~~Table~~ SECURITIES ofAND ~~Contents~~EXCHANGE COMMISSION

~~SECURITIES AND EXCHANGE~~Washington, D.C. ~~COMMISSION~~20549

~~Washington,~~Form ~~D.C.~~10-K ~~20549~~

Form 10-K


(Mark One)

þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the fiscal year ended December 31, 2007
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the transition period from to

(Mark One)
þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the fiscal year ended December 31, 2006
o		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: 0-21213

~~Commission~~LCC ~~file number:~~ International, ~~0-21213~~Inc.

~~LCC~~(Exact ~~International,~~Name of Registrant as ~~Inc.~~Specified in Its Charter)

(Exact Name of Registrant as Specified in Its Charter)


Delaware (State or Other Jurisdiction of Incorporation or Organization)		54-1807038 (I.R.S. Employer Identification No.)
7900 Westpark Drive McLean, VA (Address of Principal Executive Offices)		22102 (Zip Code)

Delaware (State or Other Jurisdiction of Incorporation or Organization)		54-1807038 (I.R.S. Employer Identification No.)
7900 Westpark Drive McLean, VA (Address of Principal Executive Offices)		22102 (Zip Code)

Registrant’s telephone number, including area code:

~~Registrant’s telephone number, including area code:~~(703) 873-2000

Securities registered pursuant to Section 12(~~703~~b) ~~873-2000~~ of the Act:

~~Securities~~Class A ~~registered~~Common ~~pursuant~~Stock, topar ~~Section 12(b)~~value of$.01 ~~the~~per share ~~Act:~~

~~Class A~~Securities ~~Common~~registered ~~Stock,~~pursuant ~~par~~to ~~value $.01~~Section ~~per~~12(g) ~~share,~~of the ~~registered on The NASDAQ Stock Market LLC~~Act:

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

~~Not~~Indicate ~~Applicable~~by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(~~Title~~d) of ~~Class)~~the Act. Yes o No þ

Indicate by check mark ifwhether the registrant is(1) has ~~a well-known~~filed ~~seasoned~~all ~~issuer,~~reports asrequired ~~defined~~to inbe ~~Rule~~filed by Section ~~405~~13 ofor 15(d) of the Securities Exchange Act of 1934 during the preceding ~~Act~~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 oþ No þo

IfIndicate ~~this~~by ~~report~~check ismark anif ~~annual~~disclosure orof ~~transition~~delinquent ~~report,~~filers pursuant ~~indicate~~to byItem 405 of ~~check~~Regulation S-K is ~~mark~~not ifcontained ~~the~~herein, ~~registrant~~and iswill not ~~required~~be contained, to ~~file~~the ~~reports~~best ~~pursuant~~of toregistrant’s ~~Section 13~~knowledge, in definitive proxy or information ~~15(d)~~statements ofincorporated ~~the~~by ~~Securities~~reference ~~Exchange~~in ~~Act~~Part III of this ~~1934~~Form 10-K or any amendment to this Form 10-K. ~~Yes~~ o ~~No þ~~

Indicate by check mark whether the registrant~~: (1) has~~ ~~filed~~is ~~all~~a ~~reports~~large accelerated ~~required~~filer, toan beaccelerated ~~filed~~filer, bya non-accelerated ~~Section 13~~filer, or ~~15(d)~~a ofsmaller ~~the~~reporting ~~Securities~~company. ~~Exchange~~See ~~Act~~the ofdefinitions ~~1934~~of ~~during~~“large ~~the~~accelerated ~~preceding~~filer,” ~~12 months (or for such shorter period~~“accelerated ~~that~~filer” ~~the~~and ~~registrant~~“smaller ~~was~~reporting ~~required~~company” ~~to file such reports) and~~in ~~(2)~~Rule ~~has~~12b-2 of ~~been~~the ~~subject~~Exchange toAct. ~~such~~(Check ~~filing requirements for the~~one): past 90 days. Yes o No þ *

~~Indicate~~Large byaccelerated ~~check~~filer ~~mark~~o ifAccelerated ~~disclosure~~filer ofþ ~~delinquent~~Non-accelerated ~~filers pursuant~~filer too ~~Item 405~~Smaller ~~of Regulation S-K is~~reporting ~~not~~company ~~contained~~o ~~herein,~~(Do ~~and will~~ not becheck ~~contained,~~if toa ~~the~~smaller ~~best of~~reporting ~~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. o~~ company)

Indicate by check mark whether the registrant is a ~~large accelerated~~shell ~~filer, an accelerated filer, or a non-accelerated~~company ~~filer.~~(as ~~See~~defined ~~definition of “accelerated filer and large accelerated filer”~~ in Rule 12b-2 of the Exchange Act~~. (Check one~~):. Yes o No þ

~~Large~~The ~~accelerated~~aggregate market value of the registrant’s voting and ~~filer o Accelerated~~non-voting common equity held by non-affiliates of the ~~filer~~registrant at June 29, 2007, based upon the last reported ~~þ Non-accelerated filer~~sale price of the registrant’s Class oA Common Stock on the NASDAQ Global Market on that date, was $114,311,865.

~~Indicate~~As byof ~~check~~April 21, ~~mark~~2008, ~~whether~~ the registrant ishad ~~a shell company~~outstanding ~~(as~~26,459,323 shares ~~defined~~of ~~in Rule~~Class ~~12b-2 of~~A ~~the~~Common ~~Exchange~~Stock, par value ~~Act)~~$. ~~Yes o No þ~~01 per share.

~~The~~DOCUMENTS ~~aggregate~~INCORPORATED ~~market~~BY ~~value of the registrant’s voting and~~REFERENCE non-voting common equity held by non-affiliates of the registrant, at June 30, 2006 based upon the last reported sale price of the registrant’s Class A common stock on the Nasdaq Global Market on that date, was $76,855,303.

AsPortions of ~~November 7,~~the ~~2007~~Registrant’s Definitive Proxy Statement for the 2008 Annual Meeting of Stockholders of the Registrant, which will be filed with the ~~registrant~~Securities ~~had~~and ~~outstanding~~Exchange Commission ~~31,313,397 shares~~pursuant ofto ~~class~~Regulation A14A ~~common~~no ~~stock,~~later ~~par~~than ~~value~~April 29, ~~$.01~~2008, are incorporated by reference into Part ~~per~~III ~~share~~of this Report.

~~DOCUMENTS~~TABLE ~~INCORPORATED BY REFERENCE~~OF CONTENTS

List hereunder the following documents incorporated by reference and the Part of the Form 10-K into which the document is incorporated:



PART I
	Item 1.	Business	3
	Item 1A.	Risk Factors	13
	Item 1B.	Unresolved Staff Comments	21
	Item 2.	Properties	21
	Item 3.	Legal Proceedings	22
	Item 4.	Submission of Matters to a Vote of Security Holders	22

PART II
	Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	22
	Item 6.	Selected Financial Data	25
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	44
	Item 8.	Financial Statements and Supplementary Data	46
	Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	90
	Item 9A.	Controls and Procedures	90
	Item 9B.	Other Information	95

PART III
	Item 10.	Directors, Executive Officers and Corporate Governance	96
	Item 11.	Executive Compensation	96
	Item 12.	Security Ownership of Certain Beneficial Owners and Management	96
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	96
	Item 14.	Principal Accountant Fees and Services	96

PART IV
	Item 15.	Exhibits and Financial Statement Schedules	96
		Signatures	97

~~None~~ 2

~~EXPLANATORY~~This ~~NOTE~~Annual Report on Form 10-K contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend our forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in these sections. These statements can be identified by the use of forward looking terminology, such as “may,” “will,” “expect,” “anticipate,” “estimate,” or “continue” or the negative thereof or other variations thereon or comparable terminology. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth elsewhere in this Form 10-K. See Item 1A “Risk Factors” for cautionary statements identifying important factors with respect to such forward-looking statements, including certain risks and uncertainties that could cause actual results to differ materially from results referred to in forward-looking statements.

~~This Annual Report on~~ ~~Form~~PART ~~10-K~~I principally reflects matters existing at December 31, 2006 and events occurring during the year ended December 31, 2006, but does include some discussion of certain specified matters and events subsequent to December 31, 2006, principally in Note. 21, Subsequent Events, in the consolidated financial statements. Additional information about periods subsequent to December 31, 2006 can be found in our filings made to date on Form 8-K and will be contained in filings with the Securities and Exchange Commission to be made by us after the date of this Annual Report on Form 10-K.

*Item ~~The Registrant has not filed its Form 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007~~1. Business

~~TABLE OF~~Overview ~~CONTENTS~~

			Page
PART I
	Item 1.	Business		3
	Item 1A.	Risk Factors		13
	Item 1B.	Unresolved Staff Comments		22
	Item 2.	Properties		22
	Item 3.	Legal Proceedings		22
	Item 4.	Submission of Matters to a Vote of Security Holders		22
PART II
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		23
	Item 6.	Selected Financial Data		25
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		43
	Item 8.	Financial Statements and Supplementary Data		45
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		88
	Item 9A.	Controls and Procedures		88
	Item 9B.	Other information		92
PART III
	Item 10.	Directors, Executive Officers and Corporate Governance		93
	Item 11.	Executive Compensation		99
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		115
	Item 13.	Certain Relationships and Related Transactions, and Director Independence		118
	Item 14.	Principal Accountant Fees and Services		120
PART IV
	Item 15.	Exhibits and Financial Statement Schedules		121
EX-10.37
EX-10.38
Exhibit 10.40
EX-10.41
Exhibit 10.45
EX-10.46
Exhibit 10.47
EX-23
EX-31.1
EX-31.2
EX-32.1
EX-32.2

LCC International, Inc., a Delaware corporation, was formed in 1983. Unless the context indicates otherwise, references in this Form 10-K to the “Company,” “our,” “we,” or “us” are to LCC International, Inc. and its subsidiaries.

We are an independent provider of integrated end-to-end 2solutions for wireless voice and data communications networks with offerings ranging from high level technical consulting, system design and optimization services, to benchmarking and performance services to ongoing operations and maintenance services. We have been successful in using initial opportunities to provide high level technical consulting services to secure later-stage system design and network optimization contracts. Engagements to provide design services also assist us in securing ongoing operations and maintenance projects, including advanced network optimization and benchmarking contracts. Our technical consulting, system design and network optimization practices position us well to capitalize on additional opportunities as new technologies are developed and wireless service providers upgrade their existing networks, deploy the latest available technologies, and respond to changes in how their customers use wireless services.

~~Table~~ Since our inception, we have delivered wireless network solutions to more than 350 customers in over 50 countries. Customers outside of ~~Contents~~the United States accounted for 67.8% and 77.1% of our revenues from continuing operations for the years ended December 31, 2007 and 2006, respectively.

~~This~~In ~~Annual~~recent ~~Report~~periods ~~on Form 10-K contains~~we ~~certain~~have ~~forward-looking~~completed ~~statements~~a ~~within~~number ~~the~~of ~~meaning~~business ofacquisitions ~~Section 27A~~and ofdispositions. ~~the~~We ~~Securities~~completed ~~Act~~the purchase of ~~1933 and~~the ~~Section 21E~~equity ofinterests in the ~~Securities~~Europe, ~~Exchange~~Middle ~~Act~~East ofand ~~1934.~~Africa Wewireless ~~intend~~engineering ~~our~~services ~~forward-looking~~business ~~statements~~of toWireless beFacilities, ~~covered by the safe~~Inc., ~~harbor~~(“WFI”) ~~provisions~~and ~~for~~also ~~forward-looking~~acquired ~~statements~~certain inassets ~~these~~and ~~sections.~~liabilities ~~These~~of ~~statements can be identified by~~ the ~~use~~U.S. wireless ofengineering services ~~forward~~business ~~looking~~of ~~terminology~~WFI, ~~such~~which asincluded ~~“may,” “will,”~~customer ~~“expect~~contracts,” ~~“anticipate~~tools,” other ~~“estimate,”~~assets orand ~~“continue”~~approximately or350 employees. ~~the~~The ~~negative~~Company made ~~thereof~~the ordecision ~~other~~to ~~variations~~sell ~~thereon~~the orCompany’s ~~comparable terminology~~U.S. Network ~~Our~~Deployment ~~actual~~operations ~~results~~and ~~could~~completed ~~differ~~that ~~materially~~sale ~~from those anticipated~~ in ~~these~~the ~~forward-looking statements as a result of~~second ~~certain~~quarter ~~factors,~~of ~~including~~2006. ~~those~~The ~~set~~Company ~~forth~~is ~~elsewhere~~also in ~~this~~the process of selling ~~Form 10-K~~its Brazilian subsidiary. See Item 1A ~~“Risk~~7, ~~Factors” for cautionary~~Management’s ~~statements~~Discussion ~~identifying~~and ~~important~~Analysis ~~factors~~of ~~with~~Financial ~~respect~~Condition toand ~~such~~Results of ~~forward-looking statements~~Operations, ~~including~~and ~~certain~~Note 4, ~~risks~~Business ~~and~~Combinations, ~~uncertainties~~and ~~that~~Note 5, ~~could~~Discontinued ~~cause~~Operations, ~~actual results~~ to ~~differ~~our ~~materially~~consolidated ~~from~~financial ~~results referred to in forward-looking~~ statements.

~~PART I~~Industry Background

~~Item~~ Wireless Telecommunications ~~1. Business~~Networks

Wireless networks are telecommunications systems built using ~~Overview~~radio frequency-based systems that allow a mobile phone or data device to communicate without a metallic or optical cord or wire equipment. The number of mobile users world-wide has surpassed those using wireline services and the penetration rate of wireless broadband is increasing at an even faster rate. The life cycle of a wireless network continually evolves and consists of several phases including strategic planning, design, deployment, expansion, optimization as well as operations and maintenance. During the strategic planning phase, operators pursue the licenses necessary to build out a wireless system and make decisions about the type of technology and equipment to be used, where it will be located, how it will utilize radio frequency spectrum and how it will be configured. Technical planning and preliminary

~~LCC International, Inc., a Delaware corporation, was formed in~~ ~~1983. Unless the context indicates otherwise, references in this~~3 ~~Form 10-K to the “Company,” “our,” “we,” or “us” are to LCC International, Inc. and its subsidiaries.~~

Weengineering designs are anoften ~~independent~~required ~~provider of integrated end-~~to~~-end solutions~~ ~~for~~decide ~~wireless~~on ~~voice~~a ~~and data communications networks~~technology ~~with~~platform ~~offerings ranging from high level technical consulting, system design~~ and ~~optimization services, to~~ deployment ~~and ongoing~~strategy ~~operations and maintenance services. We have been successful in using initial opportunities~~ to ~~provide~~determine ~~high~~total ~~level technical~~cost ~~consulting services to secure later-stage system~~of ~~design~~ownership ~~and network optimization contracts. Engagements to provide design services also assist us in securing ongoing deployment~~ as ~~well~~a asbaseline ~~operations and maintenance projects including network optimization contracts. Our technical consulting, system design and network optimization practices position us well~~ to ~~capitalize~~identify ~~on additional opportunities as new technologies are developed and wireless service providers upgrade their existing networks, deploy~~ the ~~latest available technologies, and respond to changes in how their customers use~~ wireless ~~services~~operators ROI.

~~Since~~Following ~~our~~acceptance ~~inception,~~of wea ~~have delivered~~ wireless network design, then ~~solutions~~deployment toof ~~more~~the ~~than~~network ~~350~~can ~~customers~~begin. inDuring ~~over~~this ~~50 countries.~~phase, ~~Customers~~continual ~~outside~~performance ofand ~~the~~pre-launch ~~United~~optimization ~~States accounted for 77.1% and~~testing ~~75.2%~~verifies oflive ~~our~~network ~~revenues~~quality ~~from~~of ~~continuing~~service ~~operations~~against ~~for~~ the ~~years~~original ~~ended~~design. ~~December 31~~Finally, ~~2006~~professional ~~and~~technicians ~~2005,~~install ~~respectively.~~and ~~These~~commission ~~numbers,~~the asnew ~~well~~radio asequipment, ~~all~~test ofit, ~~the~~integrate ~~other~~it ~~financial~~with ~~information set~~existing ~~forth~~networks inand ~~this~~tune ~~Part I,~~the ~~have~~components ~~been adjusted~~ to ~~reflect~~optimize ~~the~~performance and ~~divestiture~~benchmark ~~of our U.S. Network Deployment business in~~ the ~~second~~ ~~quarter~~performance ofto ~~2006~~repeat ~~and~~ the ~~pending~~optimization ~~sale of our Brazilian subsidiary~~process.

Once a wireless network becomes operational and the number of ~~Industry~~subscribers or demand for network resources increases, the ~~Background~~system must be expanded to increase system coverage and capacity. In addition, the wireless system must be continually updated and optimized to address changes in traffic patterns, and interference from neighboring or competing networks or other radio sources. Operations and maintenance also involve tuning the network to enable operators to compete more effectively in areas where there are multiple system operators.

Finally, as new technologies continuously develop, wireless ~~Wireless~~service providers must determine whether to upgrade their ~~Telecommunications~~existing ~~Networks~~networks or deploy new networks utilizing the latest available technologies. Overlaying new technologies, such as third generation and fourth generation (or “3G” and “4G”, respectively), with an existing network or deploying a new network requires operators to reengage in the strategic planning, design, deployment, expansion, and operations and maintenance phases of a new cycle in the life of an existing or new network.

~~Wireless networks are telecommunications systems built using~~ ~~radio-based systems that allow a telephone set or data terminal~~Growth ~~to communicate without a metallic or optical cord or wire equipment. The life cycle of a wireless network continually evolves~~ and ~~consists~~Evolution of ~~several phases including strategic planning, design, deployment, expansion, and operations and maintenance. During~~ the ~~strategic~~Wireless ~~planning phase, operators~~Telecommunications ~~pursue the licenses necessary to build out a wireless system and~~Industry make decisions about the type of technology and equipment to be used, where it will be located, how it will utilize radio frequency spectrum and how it will be configured. Technical planning and preliminary engineering designs are often required to decide on a deployment strategy and determine construction costs and the revenue generating ability of the wireless system.

~~Following~~Worldwide ~~acceptance~~use of a wireless ~~network~~telecommunications ~~design,~~has ~~access~~grown torapidly ~~land~~as orcellular ~~building~~and ~~rooftops~~other ~~must~~emerging bewireless ~~secured~~communications ~~for towers or~~services ~~telecommunications~~have ~~equipment,~~become ~~including~~more ~~radio~~widely ~~base~~available ~~stations, antennae~~ and ~~supporting~~affordable ~~electronics.~~for ~~Each~~the ~~site must be qualified~~mass inbusiness ~~a number of areas, including zoning ordinance requirements, regulatory compliance~~ and ~~suitability~~consumer ~~for construction~~markets. ~~Detailed site~~The ~~location~~rapid ~~designs~~growth ~~are~~in ~~prepared and radio frequency engineers~~wireless ~~review~~telecommunications ~~interference~~is todriven orby ~~from~~the ~~co-located~~dramatic ~~antennae.~~increase ~~Construction~~in ~~and~~wireless ~~equipment~~telephone ~~installation~~usage, ~~then~~as ~~must~~well beas ~~performed~~strong ~~and~~demand ~~site~~for wireless ~~performance~~Internet isand ~~measured~~other ~~after~~data ~~completion of construction~~services. ~~Finally, professional technicians install and~~

Wireless access to the Internet is still in its relative infancy 3but growing rapidly as web-enabled devices become more widely accessible and affordable. Demand for wireless Internet access and other data services is accelerating the adoption of new technologies such as those embodied in 3G and 4G to enable wireless networks to deliver enhanced data capabilities. Examples of wireless data services include e-mail, text messaging services, music on-demand, streaming video, self-generated content, ring tones, online-banking, locations-based services and interactive games. In addition, the introduction of mobile multimedia services such as voice over internet protocol (“VoIP”) and mobile TV has resulted in the development of new wireless broadband and broadcast technologies to support high speed data and video.

~~Table~~ Recently, ofthere ~~Contents~~has been a move in the telecommunications industry towards fixed-mobile convergence (“FMC”), and as a result, enabling technologies such as IP Multimedia Subsystem (“IMS”) and Unlicensed Mobile Access (“UMA”) are being introduced into the wireless networks. The IMS architecture consolidates service delivery platforms for voice and data on a common IP foundation. UMA technology enables access to mobile voice, data and IMS services over IP broadband access and unlicensed spectrum technologies. By deploying UMA technology, service providers can enable subscribers to roam and handover between cellular networks and public and private unlicensed wireless networks using dual-mode mobile handsets.

~~commission the new radio equipment, test it, integrate it with~~Key ~~existing~~Drivers ~~networks~~of ~~and~~Change ~~tune~~in ~~the~~Our ~~components to optimize~~Business ~~performance.~~

~~Once~~Historically, athe ~~wireless~~key ~~network~~drivers ~~becomes~~of ~~operational~~change ~~and~~in ~~the~~our ~~number~~business ofhave ~~subscribers~~been: ~~increases,~~ (i) the ~~system~~issuance ~~must~~of benew ~~expanded~~or toadditional ~~increase~~licenses to ~~system~~wireless ~~coverage~~service ~~and~~providers; ~~capacity. In addition,~~ (ii) the ~~wireless~~introduction ~~system~~of new ~~must~~services beor ~~continually~~technologies; ~~updated~~(iii) the ~~and~~increases ~~optimized~~in tothe ~~address changes in~~number ~~traffic~~of ~~patterns,~~subscribers ~~and~~served ~~interference~~by ~~from~~wireless ~~neighboring~~service orproviders, ~~competing~~the ~~networks~~increase orin ~~other~~usage ~~radio~~by ~~sources.~~those ~~Operations~~subscribers and ~~maintenance~~the ~~also~~scarcity of ~~involve~~wireless ~~tuning~~spectrum; and (iv) the ~~network~~increasing tocomplexity ~~enable operators to compete more~~of ~~effectively~~wireless systems in ~~areas~~operation. ~~where~~Each ~~there~~of ~~are~~these ~~multiple~~key ~~system~~drivers ~~operators~~is discussed below.

~~Finally,~~• asThe ~~new~~issuance ~~technologies~~of ~~continuously~~new ~~develop,~~or ~~wireless service~~additional ~~providers~~licenses ~~must determine whether~~ to ~~upgrade~~wireless ~~their existing~~service ~~networks~~providers. orIn ~~deploy~~September ~~new~~2006, ~~networks utilizing~~ the ~~latest available~~Federal ~~technologies.~~Communications ~~Overlaying~~Commission ~~new~~(“FCC”) ~~technologies,~~auctioned ~~such~~spectrum ~~as third~~in ~~generation~~the ~~and~~Advanced ~~fourth~~Wireless ~~generation~~Services (or “3GAWS” ~~and “4G”, respectively~~) ~~with~~band. anThe ~~existing~~winning ~~network~~bidders ~~or deploying~~included aexisting ~~new~~wireless ~~network~~carriers, ~~requires~~as ~~operators~~well toas ~~reengage~~new inentrants ~~the strategic~~such ~~planning,~~as ~~design,~~cable ~~deployment,~~companies. ~~expansion,~~A ~~and operations~~similar ~~and~~auction ~~maintenance~~is ~~phases~~taking ofplace ain ~~new~~2008 ~~cycle~~as in the ~~life~~FCC ~~of an~~auctions ~~existing~~licenses orin ~~new~~700 ~~network~~mhz band. Auctions

~~Growth~~ ~~and Evolution of the Wireless Telecommunications~~4 ~~Industry~~

~~Worldwide~~in ~~use~~Canada ofare ~~wireless~~also ~~telecommunications~~expected ~~has~~in ~~grown~~2008. ~~rapidly as~~After ~~cellular~~receiving ~~and~~new ~~other~~or ~~emerging~~additional licenses necessary to build out their wireless ~~communications~~systems, ~~services have~~wireless ~~become~~service ~~more~~providers ~~widely~~must ~~available~~make decisions about what type of technology and ~~affordable~~equipment ~~for~~will ~~the~~be ~~mass business~~used, where it will be located and ~~consumer~~how ~~markets~~it will be configured. ~~The~~In ~~rapid~~addition, ~~growth~~the inincumbent ~~wireless telecommunications~~users isof ~~driven~~the AWS spectrum must be relocated to clear the frequencies for use by the ~~dramatic~~auction ~~increase~~winners. ~~in wireless~~The ~~telephone~~spectrum ~~usage,~~relocation asprocess ~~well~~requires ascoordination, ~~strong~~negotiation, ~~demand~~and engineering for ~~wireless Internet~~both the incumbents and ~~other~~the ~~data~~new ~~services~~license holders. The network build out requires preparation of detailed site location designs and radio frequency engineers must review interference to or from co-located antennae.

~~Wireless~~• ~~access~~The introduction of new services or technologies. Although wireless service providers traditionally have relied upon their internal engineering workforces to address a significant portion of their wireless network needs, the ~~Internet~~rapid isintroduction ~~still~~of new services or technologies in ~~its~~the ~~relative~~wireless ~~infancy but~~market ~~growing~~and ~~rapidly~~the asneed ~~web-enabled~~to ~~devices~~reduce ~~become~~operating ~~more~~costs ~~widely accessible~~in many cases has resulted in wireless service providers and ~~affordable~~equipment vendors focusing on their core competencies and, as a result, outsourcing an increasing portion of their network services. ~~Demand~~Several ~~for~~wireless service providers have upgraded or have begun upgrading their networks to reduce the rate at which customers deactivate their wireless ~~Internet~~services ~~access~~ and ~~other~~to ~~data~~accommodate new services isincluding ~~accelerating~~multimedia ~~the~~messaging, ~~adoption~~which allows wireless users to send and receive messages with a combination of media elements such as text, image, sound and video. The introduction of new services and technologies such as ~~those~~wireless ~~embodied~~broadband and broadcast has resulted in 3Gopportunities ~~and~~for 4Gnew toclasses ~~enable~~ of wireless ~~networks~~service providers to ~~deliver~~enter ~~enhanced~~the ~~data~~market ~~capabilities. Examples~~with ofa ~~wireless~~quadruple ~~data~~play ~~services~~offering ~~include e-mail~~of voice, ~~text messaging~~internet, ~~services~~video, ~~music~~and ~~on-demand,~~mobility. ~~ring~~Wireless ~~tones~~broadband technologies are considered both complimentary and competitive to fixed service providers such as DSL, ~~online-banking~~cable, ~~locations-based~~ ~~services~~ and ~~interactive~~satellite ~~games~~operators. InProprietary ~~addition,~~and standard mobile TV broadcast technologies are currently being implemented by new entrants to the ~~introduction~~ ofwireless ~~mobile~~service ~~multimedia~~provider community. These new services ~~such~~are asdriving ~~voice~~wireless ~~over internet~~carriers ~~protocol~~to focus on the quality of the experience (“~~VoIP~~QoE”) as perceived by the user. To monitor and ~~mobile~~optimize TVthe ~~has~~quality ~~resulted~~ experienced by the user, the wireless service providers require new tools and processes to test many different devices as well as applications and content. • The increases in the ~~development~~number of ~~new~~wireless subscribers, the increase in usage by those subscribers, and the scarcity of wireless ~~broadband~~spectrum. The increases in the number of subscribers served by wireless service providers, the increase in usage by those subscribers, and ~~broadcast~~ the scarcity of wireless spectrum require wireless service providers to expand and optimize system coverage and capacity to maintain network quality. The wireless system also must be continually updated and optimized to address changes in traffic patterns and interference from neighboring or competing networks or other radio sources. • The increasing complexity of wireless systems. As new technologies are developed, wireless service providers must determine whether to ~~support~~upgrade ~~high~~their ~~speed~~existing ~~data~~networks or deploy new networks utilizing the latest available technologies in order to maintain their market share. For example, overlaying next generation technologies such as 3G and ~~video~~4G with an existing network or deploying a new network requires wireless service providers to reengage in the strategic planning, design, deployment, expansion, and operations and maintenance phases of a new cycle in the life of an existing or new network. The consolidation of networks also drives a need for resources to plan, optimize and implement change in existing networks.

~~Recently, there has been a move in the telecommunications~~ industry towards fixed-mobile convergence (“FMC”), and as a result, enabling technologies such as IP Multimedia Subsystem (“IMS”) and Unlicensed Mobile Access (“UMA”) are being introduced into the wireless networks. The ~~IMS architecture consolidates service delivery~~ ~~platforms~~Need for ~~voice and data on a common IP foundation. UMA~~Outsourcing technology enables access to mobile voice, data and IMS services over IP broadband access and unlicensed spectrum technologies. By deploying UMA technology, service providers can enable subscribers to roam and handover between cellular networks and public and private unlicensed wireless networks using dual-mode mobile handsets.

As a result of the drivers of change in our business described ~~Key~~above, we believe that wireless network operators and their ~~Drivers~~third party service providers are seeking to outsource an increasing portion of ~~Change~~their inwireless ~~Our~~network ~~Business~~needs and are engaging professional service firms that:

~~Historically,~~• ~~the key drivers of change in our business~~ have ~~been:~~ ~~(i) the~~expertise ~~issuance~~with ofall ~~new~~major ~~or additional licenses to~~ wireless ~~service providers~~technologies; ~~(ii) the~~• ~~introduction~~offer ofturnkey ~~new services~~solutions orthrough ~~technologies;~~in-country ~~(iii) the~~presence ~~increases~~ in the ~~number of~~markets ~~subscribers~~to be served; by• ~~wireless~~offer ~~service~~speed ~~providers,~~to ~~the increase~~market ~~in usage by those subscribers~~ and ~~the~~cost ~~scarcity~~effective ~~of wireless~~network ~~spectrum~~implementation; ~~and~~• ~~(iv) the~~have ~~increasing~~experience ~~complexity~~working ~~of wireless~~with ~~systems~~all inmajor ~~operation.~~equipment ~~Each~~vendors; ~~of these key drivers is discussed below.~~ and

• The issuance of new or additional licenses to wireless service providers. In September of 2006, the Federal Communications Commission (“FCC”) auctioned spectrum in the Advanced Wireless Services (“AWS”) band. The winning bidders included existing wireless carriers as well as new entrants such as cable companies. A similar auction is expected to occur in 2008 as the FCC auctions licenses in 700 mhz band. After receiving new or additional licenses necessary to build out their wireless systems, wireless service providers must make decisions about what type of technology and equipment will be used, where it will be located and how it will be configured. In addition, the incumbent users of the AWS spectrum must be relocated to clear the frequencies for use by the auction winners. The spectrum relocation process requires coordination, negotiation, and engineering for both the incumbents and the new license holders. The 5

4 • have sufficient numbers of highly skilled employees capable of handling large-scale domestic and international projects.

