   indebtedness for borrowed money under the Existing WWIC Loan
            Agreement up to an aggregate principal amount of US Dollars
            25,000,000 or its equivalent PROVIDED THAT such indebtedness is
            converted to Sponsor Contributions and Sponsors Unsecured Loans in
            accordance with Schedule 6 and the amount remaining is repaid in
            accordance with Clause 23.8 (Loan Proceeds Account);

      (d)   indebtedness for borrowed money to any of the Shareholders or
            Sponsors PROVIDED THAT such indebtedness for borrowed money is made
            by way of Subordinated Loan;

      (e)   indebtedness for borrowed money other than under paragraphs (a) or
            (b) above which does not exceed Euro 1,000,000 in aggregate at any
            time other than Subordinated Loans; and

      (f)   indebtedness incurred with the prior written consent of the Off
            Shore Facility Agent (acting on the instructions of the Majority
            Banks) (together "PERMITTED INDEBTEDNESS").

24.32 CAPITAL

      The Borrower shall not decrease, buy-back or redeem its Share Capital or
      the rights or obligations applicable in respect of any Share or increase
      or alter its Share Capital unless Security in respect thereof is granted
      to the Senior Creditors.

24.33 UMTS AND OTHER LICENCES

      (a)   The Borrower shall not, without the prior written consent of the
            Banks, engage in any UMTS Activities or other telecommunication
            service activities other than under the Licence.

      (b)   Paragraph (a) above does not apply if all of the following
            conditions are satisfied and evidence of compliance with such
            conditions (in form and substance satisfactory to the Off Shore
            Facility Agent (acting reasonably) is provided to the Off Shore
            Facility Agent:

            (i)   the purchase of any UMTS licence is carried out by a
                  subsidiary of the Borrower the legal and economic interests in
                  which are owned and controlled as to at least 50.1% by the
                  Borrower (the "UMTS SUBSIDIARY") and pledged to the Senior
                  Creditors;

            (ii)  any contributions (whether by the purchase of shares, making
                  of loans or otherwise) made by the Borrower to the UMTS
                  Subsidiary shall only be permitted if such contributions are
                  made by the Sponsors or Shareholders making Sponsor
                  Contributions to the Borrower (in


                                     - 83 -


                  addition to any payment obligations the Sponsors or
                  Shareholders have pursuant to the Sponsors' and Shareholders'
                  Undertaking and Completion Guarantee) as Equity Contributions
                  or Subordinated Loans to enable the Borrower to make such
                  contributions;

            (iii) at the time of making such contributions to the UMTS
                  Subsidiary the Borrower has met all of its payment
                  obligations, when due, in accordance with Clause 23.3(d)(i) to
                  (vii) (Application of moneys on the Proceeds and Revenue
                  Accounts);

            (iv)  in no event shall the UMTS Subsidiary exploit or operate under
                  any UMTS licence without the prior written consent of the
                  Banks who shall be entitled to withhold such consent if, in
                  such Banks' reasonable opinion, the Borrower would be unlikely
                  to perform its obligations under the Finance Documents
                  PROVIDED THAT if such consent is not provided by the Banks
                  such UMTS licence may be sold by the UMTS Subsidiary on a
                  commercial arm's length basis and the proceeds thereof may,
                  provided no Event of Default has occurred and is continuing,
                  be paid by the Borrower to the Sponsors notwithstanding the
                  provisions of Clause 23.3 (Application of moneys on the
                  Proceeds and Revenue Accounts); and

            (v)   the shares or interests owned or held in the UMTS Subsidiary
                  by any party (other than the Borrower) do not contain or are
                  subject to terms that are more favourable to that party than
                  the Borrower or conditions that are less onerous than those to
                  which the Borrower is subject.

      The Borrower shall promptly notify the Off Shore Facility Agent if it or
      any of its Affiliates acquires any telecommunications business or any new
      licence (excluding any renewal of or addition to any existing
      telecommunications licence), in particular any UMTS licence.

24.34 HEDGING

      (a)   The Borrower shall maintain interest rate hedging in accordance with
            the Hedging Letter.

      (b)   The Borrower may hedge its interest rate exposure under this
            Agreement with a Bank and any indebtedness arising under any Hedging
            Agreement with such Bank shall be secured by the Security Documents
            pari passu with indebtedness arising pursuant to this Agreement.

24.35 TREASURY TRANSACTIONS

      The Borrower shall not enter into any swap, cap, ceiling, floor, collar,
      option, futures transaction, forward rate agreement, foreign exchange
      transaction or other treasury or derivative transaction or any similar
      instrument other than in accordance with Clause 24.34 (Hedging).

24.36 PROHIBITED PAYMENTS

      The Borrower will not and will ensure that its officers, directors,
      employees and agents acting on its behalf will not offer, give, insist on,
      receive or solicit any illegal payment or advantage to influence the
      action of any person in connection with the Project.

24.37 LICENCE ASSIGNMENT AGREEMENT

      The Borrower will in accordance with instructions reasonably given by the
      Off Shore Facility Agent use reasonable efforts to seek the consent of the
      Government to the


                                     - 84 -


      assignment of the rights of the Borrower under the Licence pursuant to the
      Licence Assignment Agreement.

24.38 BILLS OF EXCHANGE AND SECURITY DEPOSITS

      The Borrower may issue bills of exchange or security deposits to third
      parties in respect of Permitted Indebtedness provided that:

      (a)   the liability secured by any Security including any bills of
            exchange and by any security deposit shall not exceed in aggregate
            Euro 1,000,000 or its equivalent; and

      (b)   in the case of bills of exchange issued after the date of this
            Agreement, such bills of exchange are in the form set forth in
            Schedule 16 ("PERMITTED BILL OF EXCHANGE") and expressly state the
            liability of the Borrower to such third parties.

25.   EVENTS OF DEFAULT

25.1  Each of the events or circumstances set out in this Clause 25.1 is an
      Event of Default.

25.1.1 NON-PAYMENT

      The Borrower does not pay on the due date any amount payable pursuant to a
      Finance Document at the place at and in the currency in which it is
      expressed to be payable unless payment is made within five (5) Business
      Days of its due date.

25.1.2 FINANCIAL COVENANTS AND NETWORK MILESTONES

      (a)   At any time any of the requirements of Clause 22 (Financial
            covenants and network milestones) is not satisfied.

      (b)   No Event of Default under paragraph (a) above will occur if failure
            to satisfy such requirement, if capable of remedy, is remedied
            within 30 Business Days (or, if and to the extent that any greater
            grace period applies under clause 2.3 (Failure of Milestone
            completion) of the Sponsors' and Shareholders' Undertaking and
            Completion Guarantee, within such grace period),

            PROVIDED THAT in the event that any of the requirements of Clause 22
            (Financial covenants and network milestones) (other than Clauses
            22.2(a) and (b)) is not satisfied, then within five (5) Business
            Days of delivery of the Covenant Compliance Certificate, the
            Shareholders may, in addition to the Sponsors' obligations under the
            Sponsors' and Shareholders' Undertaking and Completion Guarantee,
            cure such failure to satisfy any such requirement by making
            Subordinated Loans and/or Equity Contributions to the Borrower which
            Subordinated Loans and/or Equity Contributions shall be treated as
            (i) having been contributed on the last day of the relevant Quarter
            and (ii) additional capital or revenues of the Borrower.

25.1.3 OBLIGATIONS

      (a)   The Borrower fails duly to perform or comply:

            (i)   with any of its obligations under the Security Documents;

            (ii)  in any respect with its obligations under the Finance
                  Documents that are stated to be subject to any materiality or
                  Material Adverse Effect qualification or in any material
                  respect with its other obligations under the Finance
                  Documents; or


                                     - 85 -


            (iii) with any payment obligation in respect of which a bill of
                  exchange has been issued or security deposit given and such
                  bill of exchange is presented for payment or such security
                  deposit is retained or set off.

      (b)   No Event of Default under paragraph (a) above will occur if failure
            to comply is capable of remedy and is remedied within ten (10)
            Business Days.

25.1.4 BREACH OF MATERIAL CONTRACTS

      (a)   Any Material Contract is modified or amended without the consent of
            the Off Shore Facility Agent or materially breached (other than a
            breach by a Finance Party of its obligations under the Finance
            Documents).

      (b)   Any Material Contract is cancelled, revoked or terminated prior to
            the end of its term without the consent of the Off Shore Facility
            Agent.

      (c)   No Event of Default under paragraph (a) above will occur if the
            relevant breach is capable of remedy and is remedied within any
            grace period applicable under such Material Contract.

      (d)   No Event of Default under paragraph (a) or (b) above will occur if
            such Material Contract is permitted to be modified, amended,
            substituted, terminated or expire in accordance with the terms of
            Clause 24.27(a) (Amendments).

25.1.5 MISREPRESENTATION

      Any representation or statement made or deemed to be made by the Borrower
      in the Finance Documents or in any notice or other document or certificate
      delivered by or on behalf of the Borrower under or in connection with any
      Finance Document is or proves to have been incorrect or misleading in any
      material respect when made or deemed to be made.

25.1.6 CROSS DEFAULT/FINANCIAL INDEBTEDNESS

      (a)   Any Financial Indebtedness of the Borrower or any of the Sponsors is
            not paid when due nor within any original applicable grace period.

      (b)   Any Financial Indebtedness of the Borrower or any of the Sponsors is
            declared to be or otherwise becomes due and payable prior to its
            specified maturity as a result of an event of default (however
            described).

      (c)   Any commitment for any Financial Indebtedness of the Borrower or any
            of the Sponsors is cancelled or suspended by a creditor of the
            Borrower or any of the Sponsors as a result of an event of default
            (however described).

      (d)   Any creditor of the Borrower or any of the Sponsors becomes entitled
            to declare any Financial Indebtedness of the Borrower or any of the
            Sponsors due and payable prior to its specified maturity as a result
            of an event of default (however described).

      No Event of Default will occur under this Clause 25.1.6 if the aggregate
      amount of Financial Indebtedness or commitment for Financial Indebtedness
      falling within paragraphs (a) to (d) above is less than Euro 100,000 in
      the case of the Borrower and Euro 500,000 in the case of each Sponsor (or
      its equivalent in any other currency or currencies (which, in the case of
      SIT, shall be calculated at the exchange rate (middle rate) of Banka
      Slovenije on the calculation date)).


                                     - 86 -


25.1.7 AUTHORISATIONS

      The Borrower fails to comply with the terms and conditions of the Licence
      and/or any Authorisation necessary for the Borrower's business where
      (except in the case of the Licence) such failure to comply with the terms
      and conditions of such Authorisation would have a Material Adverse Effect
      or the Licence and/or such Authorisation is revoked or suspended where
      (except in the case of the Licence) such revocation or suspension of such
      Authorisation would have a Material Adverse Effect.

25.1.8 INSOLVENCY

      (a)   The Borrower or any of the Sponsors (together the "DEBTORS") is
            unable or admits inability to pay its debts as they fall due,
            suspends making payments on any of its debts or, by reason of actual
            or anticipated financial difficulties, commences negotiations with
            one or more of its creditors with a view to rescheduling any of its
            indebtedness.

      (b)   Under the laws of the jurisdiction to which the Debtor is subject,
            the Debtor is deemed to be insolvent or capable of being wound-up.

      (c)   A moratorium is declared in respect of any indebtedness of any
            Debtor.

25.1.9 INSOLVENCY PROCEEDINGS

      Any corporate action, legal proceedings or other procedure or step is
      taken in relation to:

      (a)   the suspension of payments, a moratorium of any indebtedness,
            winding-up, dissolution, administration or reorganisation (by way of
            voluntary arrangement, scheme of arrangement or otherwise) of the
            Borrower;

      (b)   a composition, assignment or arrangement with any creditor (other
            than any arrangement made in the ordinary course of business) of the
            Borrower;

      (c)   the appointment of a liquidator, receiver, administrator,
            administrative receiver, compulsory manager or other similar officer
            in respect of the Borrower or any of its assets; or

      (d)   enforcement of any Security (other than Permitted Encumbrances) over
            any assets of the Borrower,

      or any analogous procedure or step is taken in any jurisdiction PROVIDED
      THAT no Event of Default will occur under this Clause 25.1.9 if any such
      event is, in the reasonable opinion of the Majority Banks, frivolous or
      vexatious or dismissed or discharged (if capable of being dismissed or
      discharged) within 20 days from the commencement of such event.

25.1.10 LITIGATION

      Any litigation, arbitration, administrative proceedings or governmental or
      regulatory investigations, proceedings or disputes are commenced or
      threatened against the Borrower or its respective assets or revenues or
      there are any circumstances likely to give rise to any such litigation,
      arbitration, administrative proceedings or governmental or regulatory
      investigations, proceedings or disputes where it would be reasonably
      likely to be adversely determined and have a Material Adverse Effect.

25.1.11 OWNERSHIP OF THE BORROWER

      Western Wireless International Corporation holds less than 80% of the
      Shares, directly or indirectly, without the prior written consent of the
      Off Shore Facility Agent (acting on the instructions of the Majority
      Banks).


                                     - 87 -


25.1.12 ILLEGALITY

      At any time it is or becomes unlawful for the Borrower to perform or
      comply with any of its material obligations under the Finance Documents or
      any of the material obligations of the Borrower hereunder or thereunder
      are not or cease to be legal, valid and binding.

25.1.13 SPONSORS' AND SHAREHOLDERS' UNDERTAKING AND COMPLETION GUARANTEE

      Any breach by a Sponsor or Shareholder of clauses 2 (Completion guarantee)
      to 11 (No subrogation) of the Sponsors' and Shareholders' Undertaking and
      Completion Guarantee or any other breach that is likely to result in a
      Material Adverse Effect or at any time it is or becomes unlawful for a
      Sponsor or Shareholder to perform or comply with its material obligations
      thereunder or any of the material obligations of any of the Sponsors or
      Shareholders thereunder are not or cease to be legal, valid and binding.

25.1.14 SECURITY

      From and after the date required under this Agreement, any Security
      Document is not in full force and effect or does not create in favour of
      the parties thereto or the Security Agent for the benefit of the Secured
      Creditors the Security which it is expressed to create with the ranking
      and priority it is expressed to have.

25.1.15 GOVERNMENTAL INTERVENTION

      By or under the authority of any government, (a) the management of the
      Borrower is wholly or partially displaced or the authority of the Borrower
      in the conduct of its business is wholly or partially curtailed in any
      material respect or (b) all or a majority of the issued Shares or the
      whole or any part (the book value of which is five per cent. or more of
      the book value of the whole) of revenues or assets of the Borrower is
      seized, nationalised, expropriated or compulsorily acquired.

25.1.16 REPUDIATION

      The Borrower repudiates a Material Contract or evidences an intention to
      repudiate a Material Contract (otherwise than as permitted under Clause
      24.27 (Amendments).

25.1.17 MATERIAL ADVERSE EFFECT

      Any event or series of events which have or could reasonably be expected
      to have a Material Adverse Effect.

25.1.18 COMPETITION

      Western Wireless Corporation or any of its Affiliates participates in any
      way in any telecommunication system in Slovenia except the Project or as
      provided and in accordance with the terms and conditions set out in Clause
      24.33 (UMTS and other licences) or any of the conditions set out in Clause
      24.33 (UMTS and other licences) do not remain satisfied.

25.2  ACCELERATION

      On and at any time after the occurrence and during the continuance of an
      Event of Default the Off Shore Facility Agent may, and shall if so
      directed by the Majority Banks, by notice to the Borrower:

      (a)   cancel the Total Commitments whereupon they shall immediately be
            cancelled;

      (b)   declare that all or part of the Loans, together with accrued
            interest, and all other amounts accrued or outstanding under the
            Finance Documents (other than the Lucent Loan Agreement and Sponsors
            Unsecured Loan Agreement) be immediately due and payable, whereupon
            they shall become immediately due and payable;


                                     - 88 -


      (c)   declare that all or part of the Loans be payable on demand,
            whereupon they shall immediately become payable on demand by the
            Agent on the instructions of the Majority Banks; and/or

      (d)   require the Borrower to procure that the Issuing Bank's actual or
            contingent obligations in relation to each SIT Facility Guarantee or
            LC are cancelled or discharged in full or provide 100% cash cover to
            the satisfaction of the Issuing Bank and the SIT Facility Banks
            together with an authorisation from the Borrower (in form and
            substance satisfactory to the Issuing Bank) to the Issuing Bank
            permitting such cash cover to be set off against any liability of
            the Issuing Bank and the SIT Facility Banks under such SIT Facility
            Guarantee or LC.


                                     - 89 -


                                   SECTION 10
                               CHANGES TO PARTIES

26.   CHANGES TO THE PARTIES

26.1  ASSIGNMENTS AND TRANSFERS BY THE BANKS

      Subject to this Clause 26, a Bank (the "EXISTING BANK") may:

      (a)   assign any of its claims against the Borrower in a minimum amount
            of, in the case of a Euro Facility Bank, Euro 5,000,000, or in the
            case of a SIT Facility Bank, SIT 600,000,000 provided that if a Bank
            has as its only remaining claim against the Borrower a claim in an
            amount which is less than the relevant amounts set out herein, it
            may assign such lesser amount; or

      (b)   transfer any of its rights and obligations,

      to another bank or financial institution or to a trust, fund or other
      entity which is regularly engaged in or established for the purpose of
      making, purchasing or investing in loans, securities or other financial
      assets (the "NEW BANK").

26.2  CONDITIONS OF ASSIGNMENT OR TRANSFER

      (a)   The consent of the Borrower, the Off Shore Facility Agent and, in
            the case of an assignment or transfer by a SIT Facility Bank, the On
            Shore Facility Agent is required for an assignment or transfer by a
            Bank, unless the assignment or transfer is to another Bank or an
            Affiliate of a Bank or if an Event of Default has occurred and is
            continuing on the Transfer Date.

      (b)   The consent of the Borrower to an assignment or transfer must not be
            unreasonably withheld or delayed. The Borrower will be deemed to
            have given its consent five (5) Business Days after the Borrower has
            received the Bank's written request for such consent unless consent
            is expressly refused by the Borrower within that time.

      (c)   An assignment will only be effective on receipt by the Agent of
            written confirmation from the New Bank (in form and substance
            satisfactory to the Agent) that the New Bank will assume the same
            obligations to the other Finance Parties as it would be under if it
            were an Existing Bank.

      (d)   A transfer will only be effective if the procedure set out in Clause
            26.5 (Procedure for transfer) is complied with.

      (e)   If:

            (i)   a Bank assigns or transfers any of its rights or obligations
                  under the Material Contracts or changes its Facility Office;
                  and

            (ii)  as a result of circumstances existing at the date the
                  assignment, transfer or change occurs, the Borrower would be
                  obliged to make a payment to the New Bank or Bank acting
                  through its new Facility Office under Clause 15 (Tax gross-up
                  and indemnities) or Clause 16 (Increased Costs),

            then the New Bank or Bank acting through its new Facility Office is
            only entitled to receive payment under those Clauses to the same
            extent as the Existing Bank or Bank acting through its previous
            Facility Office would have been if the assignment, transfer or
            change had not occurred.


                                     - 90 -


26.3  ASSIGNMENT OR TRANSFER FEE

      The New Bank shall, on the date upon which an assignment or transfer takes
      effect, pay to the Agent (for its own account) a fee of Euro 1,000.

26.4  LIMITATION OF RESPONSIBILITY OF EXISTING BANKS

      (a)   Unless expressly agreed to the contrary, an Existing Bank makes no
            representation or warranty and assumes no responsibility to a New
            Bank for:

            (i)   the legality, validity, effectiveness, adequacy or
                  enforceability of the Transaction Documents or any other
                  documents;

            (ii)  the financial condition of the Borrower;

            (iii) the performance and observance by the Borrower of its
                  obligations under the Transaction Documents or any other
                  documents; or

            (iv)  the accuracy of any statements (whether written or oral) made
                  in or in connection with any Transaction Document or any other
                  document,

            and any representations or warranties implied by law are excluded to
            the broadest extent legally permissible.

      (b)   Each New Bank confirms to the Existing Bank and the other Finance
            Parties that it:

            (i)   has made (and shall continue to make) its own independent
                  investigation and assessment of the financial condition and
                  affairs of the Borrower and its related entities in connection
                  with its participation in this Agreement and has not relied
                  exclusively on any information provided to it by the Existing
                  Bank in connection with any Transaction Document; and

            (ii)  will continue to make its own independent appraisal of the
                  creditworthiness of the Borrower and its related entities
                  whilst any amount is or may be outstanding under the
                  Transaction Documents or any Commitment is in force.

      (c)   Nothing in any Transaction Document obliges an Existing Bank to:

            (i)   accept a re-transfer from a New Bank of any of the rights and
                  obligations assigned or transferred under this Clause 26; or

            (ii)  support any losses directly or indirectly incurred by the New
                  Bank by reason of the non-performance by the Borrower of its
                  obligations under the Transaction Documents or otherwise.

26.5  PROCEDURE FOR TRANSFER

      (a)   Subject to the conditions set out in Clause 26.2 (Conditions of
            assignment or transfer) a transfer is effected in accordance with
            paragraph (b) below when the Agent executes an otherwise duly
            completed Transfer Certificate delivered to it by the Existing Bank
            and the New Bank. The Agent shall, as soon as reasonably practicable
            after receipt by it of a duly completed Transfer Certificate as set
            out in Schedule 10 (Form of Transfer Certificates) appearing on its
            face to comply with the terms of this Agreement and delivered in
            accordance with the terms of this Agreement, execute that Transfer
            Certificate.


                                     - 91 -


      (b)   On the Transfer Date:

            (i)   to the extent that in the Transfer Certificate the Existing
                  Bank seeks to transfer its rights and obligations under the
                  Finance Documents the Borrower and the Existing Bank shall be
                  released from further obligations towards one another under
                  the Finance Documents and their respective rights against one
                  another shall be cancelled (being the "DISCHARGED RIGHTS AND
                  OBLIGATIONS");

            (ii)  the Borrower and the New Bank shall assume obligations towards
                  one another and/or acquire rights against one another which
                  differ from the Discharged Rights and Obligations only insofar
                  as the Borrower and the New Bank have assumed and/or acquired
                  the same in place of the Borrower and the Existing Bank;

            (iii) the Off Shore Facility Agent, the On Shore Facility Agent, the
                  Off Shore Security Agent, the On Shore Security Agent, the
                  Issuing Bank, each Arranger, the New Bank and other Banks
                  shall acquire the same rights and assume the same obligations
                  between themselves as they would have acquired and assumed had
                  the New Bank been an Original Bank with the rights and/or
                  obligations acquired or assumed by it as a result of the
                  transfer and to that extent the Agent, the Arranger and the
                  Existing Bank shall each be released from further obligations
                  to each other under this Agreement; and

            (iv)  the New Bank shall become a Party as a "Bank".

      For the avoidance of doubt, a transfer shall not constitute a novation.
      The identity of the transferred obligations and rights shall not be
      affected by the transfer.

26.6  DISCLOSURE OF INFORMATION

26.6.1 Any Bank may disclose to any of its Affiliates and any other person:

      (a)   to (or through) whom that Bank assigns or transfers (or may
            potentially assign or transfer) all or any of its rights and
            obligations under this Agreement;

      (b)   with (or through) whom that Bank enters into (or may potentially
            enter into) any sub-participation in relation to, or any other
            transaction under which payments are to be made by reference to,
            this Agreement or the Borrower; or

      (c)   to whom, and to the extent that, information is required to be
            disclosed by any applicable law or regulation,

      any information about the Borrower and the Transaction Documents as that
      Bank shall consider appropriate if, in relation to paragraphs (a) and (b)
      above, the person to whom the information is to be given has entered into
      a Confidentiality Undertaking.

26.6.2 Subject to Clause 26.6.1, each Bank shall keep confidential and not,
      without the prior written consent of the Borrower, use any information
      supplied by the Borrower or any Sponsor under any Finance Document. This
      Clause 26.6.2 shall not apply to disclosure of information:

      (a)   that is in the public domain (other than as a result of a breach of
            the undertakings herein);


                                     - 92 -


      (b)   that is required to be disclosed by applicable law, any court or
            tribunal of competent jurisdiction, rating agency, governmental
            body, banking or taxation authority or by any stock exchange upon
            which it is listed or intends to list;

      (c)   in connection with any legal proceedings arising out of or in
            connection with the Finance Documents or the performance of its
            obligations under the Finance Documents; and/or

      (d)   to its officers, employees, directors, auditors, legal or other
            professional advisors.

26.7  ASSIGNMENTS AND TRANSFER BY THE BORROWER

      The Borrower may not assign any of its rights or transfer any of its
      rights or obligations under the Finance Documents.


                                     - 93 -


                                   SECTION 11
                               THE FINANCE PARTIES

27.   ROLE OF THE AGENT AND THE ARRANGER

27.1  APPOINTMENT OF THE AGENTS

      (a)   Each other Finance Party appoints the Off Shore Facility Agent to
            act as its agent under and in connection with the Finance Documents
            in respect of the Euro Facility.

      (b)   Each other Finance Party appoints the On Shore Facility Agent to act
            as its facility agent under and in connection with the Finance
            Documents in respect of the SIT Facility.

      (c)   Each other Finance Party authorises the Agents to exercise the
            rights, powers, authorities and discretions specifically given to
            the respective Agent under or in connection with the Finance
            Documents together with any other incidental rights, powers,
            authorities and discretions.

27.2  DUTIES OF THE AGENTS

      (a)   Each Agent shall promptly forward to a Party the original or a copy
            of any document which is delivered to such Agent for that Party by
            any other Party.

      (b)   Except where a Finance Document specifically provides otherwise, an
            Agent is not obliged to review or check the adequacy, accuracy or
            completeness of any document it forwards to another Party.