~~Table~~ The ~~of Contents~~LCC Solution

~~network~~ We ~~build~~help ~~out~~wireless ~~requires~~service ~~preparation~~providers ofaround ~~detailed~~the ~~site~~world ~~location~~address ~~designs~~the issues they face in developing networks to meet subscriber demand, reduce their costs and ~~radio~~add ~~frequency~~new ~~engineers~~services ~~must~~and functionality. ~~review~~We ~~interference~~believe the services performed by LCC which address these issues and the need for wireless service providers, telecommunications equipment vendors and others to outsource oran ~~from~~increasing ~~co-located~~portion ~~antennae.~~of their wireless network services, distinguish us and result in competitive advantages:

• ~~The~~Expertise ~~introduction~~and ofexperience ~~new~~with ~~services~~all ormajor wireless technologies., ~~Although~~system ~~wireless~~protocols ~~service~~and ~~providers~~equipment ~~traditionally~~vendors. We have ~~relied~~experience ~~upon~~working ~~their~~with ~~internal~~all ~~engineering~~major ~~workforces~~wireless toaccess ~~address~~technologies, aincluding ~~significant~~second ~~portion~~generation, ofor 2G, 2.5G, 3G and 4G digital system protocols and their ~~wireless~~respective ~~network~~migration ~~needs~~paths, ~~the~~including: ~~rapid~~(i) ~~introduction~~Global ofSystem ~~new~~for ~~services~~Mobile orCommunications ~~technologies~~(“GSM”) inand ~~the~~its ~~wireless~~evolution ~~market~~path ~~and~~including ~~the~~Universal ~~need~~Mobile toTelecommunications ~~reduce~~System ~~operating~~(“UMTS”) ~~costs~~and inHigh ~~many~~Speed ~~cases~~Packet ~~has~~Access ~~resulted~~(“HSPA”); in(ii) ~~wireless~~Time ~~service~~Division ~~providers~~Multiple ~~and~~Access ~~equipment~~(“TDMA”); ~~vendors~~(iii) ~~focusing~~Code onDivision ~~their~~Multiple ~~core~~Access ~~competencies~~(“CDMA”) and, asits aevolution ~~result,~~path ~~outsourcing~~including anSingle ~~increasing~~Carrier ~~portion~~Radio ofTransmission ~~their~~Technology ~~network~~(“1xRTT”) ~~services.~~and ~~Several~~1x ~~wireless~~Evolution-Data ~~service~~Optimized ~~providers~~(“1xEV-DO ~~have~~Rev ~~upgraded~~0 orand ~~have~~Rev ~~begun~~A”); ~~upgrading~~(iv) ~~their~~Integrated ~~networks~~Dispatch toEnhanced ~~reduce~~Network ~~the~~(“iDEN”); ~~rate~~(v) atbroadband’s ~~which~~Local ~~customers~~Multipoint ~~deactivate~~Distribution ~~their~~System ~~wireless~~(“LMDS”), ~~services~~Multichannel ~~and~~Multipoint toDistribution ~~accommodate~~Service ~~new~~(“MMDS”), ~~services~~802.11x ~~including~~(“Wi-Fi”) ~~multimedia~~and ~~messaging,~~802.16 ~~which~~(“WiMAX”) ~~allows~~technologies; ~~wireless~~(vi) ~~users~~Europe’s equivalent to ~~send~~iDEN ~~and~~referred ~~receive~~to ~~messages~~as ~~with~~Tetra; a(vii) ~~combination~~Satellite ofDigital ~~media~~Audio ~~elements~~Radio ~~such~~Service as(“S-DARS”); ~~text,~~(viii) ~~image,~~Digital ~~sound~~Video Broadcasting for mobile TV (“DVB-H and ~~video~~MediaFLO”); and (ix) core network technologies. ~~The~~We ~~introduction~~are actively engaged in supporting the development of new ~~services~~ and emerging technologies ~~such~~and asstandards ~~wireless~~in ~~broadband~~the ~~and~~wireless ~~broadcast~~telecommunications ~~has~~industry ~~resulted~~through participation in ~~opportunities~~industry ~~for~~panels ~~new~~and ~~classes~~industry ofassociation ~~wireless~~forums ~~service~~and ~~providers~~through toindependent ~~enter~~research. ~~the~~We ~~market~~have worked with athe ~~quadruple~~equipment ~~play~~made ~~offering~~by ofall ~~voice,~~major ~~internet,~~equipment ~~video~~manufacturers. Our Wireless Institute, which provides training and ~~mobility.~~research ~~Wireless~~services, ~~broadband~~is ~~technologies~~an ~~are~~integral ~~considered~~part ~~both~~of ~~complimentary~~our ~~and~~technical ~~competitive~~development activities. • Ability to ~~fixed~~deliver ~~service~~turnkey ~~providers~~solutions. ~~such~~Our asability ~~DSL,~~to ~~cable,~~provide ~~and~~a ~~satellite~~broad ~~operators.~~combination ~~Proprietary~~of ~~and~~services ~~standard~~which ~~mobile~~may TVinclude ~~broadcast~~several ~~technologies~~or ~~are~~all ~~currently~~of ~~being~~the ~~implemented~~services bysuch ~~new~~as ~~entrants~~design, toconsulting ~~the~~and operations and maintenance services for wireless ~~service~~networks, ~~provider~~which ~~community.~~we ~~These~~refer ~~new~~to as end-to-end network engineering services, ~~are~~enables ~~driving~~our wireless ~~carriers~~customers to ~~focus~~engage onus ~~the~~as ~~quality~~a ofsingle ~~the~~responsible ~~experience~~party ~~(“QoE”)~~accountable asfor ~~perceived~~designing, byoptimizing ~~the~~and ~~user~~managing their wireless networks under a single contract. ToIn ~~monitor~~2007, ~~and~~LCC ~~optimize~~acquired the ~~quality~~engineering ~~experienced~~assets byof ~~the~~WFI ~~user,~~in the ~~wireless~~United ~~service~~States ~~providers~~and ~~require~~Europe. ~~new~~Through ~~tools~~these ~~and~~acquisitions, ~~processes~~LCC increased its ability to ~~test~~provide ~~many~~services ~~different~~across ~~devices~~all asregions ~~well~~in asRF ~~applications~~Engineering, Broadband Wireless Engineering, Fixed Network and ~~content.~~Backhaul, •Spectrum ~~The~~Management ~~increases~~and inLand ~~the~~Mobile ~~number~~Radio. We coordinate our use of ~~wireless~~resources ~~subscribers,~~for ~~the~~each ~~increase~~phase inof ~~usage~~the byproject ~~those~~from ~~subscribers~~planning to design, benchmarking and ~~the~~optimization ~~scarcity~~to operations and maintenance of the wireless ~~spectrum.~~network, ~~The~~enabling ~~increases~~us into reduce the ~~number~~time and cost of ~~subscribers~~our ~~served~~services. byIn ~~wireless~~order ~~service~~to ~~providers~~supplement such services, ~~the~~we ~~increase~~have established a presence in ~~usage~~numerous bycountries, ~~those~~including ~~subscribers~~Algeria, ~~and~~Belgium, ~~the~~Germany, ~~scarcity~~Greece, ofItaly, ~~wireless~~Luxembourg, ~~spectrum~~the ~~require~~Netherlands, ~~wireless~~Pakistan, ~~service~~Spain, ~~providers~~Saudi toArabia, ~~expand~~United ~~and~~Arab ~~optimize~~Emirates, ~~system~~Turkey, ~~coverage~~Sweden, Egypt, and ~~capacity~~the toUnited ~~maintain~~Kingdom. ~~network~~We ~~quality.~~provide ~~The~~our ~~wireless~~customers ~~system~~with ~~also~~a ~~must~~primary bepoint ~~continually~~of ~~updated~~accountability and ~~optimized~~reduce tothe ~~address~~inefficiencies ~~changes~~associated inwith ~~traffic~~coordinating ~~patterns~~multiple ~~and~~subcontractors ~~interference~~to ~~from~~enable ~~neighboring~~projects orto ~~competing~~be ~~networks~~transitioned orfrom ~~other~~discipline ~~radio~~to ~~sources.~~discipline •in ~~The~~an ~~increasing~~efficient ~~complexity~~manner. of• ~~wireless~~Speed ~~systems~~to market. AsOur ~~new~~expertise, ~~technologies~~global ~~are~~presence ~~developed,~~and ~~wireless~~processes ~~service~~enable ~~providers~~us ~~must~~to ~~determine~~respond ~~whether~~quickly to ~~upgrade~~support ~~their~~our ~~existing~~customers’ ~~networks~~objectives. orMembers ~~deploy~~of ~~new~~our ~~networks~~technical ~~utilizing~~and design teams often work together with the ~~latest~~customer ~~available~~at ~~technologies~~the initial stage of a project in order to ~~maintain~~plan ~~their~~an ~~market~~effective ~~share.~~and ~~For~~efficient ~~example,~~solution ~~overlaying~~for ~~next~~the ~~generation~~customer’s ~~technologies~~needs. ~~such~~• asWorldwide 3Gdepth ~~and~~of 4Gresources. ~~with~~Our anprofessionals ~~existing~~collectively ~~network~~have orexperience designing and deploying anetworks ~~new~~in ~~network~~the ~~requires~~major ~~wireless~~markets ~~service~~in ~~providers~~the toUnited ~~reengage~~States, inas well as many countries throughout the ~~strategic~~world. ~~planning,~~As ~~design,~~of ~~deployment~~December 31, ~~expansion~~2007, ~~and~~approximately ~~operations~~68.1% ~~and~~of ~~maintenance~~our ~~phases~~billable ofemployees awere ~~new~~employed ~~cycle~~outside in the ~~life~~United ofStates. anDuring ~~existing~~the orpast ~~new~~25 ~~network.~~years, ~~The~~our ~~consolidation~~professionals ofhave designed wireless networks ~~also~~employing ~~drives~~all amajor ~~need~~technologies ~~for~~in ~~resources~~North toAmerica, ~~plan~~Europe, ~~optimize~~Asia, Latin America, the Middle East and ~~implement~~Africa. ~~change~~Our inprofessional ~~existing~~staff ~~networks~~is highly educated with many of our engineering professionals holding masters degrees or doctorates.

~~The~~ ~~Need for Outsourcing~~6

~~As a result of the drivers of change in our business described~~ ~~above, we believe that wireless network operators and their~~LCC ~~third party service providers are seeking to outsource an~~Services ~~increasing portion of their wireless network needs and are engaging professional service firms that:~~

• We ~~have~~offer ~~expertise~~to ~~with~~our ~~all~~wireless ~~major~~customers a complete range of wireless network ~~technologies;~~services, •including: ~~offer~~(i) high ~~turnkey~~level ~~solutions~~technical consulting ~~through~~(20.2% ~~in-country~~and ~~presence~~2.6% inof ~~the~~revenues ~~markets~~for to2007 beand ~~served~~2006, respectively); •(ii) design ~~offer~~and ~~speed~~optimization toservices (47.0% and ~~market~~54.1% of revenues for 2007 and ~~cost~~2006, ~~effective~~respectively); (iii) deployment ~~network~~services ~~implementation~~(18.8% and 39.2% of revenues for 2007 and 2006, respectively); and (iv) ongoing operations and maintenance services (14.0% and 3.7% of revenues for 2007 and 2006, respectively). In 2007, we derived 21.1% of our revenues from projects involving 2G technology, 4.7% of our revenues from projects involving 2.5G technology, 43.8% of our revenues from projects involving 3G technology, and 30.4% of our revenues from projects involving other technologies. All percentages are based on revenues from continuing operations.

• Technical Consulting ~~have experience working with all major equipment vendors; and~~Services

• Applying ~~have~~our ~~sufficient~~extensive ~~numbers~~technical and operational expertise and experience, we initially may be engaged by a wireless customer to analyze the engineering and technology issues related to emerging technologies and acquiring new spectrum. From assisting customers with evaluating their business plans, to licensing and application support, technology assessments and defining and refining implementation strategies, our team of ~~highly~~senior ~~skilled~~wireless professionals ~~employees~~focuses ~~capable~~on providing our customers with key insights into all aspects of ~~handling~~wireless ~~large-scale~~communications ~~domestic~~and the impact that a new technology, device or application might have on the industry. We also provide training to our engineers and our ~~international~~customers ~~projects~~through our Wireless Institute, which covers the latest technologies developed and employed throughout the world.

~~The LCC~~Design ~~Solution~~and Optimization Services

Radio frequency and fixed network engineering. We ~~help~~provide both radio frequency engineering and fixed network engineering services to design wireless ~~service~~networks ~~providers~~for ~~around~~our customers. Our engineers design each wireless network based upon the ~~world~~customer’s ~~address~~transmission requirements, which are determined based upon the projected ~~issues~~level ~~they~~of ~~face~~subscriber indensity, ~~developing~~estimated ~~networks~~traffic demand and the scope of the operator’s license coverage area and the most effective connection to ~~meet~~the ~~subscriber~~wireline backbone. Our engineers ~~demand,~~perform ~~reduce~~the ~~their~~calculations, ~~costs~~measurements and ~~add~~tests ~~new~~necessary ~~services~~to optimize placement of wireless equipment, to optimize use of radio frequency and to deliver the highest possible signal ~~functionality~~quality for the greatest portion of subscriber usage within existing constraints. WeTypical ~~believe~~constraints ~~the~~that ~~services~~must be addressed include cost parameters, terrain and license limitations, interference from other operators, site availability limitations and applicable zoning restrictions, as well as other factors.

In addition, because most wireless calls are ultimately routed 5through a wireline network, traffic from wireless networks must be connected with switching centers within wireline networks. Our fixed network engineers determine the most effective method to connect cell sites to the wireline backbone. We also provide services to cover the core network including interconnect, switching and microwave engineering for all access technologies, including connection into the telecommunications infrastructures of competitive local exchange carriers, or CLECs, and incumbent local exchange carriers, or ILECs. Our engineers will assist carriers in determining the most cost effective and technically efficient means to route traffic across their fixed networks as well as evaluate the implementation of new technologies, such as wireless backhaul, or capabilities to respond to demands for additional capacity as networks handle more traffic from data and media applications.

~~Table~~ Once a wireless network becomes operational and the number of subscribers ~~Contents~~increases, our engineers assist carriers to expand system coverage, system capacity and optimize performance to address changing requirements. These activities include overlaying new technologies with existing networks and supporting requirements for strategic planning, design, deployment, expansion, and operations and maintenance phases of a new cycle in the life of an existing or new network. They also include solutions to address changing requirements in how quality of service and quality of end user experience is measured, monitored and optimized in networks providing greater degrees of data services including video, media and similar applications.

~~performed~~Competitive bybenchmarking. We ~~LCC~~provide ~~which~~system analyses ~~address~~to ~~these~~our ~~issues~~wireless ~~and~~customers for the ~~need~~measurement ~~for~~of ~~wireless~~network ~~service providers~~performance, ~~telecommunications~~including ~~equipment~~“benchmarking” ~~vendors~~their ~~and~~performance ~~others~~versus tocompetitors, ~~outsource~~based upon an ~~increasing~~extensive ~~portion~~set of ~~their wireless~~ ~~network~~parameters ~~services,~~such ~~distinguish~~as uscall ~~and~~quality, ~~result~~drop incall ~~competitive~~rates, signal ~~advantages:~~strength and coverage.

• Expertise and experience with all major wireless technologies, system protocols and equipment vendors. We have experience working with all major wireless access technologies, including second generation, or 2G, 2.5G, 3G and 4G digital system protocols and their respective migration paths, including: (i) Global System for Mobile Communications (“GSM”) and its evolution path including Universal Mobile Telecommunications System (“UMTS”) and High Speed Packet Access (“HSPA”); (ii) Time Division Multiple Access (“TDMA”); (iii) Code Division Multiple Access (“CDMA”) and its evolution path including Single Carrier Radio Transmission Technology (“1xRTT”) and 1x Evolution-Data Optimized (“1xEV-DO Rev 0 and Rev A”); (iv) Integrated Dispatch Enhanced Network (“iDEN”); (v) broadband’s Local Multipoint Distribution System (“LMDS”), Multichannel Multipoint Distribution Service (“MMDS”), 802.11x (“Wi-Fi”) and 802.16 (“WiMAX”) technologies; (vi) Europe’s equivalent to iDEN referred to as Tetra; (vii) Satellite Digital Audio Radio Service (“S-DARS”); (viii) Digital Video Broadcasting for mobile TV (“DVB-H and MediaFLO”); and (ix) core network technologies. We are actively engaged in supporting the development of new and emerging technologies and standards in the wireless telecommunications industry through participation in industry panels and industry association forums and through independent research. We have worked with the equipment made by all major equipment manufacturers. Our Wireless Institute, which provides training and research services, is an integral part of our technical development activities. • Ability to deliver turnkey solutions. Our ability to provide a broad combination of services which may include several or all of the services such as design, deployment, consulting and operations and maintenance services for wireless networks, which we refer to as end-to-end or turnkey services, enables our wireless customers to engage us as a single responsible party accountable for delivering and managing their wireless networks under a single contract. As a result of our decision to exit the network deployment business in the U.S. in 2006 and as a result of a non-competition agreement entered into with the buyer of such business, our turnkey solutions in the U.S. do not include network site deployment services and are focused on technical solutions including our engineering and quality of service (“QoS”) and quantity of experience (“QoE”) solutions as well as solutions to assist carriers in (i) clearing newly-acquired spectrum and (ii) optimizing and expanding existing backhaul networks. Our offerings in Europe, the Middle East and Africa (“EMEA”) include deployment services and we may choose to partner with deployment services providers in the United States if the need arises. We coordinate our use of resources for each phase of the project from planning to design and deployment to operations and maintenance of the wireless network, enabling us to reduce the time and cost of our services. In order to supplement such services, we have established a presence in, among others, Algeria, Belgium, Germany, Greece, Italy, Luxembourg, the Netherlands, Pakistan, Spain, Saudi Arabia, United Arab Emirates and the United Kingdom. We provide our customers with a primary point of accountability and reduce the inefficiencies associated with coordinating multiple subcontractors to enable projects to be transitioned from discipline to discipline in an efficient manner. • Speed to market. Our expertise, global presence and processes enable us to respond quickly to support our customers’ objectives. Members of our technical and design teams often work together with the customer at the initial stage of a project in order to plan an effective and efficient solution for the customer’s needs. • Worldwide depth of resources. Our professionals collectively have experience designing and deploying networks in the major markets in the United States as well as many countries throughout the world. As of December 31, 2006, approximately 72.5% of our billable employees were employed outside the United States. During the past 20 years, our professionals have designed wireless networks employing all major technologies in North America, Europe, Asia, Latin America, the Middle East and Africa. Our professional staff is highly educated with many of our engineering professionals holding masters degrees or doctorates. 7

~~LCC~~Deployment Services

WeThe ~~offer~~Company, in reviewing its strategic objectives, decided to exit ~~our~~the ~~wireless~~U.S. Network ~~customers~~Deployment abusiness ~~complete~~in ~~range~~2006 ofdue ~~wireless~~to ~~network~~the ~~services,~~increasing ~~including:~~amounts ~~(i) high~~of ~~level~~working ~~technical~~capital required to operate ~~consulting~~this ~~(2.6%~~business as a result of ~~revenues~~increasingly ~~for~~extended ~~2006~~milestone payments under customer agreements and 2to lower profit margins in the U.7%S. market. As a result, the focus of ~~revenues~~the Company’s ~~for~~deployment services has shifted to limited ~~2005);~~geographies ~~(ii) design~~in our overseas operations and ~~optimization~~include:

Program management. We provide program 6management services as part of an overall design and deployment project to manage site acquisition, radio frequency engineering, fixed network engineering and construction management services.

~~Table~~ Site acquisition and development. Our local experts in each geographic market evaluate the feasibility and desirability of ~~Contents~~base station locations in the proposed area according to the wireless customer’s requirements, including zoning ordinance requirements, leasing constraints and building access issues.

~~services~~Architecture ~~(54.1% of revenues for 2006~~ and 52engineering.6% We ~~of revenues for~~manage ~~2005);~~various ~~(iii) deployment~~activities ~~services~~associated ~~(39.2%~~with ofthe ~~revenues~~design, ~~for~~layout and ~~2006~~physical ~~and~~assessment ~~39.8%~~ of ~~revenues~~existing ~~for 2005);~~ and ~~(iv) ongoing~~proposed telecommunications ~~operations~~facilities, ~~and~~including ~~maintenance~~base ~~services~~stations ~~(3.7%~~and ofswitching ~~revenues~~centers. ~~for fiscal~~This ~~2006~~includes managing architecture and ~~3.8%~~engineering offirms ~~revenues~~with respect ~~for~~to ~~fiscal~~site ~~2005).~~drawings, Inzoning ~~2006~~exhibits, weand ~~derived~~structural ~~47.2%~~analysis ofand ~~our~~making ~~revenues~~recommendations ~~from~~to ~~projects~~confirm ~~involving~~that ~~2G technology,~~the ~~17.3%~~infrastructure ofhas ~~our~~the ~~revenues~~structural ~~from~~capacity ~~projects~~to ~~involving~~accommodate ~~2.5G technology,~~the ~~29.1%~~design of ~~our~~the ~~revenues~~wireless ~~from~~network. ~~projects~~We ~~involving~~also 3Gprovide ~~technology,~~other ~~and~~materials ~~6.4%~~and ofservices ~~our~~as ~~revenues~~may ~~from~~be ~~projects~~necessary ~~involving~~to ~~other~~secure ~~technologies.~~building permits and ~~All~~jurisdictional ~~amounts are based on revenues from continuing operations~~approvals.

Construction and procurement management. We ~~Technical~~manage various construction subcontractors to prepare the ~~Consulting~~rooftop ~~Services~~or tower site and secure the proper electrical and telecommunications connections. We also manage the procurement of materials and equipment for our wireless customers and the installation of radio frequency equipment, including base station electronics and antennae.

~~Applying~~For ~~our~~financial ~~extensive~~information ~~technical~~about ~~and operational expertise and experience, we initially may be engaged by a wireless customer to analyze~~ the ~~engineering~~sale ~~and~~of ~~technology issues related to~~the ~~emerging technologies and acquiring new spectrum~~U.S. Network ~~From~~Deployment ~~assisting customers with evaluating their~~ business ~~plans~~, tosee ~~licensing~~Note 5 and application support, technology assessments and defining and refining implementation strategies, our team of senior wireless professionals focuses on providing our customers with key insights into all aspects of wireless communications and the impact that a new technology, device or application might have on the industry. We also provide training to our ~~engineers and~~ ~~our~~consolidated ~~customers~~financial ~~through our Wireless Institute, which covers the latest technologies developed and employed throughout the world~~statements.

~~Design~~Operations and ~~Optimization~~Maintenance Services

~~Radio frequency and fixed network engineering.~~ We provide ~~both~~operations ~~radio frequency engineering~~ and ~~fixed~~maintenance ~~network engineering~~ services to ~~design~~wireless ~~wireless~~service ~~networks~~providers ~~for~~with ~~our~~ongoing ~~customers~~outsourcing needs. ~~Our~~Depending ~~engineers design each~~on ~~wireless network based upon the customer~~customers’s ~~transmission requirements~~needs, ~~which are determined based upon~~ the ~~projected level of subscriber density, estimated traffic demand and the~~ scope of ~~the~~such ~~operator’s~~arrangements ~~license coverage area and the most~~varies ~~effective connection to the wireline backbone~~greatly. ~~Our~~We ~~engineers perform~~may ~~the~~assume ~~calculations,~~responsibility ~~measurements~~for ~~and~~all ~~tests~~or ~~necessary~~part ~~to optimize placement~~ of ~~wireless equipment, to optimize use of~~the ~~radio~~day-to-day ~~frequency~~operation and tomaintenance ~~deliver the highest possible signal quality for the greatest portion~~ of ~~subscriber~~wireless ~~usage within existing constraints~~networks. ~~Typical constraints that must be addressed~~ ~~include cost parameters, terrain and license limitations, interference from other operators, site availability limitations and applicable zoning restrictions, as well as other factors.~~

~~In addition, because most wireless calls are ultimately routed~~ ~~through a wireline network, traffic from wireless networks must~~Geographic ~~be connected with switching centers within wireline networks.~~Organization Our fixed network engineers determine the most effective method to connect cell sites to the wireline backbone. We also provide services to cover the core network including interconnect, switching and microwave engineering for all access technologies, including connection into the telecommunications infrastructures of competitive local exchange carriers, or CLECs, and incumbent local exchange carriers, or ILECs. Our engineers will assist carriers in determining the most cost effective and technically efficient means to route traffic across their fixed networks as well as evaluate the implementation of new technologies, such as wireless backhaul, or capabilities to respond to demands for additional capacity as networks handle more traffic from data and media applications.

~~Once~~We provide our services through a ~~wireless~~regional ~~network~~management organization ~~becomes~~that ~~operational~~comprises ~~and~~two ~~the~~principal ~~number~~regions ofand several ~~subscribers~~smaller ~~increases,~~divisions. ~~our~~Our ~~engineers~~primary ~~assist~~operating ~~carriers~~regions ~~to expand~~are ~~system~~“Americas” ~~coverage,~~and ~~system~~“EMEA” ~~capacity~~(Europe, Middle East and ~~optimize~~Africa). ~~performance~~Our toAmericas region, which is headquartered in ~~address~~McLean, ~~changing~~Virginia, ~~requirements.~~provides ~~These~~a ~~activities~~range ~~include~~of service offerings to ~~overlaying~~wireless ~~new~~operators ~~technologies~~and ~~with~~equipment ~~existing~~vendors ~~networks~~in ~~and~~North America. In ~~supporting~~2007 ~~requirements~~Americas ~~for~~generated ~~strategic~~approximately ~~planning,~~32.2% ~~design,~~of our total ~~deployment,~~revenue. ~~expansion~~Our EMEA region, ~~and~~which ~~operations~~is ~~and~~based ~~maintenance~~in ~~phases~~London, ofis aresponsible ~~new~~for ~~cycle~~operations in the ~~life~~United ofKingdom anand ~~existing~~overseas, including orAlgeria, ~~new~~Austria, ~~network.~~Belgium, ~~They~~Egypt, ~~also~~France, Germany, ~~include~~Greece, ~~solutions~~Italy, toLuxembourg, ~~address~~the ~~changing~~Netherlands, ~~requirements~~Pakistan, ~~in how~~Romania, ~~quality~~Saudi ofArabia, ~~service~~Scandinavia, Spain and ~~quality~~Turkey. ofIn ~~end~~2007, ~~user experience is~~we ~~measured,~~established ~~monitored~~a ~~and~~marketing ~~optimized~~office in ~~networks~~Dubai, ~~providing~~United ~~greater~~Arab Emirates ~~degrees~~for ofour ~~data~~EMEA ~~services~~region. ~~including~~In ~~video~~2007, ~~media~~EMEA ~~and~~generated ~~similar~~approximately 67.8% ~~applications~~of our total revenue.

~~Competitive~~The ~~benchmarking. We~~Company’s ~~provide~~nonreportable ~~system analyses~~segments toin ~~our~~2007 ~~wireless~~were ~~customers for the measurement of~~comprised ~~network~~of ~~performance,~~our ~~including~~Asia-Pacific ~~“benchmarking”~~operations ~~their performance~~which ~~versus~~were ~~competitors,~~not ~~based~~significant ~~upon an extensive set of~~in ~~parameters such as call quality~~2007, ~~drop~~LCC ~~call rates~~Wireline, ~~signal strength~~Inc. and ~~coverage~~corporate.

~~Deployment~~For financial information about our operating segments, see ~~Services~~Note 19 to our consolidated financial statements.

~~The Company, in reviewing its strategic objectives, decided to~~ ~~exit the U.S. Network Deployment business in 2006 due to~~Business ~~the increasing amounts of working capital required to operate~~Strategy ~~this business as a result of increasingly~~

The principal elements of our business strategy are to: 7(i) benefit from adjacent market opportunities by leveraging our current knowledge and customer base, (ii) provide end-to-end services in markets that provide compelling opportunities; (iii) increase our presence in new geographic areas to capitalize on emerging opportunities; and (iv) attract and retain highly qualified personnel.

~~Table of Contents~~ 8

~~extended~~• ~~milestone~~Benefit ~~payments~~from ~~under~~adjacent market opportunities by leveraging our current knowledge and customer ~~agreements~~base. We are actively pursuing a strategy to leverage our knowledge base and customer relationships towards expanding our offerings into adjacent markets through new products and services. For example, our Research and Innovation Services team, coupled with our worldwide practical field experience, finds opportunities to ~~associated~~ ~~lesser~~create ~~profit~~and ~~margins~~apply ininnovative methods to dimension, design, optimize and monitor wireless telecommunications networks around the Uworld.S. This results in our ability to leverage unique and patented processes, combined with intellectual capital created by our internal technical and innovative culture, to provide services built around specific software tools based on market demand. As a result, we launched TotalViewtm as our software based tools and services delivery platform. Through TotalViewtm, we can offer performance and optimization services from the ~~focus~~network towards the end-user and the end-user towards the network that combines traditional Quality of Service (QoS) measurements with Mobile Content and Quality of Experience (QoE) measurements to create a unique and valued end-to-end or “total view” solutions for our customers. Our TotalViewtm strategy includes services and tools created within our Research and Innovation Services area, but also includes software based tools developed by key external partners. Consistent with our history as a leader in facilitating the ~~Company’s~~development and adoption of new wireless technologies, we have been active in the research, development and testing of fixed and mobile broadband 3G and 4G networks through consulting engagements with leading broadband carriers and equipment providers. The insight gained led to the creation of recent offerings that target wireless operators challenged by high-bandwidth and high-capacity service delivery based on EVDO, HSDPA and WiMAX technologies, as well as transport technologies such as CWDM, DWDM, SDH and ATM. Our recent offerings include core and transport technologies for wireline operators as well. We intend to expand our integrated offerings to create hosted and managed services where a customer may access QoS or QoE information that resides within our servers or centralized service delivery center. This unique service delivery strategy leverages natural synergies with our engineering businesses and provides a cost effective and faster means to reach new customers and markets. We believe these and other industry trends provide new opportunities to expand our portfolio beyond our current service offerings into areas that offer attractive recurring revenues as well as open the door to new sets of clients such as mobile content, media providers, tier 2 carriers and operators within emerging markets. We intend to pursue organic growth into adjacent markets as well as take advantage of opportunities that may arise to acquire or partner with high quality companies that can enhance our capabilities. • Provide end-to-end services. We provide integrated end-to-end solutions ranging from high level technical consulting, to system design and deployment, to ongoing operations and maintenance services. ~~has shifted~~Our ability to ~~its~~provide ~~overseas~~end-to-end, or turnkey, services enables our wireless customers to engage a single, responsible party who is accountable for delivering and managing projects under a single contract. Accordingly, we leverage initial consulting opportunities to secure later-stage system design, optimization and deployment contracts. Engagements to provide design, optimization and deployment services help us secure ongoing operations and ~~include:~~ maintenance projects, which is an emerging market segment. We intend to pursue these engagements, and will continue to focus our business on radio frequency engineering services and operations and maintenance contracts. Providing ongoing operations and maintenance services positions us well for additional opportunities as wireless service providers must either upgrade their existing networks or deploy new networks to benefit from the latest available technologies. Many clients initially engage us to perform specific services, such as engineering services. Once we secure a client relationship, we work to expand our relationship to provide additional services offered by the company. We do this by understanding the client’s needs and leveraging our reputation and demonstrated performance on client engagements. We typically self-perform network design, site acquisition and zoning services and hire subcontractors to perform civil engineering and construction services under our direct management. Self-performed work generally carries higher profit margins than subcontracted work. As described earlier, based on our assessment of the U.S. deployment market, we exited the U.S. Network Deployment business in 2006. While we have decided that the U.S. deployment market is not attractive for us, we intend to continue pursuing deployment projects in markets that provide compelling opportunities. • Increase our presence in new geographic areas to capture additional growth opportunities. In order to realize the full benefit of wireless services worldwide, we target areas with strong potential growth by

~~Program management. We provide program~~ ~~management services as part of an overall design and deployment~~9 ~~project to manage site acquisition, radio frequency engineering, fixed network engineering and construction management services.~~

~~Site~~creating ~~acquisition~~a ~~and~~localized ~~development~~presence. ~~Our~~ We pursue this effort through establishing a local ~~experts~~ presence, pursuing strategic acquisitions or entering into partnerships to reach new markets. We currently have a localized presence in ~~each~~Algeria, ~~geographic~~Austria, ~~market~~Belgium, ~~evaluate~~Egypt, France, Germany, Greece, Italy, Luxembourg, the ~~feasibility~~Netherlands, ~~and desirability~~Pakistan, ofRomania, ~~base~~Saudi ~~station~~Arabia, ~~locations~~Spain, inturkey, United Arab Emirates and the ~~proposed~~United ~~area according~~Kingdom in addition to the United States, and are considering expansion into other international markets as well as new domestic markets. To increase our local presence in emerging areas we have completed strategic acquisitions and investments in Europe. For example, in December 2006 we acquired Detron Belgium, NV, a company engaged in providing wireless ~~customer~~communications design and deployment services in Belgium and Luxemburg. In March 2007, we acquired the equity interests of Wireless Facilities, Inc.’s ~~requirements, including~~EMEA ~~zoning~~operations ~~ordinance~~which ~~requirements~~expanded our operations into new markets in France, ~~leasing~~Turkey ~~constraints~~and Scandinavia and ~~building~~ further enhanced our presence in the U.K. We intend to continue to pursue organic growth in new markets as well as take advantage of such opportunities as may occur to acquire or partner with high quality companies that accelerate our access ~~issues~~to, and provide us with a local presence in new markets.

~~Architecture~~• Attract and ~~engineering~~retain highly qualified personnel. We ~~manage various~~As ~~activities~~a ~~associated~~service ~~with~~business, ~~the~~our ~~design~~success depends on our ability to attract, ~~layout~~train and ~~physical~~ ~~assessment~~retain ofhighly ~~existing~~skilled ~~and~~professionals. ~~proposed~~As ~~telecommunications facilities~~a result, ~~including~~we ~~base~~seek ~~stations~~to ~~and~~recruit ~~switching~~highly ~~centers.~~skilled ~~This includes~~personnel, ~~managing~~facilitate ~~architecture~~their professional development and ~~engineering~~create ~~firms~~a ~~with respect~~business toatmosphere ~~site~~that ~~drawings~~encourages their continued employment. As of December 31, ~~zoning~~2007, ~~exhibits~~we had 1,304 ~~and~~total ~~structural analysis~~employees, ~~and~~of ~~making~~which ~~recommendations~~842 towere ~~confirm~~billable employees. As of that date, approximately 68.1% of our billable employees were employed outside of the ~~infrastructure~~ ~~has~~United States. In May 2007, we significantly increased the ~~structural~~number ~~capacity~~of toskilled ~~accommodate~~billable professionals in the ~~design~~ U.S. as a result of the ~~wireless~~acquisition ~~network~~of the Wireless Facilities, Inc. WeU.S. ~~also~~radio ~~provide~~frequency ~~other~~engineering ~~materials~~ business. Our professional staff is highly educated with many of our engineering professionals holding masters degrees or doctorates. Recognizing the critical importance of retaining highly qualified personnel for our business, we work closely with our employees to develop and ~~services~~enhance asthe ~~may~~technical, professional and management skills required to be ~~necessary~~successful at our Company. Our senior management believes it is critically important to ~~secure~~create ~~building~~and ~~permits~~maintain an open culture that encourages learning, responsibility and ~~jurisdictional~~ ~~approvals~~collaboration. For example, Dean J. Douglas, our Chief Executive Officer, hosts bi-monthly teleconference meetings with all employees to foster an open working environment. We also invest in all of our professionals by expanding their professional education through our Wireless Institute, which provides training for our engineers and our customers covering the latest technologies developed and deployed throughout the world.