      (c)   If an Agent receives notice from a Party referring to this
            Agreement, describing a mandatory prepayment event set out in Clause
            14.2 (Change of control, Withdrawal of the Licence and Abandonment
            of the Project), an Event of Default or Potential Event of Default
            and stating that the circumstance described is a mandatory
            prepayment event set out in Clause 14.2 (Change of control,
            Withdrawal of the Licence and Abandonment of the Project), an Event
            of Default or Potential Event of Default, it shall promptly notify
            the Finance Parties.

      (d)   If an Agent is aware of the non-payment of any principal, interest,
            commitment fee or other fee payable to a Finance Party (other than
            an Agent or an Arranger) under this Agreement it shall promptly
            notify the other Finance Parties.

      (e)   Each Agent's duties under the Finance Documents are solely
            mechanical and administrative in nature.

27.3  ROLE OF AN ARRANGER

      Except as specifically provided in the Finance Documents, an Arranger has
      no obligations of any kind to any other Finance Party under or in
      connection with any Finance Document.

27.4  NO FIDUCIARY DUTIES

      (a)   Nothing in this Agreement constitutes an Agent or an Arranger as a
            trustee or fiduciary of any other person.

      (b)   Neither an Agent nor an Arranger shall be bound to account to any
            Bank for any sum or the profit element of any sum received by it for
            its own account.


                                     - 94 -


27.5  RIGHTS AND DISCRETIONS OF THE AGENT

      (a)   Each Agent may rely on:

            (i)   any representation, notice or document believed by it to be
                  genuine, correct and appropriately authorised; and

            (ii)  any statement made by a director, authorised signatory or
                  employee of any person regarding any matters which may
                  reasonably be assumed to be within his knowledge or within his
                  power to verify.

      (b)   Each Agent may assume (unless it has received notice to the contrary
            in its capacity as agent for the Banks) that:

            (i)   no Event of Default or Potential Event of Default has occurred
                  (unless it has actual knowledge of an Event of Default or
                  Potential Event of Default arising under Clause 25.1.1
                  (Non-payment)); and

            (ii)  any right, power, authority or discretion vested in any Party
                  or the Majority Banks has not been exercised.

      (c)   Each Agent may engage, pay for and rely on the advice or services of
            any lawyers, accountants, surveyors or other experts.

      (d)   Each Agent may act in relation to the Finance Documents through its
            personnel and agents.

      (e)   Each Agent may disclose to any other Party any information it
            reasonably believes it has received as agent under this Agreement.

      (f)   Notwithstanding any other provision of any Finance Document to the
            contrary, neither an Agent nor an Arranger is obliged to do or omit
            to do anything if it would or might in its reasonable opinion
            constitute a breach of any law or a breach of a fiduciary duty or
            duty of confidentiality.

27.6  MAJORITY BANKS' INSTRUCTIONS

      (a)   Unless a contrary indication appears in a Finance Document, an Agent
            shall (i) exercise any right, power, authority or discretion vested
            in it as Agent in accordance with any instructions given to it by
            the Majority Banks (or, if so instructed by the Majority Banks,
            refrain from exercising any right, power, authority or discretion
            vested in it as Agent) and (ii) not be liable for any act (or
            omission) if it acts (or refrains from taking any action) in
            accordance with an instruction of the Majority Banks.

      (b)   Unless a contrary indication appears in a Finance Document, any
            instructions given by the Majority Banks will be binding on all the
            Finance Parties.

      (c)   Each Agent may refrain from acting in accordance with the
            instructions of the Majority Banks (or, if appropriate, the Banks)
            until it has received such security as it may require for any cost,
            loss or liability (together with any associated VAT) which it may
            incur in complying with the instructions.

      (d)   In the absence of instructions from the Majority Banks (or, if
            appropriate, the Banks), each Agent may act (or refrain from taking
            action) as it considers to be in the best interest of the Banks.


                                     - 95 -


      (e)   An Agent is not authorised to act on behalf of a Bank (without first
            obtaining that Bank's consent) in any legal or arbitration
            proceedings relating to any Finance Document.

27.7  RESPONSIBILITY FOR DOCUMENTATION

      Neither an Agent nor an Arranger:

      (a)   is responsible for the adequacy, accuracy and/or completeness of any
            information (whether oral or written) supplied by such Agent, such
            Arranger or any other person given in or in connection with any
            Finance Document, the Information Memorandum or the Legal Due
            Diligence Report; or

      (b)   is responsible for the legality, validity, effectiveness, adequacy
            or enforceability of any Finance Document or any other agreement,
            arrangement or document entered into, made or executed in
            anticipation of or in connection with any Finance Document.

27.8  EXCLUSION OF LIABILITY

      (a)   Without limiting paragraph (b) below, an Agent will not be liable
            for any action taken or omitted by it under or in connection with
            any Finance Document, unless directly caused by its gross negligence
            or wilful misconduct.

      (b)   No Finance Party may take any proceedings against any officer,
            employee or agent of an Agent in respect of any claim it might have
            against such Agent or in respect of any act or omission of any kind
            by that officer, employee or agent in relation to any Finance
            Document and any officer, employee or agent of such Agent may rely
            on this Clause 27.8.

      (c)   An Agent will not be liable for any delay (or any related
            consequences) in crediting an account with an amount required under
            the Finance Documents to be paid by such Agent if such Agent has
            taken all necessary steps as soon as reasonably practicable to
            comply with the regulations or operating procedures of any
            recognised clearing or settlement system used by such Agent for that
            purpose.

27.9  BANKS' INDEMNITY TO THE AGENT

      Each Bank shall (in proportion to its share of the Total Commitments or,
      if the Total Commitments are then zero, to its share of the Total
      Commitments immediately prior to their reduction to zero) indemnify an
      Agent, within three (3) Business Days of demand, against any cost, loss or
      liability incurred by such Agent (otherwise than by reason of such Agent's
      gross negligence or wilful misconduct) in acting as Agent under the
      Finance Documents (unless such Agent has been reimbursed by the Borrower
      pursuant to a Finance Document).

27.10 RESIGNATION OF THE AGENT

      (a)   Each Agent may resign and appoint one of its Affiliates acting
            through an office as successor by giving notice to the other Finance
            Parties and the Borrower.

      (b)   Alternatively each Agent may resign by giving notice to the other
            Finance Parties and the Borrower, in which case the Majority Banks
            (after consultation with the Borrower) may appoint a successor
            Agent.

      (c)   If the Majority Banks have not appointed a successor Agent in
            accordance with paragraph (b) above within thirty (30) days after
            notice of resignation was


                                     - 96 -


            given, a retiring Agent (after consultation with the Borrower) may
            appoint a successor Agent.

      (d)   The retiring Agent shall, at its own cost, make available to the
            successor Agent such documents and records and provide such
            assistance as the successor Agent may reasonably request for the
            purposes of performing its functions as Agent under the Finance
            Documents.

      (e)   An Agent's resignation notice shall only take effect upon the
            appointment of a successor.

      (f)   Upon the appointment of a successor, the retiring Agent shall be
            discharged from any further obligation in respect of the Finance
            Documents but shall remain entitled to the benefit of this Clause
            27. Its successor and each of the other Parties shall have the same
            rights and obligations amongst themselves as they would have had if
            such successor had been an original Party.

27.11 CONFIDENTIALITY

      (a)   In acting as agent for the Finance Parties, an Agent shall be
            regarded as acting through its agency division which shall be
            treated as a separate entity from any other of its divisions or
            departments.

      (b)   If information is received by another division or department of an
            Agent, it may be treated as confidential to that division or
            department and such Agent shall not be deemed to have notice of it.

27.12 RELATIONSHIP WITH THE BANKS

      Each Agent may treat each Bank as a Bank, entitled to payments under this
      Agreement and acting through its Facility Office unless it has received
      not less than five (5) Business Days prior notice from that Bank to the
      contrary in accordance with the terms of this Agreement.

27.13 CREDIT APPRAISAL BY THE BANKS

      Without affecting the responsibility of the Borrower for information
      supplied by it or on its behalf in connection with any Finance Document,
      each Bank confirms to an Agent and an Arranger that it has been, and will
      continue to be, solely responsible for making its own independent
      appraisal and investigation of all risks arising under or in connection
      with any Finance Document including but not limited to:

      (a)   the financial condition, status and nature of the Borrower and each
            of the Sponsors and Shareholders;

      (b)   the legality, validity, effectiveness, adequacy or enforceability of
            any Transaction Document and any other agreement, arrangement or
            document entered into, made or executed in anticipation of, under or
            in connection with any Transaction Document;

      (c)   whether that Bank has recourse, and the nature and extent of that
            recourse, against any Finance Party or any of its respective assets
            under or in connection with any Transaction Document, the
            transactions contemplated by the Transaction Documents or any other
            agreement, arrangement or document entered into, made or executed in
            anticipation of, under or in connection with any Transaction
            Document; and

      (d)   the adequacy, accuracy and/or completeness of the Initial Business
            Plan, the Information Memorandum, Legal Due Diligence Report and any
            other


                                     - 97 -


            information provided by an Agent, any Finance Party or by any other
            person under or in connection with any Transaction Document, the
            transactions contemplated by the Transaction Documents or any other
            agreement, arrangement or document entered into, made or executed in
            anticipation of, under or in connection with any Transaction
            Document.

27.14 REFERENCE BANKS

      If a Reference Bank (or, if a Reference Bank is not a Bank, the Bank of
      which it is an Affiliate) ceases to be a Bank, the Off Shore Facility
      Agent shall (in consultation with the Borrower) appoint another Bank or an
      Affiliate of a Bank to replace that Reference Bank.

27.15 DUTIES OF THE ON SHORE FACILITY AGENT TO THE OFF SHORE FACILITY AGENT

      The On Shore Facility Agent shall:

      (a)   deliver to the Off Shore Facility Agent on the second Business Day
            of each Month, a report including the amount drawndown under the SIT
            Facility and the extent of the undrawn SIT Facility Commitment as at
            the last Business Day of that Month;

      (b)   promptly forward to the Off Shore Facility Agent an original or a
            copy of any document which is delivered to the On Shore Facility
            Agent and/or the On Shore Security Agent by the Borrower or any
            party to any of the Transaction Documents; and

      (c)   immediately upon becoming aware of any breach of any Transaction
            Document, Potential Event of Default, Event of Default or any Cash
            Shortfall, notify the Off Shore Facility Agent of such breach.

27.16 DEDUCTION FROM AMOUNTS PAYABLE BY THE AGENTS

      If any Party owes an amount to an Agent under the Finance Documents such
      Agent may, after giving notice to that Party, deduct an amount not
      exceeding that amount from any payment to that Party which such Agent
      would otherwise be obliged to make under the Finance Documents and apply
      the amount deducted in or towards satisfaction of the amount owed. For the
      purposes of the Finance Documents that Party shall be regarded as having
      received any amount so deducted.

28.   CONDUCT OF BUSINESS BY THE FINANCE PARTIES

      No provision of this Agreement will:

      (a)   interfere with the right of any Finance Party to arrange its affairs
            (tax or otherwise) in whatever manner it thinks fit;

      (b)   oblige any Finance Party to investigate or claim any credit, relief,
            remission or repayment available to it or the extent, order and
            manner of any claim except to the extent set forth in Clause 18
            (Mitigation by the Banks); or

      (c)   oblige any Finance Party to disclose any information relating to its
            affairs (tax or otherwise) or any computations in respect of Tax
            except to the extent set forth in Clause 15.3 (Tax indemnity) or
            Clause 15.4 (Tax Credit).


                                     - 98 -


29.   SHARING AMONG THE FINANCE PARTIES

29.1  PAYMENTS TO FINANCE PARTIES

      If a Finance Party (a "RECOVERING FINANCE PARTY") receives or recovers any
      amount from the Borrower other than in accordance with Clause 30 (Payment
      mechanics) and applies that amount to a payment due under the Finance
      Documents then:

      (a)   the Recovering Finance Party shall, within ten (10) Business Days,
            notify details of the receipt or recovery to the relevant Agent;

      (b)   the Agent shall determine whether the receipt or recovery is in
            excess of the amount the Recovering Finance Party would have been
            paid had the receipt or recovery been received or made by the Agent
            and distributed in accordance with Clause 30 (Payment mechanics),
            without taking account of any Tax which would be imposed on the
            Agent in relation to the receipt, recovery or distribution; and

      (c)   the Recovering Finance Party shall, within ten (10) Business Days of
            demand by the Agent, pay to the Agent an amount (the "SHARING
            PAYMENT") equal to such receipt or recovery less any amount which
            the Agent determines may be retained by the Recovering Finance Party
            as its share of any payment to be made, in accordance with Clause
            30.5 (Partial payments).

29.2  REDISTRIBUTION OF PAYMENTS

      The Agent shall treat the Sharing Payment as if it had been paid by the
      relevant Finance Party and distribute it between the Finance Parties
      (other than the Recovering Finance Party) in accordance with Clause 30.5
      (Partial payments).

29.3  RECOVERING FINANCE PARTY'S RIGHTS

      (a)   On a distribution by the Agent under Clause 29.2 (Redistribution of
            payments), the Recovering Finance Party will be subrogated to the
            rights of the Finance Parties which have shared in the
            redistribution.

      (b)   If and to the extent that the Recovering Finance Party is not able
            to rely on its rights under paragraph (a) above, the Borrower shall
            be liable to the Recovering Finance Party for a debt equal to the
            Sharing Payment which is immediately due and payable.

29.4  REVERSAL OF REDISTRIBUTION

      If any part of the Sharing Payment received or recovered by a Recovering
      Finance Party becomes repayable and is repaid by that Recovering Finance
      Party, then:

      (a)   each Finance Party which has received a share of the relevant
            Sharing Payment pursuant to Clause 29.2 (Redistribution of payments)
            shall, upon request of the Agent, pay to the Agent for account of
            that Recovering Finance Party an amount equal to the appropriate
            part of its share of the Sharing Payment (together with an amount as
            is necessary to reimburse that Recovering Finance Party for its
            proportion of any interest on the Sharing Payment which that
            Recovering Finance Party is required to pay); and

      (b)   that Recovering Finance Party's rights of subrogation in respect of
            any reimbursement shall be cancelled and the Borrower will be liable
            to the reimbursing Finance Party for the amount so reimbursed.


                                     - 99 -


29.5  EXCEPTIONS

      (a)   This Clause 29 shall not apply to the extent that the Recovering
            Finance Party would not, after making any payment pursuant to this
            Clause, have a valid and enforceable claim against the Borrower.

      (b)   A Recovering Finance Party is not obliged to share with any other
            Finance Party any amount which the Recovering Finance Party has
            received or recovered as a result of taking legal or arbitration
            proceedings, if

            (i)   it notified that other Finance Party of the legal or
                  arbitration proceedings; and

            (ii)  that other Finance Party had an opportunity to participate in
                  those legal or arbitration proceedings but did not do so as
                  soon as reasonably practicable having received notice and did
                  not take separate legal or arbitration proceedings.

      (c)   This Clause 29 shall not apply to any Excluded Proceeds (as defined
            in the Intercreditor Agreement) which shall be applied in accordance
            with the Intercreditor Agreement.

29.6  PERFECTION OF TRANSFERS

      Each Finance Party hereby undertakes vis-a-vis each of the other Finance
      Parties to enter into all additional agreements and to execute all
      additional documents, which might be required under the laws of each
      relevant jurisdiction for the perfection of the transfers and subrogations
      contemplated by this Clause 29. The Borrower hereby agrees to consent to
      all relevant transfers and it hereby undertakes vis-a-vis each of the
      Finance Parties to enter into all additional agreements and to execute all
      additional documents, which are required under the laws of each relevant
      jurisdiction for the perfection of the transfers and subrogations
      contemplated by this Clause 29.


                                    - 100 -


                                   SECTION 12
                                 ADMINISTRATION

30.   PAYMENT MECHANICS

30.1  PAYMENTS TO THE AGENT

      (a)   On each date on which the Borrower or a Bank is required to make a
            payment under a Finance Document, the Borrower or Bank shall make
            the same available to the Off Shore Facility Agent in respect of a
            payment in Euro or the On Shore Facility Agent in respect of a
            payment in SIT (unless a contrary indication appears in a Finance
            Document) for value on the due date at the time and in such funds
            specified by the relevant Agent as being customary at the time for
            settlement of transactions in the relevant currency in the place of
            payment.

      (b)   Payment shall be made to such account in Ljubljana if payment is to
            be made in SIT or in Dusseldorf if payment is to be made in Euro
            with such bank as the relevant Agent specifies.

      Each Bank shall promptly indemnify the relevant Agent against any cost,
      loss or liability incurred by such Agent as a result of late or
      non-performance by such Bank of any of its payment obligations under this
      Agreement.

30.2  DISTRIBUTIONS BY THE AGENT

      Each payment received by an Agent under the Finance Documents for another
      Party shall, subject to Clause 30.3 (Distributions to the Borrower) and
      Clause 30.4 (Clawback) be made available by such Agent as soon as
      practicable after receipt to the Party entitled to receive payment in
      accordance with this Agreement (in the case of a Bank, for the account of
      its Facility Office), to such account as that Party may notify to such
      Agent by not less than five (5) Business Days' notice.

30.3  DISTRIBUTIONS TO THE BORROWER

      The Agent may (with the consent of the Borrower or in accordance with
      Clause 31 (Set-off)) apply any amount received by it for the account of
      the Borrower in or towards payment (on the date and in the currency and
      funds of receipt) of any amount due from the Borrower under the Finance
      Documents, or in or towards purchase of any amount of any currency to be
      so applied.

30.4  CLAWBACK

      (a)   Where a sum is to be paid to an Agent under the Finance Documents
            for another Party, such Agent is not obliged to pay that sum to that
            other Party (or to enter into or perform any related exchange
            contract) until it has been able to establish to its satisfaction
            that it has actually received that sum.

      (b)   If an Agent pays an amount to another Party and it proves to be the
            case that such Agent had not actually received that amount, then the
            Party to whom that amount (or the proceeds of any related exchange
            contract) was paid by such Agent shall on demand refund the same to
            such Agent together with interest on that amount from the date of
            payment to the date of receipt by such Agent, calculated by such
            Agent to reflect its cost of funds.

30.5  PARTIAL PAYMENTS

      (a)   If an Agent receives a payment that is insufficient to discharge all
            the amounts then due and payable by the Borrower under the Finance
            Documents, such


                                    - 101 -


            Agent shall apply that payment towards the obligations of the
            Borrower under the Finance Documents in the following order:

            (i)   first, in or towards payment pro rata of any unpaid fees,
                  costs and expenses of the Agents under the Finance Documents;

            (ii)  secondly, in or towards payment pro rata of any accrued
                  default interest, interest, fee or commission due but unpaid
                  under this Agreement;

            (iii) thirdly, in or towards payment pro rata of any principal due
                  but unpaid under this Agreement; and

            (iv)  fourthly, in or towards payment pro rata of any other sum due
                  but unpaid under the Finance Documents.

      (b)   Such Agent shall, if so directed by the Majority Banks, vary the
            order set out in paragraphs (a)(ii) to (iv) above and such direction
            shall also apply in respect of payments received by the other Agent.

      (c)   Paragraphs (a) and (b) above will override any appropriation made by
            the Borrower.

      (d)   This Clause 30.5 shall not apply to any Excluded Proceeds (as
            defined in the Intercreditor Agreement).

30.6  NO SET-OFF BY THE BORROWER

      All payments to be made by the Borrower under the Finance Documents shall
      be calculated and be made without (and free and clear of any deduction
      for) set-off or counterclaim.

30.7  BUSINESS DAYS

      (a)   Any payment which is due to be made on a day that is not a Business
            Day shall be made on the next Business Day and in the case of the
            Euro Facility such Business Day shall be in the same calendar month
            (if there is one) or the preceding Business Day (if there is not).

      (b)   During any extension of the due date for payment of any principal or
            Unpaid Sum under this Agreement interest is payable on the principal
            or Unpaid Sum at the rate payable on the original due date.

30.8  CURRENCY OF ACCOUNT

      (a)   A repayment of a Loan or Unpaid Sum or a part of a Loan or Unpaid
            Sum shall be made in the currency in which that Loan or Unpaid Sum
            is denominated on its due date.

      (b)   Each payment of interest shall be made in the currency in which the
            sum in respect of which the interest is payable was denominated when
            that interest accrued.

      (c)   Each payment in respect of costs, expenses or Taxes shall be made in
            the currency in which the costs, expenses or Taxes are incurred.


                                    - 102 -


30.9  CHANGE OF CURRENCY

      (a)   Unless otherwise prohibited by law, if more than one currency or
            currency unit are at the same time recognised by the central bank of
            any country as the lawful currency of that country, then:

            (i)   any reference in the Finance Documents to, and any obligations
                  arising under the Finance Documents in, the currency of that
                  country shall be translated into, or paid in, the currency or
                  currency unit of that country designated by the relevant Agent
                  (after consultation with the Borrower); and

            (ii)  any translation from one currency or currency unit to another
                  shall be at the official rate of exchange recognised by the
                  central bank for the conversion of that currency or currency
                  unit into the other, rounded up or down by the relevant Agent
                  (acting reasonably) or in the case of any translation from or
                  to SIT at the relevant exchange rate from the list of Nova
                  Ljubljanska banka d.d., Ljubljana for the foreign exchange
                  transactions with legal entities (Tecajna lista Nove
                  Ljubljanske banka d.d., Ljubljana, za obracundeviznih prilivov
                  in odlivov podjetij) or any other applicable document of Nova
                  Ljubljanska banka d.d., Ljubljana with essentially similar
                  substance.

      (b)   If a change in any currency of a country occurs, this Agreement
            will, to the extent that the relevant Agent (acting reasonably and
            after consultation with the Borrower) specifies to be necessary, be
            amended to comply with any generally accepted conventions and market
            practice in the European Interbank Market and otherwise to reflect
            the change in currency.

31.   SET OFF

      A Finance Party may set off any matured obligation due from the Borrower
      under the Finance Documents (to the extent beneficially owned by that
      Finance Party) against any matured obligation owed by that Finance Party
      to the Borrower, regardless of the place of payment, booking branch or
      currency of either obligation. If the obligations are in different
      currencies, the Finance Party may for the purpose of the set off convert
      either obligation at a market rate of exchange in its usual course of
      business or, in the case of a SIT Facility Bank, at the relevant exchange
      rate from the list of Nova Ljubljanska banka d.d., Ljubljana for the
      foreign exchange transactions with legal entities (Tecajna lista Nove
      Ljubljanske banka d.d., Ljubljana, za obracundeviznih prilivov in odlivov
      podjetij) or any other applicable document of Nova Ljubljanska banka d.d.,
      Ljubljana with essentially similar substance.

32.   NOTICES

32.1  COMMUNICATIONS IN WRITING

      Any communication, demand or notice to be made under or in connection with
      the Finance Documents shall be made in writing and, unless otherwise
      stated, may be made by fax or letter.

32.2  ADDRESSES

      The address and fax number (and the department or officer, if any, for
      whose attention the communication is to be made) of each Party for any
      communication or document to be made or delivered under or in connection
      with the Finance Documents is:


                                    - 103 -


      (a)   in case of the Borrower:

            WESTERN WIRELESS INTERNATIONAL D.O.O.

            Address:          Brnciceva ulica 49

                              1231 Ljubljana, Slovenia

            Telephone:        +386 1 5801 200

            Fax:              +386 1 5801 109

            Attention of:     Steven Fast

            Copy to:          Western Wireless International Corporation

            Address:          3650 131st  Avenue, S.E., Suite 400

                              Bellevue, Washington 98006, USA

            Telephone:        +1 425 586 8161

            Fax:              +1 425 586 8777

            Attention of:     Scott Alderman

      (b)   in case to the Borrower's process agent:

            FIDEUROP - TREUHANDGESELLSCHAFT FUR DEN GEMEINSAMEN MARKT MBH

            Address:          Marie-Curie Strasse 30

                              60439 Frankfurt am Main, Germany

            Telephone:        +49 69 95 870

            Fax:              +49 69 95 87 2584

            Attention of:     Dr. Klaus Zimmermann

      (c)   in case of the Off Shore Facility Agent and the Off Shore Security
            Agent:

            IKB DEUTSCHE INDUSTRIEBANK AG

            Address: Wilhelm-Botzkes-Stra(beta)e 1

                              40474 Dusseldorf, Germany

            Telephone:        +49 211 8221 4887 or +49 211 8221 4730

            Fax:              +49 211 8221 2887 or +49 211 8221 2730

            Attention of:     Martina Messing or Andreas Nestel,
                              Structured Finance Department


                                    - 104 -


      (d)   in case of the On Shore Facility Agent and the On Shore Security
            Agent:

            NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA

            Address:          Smartinska 130, SI - 1520 Ljubljana, Slovenia

            Telephone:        +386 1 520 7273

            Fax:              +386 1 425 60 02

            Attention of:     Ms. Jasna Istenic or Mr. Bostjan Kovac

      (e)   in the case of a Bank, as identified with its signature below or in
            a Transfer Certificate, as the case may be,

            or any substitute address, fax number or department or officer as
            the relevant Party may notify to the relevant Agent (or an Agent may
            notify to the other Parties, if a change is made by the Agent) by
            not less than five (5) Business Days' notice.

32.3  DELIVERY

      (a)   Any communication or document made or delivered by one person to
            another under or in connection with the Finance Documents will only
            be effective:

            (i)   if by way of fax, when received in legible form; or

            (ii)  if by way of letter, when it has been left at the relevant
                  address or three (3) Business Days after being deposited with
                  a reputable overnight courier service; or

      and, if a particular department or officer is specified as part of its
      address details provided under Clause 32.2 (Addresses), if addressed to
      that department or officer.

      (b)   Any communication or document to be made or delivered to an Agent
            will be effective only when actually received by such Agent and then
            only if it is expressly marked for the attention of the department
            or officer identified with such Agent's signature below (or any
            substitute department or officer as such Agent shall specify for
            this purpose).