~~Construction and procurement management. We~~ ~~manage various construction subcontractors to prepare the~~Customers ~~rooftop or tower site~~ and ~~secure the proper electrical and~~Backlog telecommunications connections. We also manage the procurement of materials and equipment for our wireless customers and the installation of radio frequency equipment, including base station electronics and antennae.

~~For~~We ~~financial~~provide ~~information~~consulting, ~~about~~design, ~~the~~deployment, ~~sale~~and ofoperations ~~the~~and Umaintenance services to wireless service providers, telecommunications equipment vendors, satellite service providers, systems integrators and tower companies.~~S. Network~~ ~~Deployment~~In ~~business~~2007, revenues ~~see~~from ~~Note 4~~our tolargest customer, Saudi Telecommunication Company, were 18.1% of our total revenues. Our other large ~~consolidated~~customers ~~financial~~include: ~~statements~~Algeria Telecom, AT&T Wireless, Ericsson, Nokia, Orange Personal Communication Services Limited, Siemens, Sprint, T-Mobile and Vodaphone. Our top ten customers accounted for 63.3% of revenues for the year ended December 31, 2007.

Our firm backlog was $61.6 million at December 31, ~~Operations~~2007. We define firm backlog as the value of work-in-hand to be done with customers as of a specific date where the following conditions are met: (i) the price of the work to be done is fixed; (ii) the scope of the work to be done is fixed, both in definition and ~~Maintenance~~amount ~~Services~~(for example, the number of sites has been determined); and (iii) there is a written contract, purchase order, agreement or other documentary evidence which represents a firm commitment by the client to pay us for the work to be performed. We also had implied backlog of approximately $16.6 million as of December 31, 2007. We define implied backlog as the estimated revenues from master service agreements and similar arrangements, which have met the first two conditions set forth above but for which we have not received a firm contractual commitment. Our contracts typically include provisions that permit customers to terminate their contracts under various circumstances, including for customer convenience.

WeSales ~~provide operations~~ and ~~maintenance services to wireless~~ ~~service providers with ongoing outsourcing needs. Depending on~~Marketing ~~customers’ needs, the scope of such arrangements varies greatly. We may assume responsibility for all or part of the day-to-day operation and maintenance of wireless networks.~~

We sell and market our consulting, design, performance ~~Geographic~~optimization, benchmarking and operations and maintenance ~~Organization~~services through the collaborative efforts of our sales force, our senior management, our marketing

~~We provide our services through a regional management~~ ~~organization that comprises two principal regions and several~~10 smaller divisions. Our primary operating regions are “Americas” and “EMEA” (Europe, Middle East and Africa). Our Americas region, which is headquartered in McLean, Virginia, provides a range of service offerings to wireless operators and equipment vendors in North America. In 2006 Americas generated approximately 23% of our total revenue. Our EMEA region, which is based in London, is responsible for operations in the United Kingdom and overseas, including Algeria, Belgium, Germany, Greece, Italy, Luxembourg, the Netherlands, Pakistan, Spain, and Saudi Arabia. In 2004, we established a marketing office in Dubai, UAE for our EMEA region. In 2006, EMEA generated approximately 77% of our total revenue.

~~The~~group ~~Company’s~~and ~~nonreportable~~our ~~segments~~Wireless inInstitute. ~~2006~~Our ~~were~~sales ~~comprised~~representatives work ofin conjunction with our ~~Asia-Pacific~~senior ~~operations~~executives ~~which~~and ~~were~~delivery organizations ~~not~~to ~~significant~~develop innew client relationships, drive revenue ~~2006,~~growth ~~LCC~~and ~~Wireline,~~establish ~~Inc~~the Company as a primary solutions provider to our clients., ~~corporate,~~Sales personnel and ~~the~~our ~~Wireless~~senior ~~Institute~~management proactively establish contact with key decision makers at all levels within our clients to identify and capture opportunities and work to establish awareness and preference for our services. InBecause ~~2006,~~customers’ ~~these~~purchasing ~~combined~~decisions ~~operations~~often ~~generated~~involve ~~less~~an extended ~~than~~decision 1%making process requiring involvement of their technical personnel, our sales personnel work collaboratively ~~total~~with ~~revenues~~our technical consulting and network personnel to develop new sales leads and secure new contracts. ~~Through~~Excluding our Wireless Institute staff, as of December 31, 2007, we ~~provide~~employed ~~training~~36 full-time tosales and marketing staff, based in our offices ~~engineers~~in ~~and~~Algeria, ~~customers~~Belgium, ~~covering~~France, Italy, the ~~latest~~Netherlands, ~~technologies~~Pakistan, ~~developed~~Saudi ~~and~~Arabia, ~~employed~~Scandinavia, ~~throughout~~Spain, the ~~world~~United Arab Emirates, the United Kingdom and the United States.

~~For financial information about our operating segments, see~~ ~~Note 18 to our consolidated financial statements.~~Marketing

In 2006 and 2007, we also invested in expanding and enhancing ~~Business~~our marketing organization, which has direct responsibility to ~~Strategy~~enhance brand equity. Our marketing staff supports our business strategy through the development of new products and services, articles, publications, analyst meetings and trade shows and key industry conferences. In 2006, the marketing team launched TotalView tm, a tools based services strategy that creates additional value for our existing services, as well as a platform to launch new services as the Company extends its service portfolio across other segments of the wireless industry. Our marketing group leads the positioning of our service offerings, creates company awareness, brand recognition and manages joint marketing efforts with strategic alliance partners. The Company’s service offerings center around the mobile content delivery that measures performance from an end-user perspective. The marketing group conducts market and competitive analyses, defines industry-specific business requirements and identifies potential sales opportunities, develops key business plans and go-to-market models, develops key marketing and sales materials, manages the website and company content, and manages as the day to day operations of our investor relations efforts.

~~The principal elements of our business strategy are to:~~ ~~(i) benefit from adjacent market opportunities by~~Wireless ~~leveraging our current knowledge and customer base,~~Institute (ii) provide end-to-end services in markets that provide compelling opportunities; (iii) increase our presence in new geographic areas to capitalize on emerging opportunities; and (iv) attract and retain highly qualified personnel.

The Wireless Institute delivers knowledge that powers the 8world’s networks in the carrier, manufacturer and content provider communities. As the wireless industry’s pioneer training and knowledge transfer organization, our Wireless Institute was the first in the industry to introduce a complete engineering curriculum and a comprehensive set of programs in wireless engineering and wireless network deployment. Today, the Wireless Institute continues to train the industry, as well as our own engineers, in cutting edge broadband network technologies such as UMTS, EVDO and WiMAX. Over the years, the Institute’s distinguished faculty has conducted international knowledge transfer projects and thousands of classes around the world.

~~Table~~ Research and ~~of Contents~~Innovation

	•	Benefit from adjacent market opportunities by leveraging our current knowledge and customer base. We are actively pursuing a strategy to leverage our knowledge base and customer relationships towards expanding our offerings into adjacent markets through new products and services. For example, our Research and Innovation Services team, coupled with our worldwide practical field experience, finds opportunities to create and apply innovative methods to dimension, design, optimize and monitor wireless telecommunications networks around the world. This results in our ability to leverage unique and patented processes, combined with intellectual capital created by our internal technical and innovative culture, to provide services built around specific software tools based on market demand. As a result, we launched TotalViewtm as our software based tools and services delivery platform. Through TotalViewtm, we can offer performance and optimization services from the network towards the end-user and the end-user towards the network that combines traditional Quality of Service (QoS) measurements with Mobile Content and Quality of Experience (QoE) measurements to create a unique and valued end-to-end or “total view” solutions for our customers. Our TotalViewtm strategy includes services and tools created within our Research and Innovation Services area, but also includes software based tools developed by key external partners. We announced a global partnership with Zandan to integrate various aspects of their software and hardware platforms which became the foundation to launch ContentViewtm, our mobile content and quality of experience solution. As part of our TotalViewtm platform, we also launched WiViewtm, a broadband dimensioning and planning tool that includes business modeling and return-on-investment scenarios that specifically assist our clients in 4G business planning strategies. Consistent with our history as a leader in facilitating the development and adoption of new wireless technologies, we have been active in the research, development and testing of fixed and mobile broadband 3G and 4G networks through consulting engagements with leading broadband carriers and equipment providers. The insight gained led to the creation of recent offerings that target wireless operators challenged by high-bandwidth and high-capacity service delivery based on EVDO, HSDPA and WiMAX technologies. We intend to expand our integrated offerings to create hosted and managed services where a customer may access QoS or QoE information that resides within our servers or centralized service delivery center. This unique service delivery strategy leverages natural synergies with our engineering businesses and provides a cost effective and faster means to reach to new customers and markets. We believe these and other industry trends provides new opportunities to expand our portfolio beyond our current service offerings into areas that offer attractive recurring revenues as well as opens the door to new sets of clients such as mobile content, media providers, tier 2 carriers and operators within emerging markets. We intend to pursue organic growth into adjacent markets as well as take advantage of opportunities that may arise to acquire or partner with high quality companies that can enhance our capabilities.
	•	Provide end-to-end services. We provide integrated end-to-end solutions ranging from high level technical consulting, to system design and deployment, to ongoing operations and maintenance services. Our ability to provide end-to-end, or turnkey, services enables our wireless customers to engage a single, responsible party who is accountable for delivering and managing projects under a single contract. Accordingly, we leverage initial consulting opportunities to secure later-stage system design, optimization and deployment contracts. Engagements to provide design, optimization and deployment services help us secure ongoing operations and maintenance projects, which is an emerging market segment. We intend to pursue these engagements, and will continue to focus our business on radio frequency engineering services and operations and maintenance contracts. Providing ongoing operations and maintenance services positions us well for additional opportunities as wireless service providers must either upgrade their existing networks or deploy new networks to benefit from the latest available technologies. For example, during 2005, we were able to leverage our established relationship with Algeria Telecom Mobilis as a consulting and engineering services provider into a turnkey deployment services engagement. Many clients initially engage us to perform specific services, such as engineering services. Once we secure a client relationship, we work to expand our relationship to provide additional services offered by the company. We do this by understanding the client’s needs and leveraging our reputation and demonstrated performance on client engagements. We typically self-perform network design, site acquisition and zoning services and hire subcontractors to perform civil engineering and construction services under our direct management. Self-performed work generally carries higher profit margins than subcontracted work. As described earlier, based on our assessment of the U.S.

We have 25 years of experience which has produced our team of leaders — executives and engineers, many with PhDs — who have worked alongside of and even trained members of the manufacturers and major carriers in the business. Our team has been involved in innovations in EDGE, UMTS, HSDPA, EVDO, WiMAX and the creation of world-class 3G networks.

The Company’s technical consulting services range from 9technology consulting to business planning with CapEx/OpEx modeling and individualized custom projects that address specific client needs. These services provide the technical expertise required to maximize business efficiencies through an in-depth understanding of wireless technology. Through our consulting services, customers gain critical insight into wireless communications, including the possible impact of new broadband technologies, devices or applications on the industry. Our Research and Innovation Services area also creates tools where none yet exist for unique greenfield networks, as well as special network needs.

~~Table of Contents~~ Competition

~~deployment~~ The market, wefor ~~exited~~technical ~~the~~consulting, ~~U.S.~~design, ~~Network~~deployment, ~~Deployment~~and operations ~~business~~and inmaintenance ~~2006.~~is ~~While~~highly wecompetitive ~~have~~and ~~decided~~fragmented and ~~that~~includes ~~the~~numerous Uservice providers.S. ~~deployment~~In ~~market is not attractive for us~~particular, we believe ~~intend to continue pursuing deployment projects in markets~~ that ~~provide~~the ~~compelling~~competition ~~opportunities.~~in

	•	Increase our presence in new geographic areas to capture additional growth opportunities. In order to realize the full benefit of wireless services worldwide, we target areas with strong potential growth by creating a localized presence. We pursue this effort through establishing a local presence, pursuing strategic acquisitions or entering into partnerships to reach new markets. We currently have a localized presence in Algeria, Belgium, Germany, Greece, Italy, Luxembourg, Pakistan, Spain, the Netherlands, Saudi Arabia, United Arab Emirates and the United Kingdom in addition to the United States, and are considering expansion into other international markets as well as new domestic markets. To increase our local presence in emerging areas we have completed strategic acquisitions and investments in Europe. For example, in December 2006 LCC United Kingdom Limited, a wholly owned subsidiary of the Company, acquired Detron Belgium, NV, a company engaged in providing wireless communications design and deployment services in Belgium and Luxemburg. We intend to continue to pursue organic growth in new markets as well as take advantage of such opportunities as may occur to acquire or partner with high quality companies that accelerate our access to, and provide us with a local presence in new markets.
	•	Attract and retain highly qualified personnel. As a service business, our success depends on our ability to attract, train and retain highly skilled professionals. As a result, we seek to recruit highly skilled personnel, facilitate their professional development and create a business atmosphere that encourages their continued employment. As of December 31, 2006, we had 783 total employees, of which 600 were billable employees. As of that date, approximately 72.5% of our billable employees were employed outside of the United States. Our professional staff is highly educated with many of our engineering professionals holding masters degrees or doctorates. Recognizing the critical importance of retaining highly qualified personnel for our business, we work closely with our employees to develop and enhance the technical, professional and management skills required to be successful at our Company. Our senior management believes it is critically important to create and maintain an open culture that encourages learning, responsibility and collaboration. For example, Dean J. Douglas, our Chief Executive Officer, hosts bi-monthly teleconference meetings with all employees to foster an open working environment. We also invest in all of our professionals by expanding their professional education through our Wireless Institute, which provides training for our engineers and our customers covering the latest technologies developed and deployed throughout the world.

Europe is particularly fragmented with numerous small, regional ~~Customers~~independent service providers. Our competitors fall into three ~~and~~broad ~~Backlog~~categories:

We• ~~provide~~internal ~~consulting,~~staffs ~~design,~~of ~~deployment, and operations and maintenance services to~~ wireless service providers, ~~telecommunications~~ ~~equipment~~• ~~vendors,~~wireline ~~satellite~~ service providers, ~~systems integrators~~ and ~~tower~~• ~~companies.~~independent Inservice ~~2006~~companies, ~~revenues~~ ~~from~~which ~~Algeria~~provide ~~Telecom~~a ~~were~~full ~~22.4%~~range of ~~our~~wireless ~~total~~network ~~revenues~~services, ~~revenues~~ ~~from Saudi Telecommunication Company were 17.9% of our total revenues~~ and ~~revenues~~a ~~from~~large ~~Cingular~~number ~~Wireless were 8.5%~~ of ~~our~~ ~~total revenues. Some of our~~ other ~~customers~~companies ~~include: Ericsson,~~that ~~Nokia,~~provide ~~Orange~~limited ~~Personal~~wireless ~~Communication Services Limited, Siemens, Sprint, T-Mobile and Vodaphone~~services. ~~Our top ten customers accounted for 82.7% of total revenues for the year ended December 31, 2006.~~

~~Our~~We ~~firm~~believe ~~backlog~~that ~~was~~the ~~approximately~~principal ~~$37.1 million~~competitive ~~at December 31,~~factors ~~2006.~~in Weour ~~define firm backlog as the value of~~market ~~work-in-hand to~~include beindependence, ~~done~~expertise ~~with~~in ~~customers~~new asand ~~of a specific date where the~~evolving ~~following~~technologies, ~~conditions~~industry ~~are~~experience, ~~met:~~ability ~~(i) the~~to ~~price~~deliver ~~of the work~~ end-to-end beservices, ~~done~~ability ~~is fixed; (ii) the scope of the work~~ to beprovide ~~done~~hardware isand technology-independent ~~fixed~~solutions, ~~both~~ability into ~~definition~~deliver ~~and~~results ~~amount~~within ~~(for~~budget ~~example,~~and ~~the~~on ~~number of~~time, ~~sites~~worldwide ~~has~~depth ~~been~~of ~~determined);~~resources, and ~~(iii) there~~reputation isand ~~a written~~competitive ~~contract,~~pricing. ~~purchase~~In ~~order~~particular, ~~agreement~~we orbelieve ~~other~~that ~~documentary evidence which represents a firm commitment by~~ the ~~client~~breadth toof ~~pay~~our usservice ~~for~~offerings, the ~~work~~efficiencies ~~to be performed. We also had implied backlog~~ of ~~approximately~~ ~~$19.0 million~~our ~~as of December 31~~processes, ~~2006.~~our Weability ~~define~~to ~~implied~~integrate ~~backlog~~new astechnologies ~~the~~and ~~estimated~~equipment ~~revenues~~ from ~~master~~ ~~service~~multiple ~~agreements and similar arrangements~~vendors, ~~which~~our ~~have~~ability ~~met~~to ~~the first~~provide ~~two~~training ~~conditions set forth above but~~ for ~~which we have not~~our ~~received~~customers athrough ~~firm~~our ~~contractual~~Wireless ~~commitment.~~Institute ~~Our~~and ~~contracts~~the ~~typically include~~high ~~provisions~~quality ~~that permit customers to terminate their~~of ~~contracts~~our ~~under~~professional ~~various~~staff ~~circumstances,~~provide ~~including~~us ~~for~~with ~~customer convenience~~a competitive advantage.

We believe our ability to compete depends on a number of 10additional factors, which are outside of our control, including: (i) the ability and willingness of customers to rely on their internal staffs to perform services themselves; and (ii) the customers’ desire to bundle equipment and services.

~~Table of Contents~~ Employees

As of December 31, 2007, we had 1,304 total employees ~~Sales~~worldwide. We believe that relations with our employees are good. None of our employees is represented by a labor union and ~~Marketing~~we have not experienced any work stoppages.

~~We sell and market our consulting, design, deployment, and~~ ~~operations and maintenance services through the collaborative~~International ~~efforts of our sales force, our senior management, our marketing~~Operations group and our Wireless Institute. Our sales representatives work in conjunction with our senior executives and delivery organizations to develop new client relationships, drive revenue growth and establish the Company as a primary solutions provider to our clients. Sales personnel and our senior management proactively establish contact with key decision makers at all levels within our clients to identify and capture opportunities and work to establish awareness and preference for our services. Because customers’ purchasing decisions often involve an extended decision making process requiring involvement of their technical personnel, our sales personnel work collaboratively with our technical consulting and network personnel to develop new sales leads and secure new contracts. Excluding our Wireless Institute staff, as of December 31, 2006, we employed 27 full-time sales and marketing staff, based in our offices in Italy, the Netherlands, Spain, the United Kingdom and the United States.

During the last three years, our international operations have ~~Sales~~become an increasingly significant source of our revenue. From the late 1990s until recently we entered into a number of strategic acquisitions and investments to enhance our international wireless capabilities and to establish a local presence in several countries. Our operations in the United Kingdom, France, Turkey, Italy, Belgium, the Netherlands and Scandinavia are a direct result of such investments. In addition, we established local capabilities by virtue of receiving the award of projects in countries such as Saudi Arabia, Pakistan and Algeria, which comprised 35.1% of our revenues in the EMEA region in 2007. We also have a localized presence in Austria, Egypt, Germany, Greece, Luxembourg, Romania, Spain and the United Arab Emirates.

InThe ~~2006,~~further wedevelopment ~~invested~~of ~~in expanding~~ our ~~sales~~international ~~organization~~operations ~~within~~requires ~~North~~us ~~America~~to byresearch ~~adding~~and 8comply ~~new sales representatives~~ with ~~responsibility~~ ~~for~~local ~~regional~~laws and ~~client based responsibilities.~~regulations, ~~The~~including ~~overall~~employment, ~~number~~corporate ofand ~~sales~~tax ~~staff~~laws. ~~increased~~For toexample, 27if ~~in the~~we ~~Company,~~enter ~~for~~into a ~~total~~longer ~~increase~~term incontract ~~2006~~overseas, ofwe ~~69%~~are ~~over that number in~~often ~~2005.~~required Asto ~~part~~establish ofa ~~this~~local ~~investment~~presence in country, ~~and~~either as a ~~result of our having~~ ~~exited~~branch ~~the~~or ~~U.S. Network~~subsidiary, ~~Deployment business~~and, weif ~~recruited sales~~hiring ~~personnel~~locally, ~~with~~to ~~experience~~comply inwith ~~selling~~all local ~~consulting~~employment, ~~overall solutions~~recruiting, hiring and ~~long-term~~benefit ~~outsourcing engagements~~requirements.

In addition, when not hiring locally, we face the task of ~~Marketing~~obtaining visas and work permits for our assigned employees and must comply with local tax requirements for our expatriate employees.

InFor ~~2006,~~financial weinformation ~~also~~about ~~invested in expanding and enhancing~~ our ~~marketing~~ ~~organization,~~international ~~which has direct responsibility to enhance brand equity. Our marketing staff supports our business strategy through the development of new products and services~~operations, ~~articles,~~see ~~publications,~~note 19 analyst meetings and trade shows and key industry conferences. In 2006, the marketing team launched TotalViewtm, a tools based services strategy that creates additional value for our existing services as well as a platform to launch new services as the Company extends its service portfolio across other segments of the wireless industry. The Company’s service offerings center around the mobile content delivery that measures performance from an end-user perspective. The marketing group conducts market and competitive analyses, defines industry-specific business requirements and identifies potential sales opportunities, develops key business plans and go-to-market models, develops key marketing and sales collateral materials, manages the website and company content, as well as the day to day operations of our ~~investor~~consolidated ~~relations~~financial ~~efforts~~statements. ~~Our marketing~~ ~~group leads the positioning of our service offerings, creates company awareness, brand recognition and manages joint marketing efforts with strategic alliance partners.~~

~~Wireless~~Government ~~Institute~~Regulation

~~The~~Although ~~Wireless~~we ~~Institute~~are ~~delivers~~not ~~knowledge~~directly ~~that~~subject ~~powers~~to ~~the world’s~~any ~~networks~~FCC inor ~~the carrier, manufacturer and content~~similar ~~provider~~government ~~communities.~~regulations, As the wireless ~~industry’s~~networks ~~pioneer training~~that ~~and~~we ~~knowledge transfer organization~~design, ~~our Wireless~~ ~~Institute~~deploy ~~was~~and ~~the~~manage ~~first~~are insubject ~~the~~to ~~industry~~various toFCC ~~introduce~~regulations ain ~~complete~~the ~~engineering~~United ~~curriculum~~States and aother ~~comprehensive~~international ~~set~~regulations. ~~of programs in~~These ~~wireless~~regulations ~~engineering~~require ~~and~~that ~~wireless~~these ~~network~~networks ~~deployment.~~meet ~~Today,~~certain ~~the~~radio ~~Wireless~~frequency ~~Institute~~emission ~~continues to train the industry~~standards, asnot ~~well~~cause asunallowable interference ~~our~~to ~~own~~other ~~engineers~~services, and in ~~cutting~~some ~~edge~~cases ~~broadband~~accept ~~network~~interference from ~~technologies~~other ~~such as UMTS, EVDO and WiMAX~~services. ~~Over~~These ~~the~~networks ~~years,~~are ~~the Institute’s~~also ~~distinguished~~subject ~~faculty~~to ~~has conducted~~government ~~international~~regulations ~~knowledge~~and ~~transfer~~requirements ~~projects~~of ~~and~~local ~~thousands~~standards ofbodies outside ~~classes around~~ the ~~world~~United States.

~~Research~~ ~~and Innovation~~12

~~We have over 24 years of experience which has produced our~~ ~~team of leaders — executives and engineers, many with~~Additional ~~PhDs — who have worked alongside of and even trained~~Information ~~members of the manufacturers and major carriers in the business. Our team has been involved in innovations in EDGE, UMTS, HSDPA, EVDO, WiMAX and the creation of world-class 3G networks.~~

AsThe ~~mentioned~~Company’s ~~previously~~internet address is www.lcc.com. A copy of this annual report on Form 10-K, as ~~the~~well ~~Company’s~~as ~~technical~~other ~~consulting~~annual reports on ~~services~~Form 10-K, quarterly ~~range~~reports ~~from~~on Form 10-Q, current ~~technology~~reports ~~consulting~~on Form 8-K and amendments to ~~business~~those ~~planning~~reports are accessible free of charge on ~~with~~our ~~CapEx/OpEx~~website ~~modeling~~or the Securities and ~~individualized~~Exchange ~~custom~~Commission (“SEC”) ~~projects~~website ~~that~~in the EDGAR database at www.sec.gov. ~~address~~as ~~specific~~soon ~~client~~as reasonably possible after such report is filed with or furnished to the SEC.

11 Item 1A. Risk Factors

~~Table of Contents~~ Risk Factors

~~needs.~~In ~~These services provide the technical expertise required~~any togiven ~~maximize~~year, ~~business~~we ~~efficiencies~~derive ~~through~~a ansignificant ~~in-depth understanding~~portion of ~~wireless technology. Through~~ our ~~consulting services,~~revenues ~~customers gain critical insight into wireless~~from ~~communications,~~a ~~including~~limited ~~the~~number ~~possible impact~~ of ~~new~~large ~~broadband technologies~~projects, ~~devices~~and, orif ~~applications~~we onare ~~the~~unable ~~industry. Our~~to ~~Research~~replace ~~and~~these ~~Innovation~~large ~~Services~~projects ~~area~~upon ~~also~~completion, ~~creates~~we ~~tools~~could ~~where~~have a ~~none~~significant ~~yet~~decrease ~~exist~~in ~~for~~our ~~unique~~revenues ~~greenfield~~which ~~networks~~would asnegatively impact ~~well~~our asability ~~special network~~to ~~needs~~generate income.

We have derived, and believe that we will continue to derive, a ~~Competition~~significant portion of our revenues in any given year from a limited number of large projects. For example, for the year ended December 31, 2007, our largest project was for Saudi Telecommunication Company , (“STC”), which comprised 18.1% of our total revenues. As these projects wind down to completion, we face the task of replacing such revenues with new projects. Our inability to replace such revenues would cause a significant decrease in our revenues and negatively affect our operating results.

~~The market for technical consulting, design, deployment, and~~We ~~operations~~generate ~~and~~a ~~maintenance~~substantial isportion ~~highly~~of ~~competitive~~our ~~and~~revenues ~~fragmented and~~from ~~includes~~a ~~numerous service providers. In particular, we~~limited ~~believe~~number ~~that~~of ~~the~~customers, ~~competition~~and inif ~~Europe~~our isrelationships ~~particularly fragmented~~ with ~~numerous small, regional independent service~~these ~~providers.~~customers ~~Our~~were ~~competitors~~harmed ~~fall~~our ~~into~~business ~~three~~would ~~broad categories:~~suffer.

• For ~~internal~~the ~~staffs~~years ofended ~~wireless~~December 31, 2007 and ~~wireline~~2006, ~~service~~we ~~providers;~~derived 63.3% •and ~~telecommunications~~82.7%, ~~equipment vendors~~respectively, ~~such~~of asour ~~Ericsson~~total ~~and~~revenues ~~Nortel,~~from ~~which~~our ten ~~frequently~~largest ~~provide~~customers. ~~design~~We ~~and~~believe ~~deployment~~that ~~services~~a aslimited ~~part~~number of customers anwill ~~equipment~~continue ~~sale~~to orbe ~~pursue~~the ~~large~~source ~~scale~~of ~~outsourcing~~a ~~contracts~~substantial portion onof anour ~~independent~~revenues ~~basis;~~for ~~and~~the •foreseeable ~~independent~~future. ~~service~~Key ~~companies~~factors in maintaining our relationships with these customers include, for ~~which~~example, ~~provide~~our aperformance ~~full~~on ~~range~~individual contracts and the strength of ~~wireless~~our ~~network~~professional ~~services~~reputation. To the extent that our performance does not meet client expectations, ~~and~~or aour ~~large~~reputation or ~~number~~relationships ofwith ~~other~~one ~~companies~~or ~~that~~more ~~provide~~key ~~limited~~clients ~~wireless~~are ~~services~~impaired, our revenues and operating results could be materially harmed.

~~Although the services provided by many of these competitors are~~Recent ~~comparable~~and tocontinuing ~~the~~consolidations ~~services~~among wewireless ~~provide,~~service ~~there are areas where~~providers ~~certain competitors~~ may ~~have~~result anin ~~advantage~~a ~~over~~significant ~~us.~~reduction ~~For~~in ~~example, telecommunications~~our ~~equipment~~existing ~~vendors presumably know the~~and ~~relative~~potential ~~strengths~~customer base, and, ~~weaknesses~~if ofwe ~~their~~are ~~products~~unable ~~better~~to ~~than~~maintain our ~~the~~existing ~~service~~relationships ~~providers~~with ~~who~~such ~~have~~providers noor ~~product~~expand ~~offerings; and~~such ~~equipment vendors~~relationships, ~~construction~~we ~~companies~~could ~~and management companies~~ have ~~greater~~a ~~financial~~significant ~~resources~~decrease ~~that~~in ~~allow them to~~our ~~offer~~revenues, ~~financing~~which ~~and~~would ~~deferred~~negatively ~~payment~~impact ~~arrangements. In addition, many of~~ our ~~competitors~~ability ~~have~~to ~~significantly greater marketing~~generate ~~resources,~~income ~~larger~~as ~~workforces~~well ~~and~~as ~~greater~~result ~~name~~in ~~recognition~~lower ~~than~~profitability or possible uslosses.

WeThe ~~believe~~level ~~our~~of ~~ability~~merger toactivity ~~compete~~among ~~depends~~telecommunications onoperators has aincreased ~~number~~markedly ofin the recent past and this trend is ~~additional~~continuing. ~~factors~~For example, ~~which~~one ~~are~~of ~~outside~~our customers, Cingular, merged with AT&T Wireless and one of our ~~control~~largest customers, Sprint, ~~including:~~merged with Nextel. These consolidations have reduced ~~(i)~~ and may continue to reduce the ~~willingness~~number of ~~competitors~~companies comprising that portion of our customer base consisting of wireless service providers. To the extent that these combined companies decide to reduce ~~finance~~the number of their service providers, our already highly ~~customers’~~competitive ~~projects~~market onenvironment ~~favorable~~will ~~terms;~~become ~~(ii)~~ more competitive, at least in the short term, as the same number of service providers ~~ability~~will ~~and~~seek ~~willingness~~business from a reduced base of potential customers. We have historically derived a significant portion of our revenues in any given year from a limited number of large projects. Also, we may not be able to ~~rely~~reduce oncosts ~~their~~in ~~internal~~response ~~staffs~~to any decrease in our revenues. If we are unable to ~~perform~~maintain our ~~services~~existing ~~themselves;~~relations ~~and~~with ~~(iii) the~~these companies or expand such ~~customers’~~relationships, ~~desire~~we could have a significant decrease in our revenues, which would negatively impact our ability to ~~bundle~~generate income ~~equipment~~as ~~and~~well ~~services~~as result in lower profitability.

~~We believe that the principal competitive factors in our market~~ ~~include independence, expertise in new and evolving~~13 technologies, industry experience, ability to deliver end-to-end services, ability to provide hardware and technology-independent solutions, ability to deliver results within budget and on time, worldwide depth of resources, and reputation and competitive pricing. In particular, we believe that the breadth of our service offerings, the efficiencies of our processes, our ability to integrate new technologies and equipment from multiple vendors, our ability to provide training for our customers through our Wireless Institute and the high quality of our professional staff provide us with a competitive advantage.

~~Employees~~We may experience significant fluctuations in our quarterly results as a result of uncertainties relating to our ability to generate additional revenues, manage our expenditures and other factors, certain of which are outside of our control.

AsOur ofquarterly ~~December 31,~~and ~~2006,~~annual weoperating ~~had~~results ~~783~~have ~~total employees~~varied ~~worldwide.~~considerably Wein ~~believe~~the ~~that~~past ~~relations~~and ~~with~~are ~~our~~likely ~~employees~~to ~~are~~vary considerably due ~~good.~~to ~~None~~a number of ~~our~~factors, ~~employees~~including isthose ~~represented~~factors bydiscussed ain this ~~labor~~“Risk ~~union,~~Factors” ~~and~~section. Many of these factors are weoutside ~~have~~our ~~not~~control ~~experienced~~and ~~any~~include, ~~work~~among ~~stoppages.~~others:

~~International Operations~~ • the timing of receipt of new licenses, use of existing spectrum for new services, or financing by potential customers; • service and price competition; • the commencement, progress, completion or termination of contracts during any particular quarter; • the availability of equipment to deploy new technologies such as broadband; • the growth rate of wireless subscribers, which has a direct impact on the rate at which new cell sites are developed and built; and • telecommunications market conditions and economic conditions generally.