      (c)   All notices from or to the Borrower shall be sent through an Agent.

32.4  NOTIFICATION OF ADDRESS AND FAX NUMBER

      Promptly upon receipt of notification of an address or fax number or
      change of address or fax number pursuant to Clause 32.2 (Addresses) or
      changing its own address or fax number, an Agent shall notify the other
      Parties.

32.5  ELECTRONIC COMMUNICATION

      (a)   Any communication to be made between an Agent and a Bank under or in
            connection with the Finance Documents may be made by electronic mail
            or other electronic means, if such Agent and the relevant Bank:

            (i)   agree that, unless and until notified to the contrary, this is
                  to be an accepted form of communication;


                                    - 105 -


            (ii)  notify each other in writing of their electronic mail address
                  and/or any other information required to enable the sending
                  and receipt of information by that means; and

            (iii) notify each other of any change to their address or any other
                  such information supplied by them.

      (b)   Any electronic communication made between an Agent and a Bank will
            be effective only when actually received in readable form and in the
            case of any electronic communication made by a Bank to such Agent
            only if it is addressed in such a manner as such Agent shall specify
            for this purpose.

32.6  ENGLISH LANGUAGE

      Any notice given or any other document provided under or in connection
      with:

            (i)   the Finance Documents which is required by law or in
                  accordance with standard banking practice to be made in
                  Slovenian shall be made in Slovenian and in each case
                  accompanied by an English translation thereof unless such
                  notice or other document is identical (other than for
                  calculation figures) in all material respects to those
                  previously agreed with the Off Shore Facility Agent;

            (ii)  the documentation related to the ECA Cover Documents shall be
                  in the German language; and

            (iii) the Finance Documents shall be in English unless otherwise
                  provided for under (i) and (ii) above.

33.   CALCULATIONS AND CERTIFICATES

33.1  ACCOUNTS

      In any litigation or arbitration proceedings arising out of or in
      connection with a Finance Document, the entries made in the accounts
      maintained by a Finance Party are prima facie evidence of the matters to
      which they relate absent manifest error.

33.2  CERTIFICATES AND DETERMINATIONS

      Any certification or determination by a Finance Party of a rate or amount
      under any Finance Document is, in the absence of manifest error,
      conclusive evidence of the matters to which it relates.

33.3  DAY COUNT CONVENTION

      (a)   In respect of the Euro Facility any interest, commission or fee
            accruing under a Finance Document will accrue from day to day and is
            calculated on the basis of the actual number of days elapsed and a
            year of 360 days or, in any case where the practice in the European
            Interbank Market differs, in accordance with that market practice.

      (b)   In respect of the SIT Facility any interest, commission or fee
            accruing under a Finance Document will accrue from day to day and is
            calculated in accordance with the Resolution on Interest Rates of
            Nova Ljubljanska Banka d.d., Ljubljana using the conform method of
            calculating interest and TOM and on the basis of a year of 365 days.


                                    - 106 -


34.   PARTIAL INVALIDITY

      If, at any time, any provision of the Finance Documents is or becomes
      illegal, invalid or unenforceable in any respect under any law of any
      jurisdiction, neither the legality, validity or enforceability of the
      remaining provisions nor the legality, validity or enforceability of such
      provision under the law of any other jurisdiction will in any way be
      affected or impaired.

35.   REMEDIES AND WAIVERS

      No failure to exercise, nor any delay in exercising, on the part of any
      Finance Party, any right or remedy under the Finance Documents shall
      operate as a waiver, nor shall any single or partial exercise of any right
      or remedy prevent any further or other exercise or the exercise of any
      other right or remedy. The rights and remedies provided in this Agreement
      are cumulative and not exclusive of any rights or remedies provided by
      law.

36.   AMENDMENTS AND WAIVERS

36.1  REQUIRED CONSENTS

      (a)   Subject to Clause 36.2 (Exceptions) any term of the Finance
            Documents may be amended or waived only with the consent of the
            Majority Banks and the Borrower and any such amendment or waiver
            will be binding on all Parties.

      (b)   The Off Shore Facility Agent may effect, on behalf of any Finance
            Party, any amendment or waiver permitted by this Clause.

36.2  EXCEPTIONS

      (a)   An amendment or waiver that has the effect of changing or which
            relates to:

            (i)   the definition of "Majority Banks" in Clause 1.1
                  (Definitions);

            (ii)  an extension to the date of payment of any amount under the
                  Finance Documents;

            (iii) a reduction in the Applicable Margin or a reduction in the
                  amount of any payment of principal, interest, fees or
                  commission payable;

            (iv)  an increase in or an extension of any Commitment;

            (v)   a change to the Borrower;

            (vi)  any provision which expressly requires the consent of all the
                  Banks;

            (vii) Clause 2.2 (Finance Parties' rights and obligations), Clause
                  21 (Reporting requirements), Clause 26 (Changes to the
                  Parties) or this Clause 36,

            shall not be made without the prior consent of all the Banks.

      (b)   An amendment or waiver which relates to the rights or obligations of
            an Agent, a Security Agent, the Issuing Bank or an Arranger may not
            be effected without the consent of such party.


                                    - 107 -


37.   COUNTERPARTS

      Each Finance Document may be executed in any number of counterparts, and
      this has the same effect as if the signatures on the counterparts were on
      a single copy of the Finance Document.


                                    - 108 -


                                   SECTION 13
                          GOVERNING LAW AND ENFORCEMENT

38.   GOVERNING LAW

      This Agreement shall be governed by, and shall be construed in accordance
      with, German law.

39.   ARBITRATION

39.1  ARBITRATION

      Subject to Clause 39.4 (Agent's option), any dispute (a "DISPUTE") arising
      out of or in connection with this Agreement (including a dispute regarding
      the existence, validity or termination of this Agreement or the
      consequences of its nullity) shall be finally settled under the Rules of
      Arbitration of the International Chamber of Commerce (the "RULES") by
      three arbitrators appointed in accordance with the Rules.

39.2  PROCEDURE FOR ARBITRATION

      The arbitral tribunal shall consist of three arbitrators. The place of
      arbitration shall be Paris and the language of the arbitration shall be
      English.

39.3  RECOURSE TO COURTS

      Save as provided in Clause 39.4 (Agent's option), the parties exclude the
      jurisdiction of the courts.

39.4  AGENT'S OPTION

      In the case of any Dispute in which the Agent for and on behalf of the
      Finance Parties is or the Finance Parties are the claimant, the Off Shore
      Facility Agent may (acting upon the instructions of the Majority Banks)
      prior to having initiated arbitral proceedings, by notice in writing to
      all other parties to this Agreement require that such Dispute be heard by
      a court of law. If the Off Shore Facility Agent gives such notice, the
      Dispute to which such notice refers shall be determined in accordance with
      Clause 40 (Jurisdiction).

40.   JURISDICTION

40.1  GERMAN COURTS

      Each of the Parties irrevocably agrees for the benefit of each of the
      other Parties that the courts at Dusseldorf, Germany, shall have
      non-exclusive jurisdiction to settle any Dispute.

40.2  SERVICE OF PROCESS

      The Borrower agrees that the process by which any suit, action or
      proceedings in Germany is begun may be served on it by being delivered to
      the process agent in Germany appointed or to be appointed by the Borrower
      according to Schedule 13 (Process Agent Confirmation) for the time being.
      If the appointment of such process agent ceases to be effective in respect
      of the Borrower, the Borrower shall immediately appoint a further person
      in Germany to accept service of process on its behalf in Germany and,
      failing such appointment within fifteen (15) days, the Agent shall be
      entitled to appoint such a person by notice to the Borrower. Nothing
      contained herein shall affect the right to serve process in any other
      manner permitted by relevant law.

40.3  NON-EXCLUSIVE SUBMISSIONS

      The submission to the jurisdiction of the courts referred to in Clause
      40.1 (German courts) shall not (and shall not be construed so as to) limit
      the right of an Agent, an Arranger and the Banks or any of them to take
      proceedings against the Borrower in any


                                    - 109 -


      other court of competent jurisdiction nor shall the taking of proceedings
      in any one or more jurisdiction preclude the taking or proceedings in any
      other jurisdiction (whether concurrently or not) if and to the extent
      permitted by applicable law.

40.4  WAIVER OF IMMUNITY

      To the extent that the Borrower may in any jurisdiction claim for itself
      or its assets immunity from suit, execution, attachment (whether in aid of
      execution, before judgement or otherwise) or other legal process and to
      the extent that in any such jurisdiction there may be attributed to itself
      or its assets such immunity (whether or not claimed), the Borrower hereby
      irrevocably agrees not to claim and hereby irrevocably waives such
      immunity to the full extent permitted by the laws of such jurisdiction.


                                    - 110 -


                                   SCHEDULE 1
                                   COMMITMENTS

                                     PART I
                                  EURO FACILITY



                                                         ECA FACILITY                              COMMERCIAL
FINANCIAL INSTITUTION                                     COMMITMENT                                FACILITY
                                                                                                   COMMITMENT
                                      ECA FACILITY       ECA FACILITY       ECA FACILITY
                                        TRANCHE 1          TRANCHE 2          TRANCHE 3
                                       COMMITMENT         COMMITMENT         COMMITMENT

                                                                                     
IKB Deutsche Industriebank AG      Euro 15,328,263.11   Euro 689,916.66    Euro 1,415,895.49     Euro 13,910,000.00

Kreditanstalt fur Wiederaufbau     Euro 15,328,263.11   Euro 689,916.66    Euro 1,415,895.48     Euro 13,910,000.00

Raiffeisenlandesbank               Euro 7,234,745.16    Euro 325,631.89    Euro 668,284.65       Euro 8,560,000.00
Oberosterreich
reg.Gen.m.b.H.

Landesbank                         Euro 7,074,582.98    Euro 318,423.08    Euro 653,490.23       Euro 6,420,000.00
Schleswig-Holstein
Girozentrale

Hypo Alpe-Adria-Bank AG            Euro 2,198,032.14    Euro 98,932.21     Euro 203,035.65             None



                                    - 111 -


                                     PART II

                                  SIT FACILITY



FINANCIAL INSTITUTION                                 SIT FACILITY COMMITMENT EQUIVALENT TO
                                                   
Nova Ljubljanska Banka d.d., Ljubljana                SIT 3,400,000,000.00

Hypo Alpe-Adria-Bank d.d.                             SIT 1,000,000,000.00



                                    - 112 -


                                   SCHEDULE 2
                                 REPAYMENT DATES



REPAYMENT DATE /          ECA FACILITY           COMMERCIAL FACILITY           SIT FACILITY
REDUCTION DATE
                                                                      
  30.05.2004                     1.25%                     0.00%

  30.11.2004                     1.25%                     0.00%

  30.05.2005                     5.75%                     5.75%

  30.11.2005                     5.75%                     5.75%                      5.00%

  30.05.2006                     8.00%                     8.00%

  30.11.2006                     8.00%                     8.00%                      5.00%

  30.05.2007                    10.00%                    12.50%

  30.11.2007                    10.00%                    12.50%                     10.00%

  30.05.2008                    12.00%                    12.50%

  30.11.2008                    12.00%                    12.50%                     20.00%

  30.05.2009                    13.00%                    14.00%                     20.00%

  30.11.2009                    13.00%                     8.50%                     40.00%

     TOTAL                     100.00%                   100.00%                    100.00%



                                    - 113 -


                                   SCHEDULE 3
                     LMA FORM OF CONFIDENTIALITY UNDERTAKING

From:    [Seller]/[Seller's agent/broker]

To:      [Potential Purchaser]/[Purchaser's agent/broker]

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

BORROWER:
DATE:
AMOUNT:
AGENT:

We understand that you are considering [acquiring](a)/[arranging the acquisition
of](b) an interest in the Agreement (the "Acquisition"). In consideration of us
agreeing to make available to you certain information, by your signature of a
copy of this letter you agree as follows:

1.    Confidentiality Undertaking You undertake (a) to keep the Confidential
      Information confidential and not to disclose it to anyone except as
      provided for by paragraph 2 below and to ensure that the Confidential
      Information is protected with security measures and a degree of care that
      would apply to your own confidential information, (b) to use the
      Confidential Information only for the Permitted Purpose, (c) to use all
      reasonable endeavours to ensure that any person to whom you pass any
      Confidential Information (unless disclosed under paragraph 2[(c)/(d)](c)
      below) acknowledges and complies with the provisions of this letter as if
      that person were also a party to it, and (d) not to make enquiries of any
      member of the Group or any of their officers, directors, employees or
      professional advisers relating directly or indirectly to the Acquisition.

2.    Permitted disclosure We agree that you may disclose Confidential
      Information:

      (a)   to members of the Purchaser Group and their officers, directors,
            employees and professional advisers to the extent necessary for the
            Permitted Purpose and to any auditors of members of the Purchaser
            Group;

      (b)   [subject to the requirements of the Agreement, in accordance with
            the Permitted Purpose so long as any prospective purchaser has
            delivered a letter to you in equivalent form to this letter;]

      [(b/c)](c) subject to the requirements of the Agreement, to any person to
            (or through) whom you assign or transfer (or may potentially assign
            or transfer) all or any of the rights, benefits and obligations
            which you may acquire under the Agreement or with (or through) whom
            you enter into (or may potentially enter into) any sub-participation
            in relation to, or any other transaction under which payments are to
            be made by reference to, the Agreement or the Borrower or


                                    - 114 -


            any member of the Group so long as that person has delivered a
            letter to you in equivalent form to this letter; and

      [(c/d)](c) (i) where requested or required by any court of competent
            jurisdiction or any competent judicial, governmental, supervisory or
            regulatory body, (ii) where required by the rules of any stock
            exchange on which the shares or other securities of any member of
            the Purchaser Group are listed or (iii) where required by the laws
            or regulations of any country with jurisdiction over the affairs of
            any member of the Purchaser Group.

3.    Notification of required or unauthorised disclosure You agree (to the
      extent permitted by law) to inform us of the full circumstances of any
      disclosure under paragraph 2[(c)/(d)](c) or upon becoming aware that
      Confidential Information has been disclosed in breach of this letter.

4.    Return of copies If we so request in writing, you shall return all
      Confidential Information supplied to you by us and destroy or permanently
      erase all copies of Confidential Information made by you and use all
      reasonable endeavours to ensure that anyone to whom you have supplied any
      Confidential Information destroys or permanently erases such Confidential
      Information and any copies made by them, in each case save to the extent
      that you or the recipients are required to retain any such Confidential
      Information by any applicable law, rule or regulation or by any competent
      judicial, governmental, supervisory or regulatory body or in accordance
      with internal policy, or where the Confidential Information has been
      disclosed under paragraph 2[(c)/(d)](c) above.

5.    Continuing obligations The obligations in this letter are continuing and,
      in particular, shall survive the termination of any discussions or
      negotiations between you and us. Notwithstanding the previous sentence,
      the obligations in this letter shall cease (without in any way prejudicing
      the confidentiality obligations under the Agreement) (a) if you become a
      party to or otherwise acquire (by assignment or sub-participation) an
      interest, direct or indirect, in the Agreement or (b) twelve months after
      you have returned all Confidential Information supplied to you by us and
      destroyed or permanently erased all copies of Confidential Information
      made by you (other than any such Confidential Information or copies which
      have been disclosed under paragraph 2 above (other than sub-paragraph
      2(a)) or which, pursuant to paragraph 4 above, are not required to be
      returned or destroyed).

6.    No representation; consequences of breach, etc You acknowledge and agree
      that:

      (a)   neither we, [nor our principal](d) nor any member of the Group nor
            any of our or their respective officers, employees or advisers (each
            a "RELEVANT PERSON") (i) make any representation or warranty,
            express or implied, as to, or assume any responsibility for, the
            accuracy, reliability or completeness of any of the Confidential
            Information or any other information supplied by us or the
            assumptions on which it is based or (ii) shall be under any
            obligation to update or correct any inaccuracy in the Confidential
            Information or any other information supplied by us or be otherwise
            liable to you or any other person in respect to the Confidential
            Information or any such information; and

      (b)   we [or our principal](d) or members of the Group may be irreparably
            harmed by the breach of the terms hereof and damages may not be an
            adequate remedy; each Relevant Person may be granted an injunction
            or specific performance for any threatened or actual breach of the
            provisions of this letter by you.


                                    - 115 -


7.    No waiver; amendments, etc This letter sets out the full extent of your
      obligations of confidentiality owed to us in relation to the information
      the subject of this letter. No failure or delay in exercising any right,
      power or privilege hereunder will operate as a waiver thereof nor will any
      single or partial exercise of any right, power or privilege preclude any
      further exercise thereof or the exercise of any other right, power or
      privileges hereunder. The terms of this letter and your obligations
      hereunder may only be amended or modified by written agreement between us.

8.    Inside information You acknowledge that some or all of the Confidential
      Information is or may be price-sensitive information and that the use of
      such information may be regulated or prohibited by applicable legislation
      relating to insider dealing and you undertake not to use any Confidential
      Information for any unlawful purpose.

9.    Nature of undertakings The undertakings given by you under this letter are
      given to us and (without implying any fiduciary obligations on our part)
      are also given for the benefit of [our principal,](d) the Borrower and
      each other member of the Group.

10.   Third party rights

      (a)   Subject to paragraph 6 and paragraph 9 the terms of this letter may
            be enforced and relied upon only by you and us.

      (b)   Notwithstanding any provisions of this letter, the parties to this
            letter do not require the consent of any Relevant Person or any
            member of the Group to rescind or vary this letter at any time.

11.   Governing Law and Jurisdiction This letter (including the agreement
      constituted by your acknowledgement of its terms) shall be governed by and
      construed in accordance with German law and the parties submit to the
      non-exclusive jurisdiction of the courts at Dusseldorf, Germany.

12.   Definitions In this letter (including the acknowledgement set out below)
      terms defined in the Agreement shall, unless the context otherwise
      requires, have the same meaning and:

      "CONFIDENTIAL INFORMATION" means any information relating to the Borrower,
      the Group, the Agreement and/or the Acquisition provided to you by us or
      any of our affiliates or advisers, in whatever form, and includes
      information given orally and any document, electronic file or any other
      way of representing or recording information which contains or is derived
      or copied from such information but excludes information that (a) is or
      becomes public knowledge other than as a direct or indirect result of any
      breach of this letter or (b) is known by you before the date the
      information is disclosed to you by us or any of our affiliates or advisers
      or is lawfully obtained by you thereafter, other than from a source which
      is connected with the Group and which, in either case, as far as you are
      aware, has not been obtained in violation of, and is not otherwise subject
      to, any obligation of confidentiality;

      "GROUP" means the Borrower and each of its Affiliates;

      "PERMITTED PURPOSE" means [subject to the terms of this letter, passing on
      information to a prospective purchaser for the purpose of](b) considering
      and evaluating whether to enter into the Acquisition; and

      "PURCHASER GROUP" means you and each of your Affiliates.


                                    - 116 -


      Please acknowledge your agreement to the above by signing and returning
      the enclosed copy.

      Yours faithfully


      ----------------------------------------------
      For and on behalf of
      [Seller/Seller's agent/broker]

      To:      [Seller]
               [Seller's agent/broker]
               The Borrower and each other member of the Group

      We acknowledge and agree to the above:


      ----------------------------------------------
      For and on behalf of
      [POTENTIAL PURCHASER/PURCHASER'S AGENT/BROKER]

- ----------
     (a)    Delete if addressee is acting as broker or agent.
     (b)    Delete if addressee is acting as principal.
     (c)    Select applicable option.
     (d)    Delete if letter is sent out by the Seller rather than the Seller's
            broker or agent.


                                    - 117 -


                                   SCHEDULE 4A
                         UTILISATION REQUEST (BORROWER)

From: Western Wireless International d.o.o

To:   [Off Shore Facility Agent/On Shore Facility Agent with copy to Off Shore
      Facility Agent]

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Utilisation Request. Terms defined in
      the Agreement have the same meaning in this Utilisation Request unless
      given a different meaning in this Utilisation Request.

2.    UTILISATION OF A LOAN

      We wish to borrow a Loan on the following terms:

                                                   
        Proposed Utilisation Date:                    [-] (or,  if that is not a  Business  Day,  the next
                                                      Business Day)

        Facility to be utilised:                      [Commercial Facility]/ [SIT Facility]

        Currency of Loan:                             [Euro]/[SIT]

        Amount:                                       [-] or, if less, the Available Facility

        Interest Period:                              [-]

        Account to which proceeds are payable:        Proceeds and Revenue Account  [account  number] [for
                                                      further  transfer in respect of Euro Facility  Loans
                                                      to the Loan Proceeds Account]



3.    UTILISATION UNDER THE SIT FACILITY GUARANTEE OR LC Please issue or open a
      SIT Facility Guarantee or LC on the following terms:

                                                    
       Proposed Utilisation Date:                      [-] (or,  if that is not a  Business  Day,  the next
                                                       Business Day)

       Issuance of:                                    [a guarantee]/[a letter of credit]*

       Amount:                                         SIT [-]

       Term of the [guarantee]/[letter of credit]:     [-]

       Beneficiary:                                    [-]



*     Select applicable option.


                                    - 118 -


4.    We confirm that the [proceeds of the Loan]/[guarantee]/[letter of credit]
      [are]/[is] to be used [in payment of capital expenditure as provided for
      in the [Initial Business Plan][Updated Business Plan]]/[in payment of
      operational expenditure as provided for in the [Initial Business
      Plan][Updated Business Plan]]/[towards repayment of amounts owing under
      the Existing WWIC Loan Agreement]/[other].

5.    We confirm that each condition specified in Clause 4.2 (Further conditions
      precedent to all Utilisations) is satisfied on the date of this
      Utilisation Request and the Contributed Capital Ratio is or as a result of
      the requested Utilisation will be at least 0.4.

6.    We confirm that each of the Repeated Representations is correct by
      reference to the facts and circumstances existing at the date of this
      Utilisation Request.

7.    This Utilisation Request is irrevocable.

                                Yours faithfully


                      -------------------------------------
                            authorised signatory for
                      Western Wireless International d.o.o.


                                    - 119 -


                                   SCHEDULE 4B
               UTILISATION REQUEST (PAYMENTS TO EQUIPMENT VENDOR)

From: Lucent Technologies Network Systems GmbH

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Utilisation Request. Terms defined in
      the Agreement have the same meaning in this Utilisation Request unless
      given a different meaning in this Utilisation Request.

2.    This is to confirm that

      (a)   on [-] deliveries/services in the value of [-]

      (b)   on [-] deliveries/services in the value of [-]

      (c)   on [-] deliveries/services in the value of [-]

                                                   TOTAL [-]

      were effected/rendered.

      A copy certified true and complete by us of an original invoice from us to
      the Borrower in respect of the above is enclosed herewith.

3.    Our claim under the Delivery Contract in respect of:

      (a)   the deliveries/services referred to in paragraph 2(a) above
            represent 85 % / 70 % / 10 % / 5 %* of the value of such
            deliveries/services and thus amounts to [-];

      (b)   the deliveries/services referred to in paragraph 2(b) above
            represent 85 % / 70 % / 10 % / 5 %* of the value of such
            deliveries/services and thus amounts to [-];

      (c)   the deliveries/services referred to in paragraph 2(c) above
            represents 85 % / 70 % / 10 % / 5 %* of the value of such
            deliveries/services and thus amounts to [-],

            TOTAL [-]

4.    We ask you to disburse Euro [-] to our account number [-] with [insert
      name of bank].

*   Select applicable option.


                                    - 120 -


5.    We further confirm that:

      (a)   [the Borrower has so far fulfilled all of its payment obligations to
            be performed pursuant to the Delivery Contract;]**

      (b)   the goods/services covered by the present Utilisation Request are in
            conformity with the Delivery Contract;

      (c)   the goods/services covered by the present Utilisation Request have
            been delivered/rendered in accordance with the Delivery Contract;
            and

      (d)   the Equipment Vendor is, and the requests made hereunder are, in
            compliance with the Delivery Contract and the Delivery Contract
            remains in full force and effect as at the date hereof.

6.    We attach a copy of a certificate executed by the Borrower and referring
      to the final acceptance of the Initial Configuration.***

                                Yours faithfully


                    ----------------------------------------
                            authorised signatory for
                    Lucent Technologies Network Systems GmbH

**    To be included in all Utilisation Requests, except the first.

***   Only in respect of a Utilisation Request completed with reference to
      Section 1.10.2 (b) (iii) of the Delivery Contract.


                                    - 121 -


                                   SCHEDULE 4C
                      UTILISATION REQUEST (PAYMENTS TO ECA)

From: Lucent Technologies Network Systems GmbH

To: IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Utilisation Request. Terms defined in
      the Agreement have the same meaning in this Utilisation Request unless
      given a different meaning in this Utilisation Request.

2.    This is to confirm that we have effected the payment of ECA Premium in the
      amount of Euro [-] to the ECA on [insert date] in accordance with the
      invoice issued by the ECA on [-], a copy of which is enclosed herewith.

3.    We ask you to disburse 85 % of this amount being Euro [-] to account
      number [-] with [insert name of bank].

                                Yours faithfully


                    ----------------------------------------
                            authorised signatory for
                    Lucent Technologies Network Systems GmbH


                                    - 122 -


                                   SCHEDULE 5
                                SELECTION NOTICE

APPLICABLE TO A LOAN UNDER THE EURO FACILITY

From: Western Wireless International d.o.o.

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Selection Notice. Terms defined in
      the Agreement have the same meaning in this Selection Notice unless given
      a different meaning in this Section Notice.

2.    We refer to the following Loan[s] under the Euro Facility with an Interest
      Period ending on [-].*

3.    We request that the next Interest Period for the above Loan[s] is [-].

4.    This Selection Notice is irrevocable.

                                Yours faithfully


                      -------------------------------------
                            authorised signatory for
                      Western Wireless International d.o.o.

*     Insert details of all Loans under the Euro Facility which have an Interest
      Period ending in the same date.


                                    - 123 -


                                   SCHEDULE 6
                              CONDITIONS PRECEDENT

               CONDITIONS PRECEDENT TO INITIAL UTILISATION REQUEST

1.    BORROWER

      (a)   A copy of the constitutional documents of the Borrower.

      (b)   A copy of a resolution of the board of directors of the Borrower:

            (i)   approving the terms of, and the transactions contemplated by,
                  the Material Contracts to which it is a party and resolving
                  that it execute the Finance Documents to which it is a party;

            (ii)  authorising a specified person or persons to execute the
                  Finance Documents to which it is a party on its behalf; and

            (iii) authorising a specified person or persons, on its behalf, to
                  sign and/or despatch all documents and notices (including, if
                  relevant, any Utilisation Request and Selection Notice) to be
                  signed and/or despatched by it under or in connection with the
                  Finance Documents to which it is a party.

      (c)   A specimen of the signature of each person authorised by the
            resolution referred to in paragraph (b) above.

      (d)   A certificate of an authorised signatory of the Borrower certifying
            that all Material Contracts as at the date of the Agreement have
            been fully disclosed to the Off Shore Facility Agent and each copy
            document relating to it specified in this Schedule 6 is correct,
            complete and in full force and effect as at the date of this
            Agreement.

      (e)   Evidence that all accounts required to be open prior to the first
            Utilisation under the Agreement have been duly opened.

2.    SPONSORS AND SHAREHOLDERS

      (a)   A copy of the constitutional documents of each of the Sponsors.

      (b)   A copy of a resolution of the board of directors of each of the
            Sponsors:

            (i)   approving the terms of, and the transactions contemplated by,
                  the Material Contracts to which it is a party and resolving
                  that it execute the Finance Documents to which it is a party;

            (ii)  authorising a specified person or persons to execute the
                  Finance Documents to which it is a party on its behalf; and

            (iii) authorising a specified person or persons, on its behalf, to
                  sign and/or despatch all documents and notices to be signed
                  and/or despatched by it under or in connection with the
                  Finance Documents to which it is a party.

      (c)   A specimen of the signature of each person authorised by the
            resolution referred to in paragraph (b) above.


                                    - 124 -


      (d)   A copy of a resolution of the Shareholders approving the terms of,
            and the transactions contemplated by, the Finance Documents to which
            the Borrower is a party.

3.    LEGAL OPINIONS

      (a)   Legal opinions of Clifford Chance, legal advisers to the Off Shore
            Facility Agent as to matters of German, New York and Luxembourg law,
            substantially in the form agreed with the Off Shore Facility Agent.

      (b)   A legal opinion of the in-house counsel to the Borrower, confirming
            that all Material Contracts are in full force and effect and create
            legal, valid and binding obligations of the parties thereto in the
            form agreed with the Off Shore Facility Agent.

      (c)   A legal opinion of Friedman Kaplan Seiler & Adelman LLP, legal
            advisers to the Sponsors, substantially in the form agreed between
            the Off Shore Facility Agent and the Sponsors.

      (d)   A legal opinion of Selih, Selih, Janezic & Jarcovic, Ljubljana,
            the local legal advisers to the Off Shore Facility Agent,
            substantially in the form agreed with the Off Shore Facility Agent.

      (e)   Legal opinions in form and substance satisfactory to the Off Shore
            Facility Agent addressing the matters set forth in clause 3(f) of
            the Lucent Loan Agreement.

      (f)   Legal opinions in form and substance satisfactory to the Off Shore
            Facility Agent confirming that the direct agreement between the
            Equipment Vendor and the Off Shore Facility Agent and the guarantee
            and undertaking agreement between Lucent Technologies Inc. and the
            Off Shore Facility Agent are in full force and effect and create
            legal, valid and binding obligations on the parties thereto.

4.    OTHER DOCUMENTS AND EVIDENCE

      (a)   A confirmation from the process agent of each of the Borrower, the
            Sponsors and the Shareholders, as applicable, in Germany, New York
            and England and Wales.

      (b)   A copy of any other Authorisation or other document, opinion or
            assurance which the Off Shore Facility Agent considers to be
            necessary or desirable (if it has notified the Borrower accordingly)
            in connection with the entry into and performance of the
            transactions contemplated by any Finance Document or for the
            validity and enforceability of any Finance Document.

      (c)   A copy of the Original Financial Statements of the Borrower.

      (d)   Evidence that the fees, costs and expenses then due from the
            Borrower pursuant to Clause 12 (Fees) and Clause 19 (Costs and
            expenses) have been paid or will be paid.

      (e)   Confirmation that the ECA has given its final approval to the
            provision of cover and the Off Shore Facility Agent being satisfied
            that the Finance Documents conform to the requirements thereof.


                                    - 125 -


      (f)   Evidence that the conditions precedent relating to the Security
            Documents set out in Schedule 9 have been satisfied.

      (g)   Evidence that the Borrower holds the Licence which has been paid for
            in full by the Borrower in cash.

      (h)   A set of ten (10) Bills of Exchange duly signed by the Borrower and
            with the date of issue inserted but otherwise left blank together
            with a duly notarised and apostilled power of attorney.

      (i)   Evidence of the satisfactory completion of the due diligence
            including all consultant reports.

      (j)   A copy of each Material Contract (other than the international
            roaming contracts and contracts in respect of leasing of lines) and
            evidence of due execution thereof.

      (k)   A copy of the Initial Business Plan and the Updated Business Plan to
            be delivered by the Borrower.

      (l)   A copy of the Hedging Letter and Hedging Agreement and, in each
            case, evidence of due execution thereof.

      (m)   A copy of the Market Study to be delivered by the Borrower.

      (n)   A copy of an initial report of the Independent Technical Consultant
            issued in the form set out in Schedule 19 (Initial report of
            Independent Technical Consultant).

      (o)   A confirmation in writing from the Equipment Vendor in the form set
            out in Schedule 12 (Confirmation from the Equipment Vendor).

      (p)   A letter of comfort from the Government in the form agreed with the
            Off Shore Facility Agent.

      (q)   A confirmation in writing substantially in the form set out in
            Schedule 8 (Form of letter of confirmation) from each of MIBO
            Kommunikacije d.o.o., Reime NIS AS and Lehmer d.o.o. to the Off
            Shore Facility Agent.

      (r)   Evidence that this Agreement and the Debt Service Reserve Account
            and any other offshore bank accounts of the Borrower have been
            reported to Banka Slovenije.

      (s)   Duly notarised and apostiled powers of attorney from each of the
            Finance Parties (other than the SIT Facility Banks);.

      (t)   A letter, in the form agreed, from Western Wireless Corporation
            addressed to the Off Shore Facility Agent on behalf of the Banks in
            relation to the ownership and funding of certain companies within
            the Western Wireless Group.

      (u)   Evidence of a deposit, in an amount not less than SIT 320,000,000 or
            its equivalent as determined by the On Shore Facility Agent for the
            account of Nova Ljubljanska banka d.d., Ljubljana as applied or
            reduced in accordance with a SIT Facility syndication agreement to
            be agreed between the Borrower, the Sponsors and the On Shore
            Facility Agent.


                                    - 126 -


      (v)   A copy of the direct agreement between the Equipment Vendor and the
            Off Shore Facility Agent and evidence of due execution thereof.

      (w)   Evidence that at least ten (10) Business Days prior to the proposed
            first Utilisation Date Existing WWIC Loans have been converted into
            Sponsor Contributions, in an amount equivalent to Euro 18,500,000
            and Sponsors Unsecured Loans, in an amount equivalent to Euro
            1,561,318.60 and in each case that the Existing WWIC Loans in
            respect of such amounts are cancelled.

      (x)   A copy of the guarantee and undertaking agreement between Lucent
            Technologies Inc. and the Off Shore Facility Agent and evidence of
            due execution thereof.

      (y)   Audit report from PriceWaterhouseCoopers, Slovenia in relation to
            Capital Contributions, in the form agreed with the Off Shore
            Facility Agent.

      (z)   A copy of the comfort letter from Western Wireless Corporation in
            the form agreed with the Off Shore Facility Agent and evidence of
            due execution thereof.

      (aa)  The form of agreed bill of exchange to be used by the Borrower in
            accordance with Clause 24.38 (Bills of Exchange and Security
            Deposits) and included in the Agreement as Schedule 16.

      (bb)  Evidence that the conditions set forth in clause 3(e) and (g) of the
            Lucent Loan Agreement have been satisfied.

      (cc)  Evidence that all accounts of the Borrower other than those
            mentioned in Schedule 7 (Permitted Accounts) have been closed.


                                    - 127 -


                                   SCHEDULE 7
                               PERMITTED ACCOUNTS

- -     IKB International S.A., Luxembourg, Account Numbers: 66922 and 80601;

- -     IKB Deutsche Industriebank AG, Account Number: 2012894685

- -     Nova Ljubljanska Banka d.d., Ljubljana, Account Number: 02922-0089881553,
      and all other accounts required to be opened in accordance with Clause 23;

- -     Hypo Alpe-Adria-Bank d.d., Ljubljana, Account Number: 33000-8993618346;

- -     Nova KBM d.d., Ljubljana, Account Number: 04302-0000348020 (This account
      is only permitted until 30 June 2002 and only on the condition that on the
      date of first Utilisation (a) there are no funds standing to the credit of
      this account or, should that not be permissible under the terms of the
      account, (b) there is not more than the minimum permissible amount under
      such terms standing to the credit of this account).


                                    - 128 -


                                   SCHEDULE 8
                         FORM OF LETTER OF CONFIRMATION

From: [MIBO Kommunikacije d.o.o.] [Reime NIS AS] [Lehmer d.o.o.]

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a letter of confirmation. Terms defined
      in the Agreement have the same meaning in this letter of confirmation
      unless given a different meaning in this letter of confirmation.

2.    We confirm that we have performed works or services in connection with
      [insert number of sites] sites details of which are listed in the schedule
      hereto (the "SITES") that:

      (a)   we have received payment in full in respect of the works and
            services performed by us on or in connection with [insert number of
            sites] Sites the details of such works and services and amounts paid
            are set out in the schedule ; [and]

      (b)   [we have received site acceptance certificates from the Borrower in
            respect of [insert number of sites] Sites the details of which are
            set out in the schedule; and]*

      (c)   [title to the works performed by us on [insert number of sites]
            Sites has passed to the Borrower the details of which are set out in
            the schedule]*,

      in accordance with the terms of the agreement entered into between us and
      the Borrower.

3.    We confirm that we have no liens in connection with any of the works or
      services performed by us on or in connection with the Sites, whether
      arising by operation of law or otherwise.

                                Yours faithfully


           ----------------------------------------------------------
                            authorised signatory for
           [MIBO Kommunikacije d.o.o.] [Reime NIS AS] [Lehmer d.o.o.]

*     To be included only in respect of the agreements entered into with MIBO
      Kommunikacije d.o.o. and Lehmer d.o.o.


                                    - 129 -


                                  THE SCHEDULE


              SITES FOR WHICH OR IN CONNECTION WITH WHICH WORKS AND SERVICES HAVE BEEN PERFORMED

   Number       Address      Works or       Payment Received         Site acceptance         Transfer of Title to
                             Services                             Certificate from the           the Borrower
                            Performed                                   Borrower

                                             Yes          No       Yes (Date      No            Yes          No
                                           (in the                of Receipt)
                                          amount of)
                                                                                   


          Total of [-] Sites              Total of    Total of     Total of    Total           Total of    Total of
                                          [-] Sites   [-] Sites    [-] Sites   of [-] Sites    [-] Sites   [-] Sites



                                    - 130 -


                                   SCHEDULE 9
       SECURITY DOCUMENTS - CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT

                                     GENERAL



                                                   STEPS FOR PERFECTION
                                                   --------------------

                       CONDITION PRECEDENT TO DRAWDOWN                          CONDITION SUBSEQUENT
                       -------------------------------                          --------------------

                                                                     
- -     Translation of Facility Agreement into the Slovenian
      language

- -     Summary and Translation of Hedging Agreement into the
      Slovenian language

- -     Certified copies of the extract of commercial register
      for Borrower, Shareholders, Senior Creditors

- -     Legal opinion of Selih that all security documents                -     Once perfected an additional legal
      have been duly executed and are legal, valid and                        opinion of Selih that the security
      binding obligations                                                     documents create the security
                                                                              which they purport to create

- -     Power of Attorney (for signing of all on shore
      securities agreements) of Senior Creditors authorising
      representative of the Off Shore Facility Agent to sign
      all on shore security documents plus complete all
      formalities necessary for the perfection of the pledge
      where applicable

- -     Only for the Asset and Licence Pledge and Lease
      Contracts Assignment Agreement, Trade Mark Pledge
      Agreement and Share Pledge Agreement: Power of
      Attorney in the English language signed by each Senior
      Creditor, with a notarial confirmation of the
      authorisation of the person who signs on behalf of
      each Senior Creditor to sign on behalf of the
      particular Senior Creditor (Vertretungsbestatigung)
      and confirmation of its signature
      (Unterschriftenbeglaubigung) and apostilled,
      authorising Nina Selih/Rudi Selih to enter into
      notarial deeds in relation to all relevant security
      documents

- -     Such other requirements as may be reasonably required
      to complete, register and perfect the Security
      Documents


                           ON SHORE SECURITY DOCUMENTS



    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
ASSET AND         Pledged Equipment        -    Execution of Asset Pledge,
LICENCE PLEDGE                                  Licence Transfer, Licence
AND LEASE                                       Pledge and Lease Contracts
CONTRACTS                                       Assignment Agreement
ASSIGNMENT
AGREEMENT                                  -    Execution of notarial deed in
                                                respect of Pledged Equipment

                                           -    Provide Schedule 1, 2 & 3 to        -    Competent court officer must
                                                the Asset and Licence Pledge             take record of the pledged
                                                and Lease Contracts                      assets, make lists of pledged
                                                Assignment Agreement -                   assets per site and mark the
                                                provide missing addresses of             pledged assets by putting
                                                sites and relevant court                 stickers on them (Court officer
                                                districts, as well as modify             when visiting sites to be
                                                designation (description) of             accompanied by WWI technical
                                                certain items (confirmed by              staff) Borrower shall have
                                                Sami Ali and N. Selih)                   achieved 50% after 6 months
                                                                                         following the date of signing
                                                                                         of the Facility Agreement



                                    - 131 -




    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                                                                    -    Within 9 months of signing of
                                                                                         the Facility Agreement, On
                                                                                         Shore Security Agent to check
                                                                                         conformity of Schedule 1 with
                                                                                         the lists issued by the court;
                                                                                         Nina Selih to give notice of
                                                                                         receipt of the list
                                           -    Application by Selih for
                                                registration of the Asset
                                                Pledge in respect of the
                                                Pledged Equipment with the
                                                competent court (depending on
                                                where each asset is located)

                                           -    Pay notary fees and
                                                application fees for
                                                registration, Nina Selih to
                                                advise Steven Fast of bank
                                                account for fee to be paid
                                                into, Steven Fast to provide
                                                proof of payment (e.g. bank
                                                statement

                                           -    Copies of the building
                                                permits for sites on which
                                                Pledged Equipment is situated


                  Pledged Equipment                                                 -    1 month after first drawdown,
                  II and                                                                 under the Commercial Facility,
                  Substitution                                                           confirm to Onshore Security
                  Equipment                                                              Agent that title in respect of
                                                                                         Pledged Equipment II has passed/

                                                                                    -    During the first 5 Months after
                                                                                         the date of signing of the
                                                                                         Facility Agreement provide to
                                                                                         the On Shore Security Agent 10
                                                                                         Business days after the end of
                                                                                         each Month a list with those of
                                                                                         the 41 sites for which a
                                                                                         building permit has been issued.

                                                                                    -    Within 5 months after the date
                                                                                         of signing of the Facility
                                                                                         Agreement execution of notarial
                                                                                         deed in respect of Pledged
                                                                                         Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable

                                                                                    -    Within 5 months after signing
                                                                                         of the Facility Agreement
                                                                                         filing of application for
                                                                                         registration of Pledged
                                                                                         Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable

                                                                                    -    Pay notary fees and application
                                                                                         fees for registration, Nina
                                                                                         Selih to advise Steven Fast of
                                                                                         bank account for fee to be paid
                                                                                         into, Steven Fast to provide
                                                                                         proof of payment (e.g. bank
                                                                                         statement)

                                                                                    -    Within 9 months of signing of
                                                                                         Facility Agreement, competent
                                                                                         court officer must take record
                                                                                         of the Pledged Equipment II,
                                                                                         make a list of pledged assets
                                                                                         per site and mark the pledged
                                                                                         assets by putting stickers on
                                                                                         them

                                                                                    -    Within 9 months of signing of
                                                                                         the Facility Agreement, On
                                                                                         Shore Security Agent to check
                                                                                         conformity of Schedule 2 with
                                                                                         the lists issued by the court;
                                                                                         Nina Selih to give notice of
                                                                                         receipt of the list

                  Licence                  -    Copy of concession                  -    Within 5 business days of issue
                                                                                         of licence, inform On
                                                                                         Shore and Off Shore Security Agent
                                                                                         and send copy



                                    - 132 -




    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                           -    Copy of application / bid           -    Within 1 month after issue of
                                                                                         licence enter into the
                                                                                         contractual pledge (as
                                                                                         attached as a Schedule to
                                                                                         Asset Pledge)

                                           -    Certificate that as of the          -    Borrower to sign Power of
                                                date of signing of the                   Attorney as set out in
                                                Facility Agreement no                    Schedule 10 (once licence
                                                change/amendment of/to the               granted)
                                                Concession Agreement has
                                                been made

                  Leases                   -    Evidence of filing of the           -    Borrower to provide originals
                                                applications for the                     of consent letter from
                                                registration of the 41 lease             Landlords I, II and
                                                site agreements (except for              Substitution Landlords
                                                the 11 leases entered with               confirming the consent to the
                                                Elektro Slovenia and RTV)                conditional assignment as
                                                with the competent courts in             follows:
                                                accordance with clauses
                                                11.4(f) and 12.4(b) of the
                                                Asset and Licence Pledge and
                                                Lease Contracts Assignment;
                                                Agreement

                                                                                    -    Within 3 Months from the date
                                                                                         of signing of the Facility
                                                                                         Agreement consent letters
                                                                                         in respect of at least 15
                                                                                         sites,

                                                                                    -    Within 6 Months from the date
                                                                                         of signing of the Facility
                                                                                         Agreement consent letters
                                                                                         in respect of at least 30
                                                                                         sites; and

                                                                                    -    Within 9 Months from the date
                                                                                         of signing of the Facility
                                                                                         Agreement consent letters
                                                                                         in respect of all 41 sites
                                                                                         and a list of all original
                                                                                         consent letters

                                           -    Copies of Leases I and II and
                                                Substitution Lease (as
                                                applicable)
                                                                                    -    File for registration of
                                                                                         Substitution Leases
                                                                                         (applicable only in case
                                                                                         of substitution pledge)
                                                                                         and, where applicable,
                                                                                         provide the consent of the
                                                                                         relevant Substitution
                                                                                         Landlords to the
                                                                                         Substitution Assignment
                                                                                         within 9 Months from the
                                                                                         date of signing of the
                                                                                         Facility Agreement

                                                                                    -    Inform the On Shore Security
                                                                                         Agent immediately of
                                                                                         rejection of filed
                                                                                         applications for
                                                                                         registration of the
                                                                                         relevant leases in respect
                                                                                         of some of the 41 sites
                                                                                         (except for the 11 sites)
                                                                                         (eg where building permit
                                                                                         missing) after becoming
                                                                                         aware of such rejection
                                                                                         and of refilling of the
                                                                                         application

                                                                                    -    Within 9 Months from the date
                                                                                         of signing of the Facility
                                                                                         Agreement, register the
                                                                                         relevant leases in respect
                                                                                         of some of the 41 sites
                                                                                         (with the exception of the
                                                                                         11 sites) with the Land
                                                                                         Registers

BORROWER'S        Shares                   -    Execution of agreement              -    Within 2 Months from the date
SHARE PLEDGE                                                                             of the signing of the
AGREEMENT                                                                                Facility Agreement to
                                                                                         register the share pledge
                                                                                         with the Register of
                                                                                         Commercial Companies
                                                                                         (there must be an
                                                                                         obligation for the
                                                                                         Borrower in the Facility
                                                                                         Agreement to provide
                                                                                         evidence for such
                                                                                         registration)

                                           -    Execution of notarial deed in       -    Provide evidence of registration
                                                respect of pledged equipment             within 9 Months from the date of
                                                                                         signing of the Facility
                                                                                         Agreement



                                    - 133 -




    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                           -    Submission to the competent
                                                court in Ljubljana of the
                                                application for the
                                                registration of the share
                                                pledge with the Register of
                                                Commercial Companies

                                           -    Pay notary fees and
                                                application fees for
                                                registration of the pledge,
                                                Nina Selih to advise Steven
                                                Fast of bank account for fee
                                                to be paid into, Steven Fast
                                                to provide proof of payment
                                                (e.g. bank statement) and the
                                                escrow agreement relating to
                                                the holding of such envelope

TRADEMARK         Trademarks               -    Execution of agreement              -    Within 9 months from signing of
PLEDGE AGREEMENT                                                                         the Facility Agreement
                                                                                         provide evidence of
                                                                                         registration of the TM
                                                                                         Pledge by the Patent Office

                                           -    Withdraw 2 outstanding
                                                applications for registration
                                                of the trademarks "EHO" and
                                                "VIVA" and provide to the On
                                                Shore Security Agent evidence
                                                of such withdrawal at the
                                                latest 10 Business Days
                                                before it makes the first
                                                Utilisation Request under the
                                                Facility Agreement

                                           -    Borrower's consent to
                                                registration of the pledge
                                                (Schedule 5)

                                           -    Submission to the Patent
                                                Office of application to
                                                register the TM Pledge

                                           -    Pay notary fees and
                                                application fees for
                                                registration, Nina Selih to
                                                advise Steven Fast of bank
                                                account for fee to be paid
                                                into, Steven Fast to provide
                                                proof of payment (e.g. bank
                                                statement)

SOFTWARE          Oracle Software          -    Execution of agreement
LICENSE           License Agreement
ASSIGNMENT
AGREEMENT
                                           -    Schedule 2 - Copy of Deed of
                                                Consent and Waiver

                                           -    Schedule 1 (Oracle License
                                                Agreement)

ASSIGNMENT OF     Receivables              -    Signing of agreement
RECEIVABLES AS
SECURITY AND
ASSIGNMENT OF
INSURANCE
POLICIES
AGREEMENT

                                           -    Borrower to provide Schedule
                                                1 complete information

                                           -    Sealed Envelope (containing
                                                details of all subscribers
                                                (natural persons) must be
                                                submitted to the notary,
                                                identified in the Assignment
                                                of Receivables as Security
                                                and Assignment of Insurance
                                                Policies Agreement



                                    - 134 -




    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                  Insurance                -    Copies of the insurance
                                                policies as required under
                                                the Facility Agreement

                                           -    Original vinculation
                                                certificates

                                           -    Borrower to provide Schedule
                                                2 (list of insurances,
                                                amounts, claims)

CLAIMS            Claims                   -    Signing of agreement
ASSIGNMENT AND
BILLS OF
EXCHANGE
AGREEMENT

                                           -    Notarised copies of account
                                                agreements (NLB + Hypo
                                                Alpe-Adria Bank) must be
                                                submitted to the Off Shore
                                                Facility Agent

                                           -    Acknowledgement by NLB and
                                                Hypo Alpe-Adria Bank

                                           -    Schedule 1 (account details)

                  Bills of Exchange        -    Provide set of 10 bills of
                                                exchange duly signed and
                                                filled in only with the date
                                                of issuance (Schedule 5)

                                           -    Confirmation by holders of
                                                bills of exchange that they
                                                will inform NLB at the latest
                                                5 Business Days before
                                                presenting any bills of
                                                exchange to NLB


                          OFF SHORE SECURITY DOCUMENTS



    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
INTERCREDITOR                              -    Execution of the agreement
AGREEMENT

DELIVERY                                   -    Execution of the agreement
CONTRACT CLAIMS
AND ASSIGNMENT                             -    Execution and provision of
AGREEMENT                                       the Security Interest
                                                Provision Permission Agreement

SECURITY                                   -    Execution of the agreement
ASSIGNMENT OF                                   (in the form of a deed) and
RIGHTS UNDER A                                  evidence thereof
SUPPLY AND
LICENSE                                    -    Execution of the Deed of
AGREEMENT                                       Consent and Waiver and
                                                evidence thereof

                                           -    Give notice of assignment to
                                                Protek Flagship (UK) Ltd

SPONSOR CASH      Cash Collateral          -    Execution of the pledge
COLLATERAL        Account                       agreement
ACCOUNT PLEDGE
AGREEMENT                                  -    Acknowledgement by the
                                                Account Bank (IKB
                                                International S.A.)

                                           -    Required cash collateral to
                                                be paid into the account

DEBT SERVICE      Debt Service             -    Execution of the pledge             -    5 business days after first
RESERVE ACCOUNT   Reserve Account               agreement                                utilisation to be funded with
PLEDGE AGREEMENT                                                                         the DSRA-Required Balance
                                           -    Acknowledgement by the
                                                Account Bank (IKB
                                                International S.A.)



                                    - 135 -



    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
PLEDGE                                     -    Execution of the pledge
AGREEMENT (NY)    Shares                        agreement;

                                           -    Delivery of all original
                                                certificated shares to the
                                                Secured Party;

                                           -    Delivery of a stock power
                                                endorsed in blank to the
                                                Secured Party; and

                                           -    The filing of a UCC-1
                                                Financing Statement



                                    - 136 -


                                   SCHEDULE 10
                          FORM OF TRANSFER CERTIFICATES

To:   [Off Shore Facility Agent [and On Shore Facility Agent]]

From: [The Existing Bank] (the "EXISTING BANK") and [The New Bank] (the "NEW
      BANK")

Dated:

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Transfer Certificate. Terms defined
      in the Agreement have the same meaning in this Transfer Certificate unless
      given a different meaning in this Transfer Certificate.