~~During~~Due ~~the~~to ~~last~~these ~~three years~~factors, our ~~international~~results ~~operations~~for ~~have become an increasingly significant source of our revenue. From the late 1990s until recently we entered into~~ a ~~number~~particular ~~of strategic~~quarter ~~acquisitions and investments to enhance our~~may ~~international~~not ~~wireless~~meet ~~capabilities and to establish a local presence in several countries. Our operations in~~ the ~~United Kingdom,~~expectations ~~Italy, and the Netherlands are a direct result~~ of ~~three such~~securities ~~investments.~~analysts Inand ~~addition~~investors, ~~we established local capabilities~~ bywhich ~~virtue~~could ofcause ~~receiving~~the anprice ~~award~~ of aour ~~project~~stock into ~~countries such~~decline ~~as Saudi Arabia and Algeria, which comprised 52~~significantly.~~4% of our~~ ~~revenues in the EMEA region in 2006.~~

Our 12contracts typically contain provisions giving customers the ability to terminate their contracts under various circumstances and we may not be able to replace the revenues from such projects which may have an adverse effect on our operating results due to our decreased revenues.

~~Table~~ Our contracts typically have provisions that permit customers to terminate their contracts under various circumstances, including termination for convenience. We also believe that intense competition and the current trend in industry contracting toward shorter-term contracts that provide increased grounds for customer termination may result in increased frequency of customer ~~Contents~~termination or renegotiation. If large projects, or a number of projects that in the aggregate account for a material amount of our revenues, are suspended for any significant length of time or terminated, we may encounter difficulty replacing such revenues and our operating results would decline as a result of our decreased revenues.

~~The further development of our international operations requires~~Our usAmended ~~to research~~ and ~~comply~~Restated ~~with~~Credit ~~local~~Agreement ~~laws~~contains ~~and~~certain ~~regulations,~~financial ~~including~~tests ~~employment, corporate~~ and ~~tax~~requires ~~laws.~~certain ~~For~~mandatory ~~example~~prepayments, ~~if we~~the ~~enter~~achievement ~~into~~of awhich ~~longer~~is ~~term~~dependent ~~contract~~to ~~overseas,~~a wesignificant ~~are~~extent ~~often~~on the ~~required~~performance toof ~~establish~~our abusiness ~~local~~as ~~presence~~well ~~in country, either~~ as aachieving certain ~~branch~~benefits orfrom ~~subsidiary,~~our ~~and,~~recent ifacquisition ~~hiring~~of ~~locally,~~the toU.S. ~~comply with all~~engineering ~~local~~business ~~employment,~~of ~~recruiting~~Wireless Facilities, ~~hiring and benefit requirements~~Inc.

InOur ~~addition~~Amended and Restated Credit Agreement requires us to meet certain periodic financial tests, ~~when~~including ~~not~~monthly ~~hiring~~cumulative EBITDA ~~locally~~covenants, weand ~~face~~requires us to make mandatory prepayments in 2008 and 2009. We have been in default under the ~~task~~Amended and Restated Credit Agreement, including defaults relating to financial covenants. These defaults have been waived by our lender and the Amended and Restated Credit Agreement has been amended, among other things, to revise certain of the periodic ~~obtaining~~financial ~~visas~~tests. Our ability to meet the periodic financial tests and ~~work~~fund ~~permits~~the ~~for~~mandatory prepayments will depend on the performance of our ~~assigned~~business, ~~employees~~as well as the realization of anticipated benefits from our recent acquisition of the U.S. engineering business of Wireless Facilities, Inc. (“Acquired WFI Business”), including the Acquired WFI Business’ revenue and gross margins for such periods ~~must~~remaining ~~comply~~relatively consistent with ~~local~~past ~~tax~~performance ~~requirements~~and ~~for~~the achievement of certain cost savings primarily related to general and administrative expenses. If our ~~expatriate~~business fails to perform as ~~employees~~expected or these benefits fall short of our estimates or are not realized on a timely basis, we may fail to comply with our financial covenants or be unable to make the required prepayments, which could result in an event of default under the credit agreement. An uncured or unwaived event of default could cause us to have to repay the credit facility at a time when we do not have the funds to make such repayment and are unable to raise them or can only raise them on terms that are unfavorable to us.

~~For financial information about our international operations,~~ ~~see note 18 to our consolidated financial statements.~~14

~~Government~~Our ~~Regulation~~existing debt obligations may constrain our ability to grow.

~~Although~~Our weAmended ~~are~~and ~~not~~Restated ~~directly~~Credit ~~subject~~Agreement toand ~~any~~our ~~FCC or similar~~outstanding ~~government~~note ~~regulations,~~to ~~the~~SPCP ~~wireless~~Group ~~networks~~L.L.C. ~~that~~(as weassignee ~~design~~of Wireless Facilities, ~~deploy~~Inc.) ~~and~~require ~~manage~~us ~~are subject~~ to ~~various~~apply ~~FCC~~most ~~regulations~~of in the ~~United~~ ~~States~~proceeds ~~and~~of ~~other~~any ~~international~~equity ~~regulations. These~~and ~~regulations~~debt ~~require~~financings ~~that~~we ~~these~~undertake ~~networks~~to ~~meet~~the ~~certain~~payment ~~radio frequency~~of ~~emission standards, not cause unallowable interference~~those toobligations. ~~other~~To ~~services,~~the ~~and~~extent inthat ~~some~~market ~~cases~~conditions ~~accept~~are ~~interference~~such ~~from~~that ~~other~~we ~~services.~~are ~~These~~unable ~~networks~~to ~~are~~raise ~~also~~funds ~~subject~~beyond those required to ~~government~~satisfy ~~regulations~~these ~~and~~obligations, ~~requirements~~our ofability ~~local~~to ~~standards~~pursue ~~bodies~~our ~~outside~~acquisition ~~the~~strategy ~~United~~may ~~States~~be adversely affected.

~~Additional~~If the ~~Information~~borrowing base under our credit facility decreases our business may be adversely impacted.

~~The~~Our ~~Company’s~~ability ~~internet~~to ~~address~~borrow funds or to maintain outstanding borrowings under our Amended and Restated Credit Agreement is dependent ~~www.lcc.com.~~upon Ahaving ~~copy~~a ofsufficient borrowing base. Our borrowing ~~this~~base ~~annual~~is ~~report~~calculated onin accordance with a formula based upon ~~Form 10-K~~various percentages of eligible billed and unbilled receivables, aswhere ~~well~~eligibility may depend upon factors such as ~~other~~the ~~annual~~age ~~reports~~of onthe ~~Form 10-K,~~receivables and the geographic location of the account debtor. ~~quarterly~~If ~~reports~~our onborrowing base declines we must repay any outstanding ~~Form 10-Q~~borrowings to the extent they exceed the borrowing base and, in ~~current~~addition, ~~reports~~we onmay not be entitled to borrow additional funds ~~Form 8-K~~under the credit facility. This could result in an adverse ~~and~~effect ~~amendments~~on toour ~~those~~business ~~reports~~due ~~are~~to ~~accessible~~a ~~free~~lack of ~~charge~~availability atof needed ~~http://investor-relations~~working capital for normal operations or a lack of availability of funds to pursue our acquisition strategy.~~lcc.com/phoenix.zhtml?c=104575&p=irol-irhome~~ If we are unable to asmake ~~soon~~a asrequired ~~reasonably~~payment ~~possible~~under ~~after~~the ~~such~~credit ~~report~~facility isthis ~~filed~~would cause ~~with~~us to be in default and at risk of having the entire orfacility ~~furnished~~called due at a time when we are unable to raise the necessary ~~Securities~~funds ~~and~~to ~~Exchange~~pay ~~Commission~~it off on terms that are unfavorable to us or at all.

~~Item~~ We ~~1A.~~may not ~~Risk~~receive ~~Factors~~the full amount of our backlog, which could harm our business.

Our firm backlog was approximately $61.6 million at ~~Risk~~December 31, 2007. We define firm backlog as the value of ~~Factors~~work-in-hand to be done with customers as of a specific date where the following conditions are met:

In• ~~any given~~the ~~year,~~price weof ~~derive~~the awork ~~significant~~to ~~portion~~be ofdone ~~our~~is ~~revenues~~fixed; ~~from a~~• ~~limited~~the ~~number~~scope of ~~large~~the ~~projects~~work to be done is fixed, both in definition and amount (for example, ifthe wenumber ~~are~~of ~~unable~~sites ~~to replace~~has ~~these~~been ~~large~~determined); ~~projects~~and ~~upon~~• ~~completion~~there is a written contract, wepurchase ~~could~~order, ~~have~~agreement or other documentary evidence which represents a ~~significant~~ ~~decrease~~firm incommitment ~~our~~by ~~revenues~~the ~~which~~client ~~would~~to ~~negatively impact~~pay ~~our~~us ~~ability~~for the work to ~~generate~~be ~~income~~performed.

We ~~have~~also ~~derived,~~had ~~and~~implied ~~believe~~backlog ~~that we will continue to derive, a significant portion~~ of ~~our~~approximately ~~revenues in any given year from a limited number of large projects~~$16.6 ~~For~~million ~~example,~~as ~~for the year~~of ~~ended~~ December 31, ~~2006,~~2007. ~~our~~We ~~largest~~define ~~project~~implied ~~was~~backlog ~~for~~as the ~~Algeria~~estimated ~~Telecom,~~revenues ~~which~~from ~~comprised~~master ~~22.4%~~service ofagreements ~~our~~and ~~total revenues. As~~similar ~~these~~arrangements ~~projects~~which ~~wind~~have ~~down~~met tothe ~~completion,~~first wetwo ~~face~~conditions ~~the~~set ~~task of~~forth ~~replacing~~above ~~such~~but ~~revenues~~for ~~with~~which ~~new~~we ~~projects.~~have ~~Our~~not ~~inability~~received ~~to replace such revenues would cause~~ a ~~significant~~firm ~~decrease in our~~contractual ~~revenues and negatively affect our operating results~~commitment.

Our backlog includes orders under contracts that in some cases Weextend for several years. The amount of our backlog that we may ~~generate~~recognize aas ~~substantial~~revenues ~~portion~~during any fiscal quarter may vary significantly because the receipt and timing of any revenues is subject to various contingencies, many of which are beyond our control. Further, the actual realization of revenues ~~from~~on engagements included in our backlog may never occur or may change because a ~~limited~~project schedule could change or the project ~~number~~could ofbe ~~customers~~cancelled, ~~and~~or ifa contract could be reduced, modified, or terminated early. If we fail to realize revenues from engagements included in our ~~relationships~~backlog ~~with~~at ~~these~~December 31, 2007 ~~customers~~our ~~were~~operating ~~harmed~~results for our ~~business~~2008 ~~would~~fiscal ~~suffer~~year, as well as future reporting periods, may be materially harmed due to decreased revenues.

~~For the years ended December 31, 2006 and 2005, we derived~~ ~~82.7% and 83.6%, respectively, of our total revenues from our~~A ~~ten~~large ~~largest~~percentage ~~customers. We believe that a limited number~~ of ~~customers~~ ~~will continue to be the source of a substantial portion of~~ our revenues ~~for~~come ~~the~~from ~~foreseeable~~fixed ~~future. Key factors~~price ~~in maintaining our relationships with these customers include~~contracts, ~~for~~ ~~example,~~which ~~our~~require ~~performance~~us onto ~~individual~~bear ~~contracts and~~ the ~~strength~~ risk of ~~our professional reputation. To the extent that our~~cost ~~performance does not meet client expectations, or our reputation or relationships with one or more key clients are impaired, our revenues and operating results could be materially harmed~~overruns.

A large percentage of our revenues are derived from fixed price 13contracts. The portion of our revenues from fixed price contracts for the years ended December 31, 2007, 2006 and 2005 was 54.7%, 52.8% and 71.0%, respectively. Under fixed price contracts, we provide specific tasks for a specific price and are typically paid on a milestone basis. Such contracts involve greater financial risks than time and materials and cost-plus type contracts because we bear the risk if actual project costs exceed the amounts we are paid under the contracts.

~~Table of Contents~~ 15

~~Recent and~~To ~~continuing consolidations among wireless service providers~~the ~~may~~extent ~~result~~we inrecognize arevenues ~~significant~~on ~~reduction~~fixed inprice ~~our~~contracts ~~existing~~using ~~and~~the ~~potential~~percentage-of-completion ~~customer~~method ~~base,~~of ~~and~~accounting, ifincreases ~~we are unable to maintain our~~in ~~existing~~estimated ~~relationships~~project ~~with~~costs ~~such providers or expand such relationships, we~~ could ~~have~~cause afluctuations ~~significant decrease~~ in our ~~revenues,~~quarterly ~~which~~results ~~would~~and ~~negatively~~adversely ~~impact~~affect our ~~ability to generate~~operating ~~income as well as result in lower profitability or possible losses~~results.

~~The~~We ~~level~~recognize ofrevenues ~~merger~~on ~~activity~~fixed ~~among~~price ~~telecommunications~~contracts ~~operators~~using the ~~has~~percentage-of-completion ~~increased~~method ~~markedly~~of inaccounting, ~~the~~which ~~recent~~requires considerable ~~past~~judgment ~~and~~since this ~~trend~~technique isrelies upon estimates ~~continuing~~or budgets. ~~For~~With ~~example, in~~ the ~~past one~~ percentage-of-completion ~~our customers~~method, in each ~~Cingular,~~period ~~has~~we ~~merged~~recognize ~~with~~expenses ~~AT&T~~as ~~Wireless~~they ~~and~~are ~~one~~incurred ofand ~~our~~recognize ~~largest~~revenues ~~customers,~~based ~~Sprint,~~on ~~merged~~the ~~with~~ratio ~~Nextel.~~of ~~These consolidations~~the ~~have~~current ~~reduced~~costs ~~and~~incurred ~~may~~for the ~~continue~~project to ~~reduce~~ the ~~number~~ ofthen ~~companies~~estimated ~~comprising~~total ~~that~~costs ~~portion~~ of ~~our~~the ~~customer~~project. ~~base~~We ~~consisting~~compare ofcosts ~~wireless~~incurred ~~service~~to ~~providers.~~date Toto ~~the~~progress ~~extent~~achieved ~~that~~against ~~these~~project ~~combined~~milestones ~~companies decide~~ to ~~reduce~~determine if the ~~number~~percentage of ~~their~~completion ~~service~~is ~~providers~~reasonable. Accordingly, ~~our~~the ~~already~~revenues ~~highly~~that ~~competitive~~we ~~market~~recognize in a ~~environment~~given ~~will~~quarter ~~become~~depend ~~more competitive~~on, atamong ~~least~~other inthings, ~~the~~costs ~~short~~we have ~~term,~~incurred asfor ~~the~~individual ~~same~~projects ~~number~~and ofour ~~service~~then ~~providers~~current ~~will seek business~~estimates ~~from~~of athe ~~reduced~~total ~~number~~costs of ~~potential~~the ~~customers~~individual projects. WeIf ~~have~~in any period ~~historically~~we ~~derived~~significantly aincrease ~~significant~~our ~~portion~~estimate of ~~our~~the ~~revenues~~total incosts to ~~any~~complete a given ~~year~~project, ~~from~~we amay ~~limited~~recognize ~~number~~very oflittle ~~large~~or ~~projects~~no additional revenues with respect to that project. ~~Also,~~If atthe total ~~any~~contract ~~given~~cost ~~time~~estimates weindicate ~~may~~that ~~not~~there beis ~~able~~a toloss, ~~reduce~~such ~~costs~~loss is recognized in ~~response~~the ~~to any~~period ~~decrease~~such indetermination ~~our~~is ~~revenues~~made. IfTo wethe extent ~~are~~that ~~unable~~our tocost ~~maintain~~estimates ~~our~~fluctuate over time or differ ~~existing~~from ~~relations~~actual ~~with~~costs, ~~these~~our ~~companies~~operating orresults ~~expand~~may ~~such~~be materially ~~relationships,~~affected. weAs ~~could~~a ~~have~~result aof ~~significant~~these ~~decrease~~challenges inassociated ~~our~~with fixed ~~revenues~~price contracts, ~~which~~our ~~would~~gross ~~negatively~~profit ~~impact~~on ~~our~~these ~~ability~~contracts toin ~~generate~~future ~~income~~periods asmay ~~well~~be assignificantly ~~result~~reduced inor ~~lower profitability~~eliminated.

~~We may~~If ~~experience~~more ~~significant~~of ~~fluctuations~~our incustomers ~~our~~require ~~quarterly~~fixed ~~results~~price ascontracts with fewer amilestones ~~result~~than ofin ~~uncertainties~~previous ~~relating~~years, we may not have sufficient access to ~~our~~working ~~ability~~capital to ~~generate~~fund the operating expenses ~~additional~~incurred ~~revenues,~~in ~~manage~~connection ~~our~~with ~~expenditures~~such contracts, and ~~other~~we ~~factors,~~may not be ~~certain~~able ofto ~~which~~perform ~~are~~under ~~outside~~our ofexisting ~~our~~contracts ~~control~~or accept new contracts with similar terms.

~~Our~~A ~~quarterly~~number ~~and~~of ~~annual~~our ~~operating~~customers ~~results~~are ~~have~~requiring ~~varied~~fixed price contracts ~~considerably~~with fewer milestones than in ~~the~~previous ~~past~~years. We may incur significant operating expenses in connection with such contracts and ~~are~~may ~~likely~~not toreceive ~~vary~~corresponding ~~considerably~~payments ~~due~~until the milestones have been completed. We may need to ause ~~number~~our ofavailable ~~factors,~~cash ~~including~~to cover ~~those~~operating ~~factors~~expenses ~~discussed~~incurred in connection with such ~~this~~contracts ~~“Risk~~until ~~Factors”~~we ~~section~~complete the milestones, invoice our customers and collect payments. ~~Many~~This ofmay ~~these~~result ~~factors~~in ~~are~~increased ~~outside~~needs ~~our~~for ~~control~~working capital, and ~~include~~if we do not have access to sufficient capital to fund our working capital needs, ~~among~~we ~~others:~~may not be able to perform under our existing contracts or accept new contracts with similar terms.

• The extent ~~the timing~~ of ~~receipt~~our ofdependence ~~new~~on ~~licenses,~~international ~~use~~operations ofmay ~~existing~~give rise ~~spectrum~~to ~~for~~increased ~~new~~management ~~services,~~challenges ~~or financing by potential customers; • service~~ and ~~price~~could ~~competition;~~harm •our results ~~the commencement, progress, completion or termination~~ of contracts during any particular quarter; • the availability of equipment to deploy new technologies such as broadband; • the growth rate of wireless subscribers, which has a direct impact on the rate at which new cell sites are developed and built; and • telecommunications market conditions and economic conditions generallyoperations.

~~Due~~Customers tooutside ~~these~~the ~~factors,~~United ~~our~~States ~~results~~accounted for a67.8% ~~particular quarter may~~and ~~not~~77.1% ~~meet~~of ~~the~~our ~~expectations~~revenues offrom ~~securities~~continuing ~~analysts~~operations ~~and~~for ~~investors,~~the years ~~which~~ended ~~could~~December 31, ~~cause~~2007 ~~the~~and ~~price~~2006, respectively. The multi-jurisdictional nature of our ~~stock~~revenues toexposes ~~decline~~us to ~~significantly~~additional risks. Such risks include:

~~Our contracts~~• ~~typically~~the ~~contain~~effects ~~provisions~~of ~~giving~~terrorism; ~~customers~~• the ~~ability~~ togeneral ~~terminate~~economic ~~their~~and ~~contracts~~political ~~under~~conditions ~~various~~in ~~circumstances and~~each wecountry; ~~may~~• ~~not~~the effect of applicable foreign tax structures, including tax rates that may be ~~able~~higher tothan ~~replace~~tax rates in the ~~revenues~~United ~~from~~States; ~~such projects~~• ~~which~~tariff ~~may~~and ~~have~~trade anregulations; ~~adverse~~• ~~effect~~management onof ~~our~~a ~~operating results~~geographically ~~due~~diverse organization; • difficulties and increased expenses in complying with a variety of foreign laws and regulations, including labor, employment and immigration laws; • changes in the applicable industry regulatory environments in foreign countries, including delays in deregulation or privatization affecting the pace at which wireless licenses are awarded; and • the inability to ~~our~~benefit ~~decreased~~from ~~revenues~~tax losses incurred in different foreign jurisdictions.

~~Our~~Expansion ~~contracts~~of ~~typically~~our ~~have~~international ~~provisions~~operations ~~that~~may ~~permit customers to~~require ~~terminate~~significant ~~their~~expenditure ~~contracts~~of ~~under various circumstances~~operating, ~~including termination~~financial ~~for~~and ~~convenience. We also believe that intense~~management ~~competition~~resources and ~~the current trend in industry contracting toward shorter-term contracts that provide increased grounds for customer termination may~~ result in increased ~~frequency~~administrative ~~of customer~~and ~~termination or renegotiation. If large projects, or a~~compliance ~~number~~costs ~~of projects~~ that incould ~~the~~increase ~~aggregate account for a material~~related amount of our revenues, are suspended for any significant length of time or terminated, we may encounter difficulty replacing such revenues and our operating results would decline as a result of our decreased revenues.

1416

~~Table~~ general and administrative expenses and negatively impact our results of ~~Contents~~operations. In addition, the cost of attracting and retaining employees with the skill set to deal with non-U.S. regulatory compliance, as well as U.S. driven regulatory matters, such as compliance with the provisions of the Sarbanes-Oxley Act of 2002 and implementing regulations, may continue to increase general and administrative expenses, which might negatively impact our international operations and could further reduce our profitability.

~~Our~~Providing ~~Amended~~services ~~and~~outside ~~Restated~~the ~~Credit~~United ~~Agreement~~States ~~contains~~carries ~~certain~~the ~~financial tests~~additional ~~and requires certain mandatory prepayments, the~~risk ~~achievement~~ of ~~which~~currency isfluctuations ~~dependent~~and toforeign aexchange ~~significant~~controls ~~extent on the~~imposed ~~performance~~by ~~of our business as well as achieving~~ certain ~~benefits~~ ~~from~~countries ~~our~~since ~~recent~~many ~~acquisition~~ of ~~the~~our non-U.S. ~~engineering~~ projects ~~business~~are ofundertaken ~~Wireless~~in ~~Facilities, Inc~~local currency.

~~Our~~Although ~~Amended~~we ~~and~~generally ~~Restated~~incur ~~Credit~~project ~~Agreement~~expenses ~~requires~~in usthe ~~to meet~~same ~~certain~~currency ~~periodic financial tests, including monthly cumulative EBITDA covenants, and requires us to make mandatory prepayments~~ in ~~2008~~which ~~and~~payments ~~2009.~~are Wereceived ~~have been in default~~ under the ~~Amended and Restated Credit Agreement~~contract, ~~including defaults relating to~~we ~~financial~~do ~~covenants.~~not ~~These~~currently ~~defaults~~engage ~~have~~in ~~been~~additional ~~waived~~currency ~~by our~~hedging ~~lender~~activities ~~and~~to limit the ~~Amended~~risk ~~and~~of ~~Restated~~exchange ~~Credit~~rate ~~Agreement has been~~fluctuations. ~~amended~~Therefore, ~~among~~fluctuations ~~other~~in ~~things, to revise certain of~~ the ~~periodic financial~~currency ~~tests.~~exchange ~~Our~~rate ~~ability~~could ~~to meet the periodic financial~~have ~~tests~~a ~~and~~negative ~~fund~~impact ~~the mandatory prepayments will depend~~ on the ~~performance~~ ofprofitability ~~our business as well as the realization~~ of ~~anticipated~~ ~~benefits from~~ our ~~recent acquisition of the U.S. engineering business of Wireless Facilities~~operations, ~~Inc.~~ ~~(“Former~~particularly ~~WFI~~if: ~~Business”~~(i), we ~~including~~cannot ~~the~~incur ~~Former~~project WFI Business’ revenue and gross margins for such periods remaining relatively consistent with past performance and the achievement of certain cost savings primarily related to general and administrative expenses. ~~If our business fails to perform as~~in ~~expected or these benefits fall short of our estimates or are not realized on a timely basis, we may fail to comply with our financial covenants or be unable to make~~ the ~~required prepayments~~same ~~which~~currency ~~could result~~ in anwhich ~~event~~payments ofare ~~default~~received under the ~~credit~~contract; ~~agreement.~~and An(ii) there ~~uncured~~is ora ~~unwaived~~negative ~~event~~impact ~~of default could~~when ~~cause~~converting usback to ~~have~~United toStates ~~repay~~Dollars. ~~the~~In ~~credit~~addition, ~~facility at a time when we~~foreign doexchange ~~not~~controls ~~have~~may limit the ~~funds~~timing ~~to make such repayment~~ and ~~are~~our ~~unable~~ability to have ~~raise~~funds ~~them~~transmitted orout ~~can~~of ~~only~~a ~~raise~~foreign ~~them on terms that are unfavorable to us~~country.

See “Management’s Discussion and Analysis of Financial ~~Our~~Condition and Results of Operation — Quantitative and ~~existing~~Qualitative ~~debt~~Disclosures ~~obligations~~About ~~may~~Market ~~constrain~~Risk ~~our~~and ~~ability~~Foreign toExchange ~~grow~~Risk.”

Our ~~Amended and Restated Credit Agreement and our outstanding~~ ~~note~~development tostage ~~SPCP~~customers ~~Group~~may ~~L.L.C.~~face ~~(as~~difficulties ~~assignee~~in ~~of Wireless Facilities,~~obtaining ~~Inc.)~~financing ~~require us~~ to ~~apply~~fund ~~most of~~ the ~~proceeds~~expansion of ~~any~~their ~~equity~~wireless ~~and~~networks, ~~debt~~which ~~financings~~may wereduce ~~undertake~~demand tofor ~~the payment of those obligations. To the extent that market conditions are such that we are unable to raise funds beyond those required to satisfy these obligations,~~ our ~~ability to pursue our acquisition strategy may be adversely affected~~services.

Many of our development stage customers depend on financial Ifmarkets to finance the development of new technologies or ~~borrowing~~networks. ~~base~~As ~~under~~an ~~our~~example, ~~credit~~during ~~facility~~the ~~decreases~~downturns in the financial markets in 2000, and specifically within the telecommunications financial markets, many of our customers experienced trouble obtaining financing to fund the expansion of their wireless networks. Most vulnerable are customers that are new licensees and wireless service providers who have limited sources of funds from operations or have business plans that are dependent on ~~may~~funding befrom ~~adversely~~the ~~impacted~~capital markets.

~~Our ability to borrow funds or to maintain outstanding~~ ~~borrowings~~If ~~under our Amended and Restated Credit Agreement is~~we ~~dependent~~are ~~upon~~unable ~~having~~to acollect ~~sufficient borrowing base. Our borrowing base is calculated in accordance with a formula based upon various percentages of eligible billed and unbilled~~ receivables~~, where~~ ~~eligibility~~from ~~may depend upon factors such as the age of the~~telecommunications ~~receivables~~companies and ~~the geographic location of the account debtor. If~~ our ~~borrowing~~development ~~base~~stage ~~declines we must repay any outstanding borrowings to the extent they exceed the borrowing base and~~customers, ~~in addition, we may not be entitled to borrow additional funds under the credit facility. This could result in an adverse effect on~~ our ~~business due to a lack of availability of needed~~operating ~~working~~results ~~capital~~may ~~for normal operations or a lack of availability of funds to pursue our acquisition strategy. If we are unable to make a required payment under the credit facility this would cause us to~~ be inmaterially default and at risk of having the entire facility called due at a time when we are unable to raise the necessary funds to pay it off or can only raise them on terms that are unfavorable to usharmed.

We ~~may~~frequently perform services for telecommunications companies ~~not~~and ~~receive~~development ~~the~~stage ~~full~~customers ~~amount~~that carry a higher degree of financial risk for us. Our customers, established and development stage, are subject to market risks and may be impacted by a tightening of available credit and/or a general economic slowdown. These conditions may render our customers ~~backlog~~unable to pay, ~~which~~or ~~could~~may ~~harm~~delay payment, for services performed by us. If we are not able to collect amounts owed to us by our customers, we may be required to write off significant ~~business~~accounts receivable and recognize bad debt expense.

~~Our~~We face ~~firm~~intense ~~backlog~~competition ~~was~~from ~~approximately~~many ~~$37.1 million~~competitors atthat have greater ~~December 31,~~resources ~~2006.~~than Wewe ~~define~~do, ~~firm~~which ~~backlog~~could asresult ~~the~~in ~~value~~price ofreductions, ~~work-in-hand to~~reduced beprofitability ~~done~~and ~~with~~loss ~~customers as~~ of amarket ~~specific date where the~~share. ~~following conditions are met:~~

• We ~~the~~face ~~price~~intense ofcompetition ~~the~~in ~~work to be done is fixed; •~~ the ~~scope~~market offor ~~the~~wireless ~~work~~network design toand besystem ~~done~~deployment isservices. ~~fixed,~~Wireless ~~both~~service providers inthemselves ~~definition~~ and ~~amount~~system ~~(for~~equipment ~~example~~vendors, ~~the~~some ~~number~~ of ~~sites~~whom are ~~has~~our ~~been determined); and • there is a written contract~~customers, ~~purchase~~have ~~order,~~developed ~~agreement~~and orcontinue ~~other~~to ~~documentary~~develop capabilities ~~evidence~~competitive ~~which~~with ~~represents~~those aprovided ~~firm commitment~~ by ~~the client to pay~~ us ~~for the work to be performed~~.

Many competitors, including equipment vendors and system 15integrators, have substantially greater financial and other resources than we do and may use such greater resources to more effectively deliver a full turnkey solution. For example, a competitor that is able to provide equipment as part of its solution or to quickly deploy a large number of personnel for a project poses a threat to our business.

~~Table~~ As a result of ~~Contents~~intense competition, we continue to encounter and may be required to agree to less favorable contract terms, including provisions such as liquidated damages, performance guarantees and deferred payment terms.

~~We also had implied backlog of approximately $19.0 million~~ ~~as of December 31, 2006. We define implied backlog as the~~17 estimated revenues from master service agreements and similar arrangements which have met the first two conditions set forth above but for which we have not received a firm contractual commitment.

~~Our~~If ~~backlog includes orders under contracts that in some cases extend for several years. The amount of our backlog that~~ we ~~may recognize~~are asnot ~~revenues~~able ~~during any fiscal quarter may vary significantly because the receipt and timing of any revenues is subject~~ to ~~various~~compete ~~contingencies~~effectively, ~~many of which are beyond~~ our ~~control.~~ ~~Further,~~ability ~~the actual realization of revenues on~~to ~~engagements~~attract ~~included~~and inretain ~~our~~customers ~~backlog~~will ~~may never occur or may change because a project schedule could change or the project could~~ be ~~cancelled,~~adversely ~~or a contract could be reduced~~affected, ~~modified, or~~which ~~terminated~~will ~~early.~~decrease Ifour ~~we fail to realize~~ revenues ~~from engagements~~and ~~included~~negatively inaffect our ~~backlog at December 31, 2006 our~~ operating ~~results for our 2007 fiscal year as well as future~~ ~~reporting periods may be materially harmed due to decreased revenues~~results.

AIf we ~~large~~fail ~~percentage~~to manage the size of our ~~revenues~~billable ~~comes~~workforce ~~from~~to ~~fixed price~~anticipate ~~contracts,~~increases ~~which~~or ~~require~~decreases usin tomarket ~~bear~~demand ~~the~~for ~~risk~~our ofservices, ~~cost~~it ~~overruns~~could harm our competitive position and financial results.

AIf ~~large~~we ~~percentage~~maintain or increase billable staffing levels in anticipation of ~~our~~one ~~revenues~~or more projects and those projects are delayed, ~~derived~~reduced ~~from~~or ~~fixed~~terminated, ~~price~~or otherwise do not materialize, ~~contracts.~~we ~~The~~may ~~portion~~underutilize ofthese personnel, which would reduce our gross ~~revenues~~profit, ~~from~~harming ~~fixed~~our ~~price~~results of operations. It is extremely ~~contracts~~difficult ~~for~~to ~~the~~project ~~years~~accurately ~~ended~~the ~~December 31,~~demand ~~2006,~~for ~~2005~~our services and, ~~2004~~correspondingly, ~~was~~maintain ~~52.8%,~~an 71appropriately sized billable workforce.0% If we maintain a billable workforce sufficient to support a resurgence in demand and ~~58.6%~~such demand does not materialize, ~~respectively.~~then ~~Under~~our ~~fixed~~expenses ~~price~~will be high relative to ~~contracts,~~revenues. If we ~~provide~~reduce ~~specific~~the ~~tasks~~size of our billable workforce in response to any industry slowdown or decrease in the demand for services, then we may not maintain a ~~specific~~sufficient ~~price~~number ~~and~~of ~~are~~skilled ~~typically~~personnel ~~paid~~to onbe aable ~~milestone~~to ~~basis.~~effectively ~~Such~~respond ~~contracts~~to ~~involve~~any ~~greater~~resurgence. ~~financial~~As ~~risks~~a ~~because~~result weof ~~bear~~these insufficient staffing levels, our competitive position in the ~~risk~~industry ifcould ~~actual~~be negatively ~~project~~impacted and we could incur increased recruiting costs ~~exceed~~to replace our billable workforce. To the ~~amounts~~extent that we are ~~paid~~unable to ~~under~~successfully anticipate increases or decreases in market demand for our services and manage the ~~contracts~~size of our billable workforce accordingly, we could lose customers to our competitors or underutilize our personnel. In either case, our financial results will suffer.

ToWe ~~the~~may ~~extent~~not webe ~~recognize~~able ~~revenues~~to onsuccessfully ~~fixed~~achieve ~~price~~the ~~contracts~~expected ~~using~~benefits ~~the percentage-~~of~~-completion~~ our ~~method~~future ~~of accounting~~acquisitions, ~~increases~~investments inor ~~estimated~~strategic ~~project costs could~~partnering ~~cause fluctuations in our quarterly results and adversely affect our operating results~~relationships.

We ~~recognize~~may ~~revenues~~make onfuture ~~fixed~~acquisitions ~~price contracts using the percentage-~~of~~-completion method of accounting~~, ~~which~~or ~~requires~~investments ~~considerable~~in, ~~judgment since~~other ~~this~~companies, ~~technique~~capabilities ~~relies~~or ~~upon~~technologies ~~estimates~~ or ~~budgets.~~enter ~~With~~into ~~the~~strategic ~~percentage-of-completion method,~~partnering inrelationships. ~~each~~Our ~~period~~strategy wefor ~~recognize expenses as they are~~acquisitions, ~~incurred~~investments and ~~recognize~~strategic ~~revenues~~partnering ~~based~~arrangements onis ~~the~~designed ~~ratio of the~~to ~~current~~either: ~~costs~~(i) ~~incurred~~allow ~~for~~us ~~the project~~ to ~~the~~expand ~~then~~our ~~estimated total~~current ~~costs~~service ~~of the project. We compare costs incurred to date to~~offerings ~~progress~~into ~~achieved~~areas ~~against~~that ~~project~~offer ~~milestones~~attractive torevenue ~~determine~~opportunities; ~~if the~~or ~~percentage~~(ii) accelerate ofour ~~completion~~access ~~is reasonable. Accordingly~~to, ~~the revenues~~and ~~that~~provide weus ~~recognize~~with in a ~~given quarter depend on, among~~local ~~other~~presence ~~things~~in, ~~costs~~new wemarkets. We have ~~incurred~~invested ~~for~~in ~~individual~~building ~~projects and~~our ~~our~~global ~~then~~marketing ~~current~~and ~~estimates~~North ofAmerican ~~the~~sales ~~total~~presence ~~costs~~to ~~of the individual~~capitalize ~~projects.~~on Ifemerging inopportunities ~~any~~and ~~period~~further weenhance ~~significantly increase~~ our ~~estimate~~ ~~of the total costs to complete a given project, we may~~sales ~~recognize~~capabilities ~~very~~in ~~little~~existing ~~or no additional revenues with respect to that project~~markets. IfOur ~~the~~new ~~total~~offerings ~~contract~~in ~~cost estimates indicate that~~quality ~~there~~of ~~is a loss~~service, ~~such~~quality ~~loss~~of isend ~~recognized~~user inexperience ~~the~~and ~~period~~spectrum ~~such~~clearing ~~determination~~represent isinvestments ~~made.~~in Tonew ~~the~~capabilities ~~extent~~ that ~~our~~may ~~cost~~be ~~estimates~~supported ~~fluctuate~~by ~~over~~strategic ~~time~~partnerships orwith ~~differ~~third ~~from~~parties. ~~actual~~Despite ~~costs, our operating~~these ~~results~~investments ~~may~~and beefforts, ~~materially~~we ~~affected.~~may Asnot abe ~~result~~able ofto ~~these~~successfully ~~challenges~~increase ~~associated~~our ~~with~~service ~~fixed~~offerings ~~price~~or ~~contracts,~~gain ~~our~~ground ~~gross profit~~ in ~~future~~new ~~periods may be significantly reduced or eliminated~~markets.

IfFuture ~~more~~acquisitions of ~~our~~new ~~customers~~companies ~~require~~or ~~fixed~~technologies ~~price~~and ~~contracts with fewer~~future ~~milestones~~strategic ~~than~~partnering inrelationships ~~previous years, we~~ may ~~not~~result ~~have~~in ~~sufficient access~~disruption to ~~working capital to fund the operating expenses~~ ~~incurred~~our inbusiness ~~connection with such contracts,~~ and weexpose ~~may~~us ~~not be able~~ to ~~perform~~risks ~~under~~associated ~~our~~with ~~existing contracts or accept new~~acquisitions ~~contracts~~and ~~with~~such ~~similar terms~~relationships.

AAny ~~number~~future ofacquisitions, ~~our~~investments ~~customers~~or ~~are~~strategic ~~requiring fixed price contracts~~partnering ~~with~~relationships ~~fewer~~may ~~milestones~~require ~~than~~additional indebt ~~previous~~or ~~years.~~equity ~~We may incur~~financing, ~~significant~~or ~~operating~~the ~~expenses~~issuance inof ~~connection~~shares, ~~with~~which ~~such~~could ~~contracts and~~be ~~may~~dilutive ~~not~~to ~~receive corresponding payments until the milestones~~our ~~have~~existing ~~been completed~~stockholders. WeIn ~~may~~addition, ~~need to use~~ our ~~available cash to cover~~ operating ~~expenses~~results ~~incurred in connection with such~~may ~~contracts~~suffer ~~until~~as wea ~~complete~~result ~~the~~of ~~milestones,~~any ~~invoice~~acquisition-related ~~our customers~~costs ~~and collect payments. This may result in increased~~or ~~needs~~impairment ~~for~~of ~~working~~goodwill ~~capital,~~ and ifother weintangible doassets ~~not~~acquired ~~have access to~~in ~~sufficient~~connection ~~capital~~with toan ~~fund~~acquisition. ~~our~~In ~~working capital needs~~addition, wesuch ~~may not~~activities becould ~~able~~expose us to ~~perform~~a ~~under~~number ~~our~~of ~~existing~~other ~~contracts~~risks orand ~~accept new~~challenges, ~~contracts with similar terms.~~including:

16 • diversion of management’s attention and resources; • potential loss of key employees and customers of acquired companies; • difficult and costly integration of operations; • lack of experience operating in the geographic market or industry sector of an acquired business; • disputes with a strategic partner; • an increase in our expenses and working capital requirements; and • exposure to unanticipated contingent liabilities.

~~Table~~ Any of ~~Contents~~these and other factors could disrupt our business and harm our ability to achieve the anticipated benefits of an acquisition, investment or strategic partnering relationship.

~~The~~ ~~extent of our dependence on international operations may give~~18 ~~rise to increased management challenges and could harm our results of operations.~~

~~Customers outside the United States accounted for 77.1% and~~Our ~~75.2%~~ability ofto reduce our ~~revenues~~general ~~from continuing operations for the years ended December 31, 2006~~ and ~~December 31,~~administrative ~~2005, respectively.~~expenses ~~The multi-jurisdictional nature of our revenues~~is ~~exposes us to additional risks~~limited. ~~Such risks include:~~

• Because ~~the~~a ~~effects~~significant portion of ~~terrorism;~~our •general ~~the~~and ~~general~~administrative expenses ~~economic~~are ~~and~~relatively ~~political~~fixed, ~~conditions~~our ability to reduce those expenses in ~~each~~proportion ~~country;~~to •any decrease in the ~~effect~~revenues we generate is limited. The enactment of ~~applicable~~the ~~foreign~~Sarbanes-Oxley ~~tax~~Act ~~structures~~of 2002, ~~including~~and ~~tax~~implementing ~~rates~~regulations, ~~that~~has ~~may~~significantly beincreased the ~~higher~~cost ~~than~~of ~~tax~~being ~~rates~~a inpublic company. Such compliance is particularly challenging for us given the ~~United~~international ~~States;~~scope •of our ~~tariff~~operations and ~~trade~~our ~~regulations;~~overall •cost ~~management~~ of acompliance ~~geographically~~relative ~~diverse~~to our ~~organization;~~size. •Our ~~difficulties~~international reach also brings a need for local general and ~~increased~~administrative ~~expenses~~capabilities in ~~complying~~both ~~with~~our aemployees and ~~variety~~certain of ~~foreign~~our ~~laws~~third ~~and~~party ~~regulations~~professionals, ~~including~~to ~~labor~~accommodate local practices and comply with local legal requirements, including employment, tax and ~~immigration~~similar ~~laws;~~matters. •We ~~changes~~believe inthat our ~~the~~ability ~~applicable~~to ~~industry~~reduce ~~regulatory~~these ~~environments~~expenses insignificantly ~~foreign~~without materially ~~countries,~~changing ~~including~~our ~~delays~~strategy inof ~~deregulation~~localization orand ~~privatization~~potentially jeopardizing ~~affecting~~our ~~the~~continued ~~pace~~legal atcompliance ~~which~~is ~~wireless~~limited. ~~licenses~~As ~~are~~a result, ~~awarded;~~we ~~and~~do •not ~~the~~expect ~~inability~~that we will always be able to ~~benefit~~reduce these ~~from~~expenses ~~tax~~in ~~losses~~proportion ~~incurred~~to significant decreases in ~~different~~our revenues, ~~foreign~~which ~~jurisdictions~~could have a material adverse effect on our net margins.

~~Expansion of our international operations may require~~ ~~significant expenditure of operating, financial and management~~Competitors ~~resources and result in increased administrative and compliance costs~~ that ~~could~~offer ~~increase~~financing ~~related~~to ~~general~~wireless ~~and~~customers ~~administrative expenses~~pose ~~and~~a ~~negatively~~threat ~~impact~~to our ~~results of operations. In~~ ~~addition,~~ability ~~the cost of attracting and retaining employees with the skill set~~ to ~~deal~~compete ~~with non-U.S. regulatory compliance~~for ~~as well as U~~business.~~S. driven regulatory matters such~~ as compliance with the provisions of the Sarbanes-Oxley Act of 2002 and with implementing regulations from the Securities and Exchange Commission with further guidance from the Public Company Accounting Oversight Board may continue to increase general and administrative expenses which might negatively impact our international operations and could further reduce our profitability.

Wireless service providers, particularly new providers and new ~~Providing~~licensees, depend increasingly on wireless telecommunications equipment vendors to supply and to finance the deployment of entire wireless networks. Frequently, those vendors only make financing available for services ~~outside~~or products if they are contracted to provide the ~~United~~services ~~States~~themselves. ~~carries~~For services the vendors ~~additional~~do ~~risk~~not provide directly, financing is provided only if they have the right to select the providers of ~~currency~~those ~~fluctuations~~services and products, including radio frequency engineering and ~~foreign~~network deployment ~~exchange~~services. ~~controls~~To ~~imposed~~the extent that wireless companies bycontinue ~~certain~~to ~~countries~~seek ~~since~~such ~~many~~financing, ofit ~~our~~would ~~non-U.S.~~harm ~~projects~~our ~~are~~ability to ~~undertaken~~compete infor ~~local~~such ~~currency~~business.

~~Although we generally incur project expenses in the same~~ ~~currency in which payments are received under the contract, we~~Our doinability ~~not~~to ~~currently~~anticipate ~~engage~~or inadapt ~~additional currency hedging activities~~ to ~~limit~~changes ~~the risk of exchange rate fluctuations. Therefore, fluctuations~~ in ~~the~~technology ~~currency exchange rate could have~~may aharm ~~negative impact on the profitability of~~ our ~~operations particularly~~competitive if: (i) we cannot incur project expenses in the same currency in which payments are received under the contract; and (ii) there is a negative impact when converting back to United States Dollars. In additionposition, ~~foreign exchange~~reputation ~~controls may limit the timing~~ and ~~our~~opportunities ~~ability to have~~for ~~funds~~revenue ~~transmitted out of a foreign country~~growth.

~~See~~We ~~“Management’s~~operate ~~Discussion~~in a highly competitive environment that is subject to rapid technological changes and ~~Analysis~~the emergence of ~~Financial~~new ~~Condition~~technologies. Our future revenues depend significantly upon the adoption and ~~Results~~deployment by wireless customers of ~~Operation —~~new technologies. ~~Quantitative~~Our ~~and~~success will depend on our ability to timely ~~Qualitative~~enhance ~~Disclosures~~our ~~About~~current ~~Market~~service ~~Risk~~offerings to keep pace with new technologies and ~~Foreign~~the ~~Exchange~~changing needs of our customers. If we are ~~Risk~~not successful in responding to technological changes or industry or marketplace developments, we may not be able to compete effectively, which could harm our reputation and opportunities for future revenue growth.”

~~Our~~We may ~~development~~not ~~stage~~be ~~customers~~able ~~may~~to ~~face~~hire ~~difficulties~~or inretain ~~obtaining~~a sufficient number of qualified ~~financing~~engineers toand ~~fund~~other ~~the~~employees ~~expansion~~to ofmeet ~~their~~our ~~wireless networks,~~contractual ~~which~~commitments ~~may~~or ~~reduce~~maintain ~~demand~~the ~~for~~quality ~~our~~of our services.

~~Many~~As ofa ~~our~~service ~~development~~business ~~stage~~our ~~customers~~success ~~depend~~depends significantly on ~~financial~~our ~~markets~~ability to ~~finance~~attract, ~~the~~train ~~development~~and ofretain ~~new~~engineering, ~~technologies~~system deployment, ormanagerial, marketing and sales personnel who have ~~networks.~~excellent Astechnical anskills, ~~example~~particularly as technology changes, as ~~during~~well as the ~~downturns~~interpersonal inskills crucial to fostering client satisfaction. Competition within the ~~financial~~wireless industry for ~~markets~~employees inwith ~~2000~~the required range of skills fluctuates, depending on customer needs, and ~~specifically~~can ~~within~~be ~~the~~intense, ~~telecommunications~~particularly ~~financial~~for ~~markets~~radio frequency engineers. At times we have had difficulty recruiting and retaining qualified technical personnel to properly and quickly staff large customer projects. In addition to recruitment difficulties, ~~many~~we ofmust ~~our~~fully ~~customers~~and ~~experienced~~properly ~~trouble~~train ~~obtaining~~our ~~financing~~employees according to ~~fund~~our ~~the~~customers’ ~~expansion~~technology requirements ofand ~~their~~deploy ~~wireless~~and fully integrate each employee into ~~networks~~our customers’ projects. ~~Most~~Increased ~~vulnerable~~competition ~~are~~in ~~customers~~the wireless ~~that~~industry ~~are~~is ~~new~~increasing ~~licensees~~the level of specific technical experience and ~~wireless~~training ~~service~~required ~~providers~~to ~~who~~fulfill ~~have~~customer-staffing requirements. ~~limited~~This ~~sources~~process ofis ~~funds~~costly and resource constraints ~~from~~may ~~operations~~impede orour ~~have~~ability ~~business~~to ~~plans~~quickly ~~that~~and ~~are~~effectively ~~dependent~~train onand ~~funding~~deploy ~~from~~all of the ~~capital~~personnel ~~markets~~required to staff a large project.

1719

~~Table~~ Because we ofhave ~~Contents~~experienced, and expect to continue to experience, long sales cycles, we expect to incur significant costs to generate new business and our customer base may not experience growth commensurate with such costs.

Purchases of our services by customers often entail a lengthy Ifdecision-making weprocess for the customer. Selecting wireless ~~are~~network ~~unable~~deployment services involves substantial costs and has strategic implications. Senior management of the customer is often involved in this process, given the importance of the decision, as well as the risks faced by the customer if the services do not meet the customer’s particular needs. We may expend substantial funds and effort to ~~collect~~negotiate ~~receivables~~agreements for ~~from~~these ~~telecommunications~~services, but may ultimately be unable to consummate ~~companies~~agreements for services and expand our ~~development~~customer ~~stage~~base. ~~customers~~In addition, we have increasingly been required to change both our personnel ~~operating~~and the techniques we employ to respond to customer ~~results~~organizational changes and expanded geographic reach. Customer buying habits currently seem to favor a regionalized sales force, which can increase costs, and may prove to be ineffective. ~~materially~~As ~~harmed~~a result of our lengthy sales cycles and these potential increased costs, we expect to continue to incur relatively high costs to generate new business.

~~We frequently perform services for telecommunications companies~~ ~~and development stage customers that carry a higher degree of~~If ~~financial~~wireless ~~risk~~service ~~for us. Our customers~~providers, ~~established~~network ~~and development~~equipment ~~stage,~~vendors ~~are subject to market risks~~ and ~~may be~~ ~~impacted~~enterprises byperform amore ~~tightening~~tasks ~~of available credit and/or a general economic slowdown. These conditions may render our customers unable to pay~~themselves, ~~or may delay payment, for services performed by us. If we are not able to collect amounts owed to us by~~ our ~~customers,~~business ~~we may be required to write off significant~~will ~~accounts receivable and recognize bad debt expense~~suffer.

Our success depends upon the continued trend by wireless service Weproviders and network equipment vendors to outsource their ~~face~~network ~~intense~~design, ~~competition~~deployment ~~from~~and ~~many~~project ~~competitors~~management ~~that~~needs. ~~have~~If ~~greater~~this ~~resources~~trend ~~than~~does wenot ~~do,~~continue ~~which~~or ~~could~~is ~~result~~reversed inand ~~price~~wireless ~~reductions~~service providers and network equipment vendors elect to perform more tasks themselves, our operating results may be adversely ~~reduced~~affected ~~profitability~~due ~~and~~to ~~loss~~the ofdecline ~~market~~in ~~share~~the demand for our services.

~~We face intense competition in the market for wireless network~~ ~~design and system deployment services. Wireless service~~Government ~~providers~~regulations ~~themselves~~may ~~and~~adversely ~~system~~affect ~~equipment vendors, some of whom are~~ our ~~customers, have developed and continue to develop capabilities competitive with those provided by us~~business.

~~Many~~The ~~competitors,~~wireless ~~including~~networks ~~equipment~~that ~~vendors~~we design, deploy and ~~system~~manage are ~~integrators,~~subject ~~have~~to ~~substantially~~various ~~greater~~FCC ~~financial~~regulations ~~and~~in ~~other~~the United States and ~~resources~~other ~~than~~international weregulations. doThese ~~and~~regulations ~~may~~require ~~use~~that these ~~such~~networks ~~greater~~meet ~~resources~~certain toradio ~~more~~frequency emission standards ~~effectively~~and ~~deliver~~not acause ~~full~~interference ~~turnkey~~to ~~solution.~~other ~~For example~~services, aand in some cases ~~competitor~~accept ~~that~~interference isfrom ~~able~~other toservices. ~~provide~~Changes ~~equipment~~in asthe regulation ~~part~~ of ~~its~~our activities, including changes in the ~~solution~~allocation orof toavailable ~~quickly~~spectrum ~~deploy~~by athe ~~large~~United ~~number~~States government and other governments or exclusion of ~~personnel~~our ~~for~~technology by a ~~project~~standards ~~poses~~body, acould ~~threat~~harm to our business, operating results, liquidity and financial position.

~~Lastly,~~We asmay be aunable ~~result~~to ofsatisfy ~~intense~~the ~~competition,~~accounting weguidelines ~~continue~~that togovern the ~~encounter~~determination ~~and~~of ~~may~~the berealizable ~~required~~value toof ~~agree~~a todeferred ~~less~~tax ~~favorable~~asset in ~~contract~~a ~~terms~~given tax jurisdiction, ~~including~~thus ~~provisions~~eliminating ~~such~~our ability to recognize as ~~liquidated~~an ~~damages,~~asset the tax benefit of operating losses in the ~~performance~~same ~~guarantees~~jurisdiction and ~~deferred~~causing ~~payment~~a ~~terms~~reduction in our overall consolidated profitability.

IfThere we are ~~not~~stringent ~~able~~rules tothat ~~compete~~govern ~~effectively~~the realizable value of a deferred tax asset. For example, ~~our~~in ~~ability~~the U.S. the Company has a deferred tax asset of approximately $24.1 million related primarily to the benefit of prior years’ operating ~~attract~~losses, ~~and~~However, ~~retain~~because ~~customers~~of ~~will~~the beCompany’s ~~adversely~~history ~~affected~~of losses in the U.S., ~~which~~the realization of this asset is not assured beyond ~~will~~a ~~decrease~~reasonable ~~our~~doubt. ~~revenues~~Accordingly, ~~and~~a ~~negatively~~valuation ~~affect~~allowance ~~our~~has ~~operating~~been ~~results~~recorded in the financial statements as of December 31, 2007.

If we fail to ~~manage~~retain ~~the~~our ~~size~~key ofpersonnel ~~our~~and ~~billable~~attract ~~workforce~~and ~~to anticipate~~retain ~~increases~~additional orqualified ~~decreases~~personnel, inour ~~market~~ability ~~demand~~to ~~for~~operate our ~~services, it~~ ~~could~~business ~~harm~~may ~~our~~be ~~competitive~~adversely ~~position and financial results~~affected.

IfOur wefuture ~~maintain~~success ~~or increase billable staffing levels in anticipation of one or more projects~~ and ~~those~~our ~~projects~~ability ~~are delayed,~~to ~~reduced~~sustain orour ~~terminated,~~revenue ~~or otherwise do not materialize,~~growth wedepend ~~may~~upon ~~underutilize~~the ~~these~~continued ~~personnel,~~service ~~which would increase our cost~~ of ~~revenues, harming~~ our ~~results~~executive ofofficers ~~operations. It is~~and ~~extremely~~other ~~difficult~~key topersonnel. ~~project~~We ~~accurately~~cannot ~~the~~guarantee ~~demand~~that ~~for our services and, correspondingly, maintain an appropriately sized billable workforce. If~~ we ~~maintain a billable workforce sufficient to support a resurgence in demand and such demand does not materialize, then our expenses~~ will be ~~high~~able ~~relative~~ to ~~revenues.~~attract Ifand weretain ~~reduce~~key ~~the~~personnel ~~size~~or ofexecutive ~~our~~management ~~billable workforce~~ in ~~response~~sufficient tonumbers, ~~any~~with ~~industry slowdown or decrease in~~ the ~~demand~~requisite ~~for services,~~skills ~~then~~or weon ~~may not maintain a sufficient number of~~acceptable ~~skilled~~terms ~~personnel~~necessary toor beadvisable ~~able~~ to ~~effectively~~support ~~respond~~our tocontinued ~~any~~growth. ~~resurgence.~~The Asloss aof ~~result~~any of ~~these~~our ~~insufficient~~key ~~staffing levels~~employees, ~~our~~ ~~competitive position~~ in ~~the~~particular ~~industry~~Dean ~~could be negatively impacted and we could incur increased recruiting costs to replace our billable workforce~~J. ~~To the extent that we are unable~~ toDouglas ~~successfully anticipate increases or decreases in market demand for~~ our ~~services~~chief ~~and~~executive ~~manage the size of our billable workforce accordingly~~officer, we could ~~lose~~adversely ~~customers~~affect to our ~~competitors~~ability orto ~~underutilize~~generate ~~our~~revenues ~~personnel.~~and Inoperate ~~either case,~~ our ~~financial~~ ~~results will suffer~~business.

~~We may~~ ~~not be able to successfully achieve the expected benefits of our~~20 ~~future acquisitions, investments or strategic partnering relationships.~~

~~We may make future acquisitions of, or investments in, other~~ ~~companies, capabilities or technologies or enter into strategic partnering relationships.~~ Our ~~strategy for acquisitions,~~ ~~investments~~stock price and ~~strategic~~trading ~~partnering~~volume ~~arrangements~~are isvolatile ~~designed to either: (i) allow us to expand our current service offerings into areas that offer attractive revenue opportunities; or (ii) accelerate our access to,~~ and ~~provide~~ uscould ~~with a local presence in~~decline, ~~new markets. In 2006, we~~ ~~invested~~resulting in ~~building~~a ~~our~~substantial ~~global~~loss ~~marketing and North American sales presence to capitalize~~ on ~~emerging opportunities and~~your ~~further enhance our sales capabilities in existing markets~~investment. ~~Our~~ ~~new offerings in quality of service, quality of end user experience and spectrum clearing represent investments in new capabilities as well as strategic~~

The stock market in general, and the market for 18technology-related stocks in particular, is highly volatile. As a result, the market price of our stock is likely to be similarly volatile, and investors in our stock may experience a decrease in the value of their stock, including decreases unrelated to our operating performance or prospects. In addition, for the period from January 1 to December 31, 2007, the average daily trading volume for our stock as reported by The NASDAQ Global Market was 91,829 shares. Accordingly, the price of our stock and the trading volume of our stock could be subject to wide fluctuations in response to a number of factors, including those listed in this “Risk Factors” section and others such as:

~~Table~~• our operating performance and the performance of ~~Contents~~other similar companies or companies deemed to be similar; • final resolution of amounts due from the sale of the Network Deployment business; • actual or anticipated differences in our quarterly operating results; • changes in our revenues or earnings estimates or recommendations by securities analysts; • publication of research reports about us or our industry by securities analysts; • additions and departures of key personnel; • strategic decisions by us or our competitors, such as acquisitions, consolidations, divestments, spin-offs, joint ventures, strategic investments, or changes in business strategy; • the passage of legislation or other regulatory developments that adversely affect us or our industry; • failure to file timely all reports required to be filed by the U.S Securities and Exchange Commission; • speculation in the press or investment community; • changes in accounting principles; • terrorist acts; • general market conditions, including economic factors unrelated to our performance; and • political or military events related to international conflicts, wars, or otherwise.

~~partnerships~~In ~~that~~the ~~may~~past, besecurities ~~supported~~class byaction ~~strategic~~litigation ~~partnerships~~has often been ~~with~~instituted ~~third~~against ~~parties.~~companies Wefollowing ~~may~~periods ~~not~~of bevolatility ~~able~~in their tostock ~~successfully~~price. ~~increase our~~This ~~service~~type ~~offerings~~of orlitigation ~~gain~~could ~~ground~~result in substantial ~~new~~costs ~~markets~~and divert our management’s attention and resources.

~~Future acquisitions~~Item of1B. ~~new~~Unresolved ~~companies~~Staff ~~or technologies and future strategic partnering relationships may result in disruption to our business and expose us to risks associated with acquisitions and such relationships.~~ Comments

Any future acquisitions, investments or strategic partnering relationships may require additional debt or equity financing, or the issuance of shares, which could be dilutive to our existing stockholdersNone. ~~In addition, our operating results may~~ suffer as a result of any acquisition-related costs or impairment of goodwill and other intangible assets acquired in connection with an acquisition. In addition, such activities could expose us to a number of other risks and challenges, including:

•Item diversion of management’s attention and resources; • potential loss of key employees and customers of acquired companies; • difficult and costly integration of operations; • lack of experience operating in the geographic market or industry sector of an acquired business; • disputes with a strategic partner; • an increase in our expenses and working capital requirements; and • exposure to unanticipated contingent liabilities2. Properties

~~Any~~We ofcurrently ~~these~~lease ~~and~~approximately ~~other~~33,000 square ~~factors~~feet ~~could~~at 7900 Westpark ~~disrupt~~Drive, McLean, Virginia, which now serves as our ~~business~~corporate ~~and~~headquarters. We moved into this space in June ~~harm~~2007. ~~our~~We ~~ability~~do not intend to ~~achieve~~sublease at the ~~anticipated~~new ~~benefits~~location. Until June 30, 2007 we leased approximately 155,000 square feet of anoffice space for our corporate headquarters in McLean, ~~acquisition~~Virginia, ~~investment~~under ora ~~strategic~~ten-year ~~partnering~~lease ~~relationship~~that expired on June 30, 2007. Through June 30, 2007 we occupied approximately 59,000 square feet of the McLean facility and subleased approximately 96,000 square feet to subtenants.

We lease approximately 6,400 square feet of office space at ~~Our~~our Europe, Middle East and Africa, or EMEA, regional ~~ability~~headquarters toin ~~reduce~~London, ~~our~~England, ~~general~~under ~~and~~a 13-year lease ~~administrative~~expiring ~~expenses~~in isSeptember 2014. We occupy approximately ~~limited~~2,300 square feet of the London facility. We currently sublease approximately 4,100 square feet to subtenants.

~~Because a significant portion of our general and administrative~~ ~~expenses are relatively fixed, our ability to reduce those~~21 expenses in proportion to any decrease in the revenues we generate is limited. The enactment of the Sarbanes-Oxley Act of 2002, and implementing regulations, has significantly increased the cost of being a public company. Such compliance is particularly difficult for us given the international scope of our operations and our overall cost of compliance relative to our size. Our international reach also brings a need for local general and administrative capabilities in both our employees and certain of our third party professionals, to accommodate local practices and comply with local legal requirements, including employment, tax and similar matters as well as compliance requirements of being a U.S. public company. We believe that our ability to reduce these expenses significantly without materially changing our strategy of localization and potentially jeopardizing our continued legal compliance is limited. As a result, we do not expect that we will always be able to reduce these expenses in proportion to significant decreases in our revenues, which could have a material adverse effect on our net margins.

In addition, we lease approximately 131,000 square feet of ~~Competitors~~office space in connection with our local operations in the ~~that~~United ~~offer~~Kingdom ~~financing~~(primarily toin ~~wireless~~London ~~customers~~and ~~pose~~Cambridge), aFrance (Paris), ~~threat~~Belgium to(Zaventem), Turkey (Istanbul) ), Italy (Rome and Milan), the Netherlands (Hertogenbosch) for our regional ~~ability~~operations and/or sales and marketing efforts in Algeria, Spain, and the U.A.E. and project office space as required to ~~compete~~perform contracts in various locations for ~~business~~our clients.

~~Wireless~~All ~~service providers, particularly new providers and new licensees, depend increasingly on wireless telecommunications equipment vendors to supply and to finance the deployment~~ of ~~entire~~ ~~wireless~~our ~~networks.~~facilities ~~Frequently,~~are ~~those~~used ~~vendors only make financing available~~ for ~~services~~current oroperations products if they are contracted to provide the services themselves. For services the vendors do not provide directly, financing is provided only if they have the right to select the providers of ~~those services~~all ~~and~~segments ~~products,~~except ~~including~~for ~~radio frequency engineering and network deployment services. To the extent that wireless companies continue to seek such financing, it would harm~~ our ~~ability~~discontinued ~~to compete~~operations ~~for~~in ~~such business~~Brazil.

~~Our inability~~Item to3. ~~anticipate~~Legal ~~or adapt to changes in technology may harm our competitive position, reputation and opportunities for revenue growth.~~ Proceedings

WeFrom ~~operate~~time into atime ~~highly~~we ~~competitive~~are ~~environment~~party to legal proceedings. We do not believe that isany ~~subject~~of the pending proceedings would have a tomaterial ~~rapid~~adverse ~~technological~~effect ~~changes~~on ~~and~~our ~~the~~business, ~~emergence~~financial ofcondition ~~new~~or ~~technologies~~results of operations. ~~Our~~However, ~~future~~we ~~revenues~~have ~~depend~~no ~~significantly~~assurance ~~upon~~that ~~the~~an ~~adoption~~unfavorable ~~and~~decision ~~deployment~~in byany such legal proceeding would not have a material adverse effect.

19 Item 4. Submission of Matters to a Vote of Security Holders

~~Table~~ Our 2007 Annual Meeting of ~~Contents~~Shareholders was held on December 26, 2007. The sole proposal submitted for shareholder consideration at the Annual Meeting was the election of directors. The following is a tabulation of the voting at the Annual Meeting.

~~wireless customers of new technologies. Our success will depend~~ Proposal ~~on our ability to timely enhance our current service offerings~~1 — toElection ~~keep pace with new technologies and the changing needs~~ of ~~our~~Directors ~~customers. If we are not successful in responding to~~ ~~technological changes or industry or marketplace developments, we may not be able to compete effectively, which could harm our reputation and opportunities for future revenue growth.~~

We may not be able to hire or retain a sufficient number of qualified engineers and other employees to meet our contractual commitments or maintain the quality of our services.


	Term				Votes		Broker
Elected Director	Expires		Votes For		Withheld		Non-Votes

Julie A. Dobson		2008		22,605,373		416,725		—
Dean Douglas		2008		22,984,681		37,417		—
Melvin J. Keating		2008		22,851,753		170,345		—
Richard Lombardi		2008		22,605,373		416,725		—
Susan Ness		2008		22,605,373		416,725		—
Rajendra Singh		2008		22,984,680		37,417		—
Mark A. Slaven		2008		22,984,868		37,230		—

~~As a service business our success depends significantly on our~~ ~~ability to attract, train and retain engineering, system~~PART II deployment, managerial, marketing and sales personnel who have excellent technical skills, particularly as technology changes, as well as the interpersonal skills crucial to fostering client satisfaction. Competition within the wireless industry for employees with the required range of skills fluctuates, depending on customer needs, and can be intense, particularly for radio frequency engineers. At times we have had difficulty recruiting and retaining qualified technical personnel to properly and quickly staff large customer projects. In addition to recruitment difficulties, we must fully and properly train our employees according to our customers’ technology requirements and deploy and fully integrate each employee into our customers’ projects. Increased competition in the wireless industry is increasing the level of specific technical experience and training required to fulfill customer-staffing requirements. This process is costly and resource constraints may impede our ability to quickly and effectively train and deploy all of the personnel required to staff a large project.