2.    We refer to Clause 26.5 (Procedure for transfer):

      (a)   The Existing Bank and the New Bank agree to the Existing Bank
            transferring to the New Bank all or part of the Existing Bank's
            Commitment, rights and obligations referred to in the schedule
            hereto in accordance with Clause 26.5 (Procedure for transfer).

      (b)   The proposed Transfer Date is [-].

      (c)   The Facility Office and address, fax number and attention details
            for notices of the New Bank for the purposes of Clause 32.2
            (Addresses) are set out in the schedule hereto.

3.    The New Bank expressly acknowledges the limitations on the Existing Bank's
      obligations set out in paragraph (c) of Clause 26.4 (Limitation of
      responsibility of Existing Banks).

[4/5]. This Transfer Certificate may be executed in any number of counterparts
      and this has the same effect as if the signatures on the counterparts were
      on a single copy of this Transfer Certificate.

[5/6] The Existing Bank hereby transfers in favour of the New Bank [all] [ %] of
      its interest in the amount of Euro [-] in the following Security
      Documents:

      [NOTE: INSERT DESCRIPTION OF ALL RELEVANT SECURITY DOCUMENTS]

      In respect of the transfer relating to the interest in [SPECIFY RELEVANT
      MOVEABLE PROPERTY SUBJECT TO THE ASSET AND LICENCE PLEDGE AND LEASE
      CONTRACTS ASSIGNMENT AGREEMENT], the Existing Bank hereby assents to and
      permits the registration of such transfer in favour of the New Bank in
      relevant court register(s) in Slovenia.

      The New Bank may apply to the competent court registrar for the
      registration of the transfer from the Existing Bank to the New Bank in
      accordance with this Transfer Certificate.

[6/7] Save for the provisions of paragraph [5/6] above (which shall be governed
      by and construed in accordance with Slovenian law), this Transfer
      Certificate and the rights and obligations of the parties hereunder shall
      be governed by and construed in accordance with German law.


                                    - 137 -


                                  THE SCHEDULE

               COMMITMENT/RIGHTS AND OBLIGATIONS TO BE TRANSFERRED

                            [insert relevant details]

           [Facility Office address, fax number and attention details
                 for notices and account details for payments,]

[Existing Bank]                             [New Bank]


By:                                                By:

This Transfer Certificate is accepted by the Off Shore Facility Agent [and the
On Shore Facility Agent] and the Transfer Date is confirmed as [-].

[Off Shore Facility Agent]


By:

[On Shore Facility Agent]


By:


                                    - 138 -


                                   SCHEDULE 11
                                    INSURANCE

The Borrower shall comply with the insurance policies in force at the date of
this Agreement and shall enter into, perform and execute the requirements of an
insurance schedule to be agreed between the Borrower and the Off Shore Facility
Agent (each acting in good faith) within two months from the date hereof, such
schedule shall replace this Schedule 11.


                                    - 139 -


                                   SCHEDULE 12
                     CONFIRMATION FROM THE EQUIPMENT VENDOR

From: Lucent Technologies Network Systems GmbH

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. Terms defined in the Agreement have the same
      meaning in this confirmation unless given a different meaning in this
      confirmation.

2.    We hereby confirm that the Delivery Contract was concluded on [-] and
      amended on [-] and has come into force on [-] and is still in full force
      and effect, that all permissions necessary have been granted and that we
      have received a down payment in relation to 15 % of the Estimated Contract
      Value in an amount of Euro 9,082,245.40, which is evidenced by the
      enclosed bank receipts.

                                Yours faithfully


                    ----------------------------------------
                            authorised signatory for
                    Lucent Technologies Network Systems GmbH


                                    - 140 -


                                   SCHEDULE 13
                           PROCESS AGENT CONFIRMATION

From: [Process Agent]

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. Terms defined in the Agreement have the same
      meaning in this process agent confirmation unless given a different
      meaning in this process agent confirmation.

2.    Pursuant to Clauses [-] the Agreement, the Borrower has irrevocably
      designated, appointed and empowered us, in the case of any court
      proceedings or legal actions in connection with the Agreement and the
      other Finance Documents to receive for and on behalf of the Borrower
      service of process in respect of such proceedings or legal actions.

3.    We hereby confirm that we irrevocably accept the appointment as German
      process agent upon the condition that we shall not be liable for any loss
      or delay in transit of any documents or for mutilation or errors in the
      transmission of any telecommunication and we agree that we will promptly
      forward any process documents served on the Borrower to the address of the
      Borrower set forth in the Agreement or such other address as the Borrower
      or the Off Shore Facility Agent may notify to us from time to time.

                                Yours faithfully


                    ----------------------------------------
                            authorised signatory for
                                 [Process Agent]


                                    - 141 -


                                   SCHEDULE 14
                         COVENANT COMPLIANCE CERTIFICATE

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

From: Western Wireless International d.o.o.

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Covenant Compliance Certificate.
      Terms defined in the Agreement have the same meaning in this Covenant
      Compliance Certificate unless given a different meaning in this Covenant
      Compliance Certificate.

2.    We confirm that as at the date of the financial statements in respect of
      [-]:

      (a)   all contributions required to be made by the Shareholders pursuant
            to the Sponsors' and Shareholders' Undertaking and Completion
            Guarantee have been made when due;

      (b)   the Contributed Capital Ratio is [-];

      (c)   the number of Subscribers was [-];

      (d)   the Population Coverage was [-];

      (e)   the Service Revenues were [-];

      (f)   EBITDA was [-] and the variance from the Initial Business Plan of
            [-] was [-];

      (g)   the Total Leverage Ratio was [-];

      (h)   the Interest Coverage Ratio was [-];

      (i)   the Debt Service Cover Ratio was [-];

      (j)   the financial statements were prepared in accordance with [US GAAP]
            [and, if applicable, Slovenian Accounting Standards] consistently
            applied and represent a true and fair view of the Borrower and do
            not omit any material liability;

      (k)   we have received Sponsors Unsecured Loans in the amount of [-],

      and attached hereto are detailed calculations and/or evidence thereof.

3.    We confirm that as of the date hereof:


                                    - 142 -


      (a)   no Potential Event of Default or Event of Default is continuing;(1)

      (b)   [no Cash Shortfall] [a Cash Shortfall] exists [in an amount equal to
            [-]].(2)

4.    As at the date of this Covenant Compliance Certificate the Repeated
      Representations are correct by reference to the facts and circumstances as
      at the date hereof except for representations which were made as of a
      specific date which shall be correct in all material respects as of such
      date.

5.    We hereby request that the Applicable Margin in relation to the [state
      Facility] be adjusted from [insert] to [insert].


Signed:______________________________       ____________________________________
               Director                           Director

[insert applicable auditor certification language](3)


__________________________________
for and on behalf of
[name of auditors of the Borrower](4)

(1)   If this statement cannot be made, the certificate should identify any
      Event of Default or Potential Event of Default that is continuing and the
      steps, if any, being taken to remedy it.

(2)   Include if Cash Shortfall exists.

(3)   To be agreed with the Borrower's auditors and the Banks prior to signing
      the Agreement. Auditors must verify all of the above statements other than
      points 2(c), (d) or 3.

(4)   Only applicable if the Covenant Compliance Certificate accompanies the
      audited financial statements and is to be signed by the auditors. To be
      agreed with the Borrower's auditors prior to signing the Agreement.


                                    - 143 -


                                   SCHEDULE 15
                       PROJECT STATUS AND PROGRESS REPORT

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

From: Western Wireless International d.o.o.

Dated:

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    We refer to the Agreement. This is a Project Status and Progress Report.
      Terms defined in the Agreement have the same meaning in this Project
      Status and Progress Report unless given a different meaning herein.

2.    Set out below is:

      (1)   with respect to the Eligible Expenditures under the ECA Facility a
            list of (i) all purchase orders placed, and (ii) deliveries received
            and/or services rendered during the Quarter together with copies of
            the relevant invoices from the Equipment Vendor;

      (2)   a detailed and full description of the status of the installation of
            the Network in comparison to the most recent Business Plan and the
            status of all national roaming agreements;

      (3)   a comparison of the Borrower's actual business and network
            development (including but not limited to network roll out and
            network quality measured in Population Coverage and dBm and services
            offered) with the Licence requirements and the Business Plan;

      (4)   the information contained in the annex hereto;

      (5)   a description of any non-compliance with delays in performance of,
            cost increases under or other issues arising out of any Material
            Contracts that could reasonably be expected to affect the Borrower's
            ability to perform its obligations under the Finance Documents;

      (6)   a detailed description of any material financial, operational,
            construction, regulatory, administrative, legal or other issues that
            have had or could reasonably be expected to have a significant
            impact on the Borrower;

      (7)   a list of all Material Contracts entered into, amended, terminated
            or substituted in the last Quarter; and

      (8)   a description of any complaints received and correspondence from the
            Government or any governmental bodies or other authority in relation
            to the Project; and

      (9)   details of all tariff plans and Subscriber acquisition costs (in
            total and per subscriber) including (without limitation) subsidies
            spent on the provision of handsets and any special offers to
            Subscribers; and


                                    - 144 -


      (10)  an update of the sales and marketing strategy report comprised in
            the Initial Business Plan and covering subscriber acquisition cost,
            marketing cost and handset and other subsidies; and

      (11)  a written outline of major market and business developments.

Signed:______________________________       ____________________________________
          Chief Financial Officer                 Chief Technical Officer

I herewith confirm the accuracy of the statements made in respect of the items
mentioned under paragraphs 2(2) and 2(4) above.

Signed on:

                  ____________________________________
                  Independent Technical Consultant*

*     In respect of (i) any Project Status and Progress Report delivered in
      connection with any request for a change in the Applicable Margin
      according to Clause 9.1(b)(i)(2) (Calculation of floating rate interest
      under the ECA Facility) and Clause 9.2(b)(i)(2) (Calculation of floating
      rate interest under the Commercial Facility); or (ii) any Project Status
      and Progress Report delivered as at 31.12.2002, 31.12.2003 or 31.12.2004.


                                    - 145 -


                                      ANNEX

1.    USAGE STATISTICS

      In respect of each of post pay and prepay subscribers:

1.1   Number of active subscribers reported as at the last day of the Quarter;

1.2   Number of churned subscribers (subscribers who no longer have the status
      of active subscriber) from the last day of the previous Quarter up until
      the last day of the Quarter;

1.3   Average minutes of use per subscriber for Mobile Originated (MO) and
      Mobile Terminated (MT) calls reported during the Quarter;

1.4   Number of Busy Hour Call Attempts (BHCA) per subscriber averaged over each
      Month during the Quarter;

1.5   Percentage of calls for fax during the Quarter;

1.6   Percentage of calls for data during the Quarter;

1.7   Average minutes of use for fax for MO and MT calls during the Quarter; and

1.8   Average minutes of use for data for MO and MT calls during the Quarter.

2.    PERFORMANCE AND QUALITY MEASUREMENT

      The following Network performance key performance indicators as measured
      on weekdays during busy hour and averaged over each Month during the
      Quarter:

2.1   Call Set-Up Success Rate;

2.2   Handover Success Rate;

2.3   Traffic Channel (TCH) blocking rate;

2.4   Standalone Dedicated Control Channel (SDDCH) blocking rate;

2.5   An interface blocking rate (point of interconnects, A interface and
      A(ter)); and

2.6   Overall network system drop call rate Base Station Subsystem (BSS) and
      Network Subsystem (NSS).

3.    INTELLIGENT NETWORK

      In respect of each prepay subscriber during the Quarter:

3.1   Number of recharge attempts split into recharge method (such as voucher,
      ATM and credit card);

3.2   Number of successful recharges of account; and

3.3   Percentage blocking (busy hour) or call gapping at SCP's INAP (Service
      Control Point's Intelligent Network Application Part) interface during
      each Month in the Quarter.


                                    - 146 -


4.    VOICE MAIL USAGE

      In respect of each prepay and per postpay subscriber during the quarter:

4.1   Average length (in minutes) of voice mail messages deposits per day;

4.2   Average number of Voice Mails per day;

4.3   Average number voice mail retrievals per day;

4.4   Average length of Interactive Voice Response (IVR) sessions that do not
      lead to a voice mail retrieval or voice mail message per day.

5.    SHORT MESSAGE USAGE

      In respect of each prepay and per post pay subscriber:

5.1   Average busy Hour SMSs (Short Message Service) for MO and MT SMSs;

5.2   Average total SMSs per Quarter for the whole Network preferably broken
      down into:

      -     MO SMS;

      -     MT SMS;

      -     SIM Toolkit SMS OTA (Over The Air) originated;

      -     Voice mail notification; and

      -     Other (such as fleet messaging).

6.    GPRS USAGE

      Number of General Package Radio System (GPRS) subscribers measured in
      respect of the Quarter on the last day of the Quarter.

      Average number of kilo Bits for MO per GPRS subscriber per Quarter.

      Average number of kilo Bits for MT per GPRS subscriber per Quarter.

7.    CALL DETAILS

7.1   The total number of minutes per Quarter for incoming (to the Network)
      calls from:

      -     the Network (intra the Network);

      -     PSTN (Public Switch Telephone Network - fixed line);

      -     Other PLMN's (Public Land Mobile Networks); and

      -     International gateway (preferably broken down into Country or tariff
            area).

7.2   The total number of minutes during the Quarter for outgoing (from the
      Network) minutes to:

      -     the Network (intra the Network);


                                    - 147 -


      -     PSTN (Public Switch Telephone Network - fixed line);

      -     Other PLMNs (Public Land Mobile Networks); and

      -     International gateway (preferably broken down into country or tariff
            area).

8.    INTERNATIONAL ROAMING SUBSCRIBERS

8.1   Total duration (in minutes) during the Quarter of incoming calls.

8.2   Total duration (in minutes) during the Quarter of outgoing calls to:

      -     the Network;

      -     PSTN;

      -     Other PLMNs; and

      -     International Gateway (preferably broken down into country or tariff
            area).

9.    NATIONAL ROAMING

      In respect of the Quarter:

9.1   Total Number of MO minutes;

9.2   Total Number of MT minutes;

9.3   Number of SMS MO; and

9.4   Number of SMS MT.


                                    - 148 -


                                   SCHEDULE 16
                       FORM OF PERMITTED BILL OF EXCHANGE

                     To be agreed prior to first Utilisation


                                    - 149 -


                                   SCHEDULE 17
                        POPULATION COVERAGE VERIFICATION

1.    DEFINITIONS

      "POPULATION COVERAGE" means coverage of the Slovenian population with the
      Borrower's own Network, unless otherwise indicated measured at a receive
      signal level of -100 dBm, as described below excluding any coverage
      derived from roaming agreements with other operators or the assistance of
      any other telecommunications system other than the Network. The total
      population number shall be calculated using recent substantive population
      density data issued or based on Slovenian national statistics bureau.

2.    POPULATION COVERAGE MEASUREMENT

2.1   The Borrower shall present soft and hard copies of maps showing the
      Population Coverage based on detailed maps of Slovenia, area coverage
      based on a receive signal strength of -85 dBm, -95 dBm and -100 dBm and
      recent substantive Slovenian population density data imported into a
      Geographic Information System (GIS) software tool to display coverage maps
      and calculate the Population Coverage as defined in paragraph 3.4 below.

2.2   The coverage areas shall be based on the receive signal strength of -100
      dBm and shall include the predicted Population Coverage for this area. The
      Borrower shall use the most recent substantive Slovenian population
      density data available on the market and the density of population
      distribution data shall be per one kilometre square grid (or denser)
      across the whole of the territory of Slovenia with a coordinate for each
      respective grid located in the most populated area within the one
      kilometre. Any further assumptions for this coverage shall be clearly
      stated.

2.3   EVIDENCE OF POPULATION COVERAGE

      The Borrower shall present to the Off Shore Facility Agent as soon as the
      same becomes available but in any event not later than 45 days after the
      respective date for the achievement of the Population Coverage covenant as
      indicated in Clause 22.2(b) (Population Coverage) or Clause 22.4
      (Confirmation by Independent Technical Consultant) together with the
      respective Covenant Compliance Certificate the following evidences for the
      achievement of the respective Population Coverage as stipulated in Clause
      22.2(b) (Population Coverage) or Clause 22.4 (Confirmation by Independent
      Technical Consultant), which shall be verified by the Independent
      Technical Consultant:

2.3.1 Detailed coverage maps showing the receive signal strength of -100 dBm and
      -95 dBm (best server) for its own GSM Network as well as the site
      locations, site references and central coordinates of population
      settlements.

2.3.2 Operation and Maintenance Centre (OMC) reports per site showing site names
      and cell status (on air, TRX (TRX - Transceiver or Transmitter Receiver)
      power levels, BCCH channels (Broadcast Control Channel)).

2.3.3 Drive tests' reports verifications of the Population Coverage as defined
      in paragraph 3.5 below.

2.4   By the measurement of the Population Coverage the Borrower shall not
      include coverage areas provided:

2.4.1 by any other network (such as for national roaming);


                                    - 150 -


2.4.2 temporary sites that have been established less than four weeks or any
      temporary site which are intended to be removed within 12 weeks after the
      milestone date without establishing a permanent site that gives equivalent
      coverage; and

2.4.3 by use of any temporary signal booster such as high power amplifier used
      to distort coverage.

3.    VERIFICATION OF POPULATION COVERAGE

3.1   DRIVE TEST ROUTES AND TIMESCALES

      The Borrower shall present detailed data as defined in paragraph 2.3 above
      on the proposed coverage area maps of regions in Slovenia at the latest
      six weeks prior to any of the dates for achievement of a certain level of
      Population Coverage as indicated in Clause 22.2(b) (Population Coverage)
      or Clause 22.4 (Confirmation by Independent Technical Consultant). This
      shall be based on the Borrower's BTS (Base Transceiver Station) sites that
      are projected to be 'on air' on the respective date for achievement of the
      respective level of Population Coverage as indicated in Clause 22.2(b)
      (Population Coverage) or Clause 22.4 (Confirmation by Independent
      Technical Consultant).

      In order to verify the coverage areas, drive test routes shall be mutually
      agreed between the Borrower and the Independent Technical Consultant at
      the latest three weeks prior to the respective date for achievement of a
      certain level of Population Coverage as indicated in Clause 22.2(b)
      (Population Coverage) or Clause 22.4 (Confirmation by Independent
      Technical Consultant) in order to substantiate coverage areas. Sample
      routes shall focus on areas with minimal coverage (below -95dBm best
      server) shown on the coverage maps and just within the borders of
      contiguous areas of Population Coverage. The Independent Technical
      Consultant may accompany the Borrower whilst performing some of the tests.

3.2   DURATION OF DRIVE TESTING

3.2.1 Drive routes shall be limited to no more than 10 days duration in total
      per Population Coverage covenant as indicated in Clause 22.2(b)
      (Population Coverage) unless prolonged by repeat tests as described in
      paragraph 3.2.2 below.

3.2.2 However should EITHER

      a)    the drive test reports (the format of which is as described in
            paragraph 3.5 below) show; OR

      b)    during the performance of the drive test it is observed that

      one or more routes whereby there occurs several dropped calls or that the
      receive signal strength is indicated below -100 dBm for a distance of 400
      metres or more (or for more than a total of five percent of the total
      distance of any drive route), THEN the associated drive route test shall
      be repeated with a nearby route in an area with higher receive signal
      strength until these criteria have been fulfilled.

3.3   FINALISATION OF THE POPULATION COVERAGE CALCULATION

      The final coverage maps, if amended by the drive tests reports according
      to measured coverage, shall be mutually agreed between the Independent
      Technical Consultant and the Borrower for the relevant Population Coverage
      covenant. Should the receive signal strength be -100 dBm or better for the
      majority of the land area within the grid (as defined in paragraph 2.2
      above) and should the coordinate for the respective grid be also covered
      then the population number for this grid shall be considered to be
      covered.


                                    - 151 -


3.4   TOOLS AND TEST EQUIPMENT REQUIRED BY THE BORROWER

      The Borrower shall use commercially available proven tools and test
      equipment to establish evidence of Population Coverage. The Borrower shall
      notify the Independent Technical Consultant prior to revising the proposed
      tools (as mentioned herein). Any replacement tool shall conform to the
      requirements as set out herein. The following Clauses describe these
      tools.

3.4.1 The Geographic Information System (GIS) software tool is an information
      system that is designed to work with data referenced by spatial or
      geographic coordinates. GIS is both a database system with specific
      capabilities for spatially referenced data, as well as a set of operations
      for analysis of the data. The GIS tool shall import detailed maps of
      Slovenia; statistical population density data and radio coverage plots in
      order to calculate the Population Coverage for all Slovenia. The
      calculation shall be made according to the methodology presented in
      paragraph 3.3. The proposed tools which will be used to perform this
      function are called Logica Odyssey and Arc View.

3.4.2 The drive test equipment and software is used in a suitable vehicle to
      analyse parameters of the uplink and downlink radio path between the
      mobile terminal and the BTS during idle mode, during call set-up and
      whilst in call mode. This should work with a laptop personal computer, a
      GPS (Global Positioning System) receiver with external antenna and a
      compatible Global System for Mobile Communication (GSM) (1800 band) mobile
      terminal equipped with the manufacturer's test software. The handset shall
      preferably use an externally mounted GSM antenna on the vehicle along with
      suitable in line loss pad between the GSM antenna and the unit to
      compensate for external antenna gain. The proposed tool which will be used
      to perform this function is called Agilent E7475A with a Sagem mobile
      handset equipped with test software.(5)

3.4.3 A post processing software tool should be used to perform detailed
      analysis of the data produced by the drive testing. This shall be
      presented in the form of statistics and detailed drive test maps showing
      the routes and drive test reports for each route as defined in paragraph
      3.5. The proposed tool which will be used to perform this function is
      called Actix Analyzer software version 4.1.

3.5   DRIVE TEST REPORTS

      For each route the Borrower shall prepare a report containing all relevant
      measured data. The report shall be made available in softcopy to the
      Independent Technical Consultant and the Off Shore Facility Agent.

      This report shall include a statistical summary of the field measurements
      (RXQUAL (Receive quality according to indicators reflecting the Bit Error
      Rate), RXLEV (Receive Signal level stated in dBm) distribution) and the
      plot of measured RXLEV and RXQUAL, as well as the location of call set-up
      failures and call drops on a map that shall also show the defined drive
      routes. RXQUAL and RXLEV shall be measured only whilst the mobile terminal
      is on a permanent call and not whilst in idle mode. The cell BCCH channel
      number shall also be detailed on the map.

      Actix                     UK company providing quality measurement and
                                analysis software to the mobile industry.
                                Headquartered in Hamlet House, 77 Fulham Palace
                                Road, Hammersmith, London.

(5)   Outside antenna gives more accurate and consistent results. Up to 10 dB
      variations can be introduced due to exact location of handset (such as on
      passenger seat or clipped to dashboard) which is affected by losses from
      surrounding such as body-loss.


                                    - 152 -


       Agilent Technologies     US company formerly owned by Hewlett Packard
                                specialising in medical, test and communications
                                equipment and software. Headquartered in 395
                                Page Mill Road, PO Box 10395, Palo Alto,
                                California.

       ArcView GIS Software     ArcView is a mapping and GIS software tool for
                                the desktop PCs.

       Sagem                    French company specialising in communications,
                                defence electronics and mobile terminals.
                                Headquartered in Le Ponant de Paris, 27 rue
                                Leblanc, 75512 Paris.


                                    - 153 -


                                   SCHEDULE 18
             INITIAL REPORT OF THE INDEPENDENT TECHNICAL CONSULTANT

To:   IKB Deutsche Industriebank AG as Off Shore Facility Agent

From: Independent Technical Consultant

Dated: [-]

Dear Sirs

                               FACILITY AGREEMENT
                           DATED [-] (THE "AGREEMENT")

1.    I refer to the Agreement. This is an initial report as referred to in
      point 4 (n) of Schedule 6 (Conditions Precedent). Terms defined in the
      Agreement have the same meaning in this initial report unless given a
      different meaning in this initial report.

2.    I certify that I have reviewed the information provided by the Borrower
      (attached hereto) and confirm, in all material respects (other than in
      relation to paragraph 2.1 below), the following.

2.1   As at [date], the:

      (a)   Population Coverage has reached 65%; and

      (b)   the number of Subscribers is 8,000.

2.2   The Network is operational, including Core Network elements [MSC (Mobile
      Switching Centre), HLR (Home Location Register), VLR (Visitor Location
      Register), AuC (Authentication Centre)], Value Added Services [Voice Mail
      System and Short Message Centre], Intelligent Network [prepay
      application], Base Station Subsystems [Transcoders, BSCs (Base Station
      Controllers) and BTSs (Base Station Transceiver)], OMCs [Operation and
      Maintenance Centre] and, as at the date mentioned in paragraph 2.1 above,
      [-] base stations are on air.

2.3   That other supporting systems for the operation of the Network are in
      place, including customer care, billing centre, critical IT infrastructure
      [_______________________________________________________________], power
      systems, and building control systems.

2.4   The National Roaming Agreement with Mobitel dated 9 November 2001 is in
      full force and effect.

I confirm that the information provided by the Borrower is sufficient to make
the confirmations set out in paragraphs 2.1 to 2.4 above.

                                Yours faithfully


                     _______________________________________
                        Independent Technical Consultant


                                    - 154 -


                      SIGNATORIES TO THE FACILITY AGREEMENT

THE BORROWER
WESTERN WIRELESS INTERNATIONAL D.O.O.


By:               JULIEN COUSTAURY
                  Name: Julien Coustaury             Name:
                  Title: General Director            Title:

Address:          Brnciceva ulica 49, 1231 Ljubljana, Slovenia
Telephone:        +386 1 5801 200
Fax:              +386 1 5801 109
Attention of:     Steven Fast

LEAD ARRANGER, OFF SHORE SECURITY AGENT, OFF SHORE FACILITY AGENT AND ORIGINAL
EURO FACILITY BANK

IKB DEUTSCHE INDUSTRIEBANK AG


By:               STEFAN ORTSEIFEN                   JAN-HENRIK RUFER
                  Name:  Stefan Ortseifen            Name: Jan-Henrik Rufer
                  Title: Member of the               Title: Assistant Director
                         Board of Directors

Address:          Wilhelm-Botzkes-Stra(beta)e 1, 40474 Dusseldorf, Germany
Telephone:        +49 211 8221 4887 or +49 211 8221 4730
Fax:              +49 211 8221 2887 or +49 211 8221 2730
Attention of:     Martina Messing or Andreas Nestel

LEAD ARRANGER AND ORIGINAL EURO FACILITY BANK
KREDITANSTALT FUR WIEDERAUFBAU


By:               REINER PROVE
                  Name:  Reiner Proeve               Name:
                  Title: Senior Project Manger       Title:

Address:          Palmengartenstr(beta)e 5-9, 60325 Frankfurt am Main, Germany
Telephone:        +49 69 7431 3927
Fax:              +49 69 7431 2258
Attention of:     Reiner Prove


SENIOR CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H.


By:               MARION POETSCHKE                   MANFRED ZIWEY
                  Name: Marion Poetschke             Name: Manfred Ziwey
                  Title: Assistant Director          Title: Director

Address:          Raiffeisenplatz 1, 4021 Linz, Austria
Telephone:        +43 732 6596 3170
Fax:              +43 732 6596 3131
Attention of:     Dr. Lambert Hofbauer

SENIOR CO-ARRANGER, ON SHORE SECURITY AGENT, ON SHORE FACILITY AGENT AND
ORIGINAL SIT FACILITY BANK

NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA


By:               MATEVZ PIRNAT
                  Name: Matevz Pirnat                Name:
                  Title: SVP and Resident            Title:
                         Representative

Address:          Smartinska 130, SI - 1520 Ljubljana, Slovenia
Telephone:        +386 1 520 7273
Fax:              +386 1 425 60 02
Attention of:     Ms. Jasna Istenie or Mr. Bostjan Kovae

CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE


By:               MARION POETSCHKE                   MANFRED ZIWEY
                  Name: Marion Poetschke             Name: Manfred Ziwey
                  Title: Assistant Director          Title: Director

Address:          Martensdamm 6, 24103 Kiel, Germany
Telephone:        +431 900 1572
Fax:              +431 900 2744
Attention of:     Klaus-Volker Lenk


                                    - 156 -


CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
HYPO ALPE-ADRIA-BANK AG


By:               MARION POETSCHKE                   MANFRED ZIWEY
                  Name: Marion Poetschke             Name: Manfred Ziwey
                  Title: Assistant Director          Title: Director

Address:          Stock im Eisen-Platz 3, 1010 Wien, Austria
Telephone:        +43 1 512 8266
Fax:              +43 1 512 8266 6990
Attention of:     International Finance

ORIGINAL SIT FACILITY BANK
HYPO ALPE-ADRIA-BANK D.D.


By:               MARION POETSCHKE                   MANFRED ZIWEY
                  Name: Marion Poetschke             Name: Manfred Ziwey
                  Title: Assistant Director          Title: Director

Address:          Trg Osvobodilne fronte 12
                  PO Box 1601, SI - 1001 Ljubljana, Slovenia
Telephone:        +386 1 300 4400
Fax:              +386 1 300 4401
Attention of:     Mr. Harald Brunner

EX-10.35

                                                                   Exhibit 10.35

CLIFFORD
CHANCE
PUNDER

                                                                  CONFORMED COPY

                              DATED 28 OCTOBER 2002

                      WESTERN WIRELESS INTERNATIONAL D.O.O.

                          IKB DEUTSCHE INDUSTRIEBANK AG

                         KREDITANSTALT FUR WIEDERAUFBAU

               RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H.

                     NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA

                   LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE

                             HYPO ALPE-ADRIA-BANK AG

                            HYPO ALPE-ADRIA-BANK D.D.

                                       and

                                     OTHERS

                               in the presence of

               WESTERN WIRELESS INTERNATIONAL CORPORATION WESTERN

                   WIRELESS INTERNATIONAL SLOVENIA CORPORATION

                                WESTERN WIRELESS
                      INTERNATIONAL SLOVENIA II CORPORATION

- --------------------------------------------------------------------------------
                            FIRST AMENDMENT AGREEMENT
                                 RELATING TO THE
                     FACILITY AGREEMENT DATED 30 APRIL 2002
                    RELATING TO THE PROJECT FINANCING OF THE
                VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA
- --------------------------------------------------------------------------------


                                    CONTENTS


CLAUSE                                                                      PAGE
                                                                         
1.       Definitions and Interpretation..................................     2

2.       Amendment of the Original Facility Agreement....................     2

3.       Representations.................................................     2

4.       Continuity and Further Assurance................................     3

5.       Fees, Costs and Expenses........................................     3

6.       Miscellaneous...................................................     3

Schedule 1 Conditions Precedent..........................................     5

Schedule 2 Amendments to Original Facility Agreement.....................     6



THIS AGREEMENT is dated 28 October 2002 and made between:

(1)   WESTERN WIRELESS INTERNATIONAL D.O.O., LJUBLJANA as borrower (the
      "BORROWER");

(2)   IKB DEUTSCHE INDUSTRIEBANK AG AND KREDITANSTALT FUR WIEDERAUFBAU, as lead
      arrangers (the "LEAD ARRANGERS");

(3)   RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. and NOVA LJUBLJANSKA
      BANKA D.D., LJUBLJANA as senior co-arrangers (the "SENIOR CO-ARRANGERS");

(4)   LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as
      co-arrangers (the "CO-ARRANGERS");

(5)   IKB DEUTSCHE INDUSTRIEBANK AG, KREDITANSTALT FUR WIEDERAUFBAU,
      RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H. LANDESBANK
      SCHLESWIG-HOLSTEIN GIROZENTRALE and HYPO ALPE-ADRIA-BANK AG as original
      lenders with regard to the Euro Facility (the "ORIGINAL EURO FACILITY
      BANKS");

(6)   IKB DEUTSCHE INDUSTRIEBANK AG, as facility agent with regard to the Euro
      Facility and the SIT Facility (the "OFF SHORE FACILITY AGENT");

(7)   IKB DEUTSCHE INDUSTRIEBANK AG, as security agent with regard to the Off
      Shore Security (the "OFF SHORE SECURITY AGENT");

(8)   NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as an original lender and issuing
      bank with regard to the SIT Facility and HYPO ALPE-ADRIA-BANK D.D. as
      original lender with regard to the SIT Facility (the "ORIGINAL SIT
      FACILITY BANKS");

(9)   NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as local facility agent with regard
      to the SIT Facility (the "ON SHORE FACILITY AGENT"); and

(10)  NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA as security agent with regard to
      the On Shore Security (the "ON SHORE SECURITY AGENT");

in the presence of

(11)  WESTERN WIRELESS INTERNATIONAL CORPORATION, WESTERN WIRELESS INTERNATIONAL
      SLOVENIA CORPORATION, and WESTERN WIRELESS INTERNATIONAL SLOVENIA II
      CORPORATION (together the "SPONSORS").

WHEREAS

(A)   On 30 April 2002 the Borrower and the Finance Parties have entered into a
      facility agreement for the financing of the construction and operation of
      a wireless communication network in Slovenia.


                                     - 1 -


(B)   The Parties have agreed to make certain amendments to the Finance
      Documents.

IT IS AGREED as follows:

1.    DEFINITIONS AND INTERPRETATION

1.1   DEFINITIONS

      In this Agreement:

      "AGREEMENT" means this agreement including all of its Schedules.

      "AMENDED FACILITY AGREEMENT" means the Original Facility Agreement, as
      amended by this Agreement.

      "EFFECTIVE DATE" means the date on which the Off Shore Facility Agent
      confirms to the Finance Parties and the Borrower that it has received each
      of the documents listed in Schedule 1 (Conditions Precedent) in a form and
      substance satisfactory to the Off Shore Facility Agent.

      "ORIGINAL FACILITY AGREEMENT" means the Facility Agreement dated 30 April
      2002 between the Borrower, the Off Shore Facility Agent, and others.

1.2   INCORPORATION OF DEFINED TERMS

      Terms defined in the Original Facility Agreement shall, unless otherwise
      defined herein, have the same meaning herein and the principles of
      construction set out in the Original Facility Agreement shall have effect
      as if set out in this Agreement.

1.3   CLAUSES

      In this Agreement any reference to a "Clause" or "Schedule" is, unless the
      context otherwise requires, a reference to a Clause or Schedule hereof.
      Clause headings are for ease of reference only.

2.    AMENDMENT OF THE ORIGINAL FACILITY AGREEMENT

      With effect from the Effective Date the Original Facility Agreement shall
      be amended as set out in Schedule 2 (Amendments to the Original Facility
      Agreement).

3.    REPRESENTATIONS

3.1   The Borrower expressly repeats the Repeated Representations and makes the
      representation in Clause 20.1.11 (No misleading information) of the
      Facility Agreement as at the date of signing of this Agreement and upon
      the Effective Date as if the references therein to Initial Business Plan,
      Information Memorandum and Legal Due Diligence Report are to the 2002
      Revised Business Plan.


                                     - 2 -


4.    CONTINUITY AND FURTHER ASSURANCE

4.1   CONTINUING OBLIGATIONS

      The provisions of the Original Facility Agreement shall, save as amended
      hereby, continue in full force and effect.

4.2   FURTHER ASSURANCE

      The Borrower shall, at the request of the Off Shore Facility Agent and at
      its own expense, do all such acts and things necessary or desirable to
      give effect to the amendments effected or to be effected pursuant to this
      Agreement.

5.    FEES, COSTS AND EXPENSES

5.1   TRANSACTION EXPENSES

      The Borrower shall, from time to time on demand of the Off Shore Facility
      Agent, reimburse the Senior Creditors for all costs and expenses
      (including legal fees) together with any VAT thereon reasonably incurred
      by it in connection with the negotiation, preparation and execution of
      this Agreement, any other document referred to in this Agreement any other
      Finance Document and the completion of the transactions herein
      contemplated.

5.2   PRESERVATION AND ENFORCEMENT OF RIGHTS

      The Borrower shall, from time to time on demand of the Off Shore Facility
      Agent, reimburse the Senior Creditors for all costs and expenses
      (including legal fees) on a full indemnity basis together with any VAT
      thereon incurred in or in connection with the preservation, performance
      and/or enforcement or protection and/or attempted enforcement or
      protection of any of the rights of the Senior Creditors under this
      Agreement, any other document referred to in this Agreement and any other
      Finance Document.

5.3   STAMP TAXES

      The Borrower shall pay all stamp, registration and other taxes to which
      this Agreement, any other document referred to in this Agreement any other
      Finance Document or any judgment given in connection herewith is or at any
      time may be subject and shall, from time to time on demand of the Off
      Shore Facility Agent, indemnify the Senior Creditors against any
      liabilities, costs, claims and expenses resulting from any failure to pay
      or any delay in paying any such tax.

6.    MISCELLANEOUS

6.1   INCORPORATION OF TERMS

      The provisions of clause 32 (Notices), clause 34 (Partial Invalidity),
      clause 35 (Remedies and Waiver), clause 38 (Governing Law), clause 39
      (Arbitration) and clause 40 (Jurisdiction) of the Original Facility
      Agreement shall be incorporated into this


                                     - 3 -


      Agreement as if set out in full herein and as if references therein to
      "this Agreement" or the Finance Documents are references to this
      Agreement.

6.2   COUNTERPARTS

      This Agreement may be executed in any number of counterparts, all of which
      taken together shall constitute one and the same instrument.

6.3   FINANCE DOCUMENT

      This Agreement is intended to be a "Finance Document" within the meaning
      of the Facility Agreement.


                                     - 4 -


                                   SCHEDULE 1
                              CONDITIONS PRECEDENT

1.    In relation to the Borrower:

      (a)   a confirmation, given by an authorised signatory of the Borrower,
            certifying that, as at the date hereof, there has been no change to
            the constitutional documents delivered by the Borrower pursuant to
            the Original Facility Agreement;

      (b)   a copy, certified as at the date of this Agreement a true and
            up-to-date copy by an authorised signatory of the Borrower, of a
            resolution of the board of directors of the Borrower approving the
            execution, delivery and performance of this Agreement and the terms
            and conditions hereof and authorising a named person or persons to
            sign this Agreement and any documents to be delivered by the
            Borrower pursuant hereto; and

      (c)   a certificate of an authorised signatory of the Borrower setting out
            the names and signatures of the persons authorised to sign, on
            behalf of the Borrower, this Agreement and any documents to be
            delivered by the Borrower pursuant hereto.

2.    A copy, certified a true copy by or on behalf of the Borrower, of each
      such law, decree, consent, licence, approval, registration or declaration
      as is, in the opinion of counsel to the Finance Parties, necessary to
      render this Agreement legal, valid, binding and enforceable, to make this
      Agreement admissible in evidence in the Borrower's and any Finance Party's
      jurisdiction of incorporation and to enable the Borrower to perform its
      obligations hereunder.

3.    A legal opinion of Selih, Selih, Janezic and Jarcovic, Ljubljana, the
      local legal advisers to the Off Shore Facility Agent, substantially in the
      form agreed with the Off Shore Facility Agent.

4.    The fees set out in the Restructuring Fee Letter addressed by the Borrower
      to the Off Shore Facility Agent, dated on or about the date of this
      Agreement, have been paid to the Finance Parties.


                                     - 5 -


                                   SCHEDULE 2
                    AMENDMENTS TO ORIGINAL FACILITY AGREEMENT

1.    The cover page of the Original Facility Agreement is amended by deleting
      the title in its entirety and replacing it with the following:

                               "FACILITY AGREEMENT

                         (AS AMENDED ON 28 OCTOBER 2002)
                    RELATING TO THE PROJECT FINANCING OF THE
                VEGA GSM TELECOMMUNICATIONS NETWORKS IN SLOVENIA"

2.    The definition of "Business Plan" in Clause 1.1 (Definitions) of the
      Original Facility Agreement is amended by deleting such definition in its
      entirety and replacing it with the following definition:

      "BUSINESS PLAN" means, prior to the delivery of the 2002 Revised Business
      Plan, the Initial Business Plan, thereafter but prior to the delivery of
      the first Updated Business Plan, the 2002 Revised Business Plan and
      thereafter the most recently delivered Updated Business Plan."

3.    Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Claims Assignment
      and Bills of Exchange Agreement" and before the definition of
      "Co-Arrangers":

      "CLOSED LAC" has the meaning set out in Schedule 19 (Additional Coverage
      Requirements)."

4.    Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Confidentiality
      Undertaking " and before the definition of "Contributed Capital":

      "CONTIGUOUS ROAD COVERAGE" has the meaning set out in Schedule 19
      (Additional Coverage Requirements)."

5.    Sub-clause (a) of the definition of "EBITDA" in Clause 1.1 (Definitions)
      of the Original Facility Agreement is amended by deleting such sub-clause
      in its entirety and replacing it with the following definition:

      "(a)  net income excluding any unrealised but including any realised
            foreign exchange gains or losses;"

6.    The definition of "Estimated Contract Value" in Clause 1.1 (Definitions)
      of the Original Facility Agreement is amended by deleting such definition
      in its entirety and replacing it with the following definition:


                                     - 6 -


      "ESTIMATED CONTRACT VALUE" means the estimated value of the equipment and
      services for all phases of the Project (comprising the Initial
      Configuration and the Planned Network Expansion) payable under the
      Delivery Contract, being Euro 59,438,541."

7.    The definition of "Fee Letter" in Clause 1.1 (Definitions) of the Original
      Facility Agreement is amended by deleting such definition in its entirety
      and replacing it with the following definition:

      "FEE LETTER" means any letter or letters dated on or about the date of
      this Agreement or such other date as set out therein between any of the
      Arrangers and the Borrower or any of the Agents and the Borrower setting
      out any of the fees referred to in Clause 12 (Fees) and the advisory
      agreement between the Borrower and the Off Shore Facility Agent dated 2
      February 2001 as amended from time to time."

8.    Sub-clause (a) of the definition of "Financial Indebtedness" in Clause 1.1
      (Definitions) of the Original Facility Agreement is amended by deleting
      such sub-clause in its entirety and replacing it with the following
      definition:

      "(a)  moneys borrowed (other than Subordinated Loans);"

9.    Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Financial
      Indebtedness" and before the definition of "3GPP":

      "FIRST FACILITY AGREEMENT AMENDMENT AGREEMENT" means the first amendment
      agreement relating to the Facility Agreement between the Borrower and the
      Banks, dated 28 October 2002."

10.   Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "ITU" and before the
      definition of "Lead Arrangers":

      "LAC" has the meaning set out in Schedule 19 (Additional Coverage
      Requirements)."

11.   Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Licence" and before
      the definition of "LMA":

      "LICENCE PLEDGE AGREEMENT" means the licence pledge agreement dated 28
      June 2002 between the Borrower and the Senior Creditors."

12.   Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Repeated
      Representations" and before the definition of "Rollover SIT Facility
      Loan":

      "2002 REVISED BUSINESS PLAN" means a revised version of the Initial
      Business Plan accommodating the changed technical, economic and tax
      assumptions, agreed between the Parties and referred to as the excel
      spreadsheet named "Vega Base Case 0826.xls."."


                                     - 7 -


13.   Sub-clause (d) of the definition of "Security Documents" in Clause 1.1
      (Definitions) of the Original Facility Agreement is amended by deleting
      such sub-clause in its entirety and replacing it with the following
      definition:

      "(d)  the Sponsors' Cash Collateral Account Pledge Agreement and the
            Sponsors' Cash Collateral Account #2 Pledge Agreement;"

14.   Sub-clause (h) of the definition of "Security Documents" in Clause 1.1
      (Definitions) of the Original Facility Agreement is amended by deleting
      such sub-clause in its entirety and replacing it with the following
      definition:

      "(h)  the Asset and Licence Pledge and Lease Contracts Assignment
            Agreement and the Licence Pledge Agreement;"

15.   Sub-clause (b) of the definition of "SMOM" in Clause 1.1 (Definitions) of
      the Original Facility Agreement is amended by deleting such sub-clause in
      its entirety and replacing it with the following definition:

      "(b)  (if no SMOM Screen Rate is available for the Interest Period of that
            SIT Facility Loan) the arithmetic mean of the rates (rounded upwards
            to four decimal places) as supplied to the On Shore Facility Agent
            at its request quoted by the SMOM Reference Banks to leading banks
            in the Slovenian Interbank Market, as of 11.00 a.m. (Ljubljana time)
            on the Quotation Day for the offering of deposits in SIT for a
            period comparable to the Interest Period of the relevant SIT
            Facility Loan."

16.   Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of "Sponsors' Cash
      Collateral Account" and before the definition of "Sponsors' Cash
      Collateral Account Pledge Agreement":

      "SPONSORS' CASH COLLATERAL ACCOUNT #2" has the meaning given to it in the
      Sponsors' and Shareholders' Undertaking and Completion Guarantee."

17.   Clause 1.1 (Definitions) of the Original Facility Agreement is amended by
      including the following words after the definition of " Sponsors' Cash
      Collateral Account Pledge Agreement" and before the definition of
      "Sponsors Unsecured Loan Agreement":

      "SPONSORS' CASH COLLATERAL ACCOUNT #2 PLEDGE AGREEMENT" means the cash
      collateral account pledge agreement to be entered into between Western
      Wireless International Corporation and the Off Shore Security Agent acting
      on behalf of the Senior Creditors."

18.   The definition of "Subordinated Loan" in Clause 1.1 (Definitions) of the
      Original Facility Agreement is amended by deleting such definition in its
      entirety and replacing it with the following definition:

      "SUBORDINATED LOAN" means a subordinated loan (other than a Sponsors
      Unsecured Loan) made to the Borrower in accordance with the Sponsors' and
      Shareholders' Undertaking and Completion Guarantee or amounts owing to the
      Sponsors that are to be treated as subordinated loans as expressly
      provided in this Agreement."


                                     - 8 -


19.   Clause 4.2.1(a)(v) (Further conditions precedent to all Utilisations) of
      the Original Facility Agreement is amended by deleting such clause in its
      entirety and replacing it with the following:

      "(v)  in respect of the SIT Facility, evidence that at least 50% of the
            Total ECA Facility Commitments and Total Commercial Facility
            Commitments have been utilised;"

20.   Clause 5.1.1 (Delivery of Utilisation Request) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      "5.1.1 The Borrower may utilise a Facility if the Off Shore Facility Agent
            with regard to any Utilisation of the Euro Facility and the On Shore
            Facility Agent with regard to a Utilisation of the SIT Facility
            receives a duly completed Utilisation Request (together with all
            related documentation):

            (a)   with regard to a Utilisation of a Euro Facility Loan, no later
                  than 11.00 a.m. (Dusseldorf time) five (5) Business Days (or
                  in the case of the first Utilisation of the Facilities, three
                  (3) Business Days) prior to the proposed Utilisation Date;

            (b)   with regard to a Utilisation of a SIT Facility Loan in an
                  amount exceeding SIT 500,000,000, no later than 11:00 a.m.
                  (Ljubljana time) five (5) Business Days (or in the case of the
                  first Utilisation of the Facilities, three (3) Business Days)
                  prior to the proposed Utilisation Date;

            (c)   with regard to a Utilisation of a SIT Facility Loan in an
                  amount of up to SIT 500,000,000, no later than 11:00 a.m.
                  (Ljubljana time) two (2) Business Day prior to the proposed
                  Utilisation Date; and

            (d)   with regard to a SIT Facility Guarantee or LC, no later than
                  11:00 a.m. (Ljubljana time) five (5) Business Days (or in the
                  case of the first Utilisation of the Facilities, three (3)
                  Business Days) prior to the proposed Utilisation Date,

            PROVIDED THAT if the Borrower fails to issue a Utilisation Request
            in respect of a Rollover SIT Facility Loan such request shall,
            subject to compliance with Clause 4.2.2(a) (Further conditions
            precedent to all Utilisations) and any repayments necessary to
            comply with Clause 4.2.2(b) (Further conditions precedent to all
            Utilisations), be deemed to have been given by the Borrower to the
            On Shore Facility Agent."

21.   Clause 5.2(a)(i)(1) (Completion of a Utilisation Request) of the Original
      Facility Agreement is amended by deleting such clause in its entirety and
      replacing it with the following:

      "(1)  in the case of a requested Loan in respect of ECA Facility Tranche
            1, is in the form set out in Schedule 4B (Utilisation Request
            (Payments to Equipment


                                     - 9 -


            Vendor)), duly completed and executed by the Equipment Vendor and is
            accompanied by the following documents that in the reasonable
            opinion of the Off Shore Facility Agent are in accordance with the
            "Uniform Rules for Collection, 1995 Revision, ICC Publication no.
            522" (i) an original invoice to the Borrower from the Equipment
            Vendor; and (ii) in respect of a Utilisation Request completed with
            reference to Clause 1.10.2(b)(iii) (Invoices and Terms of Payment)
            of the Delivery Contract a copy of a certificate executed by the
            Borrower and referring to the final acceptance of the Initial
            Configuration;"

22.   Clause 9.1(b) (Calculation of floating rate interest under the ECA
      Facility) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(b)  a margin (the "ECA FACILITY APPLICABLE MARGIN") in an amount of,
            initially, 1.25% per annum and thereafter the rate per annum set out
            in the column headed "Margin (% p.a.)" opposite the relevant
            Population Coverage (set out in the same line in the column headed
            "Population Coverage") and subject to the achievement of the
            relevant financial performance tests (set out in the same line in
            the column headed "Financial Performance") in the table below, in
            each case as at the end of the most recently ended Quarter:



                 POPULATION COVERAGE   FINANCIAL PERFORMANCE                                MARGIN (% P.A.)
                 -------------------   ---------------------                                ---------------
                                                                                      
                 75%                   EBITDA for the immediately preceding two (2)         1.10
                                       Quarters does not negatively deviate from
                                       the EBITDA in the 2002 Revised Business Plan.

                 80%                   EBITDA for the immediately preceding two (2)         1.00
                                       Quarters is positive.

                 84%                   Total Leverage Ratio greater than 6.00 but           0.90
                                       less than 11.00.

                 84%                   Total Leverage Ratio less than or equal to           0.80
                                       6.00 and greater than 5.00.

                 84%                   Total Leverage Ratio less than or equal to           0.70
                                       5.00 and greater than 4.00.

                 84%                   Total Leverage Ratio less than or equal to           0.60
                                       4.00 and greater than 3.00.

                 84%                   Total Leverage Ratio less than or equal to           0.50
                                       3.00 and greater than 2.00.

                 84%                   Total Leverage Ratio less than or equal to           0.40
                                       2.00.