~~Because we~~Item ~~have~~5. ~~experienced,~~Market ~~and~~for ~~expect~~Registrant’s toCommon ~~continue to experience~~Equity, ~~long sales~~Related ~~cycles,~~Stockholder weMatters ~~expect to incur significant costs to generate new business~~ and ~~our~~Issuer ~~customer~~Purchases ~~base~~of ~~may~~Equity ~~not experience growth commensurate with such costs.~~ Securities

~~Purchases~~Since completion of our ~~services~~initial bypublic ~~customers~~offering ~~often~~in ~~entail a lengthy~~September ~~decision-making~~1996, ~~process~~our ~~for~~Class A ~~the~~common ~~customer.~~stock ~~Selecting~~has ~~wireless network~~been ~~deployment~~quoted ~~services~~on ~~involves substantial costs and has~~the ~~strategic~~NASDAQ ~~implications.~~Global ~~Senior~~Market ~~management~~under of the ~~customer~~trading issymbol “LCCI.” ~~often~~Prior ~~involved~~to inDecember 31, ~~this process~~2007, ~~given~~all ~~the~~outstanding ~~importance~~shares of ~~the~~our ~~decision,~~Class B ascommon ~~well~~stock aswere ~~the~~converted ~~risks~~into ~~faced~~shares byof Class A ~~the~~common ~~customer~~stock. ifSee ~~the~~Note 12, ~~services~~Shareholders’ doEquity ~~not~~in ~~meet~~ the ~~customer’s~~consolidated ~~particular needs. We~~financial ~~may~~statements. ~~expend~~As ~~substantial~~of ~~funds~~February 29, ~~and~~2008, ~~effort~~there ~~to negotiate agreements~~were ~~for~~approximately ~~these~~100 ~~services,~~stockholders ~~but~~of ~~may~~record ~~ultimately~~of bethe ~~unable to consummate~~Class A ~~agreements~~common ~~for~~stock. ~~services~~As ~~and~~of ~~expand~~February 29, ~~our customer base. In addition~~2008, we ~~have~~estimate ~~increasingly been required to change both our~~there ~~personnel~~were ~~and~~approximately ~~the~~2,438 ~~techniques~~beneficial weholders ~~employ~~of tothe ~~respond to customer~~Class A ~~organizational~~common ~~changes and expanded geographic reach~~stock. ~~Customer buying~~The ~~habits~~following ~~currently~~table ~~seem~~summarizes tothe ~~favor~~high aand ~~regionalized sales~~low ~~force,~~sales ~~which~~prices ~~can~~of ~~increase~~the ~~costs,~~class A ~~and~~common ~~may~~stock ~~prove~~by tofiscal bequarter ~~ineffective.~~for As2007 ~~a result of our lengthy sales cycles~~ and ~~these potential~~2006 ~~increased~~as ~~costs,~~reported weon ~~expect~~the toNASDAQ ~~continue~~Global ~~to incur~~Market: ~~relatively high costs to generate new business.~~

If wireless service providers, network equipment vendors and enterprises perform more tasks themselves, our business will suffer.


Quarter Ended:	2007

March 31	$	3.68 to $5.07
June 30	$	3.41 to $4.62
September 30	$	3.18 to $4.85
December 31	$	1.75 to $3.49

~~Our success depends upon the continued trend by wireless service~~ ~~providers and network equipment vendors to outsource their~~22 network design, deployment and management needs. If this trend does not continue or is reversed and wireless service providers and network equipment vendors elect to perform more tasks themselves, our operating results may be adversely affected due to the decline in the demand for our services.

Government regulations may adversely affect our business.


Quarter Ended:	2006

March 31	$	2.40 to $3.65
June 30	$	3.10 to $4.15
September 30	$	3.15 to $3.77
December 31	$	3.44 to $4.05

~~The~~We ~~wireless~~have ~~networks~~never ~~that~~paid weany ~~design,~~cash ~~deploy~~dividends ~~and~~on ~~manage~~our ~~are~~common stock, and ~~subject~~we todo ~~various~~not ~~FCC~~anticipate ~~regulations~~paying individends ~~the~~on ~~United~~our ~~States~~common ~~and other~~stock, ~~international regulations. These regulations require that~~cash ~~these~~or ~~networks~~otherwise, ~~meet~~in ~~certain~~the ~~radio~~foreseeable ~~frequency~~future. ~~emission~~Future ~~standards~~dividends, if ~~and~~any, ~~not~~will ~~cause~~be ~~interference~~at tothe ~~other~~discretion ~~services,~~of ~~and~~the inBoard ~~some~~of ~~cases~~Directors and ~~accept~~will ~~interference~~depend ~~from~~upon, among other ~~services.~~things, ~~Changes in the regulation of~~ our ~~activities~~operations, ~~including changes in the~~capital ~~allocation~~requirements ofand ~~available~~surplus, ~~spectrum~~general byfinancial ~~the United States government~~condition, ~~and~~contractual ~~other~~restrictions, ~~governments~~such oras ~~exclusion~~those ofunder our ~~technology by a~~credit ~~standards body~~facility, ~~could~~and ~~have~~such aother ~~harmful~~factors ~~effect~~as onthe ~~our~~Board ~~business,~~of Directors may ~~operating~~deem ~~results, liquidity and financial position~~relevant.

~~We may~~Equity beCompensation ~~unable~~Plan ~~to satisfy the accounting guidelines that govern the~~Information ~~determination of the realizable value of a deferred tax asset in a given tax jurisdiction, thus eliminating our ability to recognize as an~~

The table below provides information, as of December 31, 202007, concerning securities authorized for issuance under our equity compensation plans:

Number of securities

Weighted average

Number of securities remaining

to be issued upon

exercise price of

available for future issuance under

exercise of

outstanding

equity compensation plans

outstanding options,

options, warrants

(excluding securities reflected in

warrants and rights

and rights

column (a))

(a)

(b)

(c)

Equity compensation plans approved by securities holders:

Amended and Restated Equity Incentive Plan(1)(2)

3,387,145

2.81

436,809

Directors Stock Option Plan (Class A Common Stock)

112,400

6.63

—

Equity compensation plans not approved by securities holders(3)

500,000

2.49

—

Total

3,999,545

2.88

436,809

asset the tax benefit of operating losses in the same jurisdiction and causing a reduction in our overall consolidated profitability.


(1)		We have outstanding 840,025 unvested restricted stock units granted under the Amended and Restated Equity Incentive Plan not included in the above table.
(2)		For a description of our Equity Incentive Plan, see Note 14. Equity Incentive Plans, in the consolidated financial statements.
(3)		The options to purchase 500,000 shares of our common stock were granted pursuant to the Dean J. Douglas Employment Inducement Plan, which was not approved by our stockholders.

~~There are stringent rules that govern the realizable value of a~~23 deferred tax asset. As we closed out the fourth quarter of 2004, we determined that our circumstances in the U.S. tax jurisdiction had changed to such an extent that it was appropriate to establish a valuation allowance for a large part of the U.S. deferred tax assets, and this resulted in an increased tax expense of $3.4 million in the fourth quarter of 2004 and precludes us from recognizing any U.S. tax benefits or deferred tax assets in 2006 and in the foreseeable future.

~~If we~~Stock ~~fail~~Performance ~~to retain our key personnel and attract and retain~~Graph ~~additional qualified personnel, our ability to operate our business may be adversely affected.~~

~~Our~~The ~~future~~following ~~success~~chart ~~and~~sets ~~our~~forth ~~ability~~a tofive-year ~~sustain~~comparison of the cumulative stockholder total return on our ~~revenue~~class A ~~growth~~common ~~depend~~stock. ~~upon~~Total stockholder return is measured by dividing total dividends (assuming dividend reinvestment) plus share price change for a particular period by the ~~continued~~share ~~service~~price at the beginning of ~~our~~the ~~executive~~measurement ~~officers~~period. ~~and~~Our cumulative stockholder ~~other~~return ~~key~~based ~~personnel.~~on Wean ~~cannot~~investment ~~guarantee~~of ~~that~~$100 weat ~~will~~December 31, be2002, when ~~able~~our class A common stock was traded on the NASDAQ Global Market at the closing price of $1.95, is compared to the ~~attract~~cumulative total return of the NASDAQ Market Index and ~~retain~~an ~~key~~index comprised ~~personnel~~of orpublicly ~~executive~~traded ~~management~~companies, which are principally in ~~sufficient~~the ~~numbers~~wireless network services business (the “Old Peer Group”) and (the “New Peer Group”) during that same period. In 2007, ~~with~~our Old Peer Group consisted of the following ~~requisite~~companies: ~~skills~~Dycom orIndustries onInc., ~~acceptable~~The Management ~~terms~~Network ~~necessary~~Group orInc., ~~advisable~~Mastec toInc., ~~support~~Tetra ~~our~~Technologies ~~continued~~Inc. ~~growth~~and Kratos Defense Security Solutions, Inc.(formerly Wireless ~~The~~Facilities, ~~loss~~Inc, of“WFI”). ~~any~~During ofMarch ~~our~~2007, ~~key~~we acquired ~~employees~~the equity interests in the Europe, Middle East and Africa business of WFI and in ~~particular~~June ~~Dean~~2007 Jwe acquired certain assets and liabilities of the U.S. wireless engineering ~~Douglas~~services ~~our~~business ~~chief~~of ~~executive~~WFI. ~~officer,~~Therefore ~~could~~we ~~adversely~~have ~~affect~~excluded ~~our~~Kratos ~~ability~~Defense toSecurity ~~generate~~Solutions, ~~revenues~~Inc. ~~and~~(formerly ~~operate~~Wireless Facilities, Inc.) from our ~~business~~New Peer Group. The total returns for both groupings are shown below.

~~Our~~COMPARISON ~~stock~~OF ~~price~~5 ~~and~~YEAR ~~trading~~CUMULATIVE ~~volume~~TOTAL ~~are~~RETURN* Among ~~volatile~~LCC ~~and~~International, ~~could~~Inc., ~~decline~~The NASDAQ Composite Index, ~~resulting~~A inNew aPeer ~~substantial~~Group ~~loss~~And onAn ~~your~~Old Peer Group ~~investment.~~

~~The~~* ~~stock~~$100 ~~market~~invested inon ~~general,~~12/31/02 ~~and the market for technology-related stocks~~ in ~~particular, is highly volatile. As a result, the market price of our~~ stock isor ~~likely to be similarly volatile, and investors in our stock may experience a decrease in the value of their stock,~~ index-including ~~decreases unrelated~~reinvestment to our operating performance or prospects. In addition, for the period from January 1 to December 31, 2006, the average daily trading volume for our stock as reported by The NASDAQ Global Market was 88,429 shares. Accordingly, the price of our stock and the trading volume of our stock could be subject to wide fluctuations in response to a number of factors, including those listed in this “Risk Factors” section and others such as: dividends.

• our operating performance and the performance of other similar companies or companies deemed to be similar; • final resolution of amounts due from the sale of the Network Deployment business; • actual or anticipated differences in our quarterly operating results; • changes in our revenues or earnings estimates or recommendations by securities analysts; • publication of research reports about us or our industry by securities analysts; • additions and departures of key personnel; • strategic decisions by us or our competitors, such as acquisitions, consolidations, divestments, spin-offs, joint ventures, strategic investments, or changes in business strategy; • the passage of legislation or other regulatory developments that adversely affect us or our industry; • failure to file timely all reports required to be filed by the U.S Securities and Exchange Commission; • speculation in the press or investment community; • changes in accounting principles; • terrorist acts; • general market conditions, including economic factors unrelated to our performance; and • political or military events related to international conflicts, wars, or otherwise. 24

InItem ~~the past, securities class action litigation has often been instituted against companies following periods of volatility in their stock price~~6. ~~This~~Selected ~~type~~Financial ~~of litigation could result in substantial costs and divert our management’s attention and resources.~~ Data

Set forth below are selected consolidated financial data as of 21and for each of the years in the five-year period ended December 31, 2007, which have been derived from our consolidated financial statements. The selected consolidated financial data set forth below should be read in conjunction with Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations and the consolidated financial statements and related notes thereto included in this Form 10-K.


	2007			2006			2005			2004			2003
	(In thousands, except per share data)

Revenues	$	145,723		$	129,953		$	145,642		$	118,666		$	82,876
Cost of revenues (exclusive of depreciation shown separately below)		120,071			97,194			114,214			92,619			65,424
Gross profit		25,652			32,759			31,428			26,047			17,452
Operating expenses:
Sales and marketing		15,086			7,910			8,131			7,897			6,612
General and administrative		24,215			26,699			27,893			26,896			17,534
Restructuring charge (recovery)		1,107			108			404			(1,137	)		(2	)
Depreciation and amortization		4,224			2,378			2,793			2,573			3,761

Total operating expenses		44,632			37,095			39,221			36,229			27,905

Operating loss		(18,980	)		(4,336	)		(7,793	)		(10,182	)		(10,453	)

Other income (expense)
Interest income (expense), net		(3,507	)		(730	)		(201	)		(100	)		309
Other		(4,811	)		1,763			(883	)		1,533			1,234

Total other income (expense)		(8,318	)		1,033			(1,084	)		1,433			1,543

Loss from continuing operations before income taxes		(27,298	)		(3,303	)		(8,877	)		(8,749	)		(8,910	)
Provision (benefit) for income taxes		1,387			1,576			2,717			4,957			(2,022	)

Loss from continuing operations		(28,685	)		(4,879	)		(11,594	)		(13,706	)		(6,888	)

Income (loss) from discontinued operations		(2,070	)		(3,151	)		(933	)		7,395			365

Net loss		(30,755	)		(8,030	)		(12,527	)		(6,311	)		(6,523	)
Preferred stock dividend		12			—			—			—			—

Net loss applicable to common stock	$	(30,767	)	$	(8,030	)	$	(12,527	)	$	(6,311	)	$	(6,523	)

Net income (loss) per share:
Continuing operations
Basic and diluted	$	(0.97	)	$	(0.20	)	$	(0.47	)	$	(0.56	)	$	(0.32	)

Discontinued operations
Basic and diluted	$	(0.07	)	$	(0.13	)	$	(0.04	)	$	0.30		$	0.01

Net loss per share
Basic and diluted	$	(1.04	)	$	(0.33	)	$	(0.51	)	$	(0.26	)	$	(0.31	)

Weighted average shares:
Basic and diluted		29,657			24,893			24,524			24,381			21,292
Consolidated Balance Sheet Data (at year-end):
Cash, cash equivalents and restricted cash	$	9,850		$	7,328		$	15,337		$	23,092		$	31,031
Working capital		22,026			33,490			37,770			49,658			54,980
Goodwill and intangibles, net		59,955			14,282			11,326			12,848			11,958
Total assets		151,450			98,423			118,953			120,807			118,591
Total debt		54,339			4,226			2,975			147			1,840
Shareholders’ equity		44,687			52,096			53,751			67,705			69,768

~~Item 1B. Unresolved Staff Comments~~ 25

~~None~~Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Item~~ The 2.following ~~Properties~~discussion and analysis should be read in conjunction with our consolidated financial statements and the notes thereto and the other financial data appearing elsewhere in this Form 10-K.

~~We leased approximately 155,000 square feet of office space~~ ~~for our corporate headquarters in McLean, Virginia, under a~~Overview ~~ten-year lease that expired on June 30, 2007. We occupied approximately 59,000 square feet of the McLean facility and subleased approximately 96,000 square feet to subtenants.~~

We ~~currently~~are ~~lease~~an ~~approximately~~independent ~~24,000 square~~provider ~~feet~~of atintegrated ~~7900~~end-to-end ~~Westpark~~solutions ~~Drive,~~for ~~McLean,~~wireless ~~Virginia,~~voice ~~which~~and ~~now~~data ~~serves~~communications asnetworks with ~~our~~offerings ranging from high level technical consulting, ~~corporate~~system ~~headquarters.~~design Weand ~~moved~~optimization ~~into~~services, ~~this~~ongoing ~~space~~operations and maintenance services and, in ~~June~~some ~~2007.~~countries, deployment services. We dohave ~~not~~been ~~intend~~successful in using initial opportunities to ~~sublease~~provide athigh ~~the~~level ~~new~~technical ~~location.~~consulting Weservices ~~have~~to secure ~~executed~~later-stage asystem ~~first~~design ~~amendment~~and network optimization contracts. Engagements to ~~this~~provide ~~lease~~design ~~for~~services also enable us to secure ~~approximately 9~~ongoing deployment,~~000~~ ~~additional~~as ~~square~~well ~~feet~~as operations and maintenance projects. WeOur ~~intend~~technical toconsulting, system design and network ~~occupy~~optimization ~~this~~practices position us well to capitalize on additional ~~space~~opportunities as new technologies are developed and wireless service providers upgrade their existing networks, deploy the latest available technologies, and respond to changes in ~~January~~how ~~2008~~customers use wireless services.

We ~~lease~~provide ~~approximately~~these ~~9,000 square~~services ~~feet~~through ofa ~~office space at our Europe, Middle East and Africa, or EMEA,~~ regional ~~headquarters~~ ~~in London~~organization, ~~England, under a~~which ~~13-year lease~~comprises ~~expiring~~two inprincipal ~~September~~regions ~~2014.~~and Weseveral ~~occupy~~smaller ~~approximately~~divisions. ~~2,000 square~~Our ~~feet~~primary ofoperating ~~the~~segments ~~London~~are ~~facility.~~Americas Weand ~~currently sublease approximately 7,000 square feet to subtenants~~EMEA.

InAmericas: Headquartered ~~addition, we lease approximately 153,000 square feet of office space~~ in ~~connection with our local operations in the United Kingdom (Cambridge~~McLean, ~~Stockley~~Virginia, ~~Park, Bath, Solihull,~~ ~~Newark,~~the ~~Enfield~~Americas ~~and~~region ~~Glasgow),~~provides ~~Italy~~a ~~(Rome~~range ~~and~~of ~~Milan),~~service ~~and~~offerings ~~the~~to ~~Netherlands~~wireless ~~(’s~~operators ~~Hertogenbosch),~~and ~~our~~equipment ~~regional~~vendors ~~marketing efforts~~ in ~~Algeria,~~North ~~Spain, and the U~~America.~~A.E.~~ ~~and project office~~In ~~space~~2007, asAmericas ~~required~~generated toapproximately ~~perform~~32.2% ~~contracts~~of ~~in various locations for~~ our ~~clients~~revenues.

~~All~~EMEA: Based ofin ~~our~~London, ~~facilities~~EMEA ~~are~~is ~~used~~responsible for operations ~~current~~in ~~operations~~the U.K., Italy, the Netherlands, Algeria, Belgium, Luxembourg, Germany, Spain, Greece, Pakistan and Saudi Arabia. In 2007, EMEA generated approximately 67.8% of ~~all~~our ~~segments~~revenues.

~~Item~~ Nonreportable 3segments: This segment of our business includes the wind down of our operations in Asia-Pacific, LCC Wireline, Inc., ~~Legal~~corporate ~~Proceedings~~and the Wireless Institute. These combined operations generated minimal revenues.

~~From~~Our ~~time~~primary tosources ~~time~~of werevenues are ~~party~~technical toconsulting, engineering ~~legal~~design ~~proceedings~~and optimization and, in certain countries in EMEA, network deployment services. WeRevenues dofrom ~~not~~services are ~~believe~~derived ~~that~~both ~~any~~from offixed ~~the~~price ~~pending~~and ~~proceedings~~time ~~would~~and ~~have~~materials acontracts. ~~material~~We ~~adverse~~recognize ~~effect~~revenues onfrom ~~our~~fixed ~~business,~~price ~~financial~~service ~~condition~~contracts orusing ~~results~~the percentage-of-completion ~~operations.~~method ~~However,~~based weon ~~have~~the noratio ~~assurance~~of individual ~~that~~contract ancosts incurred to date on a project compared ~~unfavorable~~with ~~decision~~total inestimated ~~any~~costs ~~such~~on ~~legal~~completion. ~~proceeding~~Anticipated ~~would~~contract losses ~~not~~are ~~have~~recognized as they become known and estimable. We arecognize ~~material~~revenues ~~adverse~~on ~~effect~~time and materials contracts as the services are performed.

~~Item~~ In 4EMEA, the Company generally receives purchase orders for individual cell sites based on agreed upon fixed prices for types of standard cell sites. ~~Submission~~Non-standard services related to a cell site are priced on a variable basis using either agreed upon rates per hour or a rate schedule for such non-standard services. Deployment of ~~Matters~~cell sites may take up to several months and revenues and costs are recognized on a ~~Vote~~percentage of completion ~~Security~~basis ~~Holders~~based upon the Company’s engineering estimates.

~~None~~Cost of revenues include direct compensation and benefits, living and travel expenses, payments to third-party subcontractors and consultants, equipment rentals, expendable computer software and equipment, or directly attributed, facility and overhead costs identifiable to projects.

General and administrative expenses consist of compensation, 22benefits, office and occupancy, and other costs required for the finance, human resources, information systems, and executive office functions. Sales and marketing expenses consist of salaries, benefits, sales commissions, travel and other related expenses required to implement our marketing, sales and customer support plans.

~~Table~~ We generate cash from fixed price contracts by billings associated with contract milestones, which are typically agreed upon with our customers at the time the contracts are negotiated. For our time and materials contracts, we usually bill our customers on a monthly basis as services are performed. On large network deployment contracts, which involve the design and construction of ~~Contents~~complex wireless networks, it is increasingly common for

~~PART II~~26

~~Item~~ our 5customers to require fewer contract milestones than in previous years. ~~Market~~This ~~for~~results ~~Registrant’s~~in ~~Common~~extending ~~Equity,~~the ~~Related~~periods ~~Stockholder~~during which ~~Matters~~we are obliged to fund our operating costs until a milestone can be billed to the customer. This increases the capital that we require to operate the business, and ~~Issuer~~is evidenced ~~Purchases~~by increases in foreign unbilled receivables on our balance sheet. This is an integral part of ~~Equity~~our ~~Securities~~business and we are constantly striving to manage our working capital requirements.

~~Since~~Another ~~completion~~statistic ofthat ~~our~~we ~~initial~~monitor ~~public~~is ~~offering~~our incontract ~~September~~backlog, which ~~1996,~~at ~~our class~~December A31, ~~common~~2007 ~~stock~~was ~~has~~comprised ~~been~~of ~~quoted~~firm onbacklog ~~the~~of ~~NASDAQ~~$61.6 million ~~Global~~and ~~Market~~implied ~~under~~backlog ~~the~~of ~~trading symbol “LCCI~~$16.”6 million. We ~~Prior~~expect tothat ~~December~~our ~~31,~~contract ~~2006,~~backlog ~~all~~will ~~outstanding~~vary ~~shares~~from oftime ~~our~~to time as ~~Class B~~we ~~common~~deliver ~~stock~~contract ~~were~~revenues ~~converted~~and ~~into~~win ~~shares~~new awards. We define firm backlog as the value of ~~Class A~~work-in-hand to ~~common~~be ~~stock.~~done ~~See~~with ~~Note~~customers ~~15,~~as ~~Shareholders’~~of a specific date where the ~~Equity~~following inconditions are met: (i) the ~~accompanying~~price ~~consolidated~~of ~~financial~~the work to ~~statements.~~be Asdone ofis ~~November~~fixed; (ii) 7,the ~~2007,~~scope ~~there~~of ~~were~~the work to be done is ~~approximately 114 stockholders~~fixed, ofboth ~~record~~in ofdefinition and amount (for example, the number of ~~class A~~sites ~~common~~has ~~stock.~~been Asdetermined); ofand ~~November~~(iii) 7there is a written contract, ~~2007~~purchase order, weagreement or other documentary ~~estimate~~evidence ~~there~~which ~~were~~represents ~~approximately~~a ~~2,800~~firm ~~beneficial~~commitment ~~holders~~by ofthe client to pay us for the ~~class A~~work ~~common~~to ~~stock~~be performed. ~~The~~We ~~following~~define ~~table~~implied ~~summarizes~~backlog as the ~~high~~estimated revenues from master service agreements and similar ~~low~~arrangements, ~~sales~~which ~~prices~~have ofmet the ~~class A~~first ~~common~~two ~~stock~~conditions byset ~~fiscal~~forth ~~quarter~~above but for ~~2006~~which ~~and~~we ~~2005~~have asnot ~~reported~~received ona ~~the NASDAQ~~firm ~~Global~~contractual ~~Market:~~commitment.

Quarter Ended:	2006
March 31	$	2.40 to $3.65
June 30	$	3.10 to $4.15
September 30	$	3.15 to $3.77
December 31	$	3.44 to $4.05

We have completed a number of business dispositions, acquisitions and investments, some of which have either generated significant cash proceeds or created significant requirements for cash and these transactions significantly affect the year-to-year comparability of our financial statements. During the second quarter of 2006, we made the decision to sell our U.S. Network Deployment operations for a total consideration of $10.2 million. The consideration included approximately $1.0 million of cash proceeds. At December 31, 2007, $1.8 million was due from Nokia in connection with this transaction. In conjunction with the sale, we entered into a loan agreement with a maximum amount outstanding of $4.2 million. This loan was repaid in full during 2007. In the third quarter of 2006, we made the decision to sell our Brazilian Subsidiary. We agreed to assume the obligations for payroll related taxes in dispute and recorded in discontinued operations a charge of $0.4 million, representing the net present value of the obligation related to the severance related payroll taxes due to the Brazilian tax authority. On December 29, 2006, we completed the purchase of Detron Belgium NV (“Detron Belgium”), a provider of technical services to the telecommunications industry in Belgium and Luxembourg, for $1.9 million pursuant to a share purchase agreement. On March 9, 2007, we purchased the equity interests of WFI’s EMEA business for a purchase price of approximately $4.4 million including transaction related costs. On June 1, 2007, we acquired certain assets and liabilities of WFI’s U.S. wireless engineering services business for a purchase price of approximately $43.4 million (after adjustment for final agreement on the value of net assets transferred). We expect to continue to consider business dispositions, acquisitions and investments as a way of supporting our longer-term strategies.

Quarter Ended:	2005
March 31	$	3.80 to $5.88
June 30	$	3.00 to $4.69
September 30	$	2.01 to $3.93
December 31	$	2.35 to $3.33

On November 12, 2007 we received notice from the buyers that they had decided not to proceed with the acquisition of our Brazilian subsidiary, LCCI do Brasil Ltda (“LCC Brazil”). We are working on other alternatives, including an opportunity to sell to another interested party that has submitted a non-binding letter of intent to purchase LCCI Brazil. The Company continues to be in negotiation with this other party for the sale of LCCI Brazil.

~~We have never paid any cash dividends on our common stock, and~~ ~~we do not anticipate paying dividends on our common stock, cash~~RECENT ~~or otherwise, in the foreseeable future. Future dividends, if~~DEVELOPMENTS any, will be at the discretion of the Board of Directors and will depend upon, among other things, our operations, capital requirements and surplus, general financial condition, contractual restrictions and such other factors as the Board of Directors may deem relevant.

~~Equity~~Bank ~~Compensation Plan Information~~Refinancing

On November 30, 2007, we further amended and restated our outstanding credit facility with Bank of America, N.A. (“Bank of America”) to among other things, provide for a bank waiver and amend certain covenants in the agreement for all events of default. The ~~table~~amended ~~below~~agreement provides ~~information~~for a total principal borrowing amount of up to $21.95 million which may be borrowed, asrepaid and reborrowed by us on a revolving basis until November 29, 2009. It also provides for a term loan of $6.5 million with scheduled principal payments of $3.5 million on June 1, 2008, $1.0 million on each of September 1 and December 311, ~~2006~~2008 and March 1, ~~concerning~~2009 ~~securities~~and ~~authorized~~any ~~for~~balance ~~issuance~~on ~~under~~November 29, 2009, ~~our~~an increase in the applicable interest rate on borrowings ~~equity~~by ~~compensation~~1.00% ~~plans:~~per annum, the amendment of the financial covenants set forth in the agreement and the payment to the bank of a fee of up to $0.6 million in connection with the amendment.

Number of securities

remaining available for

Number of securities

future issuance under

to be issued upon

Weighted-average

equity compensation

exercise of

exercise price of

plans (excluding

outstanding options,

securities reflected in

warrants and rights

column (a))

Plan category

(a)

(b)

(c)

Equity compensation plans approved by securities holders

Amended and Restated Equity Incentive Plan(1)(2)

3,256,629

4.26

923,859

Directors Stock Option Plan (Class A Common Stock)

142,400

7.79

—

Equity compensation plans not approved by security holders(3)

500,000

2.49

—

Total

3,899,029

4.16

923,859

On February 20, 2008, the Company filed a current report on Form 8-K disclosing that on February 19, 2008, it entered into a Second Amendment to Restated Credit Agreement and Waiver (the “Amendment”), which amends

2327

~~Table~~ the Amended and Restated Credit Agreement, dated as of May 29, ~~Contents~~2007 (the “Credit Agreement”), among the Company, as borrower, certain domestic subsidiaries of the Company, as guarantors and Bank of America, N.A. as lender and administrative agent (the “Bank”). The Amendment provides, among other things, (a) a waiver by the Bank of certain specified defaults under the Credit Agreement, and (b) a requirement that the financial statements described in Section 7.01(b) of the Credit Agreement with respect to the fiscal quarters ended March 31, 2007, June 30, 2007 and September 30, 2007, in each case, along with any additional deliveries required under the Credit Agreement in connection therewith, be delivered to the Bank on or before February 22, 2008, the failure of which will constitute an immediate event of default irrespective of otherwise applicable grace or cure period.

(1)	We have outstanding 1,366,679 unvested restricted stock units granted under the Amended and Restated Equity Incentive Plan not included in the above table.
(2)	For a description of our Equity Incentive Plan, see Note 14. Incentive Plans, in the consolidated financial statements.
(3)	We have granted Mr. Dean Douglas options to purchase 1,000,000 shares of our common stock, as disclosed in the “Outstanding Equity Awards at Fiscal Year-End” Table. 500,000 of these were granted pursuant to our Equity Incentive Plan, which has been approved by our stockholders. The remaining 500,000 were granted pursuant to the Dean J. Douglas Employment Inducement plan which was not approved by our stockholders.

The Amendment also provided that $1.35 million of the settlement proceeds of $1.8 million, as discussed in Note 5, shall be applied to the term loan payments in the reverse order of maturity, with the balance of the settlement proceeds to be used by the Company for general corporate and working capital needs. This provision thereby resulted in classifying $1.35 million of the term loan as current in the consolidated balance sheet.

~~Stock~~SEC ~~Performance~~Filing ~~Graph~~Delinquencies and NASDAQ compliance

~~The~~As ~~following~~discussed ~~chart~~more ~~sets~~fully ~~forth~~in aNote 22. ~~five-year~~Subsequent ~~comparison~~Events, to ofthe consolidated financial statements, proceedings were pending before the NASDAQ Listing and Hearing Review Council ~~cumulative~~with ~~stockholder~~respect ~~total~~to ~~return~~a onpotential delisting of our ~~class~~Class A common stock. ~~Total~~as ~~stockholder~~a ~~return~~result isof ~~measured~~the byCompany’s ~~dividing~~failure ~~total dividends~~to ~~(assuming~~file ~~dividend~~with ~~reinvestment)~~the SEC ~~plus~~its ~~share~~quarterly ~~price~~reports on ~~change~~ Form 10-Q for aeach ~~particular~~of ~~period~~the byquarters ~~the~~ended ~~share~~March 31, ~~price~~June at30 ~~the~~and ~~beginning~~September 30, of2007 ~~the~~and Form 8-K/A with ~~measurement~~respect ~~period.~~to ~~Our~~a ~~cumulative~~significant ~~stockholder~~acquisition completed in 2007. On ~~return~~February 21, ~~based~~2008, onthe anCompany ~~investment~~completed ofall ~~$100~~such atfilings. On ~~December~~March 313, ~~2001~~2008, the Company received a letter from NASDAQ ~~when~~that ~~our~~it ~~class A~~is ~~common~~now ~~stock~~compliant ~~was~~with ~~traded~~Marketplace Rule 4310 (c)(14). onAs such, the ~~NASDAQ~~Board of Directors of ~~Global~~NASDAQ ~~Market~~has atwithdrawn ~~the~~its ~~closing~~February ~~price~~14, 2008 call for review of the ~~$7.30~~December 19, is2007 ~~compared~~decisions toof the Listing Council. On ~~cumulative~~April 4, ~~total~~2008, ~~return~~the ofCompany ~~the~~filed ~~NASDAQ~~a ~~Market~~current ~~Index~~report ~~and~~on Form 8-K disclosing anthat, ~~index~~in accordance with NASDAQ’s rules, the ~~comprised~~Company ofhad ~~publicly~~received ~~traded~~a ~~companies~~NASDAQ ~~which~~staff ~~are~~determination ~~principally~~letter instating that the ~~wireless~~Company ~~network~~was ~~services~~not ~~business~~in ~~(the~~compliance ~~“Peer~~with NASDAQ Marketplace ~~Group”~~Rule 4310(c)(14) ~~during~~because ~~that~~it ~~same~~had ~~period.~~not Intimely ~~2006,~~filed ~~our~~its ~~Peer~~Annual Report ~~Group~~on ~~consisted~~Form 10-K for of the ~~following~~year ~~companies:~~ended ~~Dycom~~December 31, ~~Industries Inc~~2007., The Company ~~Management~~requested, ~~Network~~and ~~Group~~was ~~Inc.~~granted, ~~Mastec~~a ~~Inc.,~~hearing ~~Tetra~~before ~~Technologies~~the NASDAQ Listing ~~Inc.~~Qualifications ~~and~~Panel ~~Wireless~~that ~~Facilities~~is scheduled for May 8, ~~Inc~~2008.

~~COMPARISON~~Trends OFThat 5Have ~~YEAR~~Affected ~~CUMULATIVE~~or ~~TOTAL~~May ~~RETURN* Among~~Affect ~~LCC~~Results ~~International,~~of ~~Inc.,~~Operations ~~The NASDAQ Composite Index~~and ~~And~~Financial ~~A Peer Group~~Condition

* The ~~$100~~major ~~invested~~trends onthat ~~12/31/01~~have inaffected ~~stock~~ or ~~index-including~~may ~~reinvestment~~affect ofour ~~dividends.~~business are as follows:

~~Fiscal~~• ~~year~~project ~~ending~~related ~~December 31~~revenues derived from a limited set of customers in each market where we do business; • the acceleration or the delay associated with the introduction of new technologies and services by our customers; • the management and the services composition of our fixed price contracts; • spending levels by wireless service providers in the areas of network design, deployment and optimization; • migration of networks to accommodate enhanced data offerings; • consolidation in the carrier and OEM community; • increased percentage of revenues derived from our international operations; and • recent auctions of spectrum by governments in the U. S. and certain countries in Europe.

	12/01		12/02		12/03		12/04		12/05		12/06
LCC International, Inc.		100.00		26.71		73.44		79.85		44.65		55.47
NASDAQ Composite		100.00		69.66		99.71		113.79		114.47		124.20
Peer Group		100.00		69.59		164.09		149.58		134.22		159.52

Our business is characterized by a limited number of projects awarded by a limited number of customers. This can lead to volatility in our results as projects initially ramp up and then wind down. As projects are completed, we are faced with the task of replacing project revenues with new projects, either from the same customer or from new customers. In addition, the wireless industry is composed of a relatively small number of wireless service providers

2428

~~Table~~ and equipment vendors, and this inevitably leads to issues of customer ~~Contents~~concentration. Consequently, our business may be affected in any single market by the changing priorities of a small group of customers.

~~Item~~ Historically, 6.the ~~Selected~~key ~~Financial~~drivers ~~Data~~of change in our business have been: (i) the issuance of new or additional licenses to wireless service providers; (ii) the introduction of new services or technologies; (iii) increases in the number of subscribers served by wireless service providers, the increase in usage by those subscribers and the scarcity of wireless spectrum; and (iv) the increasing complexity of wireless systems in operation.

~~Set~~We ~~forth~~tend ~~below~~to ~~are~~benefit ~~selected~~from ~~consolidated~~projects ~~financial~~undertaken ~~data~~by asour ofcustomers to introduce new technologies and ~~for~~services ~~each~~in oftheir ~~the~~networks ~~years~~and inwe tend ~~the~~to ~~five-year~~suffer ~~period~~when ~~ended~~projects are delayed. Revenues from 3G networks constituted approximately 43.8%, 29.1% and 25.0% of our total revenues for the years ended December 31, 2007, 2006 and 2005, ~~which~~respectively, ~~have~~and ~~been~~it ~~derived~~is ~~from~~expected ~~our~~to be an area of ~~consolidated~~business ~~financial~~growth ~~statements~~in the future. ~~The~~A ~~selected~~large ~~consolidated~~proportion of the ~~financial~~contracts ~~data~~awarded ~~set~~by ~~forth~~our ~~below~~customers ~~should~~are befixed ~~read~~price, inand ~~conjunction~~we ~~with~~expect ~~Item 7,~~this ~~Management’s~~trend ~~Discussion~~to ~~and~~continue. ~~Analysis~~A recent trend is for the award of ~~Financial~~fixed ~~Condition~~price ~~and~~contracts ~~Results~~to ofcover ~~Operations~~the design and ~~the~~deployment of a ~~consolidated~~certain ~~financial~~geographic ~~statements~~network ~~and~~area ~~related~~on ~~notes~~a ~~thereto~~full turnkey basis, ~~included~~including inplanning, ~~this~~engineering design, site acquisition, ~~Form 10-K~~construction and deployment services.

	2006			2005			2004			2003			2002
Revenues	$	129,953		$	145,642		$	118,666		$	82,876		$	57,515
Cost of revenues (exclusive of depreciation shown separately below)		97,194			114,214			92,619			65,424			49,042
Gross profit		32,759			31,428			26,047			17,452			8,473
Operating expenses:
Sales and marketing		7,910			8,131			7,897			6,612			7,933
General and administrative		26,699			27,893			26,896			17,534			19,528
Restructuring charge (recovery)		108			404			(1,137	)		(2	)		13,215
Gain on sale of tower portfolio and administration, net		—			—			—			—			(2,000	)
Depreciation and amortization		2,378			2,793			2,573			3,761			2,748
Total operating expenses		37,095			39,221			36,229			27,905			41,424
Operating loss		(4,336	)		(7,793	)		(10,182	)		(10,453	)		(32,951	)
Other income (expense)
Interest income (expense), net		(730	)		(201	)		(100	)		309			771
Other		1,763			(883	)		1,533			1,234			(3,975	)
Total other income (expense)		1,033			(1,084	)		1,433			1,543			(3,204	)
Loss from continuing operations before income taxes		(3,303	)		(8,877	)		(8,749	)		(8,910	)		(36,155	)
Provision (benefit) for income taxes		1,576			2,717			4,957			(2,022	)		(8,373	)
Loss from continuing operations		(4,879	)		(11,594	)		(13,706	)		(6,888	)		(27,782	)
Income (loss) from discontinued operations		(3,151	)		(933	)		7,395			365			(888	)
Net loss	$	(8,030	)	$	(12,527	)	$	(6,311	)	$	(6,523	)	$	(28,670	)
Net loss per share:
Continuing operations
Basic and diluted	$	(0.20	)	$	(0.47	)	$	(0.56	)	$	(0.32	)	$	(1.33	)
Discontinued operations
Basic and diluted	$	(0.13	)	$	(0.04	)	$	0.30		$	0.01		$	(0.04	)
Net loss per share
Basic and diluted	$	(0.33	)	$	(0.51	)	$	(0.26	)	$	(0.31	)	$	(1.37	)
Weighted average shares:
Basic and diluted		24,893			24,524			24,381			21,292			20,902
Consolidated Balance Sheet Data (at year-end):
Cash and short-term investments	$	7,328		$	15,337		$	23,092		$	31,031		$	39,329
Working capital		33,490			37,770			49,658			54,980			49,959
Goodwill and intangibles, net		14,282			11,326			12,848			11,958			11,273
Total assets		98,423			118,953			120,807			118,591			96,723
Total debt		4,226			2,975			147			1,840			—
Shareholders’ equity		52,096			53,751			67,705			69,768			61,088

During the year ended December 31, 2007, approximately 13.6% of our revenues were generated by work done by subcontractors, for construction related activities, compared to 20.1% and 25.1% in 2006 and 2005, respectively.

We believe that the Americas may benefit from increased spending 25by certain United States wireless service providers. This increased spending can be attributed to several trends: (i) the implementation of new technologies such as 3G wireless and broadband wireless; (ii) activity generated by efforts to consolidate networks resulting from merger activity; (iii) network quality enhancement programs to reduce churn; (iv) network expansion and capacity programs geared toward enabling new and enhanced services; and (v) other miscellaneous network upgrades and enhancements required for market share maintenance and competitive reasons.

~~Table~~ We have also observed an increase in spending on wireless networks in developing countries. However, the increase in worldwide terrorism may affect our business in these countries. For example, the U.S. State Department has issued security advisories for U.S. nationals in Saudi Arabia, Algeria and certain other countries in the Middle East. While we tend to staff these projects largely with local or regional personnel, we do recognize that undertaking work in such areas at this time carries a higher level of ~~Contents~~operating and political risk than in other more developed areas.

~~Item 7. Management’s Discussion and Analysis of Financial Condition and~~ Results of Operations

The ~~following~~ discussion ~~and~~below ~~analysis~~provides ~~should~~information bewhich ~~read in~~management ~~conjunction~~believes ~~with~~is ~~our~~relevant ~~consolidated~~to ~~financial~~an ~~statements~~assessment and ~~the~~understanding of our ~~notes~~consolidated ~~thereto~~results ~~and~~of ~~the~~operations ~~other~~and financial ~~data~~condition. ~~appearing elsewhere~~The discussion should be read in ~~this~~conjunction with the consolidated ~~Form 10-K~~financial statements and accompanying notes thereto included elsewhere herein.

~~Overview~~29

~~We are an independent provider of integrated~~ ~~end-to-end solutions for wireless voice and data communications networks with offerings ranging from high level technical consulting~~Revenues, ~~system~~Cost ~~design~~of ~~and~~Revenues ~~optimization services, to deployment~~ and ~~ongoing~~ ~~operations~~Gross ~~and maintenance services. We have been~~Margin successful in using initial opportunities to provide high level technical consulting services to secure later-stage system design and network optimization contracts. Engagements to provide design services also enable us to secure ongoing deployment as well as operations and maintenance projects. Our technical consulting, system design and network optimization practices position us well to capitalize on additional opportunities as new technologies are developed and wireless service providers upgrade their existing networks, deploy the latest available technologies, and respond to changes in how customers use wireless services.

We provide these services through a regional organization, which comprises two principal regions and several smaller divisions. Our primary operating segments are Americas and EMEA (Europe, Middle East and Africa).


	Years Ended December 31,
	2007					2006					2005
	(In Thousands)

Revenues:
Americas	$	46,974				$	29,959				$	36,478
EMEA		98,749					99,944					107,844
Nonreportable segments		—					50					1,320

	$	145,723				$	129,953				$	145,642

				(% of revenue)					(% of revenue)				(% of revenue)
Cost of revenues:
Americas	$	39,471		84.0	%	$	24,629		82.2	%	$	32,042	87.8	%
EMEA		80,613		81.6	%		72,684		72.7	%		81,483	75.6	%
Nonreportable segments		(13	)	—			(119	)	—			689	52.2	%

	$	120,071		82.4	%	$	97,194		74.8	%	$	114,214	78.4	%

Gross margin:
Americas	$	7,503		16.0	%	$	5,330		17.8	%	$	4,436	12.2	%
EMEA		18,136		18.4	%		27,260		27.3	%		26,361	24.4	%
Nonreportable segments		13		—			169		—			631	47.8	%

	$	25,652		17.6	%	$	32,759		25.2	%	$	31,428	21.6	%

~~Americas: Headquartered in McLean, Virginia,~~ ~~the~~ Americas ~~region provides a range of service offerings to~~ ~~wireless operators and equipment vendors in North America. In 2006, Americas generated approximately 23% of our total revenue.~~

~~EMEA: Based~~During 2007, we experienced an increase in ~~London,~~our ~~EMEA~~Americas issegment revenues ~~responsible~~of ~~for~~$17.0 million to $47.0 million from ~~operations~~$30.0 million in the Uprior year.~~K.,~~ ~~Italy,~~This increase was primarily due to the ~~Netherlands,~~acquisition ~~Algeria,~~of the WFI US engineering ~~Belgium,~~business ~~Luxembourg~~on May 29, ~~Germany~~2007. Gross margin for the Americas region for year ended December 31, ~~Spain~~2007 was 16.0%, ~~Greece~~as compared to 17.8% in the prior year. This is primarily due to the low margins from the WFI US engineering business and the “bench costs” experienced during the integration of that business. During much of 2007, ~~Pakistan~~the WFI US Engineering businesses workforce was being integrated and ~~Saudi~~rationalized into ~~Arabia~~our existing workforce. InThis had the impact of having more of the revenue generating workforce being idle or underutilized during 2007 as compared to the comparable period in 2006. In addition, ~~EMEA~~we ~~generated~~incurred ~~approximately~~costs ~~77%~~of maintaining that portion of ~~our~~the idle ~~total~~or underutilized workforce “bench costs” without ~~revenue~~generating sufficient revenues to offset such costs.

~~Nonreportable~~During ~~segments: This~~2006, we experienced a decrease in our Americas segment revenue of ~~our~~$6.5 million to $30.0 million from ~~business~~$36.5 million ~~includes~~in 2005. The decrease is primarily the ~~wind~~result of ~~down~~a decrease in revenues of ~~our~~approximately ~~operations~~$6.9 million from customers who were customers in 2006 and 2005 and a ~~Asia-Pacific,~~decrease in revenue of $2.3 million from customers who were ~~LCC~~customers ~~Wireline~~in 2005 but not 2006, ~~Inc~~offset by increases in revenue of $0.7 million ~~corporate~~of certain customers who were customers in 2006 and ~~the~~2005 ~~Wireless~~and ~~Institute~~$2.0 million Inof revenue from customers who were customers in 2006, ~~these~~but ~~combined~~not ~~operations~~2005. ~~generated~~We ~~minimal~~believe ~~revenues~~a portion of the decreases were the result of our decision to reduce our dependence on lower margin work in the U.S. While ~~LCC~~we can ~~Wireline~~not ~~ceased~~estimate ~~operations~~the exact impact on revenue of our decision to focus on higher margin work, we believe that decision resulted in the ~~first~~increase ~~quarter~~in the Americas segment gross margins as a percentage of revenue to 17.8% in 2006 from 12.2% in 2005 and an increase in the segment’s gross margin of $0.9 million to $5.3 million in 2006 from $4.4 million in 2005.

~~Our~~In ~~primary~~2005, ~~sources~~total of revenues ~~are~~for ~~technical~~the ~~consulting~~region were $36.5 million, ~~engineering~~up ~~design~~$1.0 million ~~and~~from ~~optimization~~2004. ~~and,~~Cost inof ~~EMEA,~~revenues ~~network~~increased ~~deployment services~~$3.4 million ~~Revenues~~over ~~from~~2004 ~~services~~for ~~are~~a ~~derived~~$2.4 million ~~both~~decline in ~~from~~gross ~~fixed~~margin ~~price~~ and ~~time~~a ~~and~~decrease ~~materials~~in ~~contracts.~~gross Wemargin ~~recognize~~as a percentage of ~~revenues~~revenue to 12.2% in 2005 from ~~fixed~~19.3% ~~price~~in ~~service~~2004. ~~contracts~~Among ~~using~~our ~~the~~top ~~percentage-of-completion method~~customers ~~based~~we onexperienced ~~the~~declines ~~ratio~~in ofgross ~~individual~~margin ~~contract~~as ~~costs incurred~~a topercentage ~~date~~of onrevenue aof ~~project~~between ~~compared~~6.8% ~~with~~and ~~total~~8.9% ~~estimated~~reducing ~~costs on~~our ~~completion~~margins for those customers by approximately $2.7 million. This ~~Anticipated~~decline ~~contract~~in ~~losses~~total ~~are~~gross ~~recognized~~margin and gross margin as ~~they~~a ~~become~~percentage ~~known~~of ~~and~~revenue ~~estimable.~~was Weattributable ~~recognize~~to ~~revenues~~our taking on ~~time and~~certain ~~materials~~types ~~contracts~~of aslower ~~the~~margin ~~services~~work ~~are~~which ~~performed.~~generated increased revenues but at generally

~~Cost of revenues include direct compensation and benefits,~~ ~~living and travel expenses, payments to third-party~~30 ~~subcontractors and consultants, equipment rentals, expendable computer software and equipment, and allocated, or directly attributed, facility and overhead costs identifiable to projects.~~

~~General~~decreased ~~and~~margins. ~~administrative~~Margins ~~expenses~~were ~~consist~~also ofaffected ~~compensation, benefits,~~negatively ~~office~~by ~~and occupancy, and other costs required for the~~not ~~finance,~~matching ~~human~~lower ~~resources,~~cost ~~information~~personnel ~~systems, and executive office functions. Sales and marketing expenses consist of salaries, benefits, sales commissions, travel and other related expenses required~~ to ~~implement~~the ~~our~~lower ~~marketing,~~margin ~~sales and customer support plans~~work.

~~We generate cash from fixed price contracts by billings~~ ~~associated with contract milestones, which are typically agreed~~EMEA upon with our customers at the time the contracts are negotiated. For our time and materials contracts, we usually bill our customers on a monthly basis as services are performed. On large network deployment contracts, which involve the design and construction of complex wireless networks, it is increasingly common for our customers to require fewer contract milestones than in previous years. This results in extending the periods during which we are obliged to fund our operating costs until a milestone can be billed to the customer. This increases the capital that we require to operate the business, and is evidenced by increases in foreign unbilled receivables on our balance sheet. This is an integral part of our business and we are constantly striving to manage our working capital requirements.

In 2007, revenues for the year decreased by $1.2 million to 26$98.7 million as compared to $99.9 million for the prior year. The primary reason for this decrease was the continued slowdown in revenues from our deployment and consulting contracts in Algeria and the U.K., partially offset by increased revenues attributable to our engineering services contract in Saudi Arabia and increased revenues attributable to the entities doing business in Europe that we acquired from WFI in the first quarter of fiscal 2007. Gross margin was 18.4% in 2007 as compared to 27.3% in 2006. This decrease was due primarily to the reduction in higher margin services provided in Algeria and the continued occurrence of certain relatively fixed costs in Algeria and the U.K., without sufficient revenue to reach the level of gross margin achieved in the 2006 period.

~~Table~~ In 2006, revenues for the year decreased $7.9 million to $99.9 million and cost of ~~Contents~~revenues decreased $8.8 million to $72.7 million, resulting in an increase in gross margin to 27.3% in 2006 compared to 24.4% in 2005. The majority of our gross margin was generated by services provided under our deployment and our consulting contracts in Algeria and our engineering services contract in Saudi Arabia which generated 65.6% of 2006 gross profits. In Algeria, decreases in revenue of $2.0 million and cost of revenue of $4.0 million generated an increase in gross margin and gross margin percentage of $2.0 million and 13.6%, respectively. Algeria provided 37.1% of our EMEA segment gross profits in 2006, up 6.3% from 30.8% in 2005. In Saudi Arabia decreases in revenue of $7.9 million and cost of revenue of $5.2 million reduced gross margin by $2.7 million with no change in the gross margin percentage. Saudi Arabia provided 28.5% of our EMEA segment gross profits in 2006, down 11.0% from 39.5% in 2005. In Italy, a decrease in cost of revenue of $0.9 million on comparable revenues increased gross margin and gross margin percentage $0.9 million and 13.5%, respectively. Revenue and cost of revenues in the U.K. increased by $5.2 million and $4.5 million, respectively, generating increases in gross margin and gross margin percentage of $0.7 million and 1%, respectively. Decreases in revenues and cost of revenues in the Netherlands of $3.7 million and $3.5 million, respectively, generated a slight increase in gross profit percentage.

~~Another~~In ~~critical~~2005, ~~statistic~~revenues ~~that~~for wethe ~~monitor~~year isgrew ~~our~~to ~~contract~~$107.8 million, an ~~backlog,~~increase ~~which~~of ~~at December~~$29.7 ~~31,~~million ~~2006~~over the previous year. The entire growth in revenue was ~~comprised~~attributable ofto ~~firm~~our operations in ~~backlog~~developing ofcountries. Saudi Arabian revenue growth for 2005 was $3715.16 million, ~~and~~with ~~implied~~Algerian ~~backlog~~revenue growth of $1916.08 million. WeLesser ~~expect~~developed ~~that~~countries ~~our~~generated ~~contract~~70% ~~backlog will~~of ~~vary~~2005 gross ~~from~~profits. ~~time~~Overall gross margins improved in 2005 to ~~time~~24.4% asfrom wethe ~~deliver~~22.6% ~~contract~~in ~~revenues~~2004, ~~and~~largely ~~win~~due to the higher ~~new~~margins ~~awards~~produced in the lesser developed countries.

~~We have entered into a number of business dispositions,~~ ~~acquisitions and investments, some of which have either~~Nonreportable ~~generated significant cash proceeds or created significant~~Segments requirements for cash and these transactions significantly affect the year-to-year comparability of our financial statements. For example, in 2004, we sold an unsecured claim against NextWave Telecom, Inc. (“NextWave Telecom”) for $0.8 million and recorded an impairment charge of $0.2 million related to the investment in our joint venture in China, following changes in local business conditions. In the second quarter of 2005, we received a cash payment of approximately $0.6 million from NextWave Telecom for the exercise of all warrants held by us. The exercise was made in accordance with the terms of NextWave Telcom’s reorganization plan under bankruptcy proceedings. In the fourth quarter of 2005, we sold off the one remaining tower that we owned for $0.3 million. During the second quarter of 2006, we made the decision to sell our U.S. Network Deployment operations for a total consideration of $10.2 million. The consideration included $985,000 of cash proceeds, with the remainder to be paid upon final settlement. In conjunction with the sale, we entered into a loan agreement with a maximum amount outstanding of $4.2 million. At December 31, 2006 the balance of this loan was approximately $3.2 million. In the third quarter of 2006, we made the decision to sell our Brazilian subsidiary. We agreed to assume the obligations for payroll related taxes in dispute and recorded in discontinued operations a charge of $0.4 million, representing the net present value of the obligation related to the severance related payroll taxes due to the Brazilian tax authority. On December 29, 2006, we completed the purchase of Detron Belgium NV (“Detron Belgium”), a provider of technical services to the telecommunications industry in Belgium and Luxembourg, for $1.9 million pursuant to a share purchase agreement. On March 9, 2007, we purchased the equity interests of Wireless Facilities, Inc.’s Europe, Middle East and Africa business for a cash purchase price of $4.0 million. On June 1, 2007, we acquired certain assets and liabilities of Wireless Facilities Inc.’s U.S. wireless engineering services business for a purchase price of approximately $39.0 million. We expect to continue to consider business dispositions, acquisitions and investments as a way of supporting our longer-term strategies.

OnThere ~~November 12,~~were ~~2007,~~no inrevenues ~~connection with our decision to sell our Brazilian subsidiary, we received notice~~ from the ~~buyers~~ ~~that~~non-reportable ~~they~~segments ~~have decided not to proceed with the~~during ~~acquisition. We are working on alternatives including an opportunity to sell~~ the ~~entity~~year toended ~~another~~December 31, ~~interested party under similar terms and conditions~~2007.

In 2006 the nonreportable segments generated revenues of ~~Trends~~$0.1 million, down $1.2 million from 2005. This ~~That~~resulted ~~Have~~from ~~Affected~~the orchanges ~~May~~in ~~Affect~~the ~~Results~~LCC Wireline, Inc. division and the closure of ~~Operations~~our China office discussed below. During 2006, there was a loss from operations of $13.1 million for the nonreportable segments, which compares to a loss from operations of $10.6 million for 2005. The majority of this loss is attributable to corporate general and administrative costs, ~~Financial~~which ~~Condition~~are included in the nonreportable segment and are not allocated to the Americas or EMEA.

~~The~~In ~~major~~2005 ~~trends~~the ~~that~~nonreportable ~~have~~segments ~~affected~~generated orrevenues ~~may~~of $1.3 million, ~~affect~~down $3.7 million from 2004. This decline is primarily attributable to the LCC Wireline, Inc. division, which ceased operations in the first quarter of 2005 and the closure of our ~~business~~Beijing, China office as part of the restructuring in the second quarter of 2005. During 2005, there was an operating loss of $10.6 million for the nonreportable segments, which compares to an operating loss from operations of $9.1 million for 2004. The majority of this loss is attributable to corporate general and administrative costs, which are asincluded ~~follows:~~in the nonreportable segment and are not allocated to the Americas or EMEA.

• project related revenues derived from a limited set of customers in each market where we do business; • the acceleration or the delay associated with the introduction of new technologies and services by our customers; • the management and the services composition of our fixed price contracts; • increased spending by wireless service providers in the areas of network design, deployment and optimization; • migration of networks to accommodate enhanced data offerings; • consolidation in the carrier and OEM community; and • increased percentage of revenues derived from our international operations. 31

~~Our business is characterized by a limited number of projects~~ ~~awarded by a limited number of customers. This can lead to~~Operating ~~volatility in our results as projects initially ramp up and then~~Expenses wind down. As projects are completed, we are faced with the task of replacing project revenues with new projects, either from the same customer or from new customers. In addition, the wireless industry is composed of a relatively small number of wireless service providers and equipment vendors, and this inevitably leads to issues of customer concentration. Consequently, our business may be affected in any single market by the changing priorities of a small group of customers.


	Year Ended December 31,
	2007			2006			2005
	(In thousands)

Sales and marketing:
Americas	$	3,774		$	2,832		$	2,228
EMEA		8,541			3,748			5,538
Nonreportable segments		2,771			1,330			365

	$	15,086		$	7,910		$	8,131

Bad debt expense (recovery):
Americas	$	(71	)	$	20		$	223
EMEA		182			(41	)		254
Nonreportable segments		—			—			251

		111			(21	)		728

Other general and administrative:
Americas		4,504			3,620			5,274
EMEA		9,850			11,085			11,604
Nonreportable segments		9,750			12,015			10,287

		24,104			26,720			27,165

Total general and administrative:
Americas		4,433			3,640			5,497
EMEA		10,032			11,044			11,858
Nonreportable segments		9,750			12,015			10,538

	$	24,215		$	26,699		$	27,893

Restructuring charge (recovery):
Americas	$	—		$	—		$	447
EMEA		1,600			31			—
Nonreportable segments		(493	)		77			(43	)

	$	1,107		$	108		$	404

Depreciation and amortization:
Americas	$	1,437		$	430		$	432
EMEA		2,508			1,609			2,016
Nonreportable segments		279			339			345

	$	4,224		$	2,378		$	2,793

Total Operating Expenses:
Americas		9,643			6,902			8,604
EMEA		22,681			16,432			19,412
Nonreportable segments		12,308			13,761			11,205

	$	44,632		$	37,095		$	39,221

~~Table of Contents~~ 32

~~Historically, the key drivers of change in our business have~~ ~~been:~~Sales (i) the issuance of new or additional licenses to wireless service providers; (ii) the introduction of new services or technologies; (iii) the increases in the number of subscribers served by wireless service providers, the increase in usage by those subscribers and ~~the scarcity of~~ ~~wireless~~marketing ~~spectrum; and (iv) the increasing complexity of~~expenses ~~wireless systems in operation.~~

WeThe ~~tend~~increase toin ~~benefit~~sales ~~from~~and ~~projects~~marketing ~~undertaken~~expense ~~by our customers~~ to ~~introduce~~$15.1 million ~~new~~during ~~technologies~~2007 ~~and~~from ~~services~~$7.9 million in ~~their networks and we~~2006 ~~tend~~was toprimarily ~~suffer~~due ~~when~~to ~~projects~~increased ~~are~~sales ~~delayed.~~headcount ~~Revenues~~and ~~from 3G~~increased ~~networks~~sales ~~constituted~~efforts ~~approximately~~as ~~29.1%,~~a ~~25.0%~~result ~~and 21.6%~~ of ~~our total~~the ~~revenues~~acquisition ~~for~~of the ~~years~~WFI ~~ended December 31, 2006, 2005~~US ~~and~~Engineering ~~2004~~business on May 29, ~~respectively~~2007, and itthe isWFI ~~expected to be an area of~~EMEA business ~~growth~~acquired inon ~~the~~March 9, ~~future.~~2007, Apartially ~~large~~offset ~~proportion of the contracts awarded~~ by ~~our customers are fixed price, and we~~ ~~expect~~reduced ~~this~~commission ~~trend~~expense toin ~~continue. A recent trend is for~~ the ~~award of~~EMEA ~~fixed~~region ~~price~~as ~~contracts~~a toresult ~~cover the design and deployment~~ of a ~~certain~~lower ~~geographic~~revenues ~~network~~relating ~~area~~to onour ~~a full turnkey basis~~Algeria, ~~including~~ ~~planning,~~UK ~~engineering design, site acquisition, construction~~ and ~~deployment~~Saudi ~~services~~contracts.

~~During~~In ~~the~~2006, ~~year~~sales ~~ended~~and ~~December~~marketing expenses decreased by $0.2 31million, ~~2006,~~year ~~approximately~~over year. In the EMEA region a decrease ~~20.~~of $1%.8 million was primarily due to a reduction of commissions ~~our~~expense of approximately $1.3 million related to lower revenues ~~were~~in ~~generated~~Saudi Arabia. The balance was due to modest declines in the other business units. This decrease was offset by ~~work~~an ~~done~~increase in the Americas region of $0.6 million due to increased sales and marketing efforts by operating personnel ~~subcontractors,~~and signing bonuses for ~~construction~~new ~~related~~sales ~~activities,~~staff. ~~compared~~In toour corporate ~~25.1%~~division, ~~and~~increases 16of $1.9%0 million inwere ~~2005~~due to the implementation of Investor Relations and ~~2004,~~Marketing ~~respectively~~functions.

WeIn ~~believe~~2005, ~~that~~sales ~~the~~and ~~Americas~~marketing ~~may~~expenses ~~benefit from~~ increased ~~spending~~by by$0.2 million. ~~certain~~Sales ~~United~~and ~~States~~marketing ~~wireless~~costs ~~service providers. This~~increased ~~increased~~$1.8 million ~~spending~~in ~~can~~EMEA bedue ~~attributed~~primarily to ~~several~~an ~~trends:~~increase in ~~(i) the~~commission ~~implementation~~expense ofrelating ~~new~~to ~~technologies~~the ~~such~~technical asconsulting 3Gcontract ~~wireless~~in ~~and~~Saudi ~~broadband~~Arabia. ~~wireless;~~Sales ~~(ii) activity~~and ~~generated~~marketing ~~by efforts~~expenses ~~to consolidate networks resulting from merger activity;~~declined ~~(iii)~~$1.1 ~~network~~million ~~quality~~in ~~enhancement~~the ~~programs~~Americas toand ~~reduce churn; (iv)~~$0.5 ~~network~~million ~~expansion~~in ~~and capacity programs geared toward~~the ~~enabling~~nonreportable ~~new~~segments ~~and~~primarily ~~enhanced~~as ~~services;~~a ~~and~~result ~~(v) other miscellaneous~~of ~~network~~the ~~upgrades and enhancements required for~~cost ~~market~~restructuring ~~share~~undertaken ~~maintenance~~during ~~and~~the ~~competitive~~second ~~reasons~~quarter of 2005.

~~We have also observed an increase in spending on wireless~~ ~~networks~~Net ~~in developing countries. However, the increase in~~bad ~~worldwide~~debt ~~terrorism~~expense ~~may affect our business in these countries.~~(recovery) For example, the U.S. State Department has issued security advisories for U.S. nationals in Saudi Arabia, Algeria and certain other countries in the Middle East. While we tend to staff these projects largely with local or regional personnel, we do recognize that undertaking work in such areas at this time carries a higher level of operating and political risk than in other more developed areas.

In 2007, the Company had bad debt expense of $0.1 million. 28In 2006 there were net recoveries of under $0.1 million. In 2005, we had bad debt expense of $0.7 million, of which $0.6 million was recorded in the fourth quarter. The 2005 bad debt expense was evenly divided amongst the segments and was not associated with any single customer nor with a single project.

~~Table~~ Other general ofand ~~Contents~~administrative expenses

In 2007, other general and administrative expense decreased to ~~Results~~$24.1 million from $26.7 million. The decrease is primarily due to our efforts to increase the efficiency of ~~Operations~~our administrative operations and support functions in the Americas and the ongoing consolidation of back office operations of certain of our smaller operations in EMEA, as well as the fact that we had sufficient resources and systems to absorb the acquisition of the WFI US and EMEA Engineering businesses in 2007, without a significant increase in our general and administrative organization.

~~The~~In ~~discussion~~2006, ~~below~~other ~~provides~~general ~~information~~and ~~which~~administrative ~~management~~expenses were ~~believes~~$26.7 million, isa ~~relevant~~decrease toof an$0.4 million ~~assessment~~or 1.6% year over year. This reduction occurred in the Americas segment with a decrease in personnel and ~~understanding~~benefits expense of ~~our~~approximately ~~consolidated~~$0.8 million, ~~results~~as ofwell ~~operations~~as reductions in recruiting, human resources, research and ~~financial~~innovations, ~~condition.~~and ~~The~~information technology ~~discussion~~which ~~should~~accounted befor ~~read~~additional inreductions ~~conjunction~~of ~~with~~$0.8 million. This ~~the~~reduction ~~consolidated~~was partially offset by increases in corporate ~~financial~~expenses, ~~statements~~primarily ~~and~~of ~~accompanying~~$0.9 million ~~notes~~for ~~thereto~~audit ~~included~~fees and ~~elsewhere~~$0.4 million ~~herein~~for stock based compensation expense.

In 2005, other general and administrative expenses were ~~Revenues~~$27.2 million, an increase of $1.7 million or 6.5% ~~Cost~~year over year. Most of ~~Revenues~~this increase occurred in the nonreportable segments, which includes corporate general and administrative ~~Gross~~expenses. ~~Margins~~Corporate general and administrative expenses were higher due to increased employee benefits costs, the costs of bringing onboard a new CEO, and costs associated with the restatement. Other general and administrative expenses for EMEA in 2005 include a management performance bonus.