            PROVIDED THAT:

            (i)   any change to the ECA Facility Applicable Margin shall take
                  place from the immediately following Euro Facility Interest
                  Payment Date


                  (the "ECA FACILITY APPLICABLE MARGIN ADJUSTMENT DATE")
                  (subject to Clause 9.1(b)(iii)) if:

                  (1)   the Borrower has requested a reduction in the Applicable
                        Margin in the Covenant Compliance Certificate at least
                        15 Business Days prior to such Euro Facility Interest
                        Payment Date or the Off Shore Facility Agent has
                        notified the Borrower, based on the information referred
                        to in (2) below, that there will be an increase in the
                        Applicable Margin in accordance with the above
                        provisions of this paragraph (b);

                  (2)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        financial performance of the Borrower on the basis of
                        the most recent information required to be provided by
                        the Borrower pursuant to Clauses 21.1(a) and (c)
                        (Financial statements and other information) and Clause
                        21.3 (Covenant Compliance Certificate);

                  (3)   no Event of Default or Potential Event of Default is
                        continuing; and

                  (4)   the Off Shore Facility Agent has confirmed the
                        satisfaction of the above conditions relating to
                        Population Coverage (on receipt of confirmation of such
                        Population Coverage from the Independent Technical
                        Consultant) or such confirmation has not been received
                        by the date upon which the Borrower would be entitled to
                        a change in the ECA Facility Applicable Margin (had such
                        confirmation been received);

            (ii)  if the Off Shore Facility Agent has not received the
                  information required to be provided by the Borrower pursuant
                  to Clauses 21.1(a) and (c) (Financial statements and other
                  information) and Clause 21.3 (Covenant Compliance Certificate)
                  in respect of the relevant period by its due date for delivery
                  pursuant to this Agreement, the Applicable Margin will be
                  1.25% per annum from that date until such time as the Borrower
                  satisfies the conditions set out in this paragraph (b) and is
                  in compliance with its obligations under Clause 21 (Reporting
                  requirements);

            (iii) if after an ECA Facility Applicable Margin Adjustment Date the
                  Independent Technical Consultant is of the opinion that the
                  above conditions relating to Population Coverage have not been
                  satisfied but the ECA Facility Applicable Margin has been
                  changed by the Off Shore Facility Agent the ECA Facility
                  Applicable Margin shall be readjusted to the applicable level
                  in accordance with the above provisions of this paragraph (b)
                  for the entire Interest Period from such ECA Facility
                  Applicable Margin Adjustment Date."



23.   Clause 9.2(b) (Calculation of floating rate interest under the Commercial
      Facility) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(b)  a margin (the "COMMERCIAL FACILITY APPLICABLE MARGIN") in an amount
            of, initially, 3.25% per annum and thereafter the rate per annum set
            out in the column headed "Margin (% p.a.)" opposite the relevant
            Population Coverage (set out in the same line in the column headed
            "Population Coverage") and subject to the achievement of the
            relevant financial performance tests (set out in the same line in
            the column headed "Financial Performance") in the table below, in
            each case as at the end of the most recently ended Quarter:



                 POPULATION COVERAGE   FINANCIAL PERFORMANCE                                    MARGIN (% P.A.)
                 -------------------   ---------------------                                    ---------------
                                                                                          
                 75%                   EBITDA for the immediately preceding two (2)             2.50
                                       Quarters does not negatively deviate from
                                       the EBITDA in the 2002 Revised Business Plan.

                 80%                   EBITDA for the immediately preceding two (2)             2.25
                                       Quarters is positive.

                 84%                   Total Leverage Ratio greater than 6.00 but               2.25
                                       less than 11.00.

                 84%                   Total Leverage Ratio less than or equal to               2.00
                                       6.00 and greater than 5.00.

                 84%                   Total Leverage Ratio less than or equal to               1.50
                                       5.00 and greater than 4.00.

                 84%                   Total Leverage Ratio less than or equal to               1.25
                                       4.00 and greater than 3.00.

                 84%                   Total Leverage Ratio less than or equal to               1.00
                                       3.00 and greater than 2.00.

                 84%                   Total Leverage Ratio less than or equal to               0.75
                                       2.00.


            PROVIDED THAT:

            (i)   any change to the Commercial Facility Applicable Margin shall
                  take place from the immediately following Euro Facility
                  Interest Payment Date (the "COMMERCIAL FACILITY APPLICABLE
                  MARGIN ADJUSTMENT DATE") (subject to Clause 9.2(b)(iii)) if:

            (1)   the Borrower has requested a reduction in the Applicable
                  Margin in the Covenant Compliance Certificate at least 15
                  Business Days prior to such Euro Facility Interest Payment
                  Date or the Off Shore Facility Agent has notified the
                  Borrower, based on the information referred to in (2) below,
                  that there will be an increase in the Applicable Margin in
                  accordance with the above provisions of this paragraph (b);



            (2)   the Off Shore Facility Agent has confirmed the satisfaction of
                  the above conditions relating to financial performance of the
                  Borrower on the basis of the most recent information required
                  to be provided by the Borrower pursuant to Clauses 21.1(a) and
                  (c) (Financial statements and other information) and Clause
                  21.3 (Covenant Compliance Certificate);

            (3)   no Event of Default or Potential Event of Default is
                  continuing; and

            (4)   the Off Shore Facility Agent has confirmed the satisfaction of
                  the above conditions relating to Population Coverage (on
                  receipt of confirmation of such Population Coverage from the
                  Independent Technical Consultant) or such confirmation has not
                  been received by the date upon which the Borrower would be
                  entitled to a change in the Commercial Facility Applicable
                  Margin (had such confirmation been received);

      (ii)  if the Off Shore Facility Agent has not received the information
            required to be provided by the Borrower pursuant to Clauses 21.1(a)
            and (c) (Financial statements and other information) and Clause 21.3
            (Covenant Compliance Certificate) in respect of the relevant period
            by its due date for delivery pursuant to this Agreement, the
            Applicable Margin will be 3.25% per annum from that date until such
            time as the Borrower satisfies the conditions set out in this
            paragraph (b) and is in compliance with its obligations under Clause
            21 (Reporting requirements);

      (iii) if after a Commercial Facility Applicable Margin Adjustment Date the
            Independent Technical Consultant is of the opinion that the above
            conditions relating to Population Coverage have not been satisfied
            but the Commercial Facility Applicable Margin has been changed by
            the Off Shore Facility Agent, the Commercial Facility Applicable
            Margin shall be readjusted to the applicable level in accordance
            with the above provisions of this paragraph (b) for the entire
            Interest Period from such Commercial Facility Applicable Margin
            Adjustment Date."

24.   Clause 12 (Fees) of the Original Facility Agreement is amended by
      including the following clause after clause 12.6 (Proceeds and Revenue
      Account #2) of the Original Facility Agreement:

      "12.7 OFF SHORE FACILITY AGENT FEE

            The Borrower shall pay to the Offshore Facility Agent for its
            services an annual fee as set out in a Fee Letter."

25.   Clause 21 (Reporting Requirements) of the Original Facility Agreement is
      amended by including the following clause after Clause 21.6 (Business Plan
      Review) of the Original Facility Agreement:


      "21.7 BUILDING PERMIT REPORTS

      21.7.1 All outstanding building permits are obtained within a period of 9
            Months commencing on the date of the Facility Agreement; and

      21.7.2 The Borrower shall provide to the Off Shore Facility Agent within
            10 Business Days of the last day of each Month from the date of the
            First Facility Agreement Amendment Agreement until the date on which
            all building permits are obtained, a report indicating:

            (a)   the number of sites for which building permits have been
                  achieved;

            (b)   the number of sites for which building permits remain
                  outstanding; and

            (c)   an explanation as to the status of applications for all
                  outstanding permits including details of any problems
                  encountered in relation to the obtaining of those permits and
                  the steps taken by the Borrower to remedy such problems."

26.   Clause 22.2 (Stage I covenants) of the Original Facility Agreement is
      amended by deleting such clause in its entirety and replacing it with the
      following:

      **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES
      AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT**

27.   Clause 22.3(c) (Interest Coverage Ratio) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      (B)   **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
            SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
            CONFIDENTIAL TREATMENT**


28.   Clause 22.3(d) (Debt Service Cover Ratio) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      (C)   **CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
            SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
            CONFIDENTIAL TREATMENT**

29.   Clause 22.3(e) (Population Coverage) of the Original Facility Agreement is
      deleted in its entirety.

30.   Clause 22.4 (Confirmation by Independent Technical Consultant) of the
      Original Facility Agreement is amended by deleting such clause in its
      entirety and replacing it with the following:

      "22.4 CONFIRMATION BY INDEPENDENT TECHNICAL CONSULTANT
      The figures in Clauses 22.2(a) and (b) (Stage I covenants) shall be
      confirmed by the Independent Technical Consultant annually commencing on
      31 December 2002 and ending on 31 December 2004. The accomplishment of the
      covenants set out in Clause 22.2(e)(i) and 22.2(e)(ii) (Stage I covenants)
      shall be confirmed by the Independent Technical Consultant within 15
      Business Days after their respective due date."




31.   Clause 23.3(c) (Application of money on the Proceeds and Revenue Accounts)
      of the Original Facility Agreement is amended by deleting such clause in
      its entirety and replacing it with the following:

      "(c)  any Proceeds and Revenues that constitute Contributed Capital or
            Sponsors Unsecured Loans or the proceeds of any Loans payable to the
            Borrower under the Euro Facility shall be paid into the Loan
            Proceeds Account and applied in accordance with Clause 23.8 (Loan
            Proceeds Account) PROVIDED THAT in respect of any amounts
            contributed as Contributed Capital to permit the Borrower to make
            contributions to the UMTS Subsidiary in accordance with Clause
            24.33(b)(ii) (UMTS and other licenses), the Borrower may transfer,
            after compliance with the provisions of Clause 24.33(b)(iii) (UMTS
            and other licenses), such amounts to the UMTS Subsidiary; and"

32.   Clause 23.3(d)(ii) (Application of money on the Proceeds and Revenue
      Accounts) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(ii) second, in or towards payment of all due and payable operating costs
            as shown in the 2002 Revised Business Plan (including amounts in
            respect of direct costs payable under the Management Agreement which
            are provided for in the Initial Business Plan but excluding any
            amounts payable under the Lucent Loan Agreement);"

33.   Clause 23.3(d)(iii) (Application of money on the Proceeds and Revenue
      Accounts) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(iii) third, in or towards payment of all due and payable on-going
            capital costs in relation to the build-out of the Network as shown
            in the 2002 Revised Business Plan and necessary to perform its
            business but excluding any amounts payable under the Lucent Loan
            Agreement;"

34.   Clause 23.3(d)(vii) (Application of money on the Proceeds and Revenue
      Accounts) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(vii) seventh, in or towards payment of capital costs in the amounts and
            at the times set out in the Business Plan (other than the Initial
            Business Plan and/or the 2002 Revised Business Plan) and subject to
            Clause 23.3(e)(ii) amounts in respect of any margin payable under
            the Management Agreement in an amount not exceeding (A) US Dollars
            700,000 or its equivalent in the financial year ending 31 December
            2002 and (B) in each financial year thereafter the lesser of (Y) 50%
            of any direct costs payable under the Management Agreement and (Z)
            US Dollars 700,000 or its equivalent;"



35.   Clause 23.3(d)(x) (Application of money on the Proceeds and Revenue
      Accounts) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(x)  tenth, in or towards any payment due and payable to the Shareholders
            (including any interest payable on any Subordinated Loans or other
            amounts payable under the Management Agreement that have not been
            paid pursuant to Clauses 0 or (vii) or any prepayment pursuant to
            the Sponsor Subordinated Loan Agreement #2) in an amount not to
            exceed 50% of the Excess Cash Flow."

36.   Clause 23.3(e) (Application of money on the Proceeds and Revenue Accounts)
      of the Original Facility Agreement is amended by deleting such clause in
      its entirety and replacing it with the following:

      "(e)  The Borrower shall only be entitled to make the payments referred to
            in this Clause 23.3 out of the Proceeds and Revenue Accounts on the
            following basis:

            (i)   subject to Clause 23.3(e)(ii), amounts payable pursuant to
                  paragraphs (d)(i) to (vii) above inclusive shall be paid when
                  due;

            (ii)  in respect of the fees payable under the Management Agreement
                  under Clause 23.3(d)(vii):

                  (1)   from the date of the First Facility Agreement Amendment
                        Agreement until 1 January 2005 such fees (the
                        "SUBORDINATED MANAGEMENT FEES") may only be paid,
                        subject to Clause 23.3(e)(iii), in accordance with
                        paragraph (x) above and the obligations of the Borrower
                        to pay the Subordinated Management Fees outstanding
                        between the date of the First Facility Agreement
                        Amendment Agreement and 1 January 2005 shall be
                        converted into and treated as Subordinated Loans;

                  (2)   after 1 January 2005 all such fees shall be paid in
                        accordance with Clause 23.3(d)(vii);

            (iii) amounts payable pursuant to paragraph (d)(x) above shall only
                  be paid on satisfaction of the conditions set out in paragraph
                  (f) below."

37.   Clause 23.5.3 (Sale Proceeds Account) of the Original Facility Agreement
      is amended by deleting such clause in its entirety and replacing it with
      the following:

      "23.5.3 Any amounts standing to the credit of the Sale Proceeds Account
            that are not used in accordance with Clause 23.5.2 (Sale Proceeds
            Account) shall be applied in prepayment in accordance with Clause
            14.5.1(a) (Mandatory prepayments)."

38.   Clause 23.6.2(b) (Debt Service Account) of the Original Facility Agreement
      is amended by deleting such clause in its entirety and replacing it with
      the following:


            "(b)  from the date falling six (6) Months prior to the first
                  Repayment Date, one sixth of the Debt Service Payments (other
                  than in respect of the SIT Facility and other than in respect
                  of interest and amounts payable under the Hedging Agreements
                  prior to their termination) due and payable on the next
                  repayment date under the Euro Facility, the Sponsors Unsecured
                  Loan Agreement and under the Lucent Loan Agreement; and"

39.   Clause 23.6.2 (Debt Service Account) of the Original Facility Agreement is
      amended by including the following Clause 21.6.2(c) after Clause 21.6.2(b)
      (Debt Service Account) of the Original Facility Agreement:

            "(c)  in respect of the Commitment Fees payable under Clause 12.1
                  (Commitment fees), one third of the amount due and payable on
                  the next date for payment thereof."

40.   Clause 24.37 (Licence Assignment Agreement) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      "24.37 LICENCE PLEDGE AGREEMENT

      The Borrower will in accordance with instructions reasonably given by the
      Off Shore Facility Agent use reasonable efforts to seek the consent of the
      Government to the pledge of the rights of the Borrower under the Licence
      pursuant to the Licence Pledge Agreement."

41.   Clause 24 (General Undertakings) of the Original Facility Agreement is
      amended by including the following Clause 24.39 after Clause 24.38 (Bills
      of Exchange and Security Deposits) of the Original Facility Agreement:

      (D)   "24.39 ROAMING**CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY
            WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST
            FOR CONFIDENTIAL TREATMENT**


42.   Clause 25.1.2 (Financial covenants and network milestones) of the Original
      Facility Agreement is amended by deleting such clause in its entirety and
      replacing it with the following:

      "25.1.2 FINANCIAL COVENANTS AND NETWORK MILESTONES

      (a)   At any time any of the requirements of Clause 22 (Financial
            covenants and network milestones) is not satisfied.

      (b)   No Event of Default under paragraph (a) above will occur if failure
            to satisfy such requirement, if capable of remedy, is remedied
            within 30 Business Days (or, if and to the extent that any greater
            grace period applies under clause 2.3


            (Failure of Milestone completion) of the Sponsors' and Shareholders'
            Undertaking and Completion Guarantee, within such grace period),

            PROVIDED THAT in the event that any of the requirements of Clause 22
            (Financial covenants and network milestones) (other than Clauses
            22.2(a) and (b)) is not satisfied, then within five (5) Business
            Days of delivery of the Covenant Compliance Certificate, the
            Shareholders may, in addition to the Sponsors' rights and
            obligations under the Sponsors' and Shareholders' Undertaking and
            Completion Guarantee, cure such failure to satisfy any such
            requirement by making Subordinated Loans and/or Equity Contributions
            to the Borrower which Subordinated Loans and/or Equity Contributions
            shall be treated as (i) having been contributed on the last day of
            the relevant Quarter and (ii) additional capital or revenues of the
            Borrower."

43.   Clause 27.13(d) (Credit appraisal by the Banks) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      "(d)  the adequacy, accuracy and/or completeness of the Initial Business
            Plan, the 2002 Revised Business Plan, the Information Memorandum,
            Legal Due Diligence Report and any other information provided by an
            Agent, any Finance Party or by any other person under or in
            connection with any Transaction Document, the transactions
            contemplated by the Transaction Documents or any other agreement,
            arrangement or document entered into, made or executed in
            anticipation of, under or in connection with any Transaction
            Document."

44.   Clause 27.13(d) (Credit appraisal by the Banks) of the Original Facility
      Agreement is amended by deleting such clause in its entirety and replacing
      it with the following:

      "7.   Set Off

      A Finance Party may set off any matured obligation due from the Borrower
      under the Finance Documents (to the extent beneficially owned by that
      Finance Party) against any matured obligation owed by that Finance Party
      to the Borrower, regardless of the place of payment, booking branch or
      currency of either obligation. If the obligations are in different
      currencies, the Finance Party may for the purpose of the set off convert
      either obligation at a market rate of exchange in its usual course of
      business or, in the case of a SIT Facility Bank, at the relevant exchange
      rate from the list of Nova Ljubljanska banka d.d., Ljubljana for the
      foreign exchange transactions with legal entities (Tecajna lista Nove
      Ljubljanske banka d.d., Ljubljana, za obracun deviznih prilivov in odlivov
      podjetij) or any other applicable document of Nova Ljubljanska banka d.d.,
      Ljubljana with essentially similar substance."

45.   Clause 2 (Utilisation of a Loan) of Schedule 4A (Utilisation Request
      (Borrower)) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "2.   Utilisation of a Loan

            We wish to borrow a Loan on the following terms:




                                                   
        Proposed Utilisation Date:                    [-] (or, if that is not a Business Day, the next
                                                      Business Day)

        Facility to be utilised:                      [Commercial Facility]/ [SIT Facility]

        Currency of Loan:                             [Euro]/[SIT]

        Amount:                                       [-] or, if less, the Available Facility

        Interest Period:                              [-] (subject to Clause 10 of the Agreement)

        Account to which proceeds are payable:        Proceeds and Revenue Account [account number] [for
                                                      further transfer in respect of Euro Facility Loans
                                                      to the Loan Proceeds Account]"


46.   Clause 4 of Schedule 4A (Utilisation Request (Borrower)) of the Original
      Facility Agreement is amended by deleting such clause in its entirety and
      replacing it with the following:

      "4.   We confirm that the [proceeds of the Loan]/[guarantee]/[letter of
            credit] [are]/[is] to be used [in payment of capital expenditure as
            provided for in the [Business Plan]]/[in payment of operational
            expenditure as provided for in the [Business Plan]]/[towards
            repayment of amounts owing under the Existing WWIC Loan
            Agreement]/[other]."

47.   Clause 6 of Schedule 4B (Utilisation Request (Payments to Equipment
      Vendor)) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "6.   We attach a copy of a certificate executed by the Borrower and
            referring to the final acceptance of the delivered systems (from the
            Initial Configuration).***"

48.   Schedule 9 (Security Documents - Conditions Precedent and Conditions
      Subsequent) of the Original Facility Agreement is amended by deleting such
      schedule in its entirety and replacing it with the following:

***   Only in respect of a Utilisation Request completed with reference to
      Section 1.10.2 (b) (iii) of the Delivery Contract.


                                   "SCHEDULE 9
       SECURITY DOCUMENTS - CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT

                                     GENERAL



                                                      STEPS FOR PERFECTION

            CONDITION PRECEDENT TO DRAWDOWN                                              CONDITION SUBSEQUENT
            -------------------------------                                              --------------------
                                                                     
- -     Translation of Facility Agreement into the
      Slovenian language

- -     Summary and Translation of Hedging Agreement into
      the Slovenian language

- -     Certified copies of the extract of commercial
      register for Borrower, Shareholders, Senior
      Creditors

- -     Legal opinion of Selih that all security                          -     Once perfected an additional legal opinion of
      documents have been duly executed and are legal,                        Selih that the security documents create the
      valid and binding obligations                                           security which they purport to create

- -     Power of Attorney (for signing of all on shore
      securities agreements) of Senior Creditors
      authorising representative of the Off Shore
      Facility Agent to sign all on shore security
      documents plus complete all formalities necessary
      for the perfection of the pledge where applicable

- -     Only for the Asset and Licence Pledge and Lease
      Contracts Assignment Agreement, Trade Mark Pledge
      Agreement and Share Pledge Agreement: Power of
      Attorney in the English language signed by each
      Senior Creditor, with a notarial confirmation of
      the authorisation of the person who signs on
      behalf of each Senior Creditor to sign on behalf
      of the particular Senior Creditor
      (Vertretungsbestatigung) and confirmation of its
      signature (Unterschriftenbeglaubigung) and
      apostilled, authorising Nina Selih/Rudi Selih to
      enter into notarial deeds in relation to all
      relevant security documents

- -     Such other requirements as may be reasonably
      required to complete, register and perfect the
      Security Documents




                               ON SHORE DOCUMENTS




    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
ASSET AND LICENCE    Pledged               -    Execution of Asset Pledge,
PLEDGE AND LEASE     Equipment                  Licence Transfer, Licence
CONTRACTS                                       Pledge and Lease Contracts
ASSIGNMENT                                      Assignment Agreement
AGREEMENT

                                           -    Execution of notarial deed in
                                                respect of Pledged Equipment

                                           -    Provide Schedule 1, 2 & 3 to        -    Competent court officer must
                                                the Asset and Licence Pledge             take record of the pledged
                                                and Lease Contracts                      assets, make lists of pledged
                                                Assignment Agreement -                   assets per site and mark the
                                                provide missing addresses of             pledged assets by putting
                                                sites and relevant court                 stickers on them (Court officer
                                                districts, as well as modify             when visiting sites to be
                                                designation (description) of             accompanied by WWI technical
                                                certain items (confirmed by              staff) Borrower shall have
                                                Sami Ali and N. Selih)                   achieved 50% after 6 months
                                                                                         following the date of signing
                                                                                         of the Facility Agreement

                                                                                    -    Within 9 months of signing of
                                                                                         the Facility Agreement, On
                                                                                         Shore Security Agent to check
                                                                                         conformity of Schedule 1 with
                                                                                         the lists issued by the court;
                                                                                         Nina Selih to give notice of
                                                                                         receipt of the list
                                           -    Application by Selih for
                                                registration of the Asset
                                                Pledge in respect of the
                                                Pledged Equipment with the
                                                competent court (depending on
                                                where each asset is located)

                                           -    Pay notary fees and
                                                application fees for
                                                registration, Nina Selih to
                                                advise Steven Fast of bank
                                                account for fee to be paid
                                                into, Steven Fast to provide
                                                proof of payment (e.g. bank
                                                statement

                                           -    Copies of the building
                                                permits for sites on which
                                                Pledged Equipment is situated

                     Pledged                                                        -    1 month after first drawdown,
                     Equipment II                                                        under the Commercial Facility,
                     and                                                                 confirm to On Shore Security
                     Substitution                                                        Agent that title in respect of
                     Equipment                                                           Pledged Equipment II has passed

                                                                                    -    During the first 9 Months after
                                                                                         the date of signing of the
                                                                                         Facility Agreement provide to
                                                                                         the On Shore Security Agent 10
                                                                                         Business days after the end of
                                                                                         each Month a list with those of
                                                                                         the 41 sites for which a
                                                                                         building permit has been issued.






    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                                                                    -    Within 10 months after the date
                                                                                         of signing of the Facility
                                                                                         Agreement execution of notarial
                                                                                         deed in respect of Pledged
                                                                                         Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable

                                                                                    -    Within 10 months after the
                                                                                         signing of the Facility
                                                                                         Agreement filing of application
                                                                                         of Pledged Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable

                                                                                    -    Pay notary fees and application
                                                                                         fees for registration, Nina
                                                                                         Selih to advise Steven Fast of
                                                                                         bank account for fee to be paid
                                                                                         into, Steven Fast to provide
                                                                                         proof of payment (e.g. bank
                                                                                         statement)

                                                                                    -    Within 14 months of signing of
                                                                                         Facility Agreement, competent
                                                                                         court officer must take record
                                                                                         of the Pledged Equipment II,
                                                                                         make a list of pledged assets
                                                                                         per site and mark the pledged
                                                                                         assets by putting stickers on
                                                                                         them

                                                                                    -    Within 14 months of signing of
                                                                                         the Facility Agreement, On
                                                                                         Shore Security Agent to check
                                                                                         conformity of Schedule 2 with
                                                                                         the lists issued by the court;
                                                                                         Nina Selih to give notice of
                                                                                         receipt of the list

                     Licence               -    Copy of concession                  -    Within 5 business days of issue
                                                                                         of licence, inform On
                                                                                         Shore and Off Shore
                                                                                         Security Agent and send
                                                                                         copy

                                           -    Copy of application / bid           -    Within 2 month after issue of
                                                                                         licence enter into the
                                                                                         contractual pledge (as
                                                                                         attached as a Schedule to
                                                                                         Asset Pledge)

                                           -    Certificate that as of the          -    Borrower to sign Power of
                                                date of signing of the                   Attorney as set out in
                                                Facility Agreement no                    Schedule 10 (once licence
                                                change/amendment of/to the               granted)
                                                Concession Agreement has
                                                been made

                     Leases                -    Evidence of filing of the           -    Borrower to provide originals
                                                applications for the                     of consent letter from
                                                registration of the 40 lease             Landlords I, II and
                                                site agreements (except for              Substitution Landlords
                                                the 13 leases entered with               confirming the consent to the
                                                Elektro Slovenia and its                 conditional assignment within
                                                affiliates and RTV and its               9 Months from the date of
                                                affiliates) with the                     signing of the Facility
                                                competent courts in                      Agreement:
                                                accordance with
                                                Clauses 11.4(f) and 12.4(b)
                                                of the Asset and Licence
                                                Pledge and Lease Contracts
                                                Assignment; Agreement

                                           -    Copies of Leases I and II and
                                                Substitution Lease (as
                                                applicable)






    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                                                                    -    File for registration of
                                                                                         Substitution Leases
                                                                                         (applicable only in case
                                                                                         of substitution pledge)
                                                                                         and, where applicable,
                                                                                         provide the consent of the
                                                                                         relevant Substitution
                                                                                         Landlords to the
                                                                                         Substitution Assignment
                                                                                         within 10 Months from the
                                                                                         date of signing of the
                                                                                         Facility Agreement

                                                                                    -    Inform the On Shore Security
                                                                                         Agent immediately of
                                                                                         rejection of filed
                                                                                         applications for
                                                                                         registration of the
                                                                                         relevant leases in respect
                                                                                         of the 40 site leases
                                                                                         (except for the 13 site
                                                                                         leases entered with
                                                                                         Elektro Slovenia and its
                                                                                         affiliates and RTV and its
                                                                                         affiliates) (eg where
                                                                                         building permit missing)
                                                                                         after becoming aware of
                                                                                         such rejection and of
                                                                                         refilling of the
                                                                                         application

                                                                                    -    Within 20 Months from the date
                                                                                         of signing of the Facility
                                                                                         Agreement, register the
                                                                                         relevant leases in respect
                                                                                         of the 40 site leases
                                                                                         (with the exception of the
                                                                                         13 site leases entered
                                                                                         with Elektro Slovenia and
                                                                                         its affiliates and RTV and
                                                                                         its affiliates) with the
                                                                                         Land Registers

BORROWER'S SHARE     Shares                -    Execution of agreement              -    Within 2 Months from the date
PLEDGE AGREEMENT                                                                         of the signing of the
                                                                                         Facility Agreement to
                                                                                         register the share pledge
                                                                                         with the Register of
                                                                                         Commercial Companies
                                                                                         (there must be an
                                                                                         obligation for the
                                                                                         Borrower in the Facility
                                                                                         Agreement to provide
                                                                                         evidence for such
                                                                                         registration)

                                           -    Execution of notarial deed in       -    Provide evidence of
                                                respect of pledged equipment             registration within 9
                                                                                         Months from the date of
                                                                                         signing of the Facility
                                                                                         Agreement
                                           -    Submission to the competent
                                                court in Ljubljana of the
                                                application for the
                                                registration of the share
                                                pledge with the Register of
                                                Commercial Companies

                                           -    Pay notary fees and
                                                application fees for
                                                registration of the pledge,
                                                Nina Selih to advise Steven
                                                Fast of bank account for fee
                                                to be paid into, Steven Fast
                                                to provide proof of payment
                                                (e.g. bank statement) and the
                                                escrow agreement relating to
                                                the holding of such envelope

TRADEMARK PLEDGE     Trademarks            -    Execution of agreement              -    Within 9 months from signing of
AGREEMENT                                                                                the Facility Agreement
                                                                                         provide evidence of
                                                                                         registration of the TM
                                                                                         Pledge by the Patent Office






    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
                                           -    Withdraw 2 outstanding
                                                applications for registration
                                                of the trademarks "EHO" and
                                                "VIVA" and provide to the On
                                                Shore Security Agent evidence
                                                of such withdrawal at the
                                                latest 10 Business Days
                                                before it makes the first
                                                Utilisation Request under the
                                                Facility Agreement

                                           -    Borrower's consent to
                                                registration of the pledge
                                                (Schedule 5)

                                           -    Submission to the Patent
                                                Office of application to
                                                register the TM Pledge

                                           -    Pay notary fees and
                                                application fees for
                                                registration, Nina Selih to
                                                advise Steven Fast of bank
                                                account for fee to be paid
                                                into, Steven Fast to provide
                                                proof of payment (e.g. bank
                                                statement)

SOFTWARE LICENSE     Oracle Software       -    Execution of agreement
ASSIGNMENT           License
AGREEMENT            Agreement

                                           -    Schedule 2 - Copy of Deed of
                                                Consent and Waiver

                                           -    Schedule 1 (Oracle License
                                                Agreement)

ASSIGNMENT OF        Receivables           -    Signing of agreement
RECEIVABLES AS
SECURITY AND
ASSIGNMENT OF
INSURANCE POLICIES
AGREEMENT

                                           -    Borrower to provide Schedule
                                                1 complete information

                                           -    Sealed Envelope (containing
                                                details of all subscribers
                                                (natural persons) must be
                                                submitted to the notary,
                                                identified in the Assignment
                                                of Receivables as Security
                                                and Assignment of Insurance
                                                Policies Agreement

                     Insurance             -    Copies of the insurance
                                                policies as required under
                                                the Facility Agreement

                                           -    Original vinculation
                                                certificates

                                           -    Borrower to provide Schedule
                                                2 (list of insurances,
                                                amounts, claims)






    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
CLAIMS ASSIGNMENT    Claims                -    Signing of agreement
AND BILLS OF
EXCHANGE AGREEMENT
                                           -    Notarised copies of account
                                                agreements (NLB + Hypo
                                                Alpe-Adria Bank) must be
                                                submitted to the Off Shore
                                                Facility Agent

                                           -    Acknowledgement by NLB and
                                                Hypo Alpe-Adria Bank

                                           -    Schedule 1 (account details)

                     Bills of              -    Provide set of 10 bills of
                     Exchange                   exchange duly signed and
                                                filled in only with the date
                                                of issuance (Schedule 5)

                                           -    Confirmation by holders of
                                                bills of exchange that they
                                                will inform NLB at the latest
                                                5 Business Days before
                                                presenting any bills of
                                                exchange to NLB


                          OFF SHORE SECURITY DOCUMENTS



    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
INTERCREDITOR                              -    Execution of the agreement
AGREEMENT

DELIVERY CONTRACT                          -    Execution of the agreement
CLAIMS AND
ASSIGNMENT                                 -    Execution and provision of
AGREEMENT                                       the Security Interest
                                                Provision Permission Agreement

SECURITY                                   -    Execution of the agreement
ASSIGNMENT OF                                   (in the form of a deed) and
RIGHTS UNDER A                                  evidence thereof
SUPPLY AND LICENSE
AGREEMENT                                  -    Execution of the Deed of
                                                Consent and Waiver and
                                                evidence thereof

                                           -    Give notice of assignment to
                                                Protek Flagship (UK) Ltd

SPONSOR CASH         Cash Collateral       -    Execution of the pledge
COLLATERAL ACCOUNT   Account                    agreement
PLEDGE AGREEMENT
                                           -    Acknowledgement by the
                                                Account Bank (IKB
                                                International S.A.)

                                           -    Required cash collateral to
                                                be paid into the account

DEBT SERVICE         Debt Service          -    Execution of the pledge             -    5 business days after first
RESERVE ACCOUNT      Reserve Account            agreement                                utilisation to be funded with
PLEDGE AGREEMENT                                                                         the DSRA-Required Balance
                                           -    Acknowledgement by the
                                                Account Bank (IKB
                                                International S.A.)

PLEDGE AGREEMENT     Shares                -    Execution of the pledge
(NY)                                            agreement;

                                           -    Delivery of all original
                                                certificated shares to the
                                                Secured Party;

                                           -    Delivery of a stock power
                                                endorsed in blank to the
                                                Secured Party; and

                                           -    The filing of a UCC-1
                                                Financing Statement




       SUBSTITUTION CONDITIONS SUBSEQUENT FOR ON SHORE SECURITY DOCUMENTS

In case under Slovenian law moveable assets may validly be pledged by
registering the respective assets with an official register the following
conditions subsequent shall, at the request of the Off Shore Security Agent,
replace the conditions subsequent for the secured Assets "Pledged Equipment II
and Substitution Equipment" under the Asset and Licence Pledge and Lease
Contracts Assignment Agreement set out above in the table "On Shore Security
Documents" in the column "Conditions Subsequent" and for such purpose the
Borrower shall enter into all necessary documentation to give effect hereto.



    DOCUMENT        SECURED ASSETS                                    STEPS FOR PERFECTION
    --------        --------------         ---------------------------------------------------------------------------------
                                           CONDITION PRECEDENT TO DRAWDOWN                   CONDITION SUBSEQUENT
                                           -------------------------------          ----------------------------------------
                                                                           
ASSET AND         Pledged Equipment                                                 -    1 month after first drawdown,
LICENCE PLEDGE    II and                                                                 under the Commercial Facility,
AND LEASE         Substitution                                                           confirm to On Shore Security
CONTRACTS         Equipment                                                              Agent that title in respect of
ASSIGNMENT                                                                               Pledged Equipment II has passed
AGREEMENT

                                                                                    -    During the first 9 Months after
                                                                                         the date of signing of the
                                                                                         Facility Agreement provide to
                                                                                         the On Shore Security Agent 10
                                                                                         Business days after the end of
                                                                                         each Month a list with those of
                                                                                         the 41 sites for which a
                                                                                         building permit has been issued.

                                                                                    -    Within 10 months after the date
                                                                                         of signing of the Facility
                                                                                         Agreement execution of notarial
                                                                                         deed in respect of Pledged
                                                                                         Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable

                                                                                    -    Within 7 months after
                                                                                         establishment of the Slovenian
                                                                                         Official Register of the
                                                                                         Pledged Moveables and Pledges
                                                                                         (Uradni Registar Zarubljenih
                                                                                         Premicnin in Zastavnih Pravic)
                                                                                         filing of application for
                                                                                         registration of Pledged
                                                                                         Equipment II and any
                                                                                         Substitution Equipment, if
                                                                                         applicable and provision of
                                                                                         evidence of such filing to Nina
                                                                                         Selih

                                                                                    -    Pay notary fees, Nina Selih to
                                                                                         advise Steven Fast of bank
                                                                                         account for fee to be paid
                                                                                         into, Steven Fast to provide
                                                                                         proof of payment (e.g. bank
                                                                                         statement)
"




49.   Clauses 4 to 6 of Schedule 10 (Form of Transfer Certificates) of the
      Original Facility Agreement are amended by deleting such clauses in its
      entirety and replacing it with the following:

      "4.   This Transfer Certificate may be executed in any number of
            counterparts and this has the same effect as if the signatures on
            the counterparts were on a single copy of this Transfer Certificate.

      5.    The Existing Bank hereby transfers in favour of the New Bank [all]
            [%] of its interest in the amount of Euro [-] in the following
            Security Documents:

            [NOTE: INSERT DESCRIPTION OF ALL RELEVANT SECURITY DOCUMENTS]

      6.    Save for the provisions of paragraph 5 above (which shall be
            governed by and construed in accordance with Slovenian law), this
            Transfer Certificate and the rights and obligations of the parties
            hereunder shall be governed by and construed in accordance with
            German law."

50.   Schedule 11 (Security Documents - Conditions Precedent and Conditions
      Subsequent) of the Original Facility Agreement is amended by deleting such
      schedule in its entirety and replacing it with the following:

                                  "SCHEDULE 11
                                    INSURANCE

      The Borrower shall comply with the insurance policies in force at the date
      of this Agreement and shall enter into, perform and execute the
      requirements of an insurance schedule to be agreed between the Borrower
      and the Off Shore Facility Agent (each acting in good faith) by 30
      November 2002, such schedule shall replace this Schedule 11."

51.   Clause 2 of the letter of Schedule 12 (Confirmation from the Equipment
      Vendor) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "2.   We hereby confirm that the Delivery Contract was concluded on [-]
            and amended on [-] and has come into force on [-] and is still in
            full force and effect, that all permissions necessary have been
            granted and that we have received a down payment in relation to 15 %
            of the Estimated Contract Value in an amount of Euro 9,138,427 which
            is evidenced by the enclosed bank receipts."

52.   Clause 2.(f) of the letter of Schedule 14 (Covenant Compliance
      Certificate) of the Original Facility Agreement is amended by deleting
      such clause in its entirety and replacing it with the following:


      "(f)  EBITDA was [-] and the variance from the 2002 Revised Business Plan
            of [-] was [-];"

53.   Clause 2.(2) of the letter of Schedule 15 (Project Status and Progress
      Report) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(2)  a detailed and full description of the status of the installation of
            the Network in comparison to the most recent Business Plan
            (including information in respect of the two LACs in Ljubljana and
            one LAC in Maribor that are required by Clause 22.2(e) (Stage I
            covenants) to become Closed LACs and information on the road
            coverage of the highways as more particularly described in Schedule
            19 of the Agreement) and the status of all national roaming
            agreements;"

54.   Clause 2.(10) of the letter of Schedule 15 (Project Status and Progress
      Report) of the Original Facility Agreement is amended by deleting such
      clause in its entirety and replacing it with the following:

      "(10) an update of the sales and marketing strategy report comprised in
            the 2002 Revised Business Plan and covering subscriber acquisition
            cost, marketing cost and handset and other subsidies; and"

55.   The Original Facility Agreement is amended by including the following
      Schedule 19 (Additional Coverage Requirement) including attachments and
      annex thereto after Schedule 18 (Initial Report of the Independent
      Technical Consultant) of the Original Facility Agreement:

                                  " SCHEDULE 19
                        ADDITIONAL COVERAGE REQUIREMENTS

1.    DEFINITIONS

      "LAC" means a Location Area Code which is a fixed length code identifying
      a location area within Mobitel's(6) network, the geographical areas of
      each LAC within Slovenia are shown in Annex 1 (LAC codes in Slovenia )(7).

      "CONTIGUOUS ROAD COVERAGE" means coverage of the Slovenian roads (marked
      red in the map attached as Annex 2 (Slovenian roads coverage)), to the
      extent of at least 90% of the total length of such marked roads with the
      Borrower's own Network, unless otherwise indicated measured at a receive
      signal level of -100 dBm or better, excluding any coverage derived from
      roaming agreements.

(6)   Reference is made to the National Roaming Agreement, dated 9th November
      2001, between the Borrower and Mobitel Telekomunikacijske storitve d.d..

(7)   Annex 2 shall indicate the most up to date Mobitel coverage maps showing
      each LAC and corresponding code.


      "CLOSED LAC" means:

      (a)   the coverage with the Borrower's own Network corresponding to the
            predicted coverage maps as shown in Annex 3 (LACs in Ljubljana) and
            4 (LAC in Maribor), such prediction based on the base stations being
            "on air" as defined in Annex 5 (Base stations being "on air"); and

      (b)   forbidding any of the Borrower's Subscribers from performing
            location updates on or handovers to any cells of BTS within the
            geographical areas of Mobitel's network corresponding to LAC codes
            11, 14, 28 and 39 as shown in Annex 1 (LAC codes in Slovenia ).

2.    LAC

      The Borrower shall ensure, by the dates set out in the Agreement, that the
      three LACs in Ljubljana and one LAC in Maribor, as indicated in Annex 3
      (LACs in Ljubljana) and 4 (LAC in Maribor) respectively have become Closed
      LACs and shall provide evidence of the same to the satisfaction of the
      Independent Technical Consultant by the times provided for in the
      Agreement (together with such other information as the Off Shore Facility
      Agent and the Independent Technical Consultant may reasonably require).

3.    CONTIGUOUS ROAD COVERAGE

      The Borrower shall provide to the Off Shore Facility Agent, at the times
      set forth in the Agreement, evidence of Contiguous Road Coverage in form
      and substance satisfactory to the Independent Technical Consultant. The
      Borrower shall perform drive tests using such tools as described in
      Schedule 17 (Population Coverage Verification) of the Facility Agreement
      to demonstrate that there is Contiguous Road Coverage (for the avoidance
      of doubt, measurements shall be valid only when the terminal is in
      dedicated mode).


                                     ANNEX 1
                          MAP OF LAC CODES IN SLOVENIA




                                     ANNEX 2
                        MAP OF SLOVENIAN ROADS COVERAGE





                                     ANNEX 3
                            MAP OF LACS IN LJUBLJANA




                                     ANNEX 4
                             MAP OF LAC IN MARIBOR





                                     ANNEX 5
                      MAP OF BASE STATIONS BEING "ON AIR"






                 SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT
                       RELATING TO THE FACILITY AGREEMENT

THE BORROWER
WESTERN WIRELESS INTERNATIONAL D.O.O.


By:               JULIEN COUSTAURY
                  Name: Julien Coustaury
                  Title: Director

Address:          Brnciceva ulica 49, 1231 Ljubljana, Slovenia
Telephone:        +386 1 5801 200
Fax:              +386 1 5801 109
Attention of:     Steven Fast

LEAD ARRANGER, OFF SHORE SECURITY AGENT, OFF SHORE FACILITY AGENT AND ORIGINAL
EURO FACILITY BANK
IKB DEUTSCHE INDUSTRIEBANK AG


By:               JAN-HENRIK RUFER                 MANFRED ZIWEY
                  ----------------                 -------------
                  Name: Jan-Henrik Rufer           Name:  Manfred Ziwey
                  Title: Assistant Director        Title: Director

Address:          Wilhelm-Botzkes-Stra(beta)e 1, 40474 Dusseldorf, Germany
Telephone:        +49 211 8221 4887 or +49 211 8221 4730
Fax:              +49 211 8221 2887 or +49 211 8221 2730
Attention of:     Martina Messing or Andreas Nestel

LEAD ARRANGER AND ORIGINAL EURO FACILITY BANK
KREDITANSTALT FUR WIEDERAUFBAU


By:               MR. KASSEL                       MRS. SIMON
                  ----------                       ----------
                  Name: Mr. Kassel                 Name: Mrs. Simon
                  Title: First Vice President      Title: Senior Project Manager

Address:          Palmengartenstra(beta)e 5-9, 60325 Frankfurt am Main, Germany
Telephone:        +49 69 7431 3927
Fax:              +49 69 7431 2258
Attention of:     Reiner Prove



          SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO
                             THE FACILITY AGREEMENT

SENIOR CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
RAIFFEISENLANDESBANK OBEROSTERREICH REG.GEN.M.B.H.


By:               DR. HELMUT SCHUTZENEDER          DR. LAMBERT HOFBAUER
                  -----------------------          --------------------
                  Name: Dr. Helmut Schutzeneder    Name: Dr. Lambert Hofbauer
                  Title: Member of the Board       Title: Authorised Signatory

Address:          Raiffeisenplatz 1, 4021 Linz, Austria
Telephone:        +43 732 6596 3170
Fax:              +43 732 6596 3131
Attention of:     Dr. Lambert Hofbauer

SENIOR CO-ARRANGER, ON SHORE SECURITY AGENT, ON SHORE FACILITY AGENT AND
ORIGINAL SIT FACILITY BANK
NOVA LJUBLJANSKA BANKA D.D., LJUBLJANA


By:               TOMAZ JEZERC                     JOZE GASPER FILIPIC
                  ---------------                  -----------------------
                  Name: Tomaz Jezerc               Name: Joze Gasper Filipic
                  Title: General Manager           Title: Executive Director

Address:          Smartinska 130, SI - 1520 Ljubljana, Slovenia
Telephone:        +386 1 520 7273
Fax:              +386 1 425 60 02
Attention of:     Ms. Jasna Istenic or Mr. Bostjan Kovac

CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
LANDESBANK SCHLESWIG-HOLSTEIN GIROZENTRALE


By:               GERHARD DITTMER                    HARALD PERSSON
                  ---------------                    --------------
                  Name: Gerhard Dittmer              Name: Harald Persson
                  Title: Assistant Vice President    Title: Vice President

Address:          Martensdamm 6, 24103 Kiel, Germany
Telephone:        +431 900 1572
Fax:              +431 900 2744
Attention of:     Klaus-Volker Lenk



SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO
THE FACILITY AGREEMENT

CO-ARRANGER AND ORIGINAL EURO FACILITY BANK
HYPO ALPE-ADRIA-BANK AG


By:               WALTER BLEYER                      ORTRUN SUPPANZ
                  -------------                      --------------
                  Name: Walter Bleyer                Name: Ortrun Suppanz
                  Title: Senior Vice President       Title: Senior Lending
                                                            Officer

Address:          Stock im Eisen-Platz 3, 1010 Wien, Austria
Telephone:        +43 1 512 8266
Fax:              +43 1 512 8266 6990
Attention of:     International Finance

ORIGINAL SIT FACILITY BANK
HYPO ALPE-ADRIA-BANK D.D.


By:               HARALD BRUNNER                     URBAN GOLOB
                  --------------                     -----------
                  Name: Harald Brunner               Name: Urban Golob
                  Title: Member of the Board         Title: Prokurist,
                                                            Corporate, Head of
                                                            Division

Address:          Trg Osvobodilne fronte 12
                  PO Box 1601, SI - 1001 Ljubljana, Slovenia
Telephone:        +386 1 300 4400
Fax:              +386 1 300 4401
Attention of:     Mr. Harald Brunner



          SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO
                             THE FACILITY AGREEMENT

ACKNOWLEDGEMENT

By signing hereunder, each Sponsor and Shareholder acknowledges and consents to
the terms and conditions of this Agreement and of the amendments made to the
Original Facility Agreement.

Each Sponsor and Shareholder confirms that it is not aware of any circumstances
which would prejudice the entry into, performance, validity and enforceability
of this Agreement by any party hereto or of any transaction contemplated herein.
Each Sponsor and Shareholder represents that no obligation of any Sponsor or
Shareholder to any Senior Creditor under any Finance Document, in particular the
Sponsor's and Shareholders' Undertaking and Completion Guarantee, is adversely
affected by this Agreement, any amendment to the Original Facility Agreement or
any transaction contemplated herein.

THE SPONSORS

WESTERN WIRELESS INTERNATIONAL CORPORATION


By:               SCOTT ALDERMAN
                  Name:  Scott Alderman
                  Title: Vice President

Address:          3650 131st Avenue, S.E., Suite 400, Bellevue,
                  Washington 98006, USA
Telephone:        +1 425 586 8161
Fax:              +1 425 586 8777
Attention of:     Scott Alderman

WESTERN WIRELESS INTERNATIONAL SLOVENIA CORPORATION


By:               SCOTT ALDERMAN
                  Name:  Scott Alderman
                  Title: Vice President

Address:          3650 131st Avenue, S.E., Suite 400, Bellevue,
                  Washington 98006, USA
Telephone:        +1 425 586 8161
Fax:              +1 425 586 8777
Attention of:     Scott Alderman


          SIGNATURE PAGE OF THE FIRST AMENDMENT AGREEMENT RELATING TO
                             THE FACILITY AGREEMENT

WESTERN WIRELESS INTERNATIONAL SLOVENIA II CORPORATION


By:               SCOTT ALDERMAN
                  Name:  Scott Alderman
                  Title: Vice President

Address:          3650 131st Avenue, S.E., Suite 400, Bellevue,
                  Washington 98006, USA
Telephone:        +1 425 586 8161
Fax:              +1 425 586 8777
Attention of:     Scott Alderman

EX-21.1

                         Exhibit 21.1 - Subsidiaries

Subsidiary                            Jurisdiction of Incorporation/Organization
- ----------                             -----------------------------------------

Western Wireless Corporation                                    Washington
Western CLEC Corporation                                        Delaware
WWC CLEC Holding Corporation                                    Delaware
WWC Paging Corporation                                          Washington
WWC Systems Purchasing Corporation                              Delaware
WWC License Holding LLC                                         Delaware
WWC License LLC                                                 Delaware
WWC Texas RSA Holding Corporation                               Delaware
WWC Texas RSA Limited Partnership                               Delaware
WWC Holding Co., Inc.                                           Delaware
Western COG Corporation                                         Delaware
Cellular One L.L.C.                                             Delaware
Cellular One Group                                              Delaware
Western Wireless International Holding Corporation              Delaware
Western Wireless International Corporation                      Delaware
Western Wireless International Ireland Corporation              Delaware
Western Wireless International Ghana Corporation                Delaware
Western Wireless International Haiti Corporation                Delaware
Western Wireless International Austria Corporation              Delaware
Western Wireless International Georgia Corporation              Delaware
Western Wireless International Iceland Corporation              Delaware
Western Wireless International SakSat Corporation               Delaware
Western Wireless International Bolivia Corporation              Delaware
Western Wireless International Bolivia II Corporation           Delaware
Western Wireless International Bolivia III Corporation          Delaware
Western Wireless International Ivory Coast Corporation          Delaware
Western Wireless International Ivory Coast II Corporation       Delaware
Western Wireless International Paraguay Corporation             Delaware
Western Wireless International Slovenia Corporation             Delaware
Western Wireless International Slovenia II Corporation          Delaware
Western Wireless International Croatia Corporation              Delaware
Western Wireless International Enterprises, Inc.                Delaware
Western Wireless International II Corporation                   Delaware
CCIH, L.L.C.                                                    Delaware
Meteor II Limited                                               Ireland
Meteor Mobile Holdings Limited                                  Ireland
Meteor Mobile Communications                                    Ireland
ACG Telesystems Ghana LLC                                       Delaware
Western Telesystems Ghana Limited                               Ghana
Communications Cellulaire d'Haiti, S.A.                         Haiti
EHG Einkaufs- und Handels GmbH                                  Austria
tele.ring Telekom Service GmbH & Co KEG                         Austria
tele.ring Telekom Service GmbH                                  Austria
Ekom 3G GmbH                                                    Austria
Telcell Wireless LLC                                            Delaware
Magticom GSM                                                    Georgia
TAL hf                                                          Iceland
Islandia ehf                                                    Iceland
Lina Net                                                        Iceland
SakSat, LLC                                                     Delaware
SakSat-Georgia, Ltd.                                            Georgia
NuevaTel (PCS de Bolivia) S.A.                                  Bolivia
Cora de Comstar S.A.                                   Republic of Cote d'Ivoire
Western Wireless International d.o.o                            Slovenia
VIP - Net GMS d.o.o                                             Croatia

EX-23.1

                                                                    Exhibit 23.1

                        CONSENT OF INDEPENDENT ACCOUNTS


We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (No. 333-10421, No. 333-86437, No. 333-18137 and No.
333-28959) of Western Wireless Corporation of our report dated February 25, 2003
relating to the consolidated financial statements and financial statement
schedules, which appears in this Form 10-K.



PricewaterhouseCoopers LLP




Seattle, Washington
March 24, 2003