	Years Ended December 31,
	2006					2005				2004
	(In thousands)					(In thousands)				(In thousands)
Revenues:
Americas	$	29,959				$	36,478			$	35,515
EMEA		99,944					107,844				78,172
Nonreportable segments		50					1,320				4,979
	$	129,953				$	145,642			$	118,666
				(% of revenue)				(% of revenue)				(% of revenue)
Cost of revenues:
Americas	$	24,629		82.2	%	$	32,042	87.8	%	$	28,660	80.7	%
EMEA		72,684		72.7	%		81,483	75.6	%		60,511	77.4	%
Nonreportable segments		(119	)	—			689	52.2	%		3,448	69.3	%
	$	97,194		74.8	%	$	114,214	78.4	%	$	92,619	78.1	%
Gross margin:
Americas	$	5,330		17.8	%	$	4,436	12.2	%	$	6,855	19.3	%
EMEA		27,260		27.3	%		26,361	24.4	%		17,661	22.6	%
Nonreportable segments		169		—			631	47.8	%		1,531	30.7	%
	$	32,759		25.2	%	$	31,428	21.6	%	$	26,047	21.9	%

Restructuring

During 2005, we recorded a net restructuring charge of ~~Americas~~$0.6 million, which included $0.2 million of charges related to discontinued operations. This charge included $0.8 million in severance termination benefits and costs associated with the involuntary employee separation of approximately 48 employees in North America and Asia-Pacific, $0.1 million associated with closing facilities and disposing of assets, and a reduction of $0.3 million due to reoccupied space in our McLean office and a recovery of sublease income.

~~During the year 2006, we experienced a decrease in our Americas~~ ~~segment revenue of $6.5 million to $30.0 million from~~33 $36.5 million in the prior year. The decrease is primarily the result of a decrease in revenues of approximately $6.9 million from customers who were customers in 2006 and 2005 and a decease in revenue of $2.3 million from customers who were customers in 2005 but not 2006 offset by increases in revenue of $0.7 million of certain customers who were customers in 2006 and 2005 and $2.0 million of revenue from customers who were customers in 2006 but not 2005. We believe a portion of the decreases were the result of our decision to reduce our independence on lower margin work in the U.S. While we can not estimate the exact impact on revenue of our decision to focus on higher margin work, we believe the impact of that decision is evidenced by the increase in the Americas segment gross margins as a percentage of revenue to 17.8% in 2006 from 12.2% in 2005 and an increase in the segment’s gross margin of $0.9 million to $5.3 million in 2006 from $4.4 million in 2005.

InDuring ~~2005, total revenues for~~ the ~~region~~second ~~were~~quarter ~~$36.5 million~~of 2006, up ~~$1.0 million~~we ~~from~~had ~~2004.~~an ~~Cost of revenues increased~~additional $30.41 million ~~over~~restructuring ~~2004~~charge. ~~for~~This acharge ~~$2.4 million~~was ~~decline in~~due ~~gross~~mainly ~~margin~~to ~~and~~ a ~~decrease~~revised inestimate ~~gross margin as a percentage~~ of ~~revenue~~ tothe ~~12.2%~~operating incosts ~~2005~~for ~~from 19.3% in 2004. Among~~ our ~~top~~ ~~customers~~facility ~~we experienced declines~~ in ~~gross~~McLean, ~~margin~~Virginia ~~percent between 6.8~~ and ~~8.9~~to ~~reducing~~a ~~our~~lesser ~~margins~~extent, ~~for those customers by approximately $2.7 million. This decline in total gross margin and gross margin as~~ a ~~percentage of revenue was~~revised ~~attributable~~estimate ~~to our taking~~ on ~~certain~~the ~~types~~sublease ofincome ~~lower~~assumptions ~~margin~~for ~~work which~~our ~~generated~~facility ~~increased revenues but at generally decreased~~in ~~margins~~London. ~~Margins were also affected negatively by not matching~~ ~~lower cost personnel to the lower margin work.~~

InSubstantially ~~2004,~~all ~~total~~the ~~revenues~~activities ~~for~~related ~~the~~to ~~region~~these ~~were $35.5 million,~~restructurings anhave ~~increase~~been ~~over~~completed. ~~the~~However, ~~prior~~we ~~year~~continue ofto ~~$8.0 million.~~be ~~Combined~~obligated under ~~with~~facility anleases ~~increase~~that inexpire ~~cost~~from of2007 ~~revenue~~through 2014. The accrual of approximately $60.71 million remaining at December 31, ~~our~~2007 relates to remaining obligations through ~~gross~~the ~~margin~~year ~~increased~~2014 ~~$1.3 million~~associated with aoffices ~~decline~~exited inor ~~gross~~downsized, ~~margin~~offset ~~percent~~by ofour ~~0.8.~~estimates ~~The~~of ~~decline~~future inincome ~~gross~~from ~~margin as a~~sublease ~~percentage~~agreements. ofThe ~~revenue~~restructuring ~~was~~charge ~~attributable~~calculation toassumes ~~our~~as ~~taking on certain~~of ~~types~~December 31, of2007 ~~lower~~that ~~margin~~we ~~work~~will ~~which~~receive ~~generated~~$2.4 million ~~increased revenues~~in ~~but~~sublease atincome, ~~generally~~all ~~decreased~~of ~~margins~~which is committed.

During the second quarter of 2007, the Company took steps 29towards recognizing integration related and other cost synergies by implementing a workforce reduction that eliminated approximately 60 positions worldwide and consolidated certain facilities in the U.K., by adopting a restructuring plan (“2007 Restructuring”), and recorded restructuring charge of $1.6 million. Approximately $1.0 million of the charge was related to severance and headcount related costs and $0.6 million was related to non-headcount related expenses. During the second quarter, we also recorded a $0.5 million recovery of a prior restructuring charge. The Company recorded the severance charges related to these headcount reductions as an operating expense in the second and third quarters of 2007. The facilities and other non headcount related charges were recorded as operating expense in the second and third quarters of 2007. The Company paid the majority of severance and related costs in the third quarter with the remaining costs to be paid in the fourth quarter of 2007. During the fourth quarter, we also recorded a $0.2 million recovery of a prior restructuring charge. The cash payments related to the consolidation of facilities were made over the term of the related leases, the longest of which terminated in December 2007.

~~Table~~ The Company also recorded a restructuring charge of $0.5 million ~~Contents~~related to personnel severance costs in connection with the acquisition of certain assets and liabilities of the US wireless engineering services business of WFI. The Company included these severance charges in goodwill. See Note 4, Business Combinations.

~~EMEA~~Other Income and Expense

In 2006, revenues for the year decreased $7.9 million to $99.9 million and cost of revenues decreased $8.8 million to $72.7 million, resulting in an increase in gross margin to 27.3% in 2006 compared to 24.4% in 2005. The majority of our gross margin continues to be generated by services provided under our deployment and our consulting contracts in Algeria and our engineering services contract in Saudi Arabia which generated 65.6% of 2006 gross profits. In Algeria, decreases in revenue of $2.0 million and cost of revenue of $4.0 million generated an increase in gross margin and gross margin percent of $2.0 million and 13.6%, respectively. Algeria provided 37.1% of our EMEA segment gross profits in 2006, up 6.3% from 30.8% in 2005. In Saudi Arabia decreases in revenue of $7.9 million and cost of revenue of $5.2 million reduced gross margin by $2.7 million with no change in the gross margin percent. Saudi Arabia provided 28.5% of our EMEA segment gross profits in 2006, down 11.0% from 39.5% in 2005. In Italy, a decrease in cost of revenue of $0.9 million on comparable revenues increased gross margin and gross margin percent $0.9 million and 13.5%, respectively. Revenue and cost of revenues in the U.K. increased by $5.2 million and $4.5 million, respectively, generating increases in gross margin and gross margin percent of $0.7 million and 1%, respectively. Decreases in revenues and cost of revenues in the Netherlands of $3.7 million and $3.5 million, respectively, generated a slight increase in gross profit percent.


	Years Ended December 31,
	2007			2006			2005
	(In thousands)

Components of other income (expense):
Interest income:
Americas	$	1		$	1		$	—
EMEA		49			35			16
Nonreportable segments		45			98			98

	$	95		$	134		$	114

Interest expense:
Americas	$	(1,705	)	$	—		$	(1	)
EMEA		(117	)		(29	)		(16	)
Nonreportable segments		(1,780	)		(835	)		(298	)

	$	(3,602	)	$	(864	)	$	(315	)

Gain (loss) on investments:
Americas	$	—		$	—		$	—
EMEA		5			—			19
Nonreportable segments		(42	)		—			(34	)

		(37	)		—			(15	)

Foreign currency gains and (losses):
Americas		(2	)		—			—
EMEA		(3,193	)		176			(154	)
Nonreportable segments		648			1,260			(1,552	)

		(2,547	)		1,436			(1,706	)

~~In 2005, revenues for the year grew to $107.8 million, an~~ ~~increase of $29.7 million over the previous year. The~~34 entire growth in revenue was attributable to our operations in developing countries. Saudi revenue growth for 2005 was $15.6 million, with Algerian revenue growth of $16.8 million. Lesser developed countries generated 70% of 2005 gross profits. Overall gross margins improved in 2005 to 24.4% from the 22.6% in 2004, largely due to the higher margins produced in the lesser developed countries.

In 2004, we expanded our operations to rapidly expanding emerging countries as we commenced a multi-year service project in Saudi Arabia and continued our consultancy and deployment activities in Algeria. Revenues for the year grew to $78.2 million, an increase of $24.9 million over the previous year. Growth in our business in developed countries accounted for about $5.0 million of this increase, while lesser developed countries accounted for about $17.5 million; of this latter increase, $15.7 million was attributable to Saudi Arabia. Developed countries generated about 57.6% of our revenue and about 37.4% of our gross profits, while lesser developed countries generated about 42.4% of our revenues and 62.6% of our gross profits. Gross margins improved from 20.8% of revenues in 2003 to 22.6% in 2004, largely due to the increased mix of more profitable business in lesser developed countries, most of which is represented by time and materials contracts.


	Years Ended December 31,
	2007			2006			2005
	(In thousands)

Miscellaneous:
Americas		48			—			1
EMEA		(1,358	)		639			(5	)
Nonreportable segments		(917	)		(312	)		842

		(2,227	)		327			838

Total other:
Americas		46			—			1
EMEA		(4,544	)		815			(140	)
Nonreportable segments		(313	)		948			(744	)

	$	(4,811	)	$	1,763		$	(883	)

Total other income and expense:
Americas	$	(1,658	)	$	1		$	—
EMEA		(4,612	)		821			(140	)
Nonreportable segments		(2,048	)		211			(944	)

	$	(8,318	)	$	1,033		$	(1,084	)

~~Nonreportable~~Interest ~~Segments~~income

InInterest ~~2006~~income ~~the~~in ~~nonreportable~~2007, ~~segments~~2006 ~~generated~~and ~~revenues~~2005 ~~of $0.1 million,~~decreased ~~down~~year ~~$1.2 million~~over ~~from 2005. This~~year ~~resulted~~due ~~from~~to ~~the~~lower ~~changes~~average inbalances ~~the~~of ~~LCC~~cash ~~Wireline,~~on ~~Inc.~~deposit ~~division~~ and decreases ~~the~~in ~~closure~~available ofyields ~~our~~on ~~China~~short-term ~~office discussed below~~investments. ~~During 2006,~~Approximately ~~there was a loss from operations of~~ $130.1 million ~~for~~of ~~the nonreportable~~interest ~~segments,~~income ~~which~~related ~~compares~~ to a ~~loss~~refund ~~from operations~~of ~~of $10~~U.6S. ~~million~~taxes ~~for~~was ~~2005.~~recorded ~~The majority of this loss is attributable to corporate general and administrative costs, which are included~~ in ~~the nonreportable segment and are not allocated to the Americas or EMEA~~2006.

~~In 2005 the nonreportable segments generated revenues of~~ ~~$1.3 million, down $3.7 million from 2004. This~~Interest ~~decline is primarily attributable to the LCC Wireline, Inc.~~Expense division, which ceased operations in the first quarter of 2005 and the closure of our Beijing, China office as part of the restructuring in the second quarter of 2005. During 2005, there was an operating loss of $10.6 million for the nonreportable segments, which compares to an operating loss from operations of $9.1 million for 2004. The majority of this loss is attributable to corporate general and administrative costs, which are included in the nonreportable segment and are not allocated to the Americas or EMEA.

~~Nonreportable~~Interest ~~segments~~expense ~~generated~~increased ~~revenues~~to of $53.06 million in ~~2004, which consisted of revenues~~ from ~~our Asia-Pacific~~ ~~operations~~$0.9 million ~~and~~in ~~LCC~~the ~~Wireline.~~prior ~~In 2003~~year, weand ~~formed~~was ~~LCC~~primarily ~~Wireline,~~due to ~~which~~increased ~~focused~~borrowings onas ~~providing~~a ~~technical~~result ~~services~~of toour ~~CLECs~~recent ~~and ILECs~~acquisitions.

In ~~2003,~~2006 weinterest ~~purchased~~expense increased as a ~~49%~~result ~~share~~of inhigher borrowings aunder ~~joint~~our ~~venture~~borrowing infacility ~~Beijing,~~with Commerce Funding ~~China~~Corporation, ~~with~~(“CFC”), ~~the~~a ~~objective~~Wells ofFargo ~~pursuing~~company, ~~opportunities~~as ~~in China~~well ~~primarily~~as ~~through~~the ~~this~~fees ~~joint~~associated ~~venture.~~with Inadvances ~~2004,~~from weNokia ~~agreed~~under ~~with~~the agreement to dispose of our ~~partner,~~U.S. Network ~~LCC~~Deployment business. ~~Bright~~We ~~Oceans~~terminated ~~Communications~~our ~~Consulting~~credit ~~Co.~~facility with CFC on ~~Ltd.~~March 9, ~~(“LCC/BOCO”)~~2007, toand ~~close~~entered ~~the~~into ~~joint~~a ~~venture.~~new revolving credit ~~Liquidation~~facility. ofSee ~~the~~Sources ~~joint~~and ~~venture~~Uses of Cash below.

Total interest expense for 2006 and 2005 was approximately 30$0.9 million and $0.3 million, respectively. Of these amounts, approximately $0.6 million and $0.3 million in 2006 and 2005, respectively, were attributable to interest and fees arising from our financing arrangement with CFC. This agreement was terminated March 9, 2007.

~~Table~~ Foreign currency ofgains ~~Contents~~and losses

~~was~~In ~~completed~~2007, inwe ~~the~~recorded ~~fourth~~losses ~~quarter~~on offoreign ~~2005~~currencies of $2.5 million ~~Our~~due ~~investment~~to inthe appreciation of the Euro with ~~LCC/BOCO~~respect ~~was~~to ~~accounted~~the ~~for~~U.S. Dollar ~~using~~and the ~~equity~~British ~~method~~Pound ofthroughout ~~accounting~~the year. WeIn 2006 we recorded ~~equity~~gains ~~losses~~on offoreign currencies of $0.1.4 million due to the appreciation of the British Pound and Euro with respect to the U.S. Dollar throughout the year. In 2005, we recorded losses on foreign currencies of $01.37 million, ~~during~~due to the ~~years~~appreciation ~~ended~~of ~~December~~the U.S. ~~31,~~Dollar ~~2005~~against the Euro and the British Pound ~~and~~throughout ~~2004,~~the ~~respectively,~~year. ~~all~~All of ~~which~~our ~~was~~foreign ~~recorded~~currency intransaction gains ~~other~~and losses are due to intercompany payables and ~~expense~~receivables denominated in foreign currency.

~~Operating~~Miscellaneous ~~Expenses~~

	Year Ended December 31,
	2006			2005			2004
	(in thousands)
Sales and marketing:
Americas	$	2,832		$	2,228		$	3,349
EMEA		3,748			5,538			3,682
Nonreportable segments		1,330			365			866
		7,910			8,131			7,897
Bad debt expense (recovery):
Americas		20			223			100
EMEA		(41	)		254			26
Nonreportable segments		—			251			19
		(21	)		728			145
Shareholder note compensation:
Americas		—			—			—
EMEA		—			—			—
Nonreportable segments		—			—			1,240
		—			—			1,240
Other general and administrative:
Americas		3,620			5,274			4,942
EMEA		11,085			11,604			11,933
Nonreportable segments		12,015			10,287			8,636
		26,720			27,165			25,511
Total general and administrative:
Americas		3,640			5,497			5,042
EMEA		11,044			11,858			11,959
Nonreportable segments		12,015			10,538			9,895
		26,699			27,893			26,896
Restructuring charge (recovery):
Americas		—			447			—
EMEA		31			—			(567	)
Nonreportable segments		77			(43	)		(570	)
		108			404			(1,137	)
Depreciation and amortization:
Americas		430			432			350
EMEA		1,609			2,016			1,818
Nonreportable segments		339			345			405
		2,378			2,793			2,573
Total:
Americas		6,902			8,604			8,741
EMEA		16,432			19,412			16,892
Nonreportable segments		13,761			11,205			10,596
	$	37,095		$	39,221		$	36,229

In 2007, we recorded in our non-reportable segments liquidated damages of $2.1 million in conjunction with our inability to file a registration statement in connection with our sale of common stock. We also recorded transfer pricing allocations between the segments that are eliminated in consolidation.

35 31

~~Table~~ In the second quarter of ~~Contents~~2006 we recorded a gain of $0.2 million on the favorable settlement of a dispute relating to an earn out agreement that we had entered into in conjunction with the acquisition of our Netherlands subsidiary.

In the second quarter of 2005, the Company received a cash ~~Sales~~payment ~~and~~of approximately $0.6 million from NextWave for the ~~marketing~~exercise ~~expenses~~of all warrants held by the Company. The exercise was made in accordance with the terms of NextWave’s reorganization plan under bankruptcy proceedings. In the fourth quarter of 2005, we sold off the one remaining tower that we owned for $0.3 million.

~~In 2006, sales and marketing expenses decreased by~~ ~~$0.2 million, year over year. In the EMEA region a decrease~~Income of(Loss) ~~$1.8 million~~Before ~~was primarily due to a reduction of~~Taxes commissions expense of approximately $1.3 million related to lower revenues in Saudi Arabia. The balance was due to modest declines in the other business units. This decrease was offset by an increase in the Americas region of $0.6 million due to increased sales and marketing efforts by operating personnel and signing bonuses for new sales staff. In our corporate division, increases of $1.0 million were due to the implementation of Investor Relations and Marketing functions.

In 2005, sales and marketing expenses increased by $0.2 million. Sales and marketing costs increased $1.8 million in EMEA due primarily to an increase in commission expense relating to the technical consulting contract in Saudi Arabia. Sales and marketing expenses declined $1.1 million in the Americas and $0.5 million in the nonreportable segments primarily as a result of the cost restructuring undertaken during the second quarter.


	Years Ended December 31,
	2007			2006			2005
	(In thousands)

Segment Income (Loss) Before Taxes
Americas	$	(3,798	)	$	(1,571	)	$	(4,168	)
EMEA		(9,156	)		11,649			6,809
Nonreportable segments		(14,344	)		(13,381	)		(11,518	)

	$	(27,298	)	$	(3,303	)	$	(8,877	)

~~Sales and marketing expenses increased from 2003 to 2004 by~~ ~~about $1.3 million or 19%. The increase was largely~~Tax ~~attributable to sales commissions in our new businesses in EMEA,~~Expense ~~particularly in Saudi Arabia.~~

In 2007, we recorded tax expense of $1.4 million. The tax ~~Net~~expense ~~bad~~arises from international operations that generate ~~debt~~taxable income. The decrease in tax expense ~~(recovery)~~for 2007 as compared to the prior year was due primarily to the reduction of taxable income generated in our Algerian operations. A valuation allowance has been established for tax benefits associated with losses in the U.S. and certain foreign operations. No tax benefit is recognized for these losses because we do not have sufficient history of taxable income in these jurisdictions to conclude that it is more likely than not that tax benefits associated with net operating loss carryforwards will be realized.

In 2006, ~~there~~we ~~were~~recorded ~~net~~tax ~~recoveries~~expense of ~~under~~ $0.1.6 million. InOf that ~~2005~~amount, we$1.9 million ~~had~~is ~~bad~~for ~~debt~~foreign ~~expense~~taxes ofprimarily associated $0with our profitable operations in Saudi Arabia and Algeria.~~7 million,~~ ofThis ~~which~~is partially offset by a tax benefit of $0.64 million ~~was~~in ~~recorded~~the inUnited States attributable to the release ~~fourth~~of ~~quarter.~~a ~~The~~federal ~~2005~~tax reserve related to a tax return ~~bad~~position ~~debt~~for ~~expense~~which ~~was~~the ~~evenly~~statute ~~divided~~of ~~amongst~~limitations closed in 2006. The increase in the ~~segments~~income tax provision and ~~was~~effective tax rate ~~not~~in ~~associated~~2006 ~~with~~is ~~any~~primarily ~~single~~attributable ~~customer~~to ~~nor~~additional ~~with~~valuation allowances and other adjustments against net operating losses. As a ~~single~~net result of these additional valuation allowances and ~~project.~~adjustments, Inwe ~~2004~~incurred ~~the~~a ~~Company~~charge ~~had~~to ~~bad~~the ~~debt~~income ~~expense~~tax provision of approximately $06.13 million. In addition, the Company continued to have significant branch income that was subject to tax in the branch jurisdiction and only partially offset by foreign tax credits in the parent company jurisdiction.

In 2005, we recorded tax expense of $2.7 million. Of that ~~Shareholder~~amount, $3.2 million is for foreign taxes primarily ~~note~~associated ~~compensation~~with our profitable operations in Saudi Arabia and Algeria. This is partially offset by a tax benefit of $0.5 million in the United States attributable to an expected tax refund of income tax paid in prior years. The increase in the income tax provision and effective tax rate in 2005 is primarily attributable to additional valuation allowances and other adjustments against net operating losses. As a net result of these additional valuation allowances and adjustments, in 2005, we incurred a charge to the income tax provision of approximately $2.9 million. In addition, there were significant increases in branch income, primarily in Saudi Arabia, which was subject to tax in both the branch jurisdiction and in the parent company jurisdiction.

~~Shareholder~~We ~~note~~believe ~~compensation relates to cash and non-cash compensation arising from the loan made to our then President and Chief Executive Officer~~that, inas ~~1999, a portion~~ of ~~which was subsequently deemed discharged in 2004. On~~ December 1031, ~~2004,~~ ~~we entered into an agreement~~2007, ~~pursuant~~our ~~to which we~~cumulative ~~purchased~~historical ~~certain~~losses, ~~shares~~along ~~that~~with ~~our~~other ~~former~~qualitative ~~President~~factors and ~~Chief~~ ~~Executive~~uncertainties ~~Officer~~concerning ~~held in~~ our ~~company~~business and ~~returned~~industry, ~~these~~outweigh ~~shares~~the topositive ~~our~~evidence ~~treasury~~supporting ~~account,~~the ~~where~~realizability ~~they~~of ~~are~~the ~~available for reissue.~~tax ~~The~~benefit ~~proceeds~~of ~~from~~our ~~the~~net ~~sale~~operating ofloss ~~these~~carryforwards. ~~shares,~~As ~~approximately~~a result a ~~$0.9 million,~~valuation ~~was~~allowance ~~used~~has tobeen ~~reduce~~established. ~~the~~However, ~~indebtedness~~it ~~under the~~is ~~loan~~possible ~~agreement,~~that ~~and~~an weanalysis ~~deemed~~of ~~the~~our ~~balance~~financial ofresults ~~the~~in ~~loan,~~future ~~approximately~~periods ~~$0.7 million,~~will toprovide ~~have~~sufficient ~~been~~positive ~~paid~~evidence into ~~full. This~~indicate ~~represented~~that ~~non-cash~~the ~~compensation~~tax tobenefit of our ~~former~~cumulative ~~President~~loss ~~and~~carryforward can be ~~Chief~~realized, ~~Executive~~at ~~Officer.~~which Wetime ~~also~~we ~~paid~~would ~~cash~~expect ~~compensation in the form of~~ a ~~bonus~~reversal of ~~approximately~~some ~~$0.5 million to assist in~~or ~~covering~~all of the ~~personal~~remaining ~~income~~valuation ~~tax~~allowance. ~~obligations~~During ~~resulting~~2007, ~~from~~2006 ~~this~~and ~~agreement.~~2005, ~~The~~we ~~total~~recorded ofadditional ~~the~~valuation ~~non-cash~~allowances ~~compensation~~ of $07.3 million, $7.2 million and ~~the cash compensation of~~ $03.53 million, isrespectively. ~~included~~The inchange ~~operating expenses~~ in ~~2004.~~valuation

~~Other~~ ~~general and administrative expenses~~36

Inallowance ~~2006,~~includes ~~other~~changes ~~general~~due ~~and~~to ~~administrative~~stock ~~expenses~~compensation ~~were $26.7 million,~~and ~~a decrease of $0.4 million or 1.6% year~~certain ~~over~~discontinued ~~year.~~operations, ~~This~~which ~~reduction~~are ~~occurred~~not included in the ~~Americas~~change ~~segment with a decrease~~ in ~~personnel and benefits expense of approximately~~ ~~$0.8 million,~~valuation asallowance ~~well as reductions in recruiting, human resources, research and innovations, and information technology which accounted~~ for ~~additional~~the ~~reductions~~calculation of ~~$0.8 million. This~~the ~~reduction~~income ~~was offset by increases in corporate expenses,~~tax ~~primarily~~provision ~~of $0.9 million~~ for ~~audit~~continuing ~~fees and $0~~operations.~~4 million for stock based compensation expense.~~

~~In 2005, other general and administrative expenses were~~ ~~$27.2 million, an increase of $1.7 million or 6.5%~~Net ~~year over year. Most of this increase occurred in the~~Loss nonreportable segments which includes corporate general and administrative expenses. Corporate general and administrative expenses were higher due to increased employee benefits costs, the costs of bringing onboard a new CEO, and costs associated with the restatement. Other general and administrative expenses for EMEA in 2005 include a management performance bonus.

InThe ~~2004,~~components ~~other~~of ~~general~~the ~~and~~Net ~~administrative~~Loss ~~expenses~~for ~~increased~~each ~~by $5.6 million~~of orthe ~~28%,~~years ~~year over year, primarily attributable~~ended ~~to increases in costs in our EMEA region of $3.4~~December ~~million and~~31, ~~in our corporate costs of $1.9 million. In EMEA~~2007, ~~the increase~~2006 ~~was driven by support for new businesses in Saudi Arabia~~ and ~~Germany,~~2005 ~~expansion~~are ofdescribed ~~our~~below.

In 2007, revenues of $145.7 million generated a pretax loss 32from continuing operations of $27.3 million. In 2007 we recorded tax expense of $1.4 million, which resulted in a loss from continuing operations of $28.7 million. Losses from discontinued operations were $2.1 million in 2007.

~~Table~~ In 2006, revenues of ~~Contents~~$130.0 million generated a pretax loss from continuing operations of $3.3 million. We recorded tax expense of $1.6 million for a loss from continuing operations of $4.9 million. Losses from discontinued operations were $3.2 million in 2006.

~~activities~~In in2005, ~~the~~revenues ~~Netherlands,~~of ~~and~~$145.6 million ~~severance~~generated ~~and~~a ~~downsizing~~pretax loss ~~costs~~from ~~for~~continuing ~~Italy.~~operations ~~The~~of ~~primary~~$8.9 million. ~~increase~~We inrecorded ~~our~~tax expense ~~corporate~~of ~~costs~~$2.7 million ~~was attributable~~for toa ~~the~~loss ~~costs~~from continuing operations of ~~compliance~~$11.6 million. ~~with~~Losses ~~the~~from ~~requirements of~~discontinued ~~the~~operations ~~Sarbanes-Oxley~~were ~~Act~~$0.9 million ofin ~~2002~~2005.

~~Restructuring~~Liquidity and Capital Resources

InThe ~~2002,~~ following ~~the~~discussion ~~completion~~relates ofto ~~several~~our ~~large~~sources ~~fixed price projects~~ and ~~the~~uses ~~general~~of ~~reduction in the U.S. market’s~~cash ~~wireless infrastructure spending, we restructured our operations~~ and ~~recorded~~cash arequirements ~~restructuring~~during ~~charge~~2007, ~~of $13.5 million. Of this total charge~~2006, ~~approximately $12.5 million related to excess office space~~ and $12005.~~0 million to severance costs for~~ ~~about 140 employees, which included $0.3 million related to discontinued operations.~~

~~During 2004, we reversed $1.2 million of the payable due to~~Sources ~~reoccupied office space in McLean, Virginia~~ and aUses ~~decrease~~of inCash ~~the estimated time period expected to sublease space in our McLean and London offices.~~

During 2005, we recorded a net restructuring charge of $0.6 million, which included $0.2 million of charges related to discontinued operations. This charge included $0.8 million in severance termination benefits and costs associated with the involuntary employee separation of approximately 48 employees in North America and Asia-Pacific, $0.1 million associated with closing facilities and disposing of assets, and a reduction of $0.3 million due to reoccupied space in our McLean office and a recovery of sublease income.


	Years Ended December 31,
	2007			2006			2005
	(In thousands)

Net cash used in operating activities	$	(16,878	)	$	(10,063	)	$	(8,079	)
Net cash used in investing activities		(26,094	)		(196	)		(2,574	)
Net cash provided by financing activities		45,401			1,570			3,533
Effect of exchange rates on cash and cash equivalents		756			546			(614	)

Net increase (decrease) in cash and cash equivalents	$	3,185		$	(7,751	)	$	(7,734	)

During 2007, the ~~second~~Company’s ~~quarter~~balance of ~~2006~~cash and cash equivalents increased by $3.2 million. This increase in cash and cash equivalents was primarily the result of our financing activities which generated cash of $45.4 million, offset weby ~~had~~cash anused ~~additional~~in investing activities of $026.1 million ~~restructuring~~in ~~charge~~respect of our acquisitions during the period and $16.9 million ~~This~~used ~~charge~~in ~~was~~operating ~~due~~activities as a ~~mainly~~result toof our operating losses. Financing activities included a net ~~revised~~increase ~~estimate~~in debt of $29.2 million to fund our acquisitions and net proceeds from the ~~operating~~sale ~~costs~~of ~~for~~additional ~~our~~common ~~facility~~stock induring ~~McLean,~~2007 ~~Virginia~~of $15.8 million. Cash and tocash equivalents awere ~~lesser~~also ~~extent,~~increased aby ~~revised~~$0.8 million from the ~~estimate~~effect of foreign exchange rate changes on cash and cash equivalents. During 2006, the ~~sublease~~Company’s ~~income~~balance ~~assumptions~~of ~~for~~cash and cash equivalents decreased by $7.8 million. This decrease in cash and cash equivalents in 2006 was primarily the result of our ~~facility~~use of cash of $10.0 million for operating activities and $0.2 million used in investing activities offset by ~~London~~$1.6 million net generated by financing activities and $0.5 million from the effect of foreign exchange rate changes on cash and cash equivalents.

~~Substantially~~Investing ~~all~~activities ~~the~~decreased ~~activities~~cash ~~related~~and tocash ~~these~~equivalents ~~restructurings~~by ~~have~~$26.1 million ~~been~~during ~~completed~~2007. ~~However,~~The weprincipal ~~continue to be obligated under~~investing ~~facility~~activities ~~leases~~were ~~that~~the ~~expire~~acquisition ~~from~~in March 2007 ~~through~~of ~~2014.~~the ~~The accrual~~equity ofinterests ~~approximately~~in ~~$1.0 million~~the ~~remaining at December 31~~Europe, ~~2006~~Middle ~~relates~~East toand ~~remaining~~Africa ~~obligations~~business ~~through~~of WFI and the ~~year~~acquisition ~~2014~~in ~~associated~~June ~~with~~2007 ~~offices~~of ~~exited~~certain orassets ~~downsized,~~and ~~offset~~liabilities ~~by our estimates~~ of ~~future~~the ~~income~~U.S. wireless ~~from~~engineering ~~sublease~~services ~~agreements.~~business ~~The~~of ~~restructuring~~WFI ~~charge~~for ~~calculation~~an ~~assumes~~aggregate as of ~~December~~ $22.9 ~~31,~~million ~~2006~~in ~~that~~cash. During 2007, we ~~will~~used ~~receive~~ $34.38 million inof cash for purchases of ~~sublease income~~property, ~~all~~plant ofand ~~which~~equipment that is ~~committed~~used primarily for revenue generating purposes.

Financing activities increased cash and cash equivalents by ~~Other~~$45.4 million during 2007. On April 19, 2007, we ~~Income~~raised ~~and~~$17.0 million ~~Expense~~through the sale of 5,100,000 newly issued Class A common shares at a price of $3.35 per share

	Years Ended December 31,
	2006			2005			2004
	(In thousands)
Other income (expense):
Interest income:
Americas	$	1		$	—		$	—
EMEA		35			16			29
Nonreportable segments		98			98			118
	$	134		$	114		$	147
Interest expense:
Americas		—			(1	)		—
EMEA		(29	)		(16	)		(243	)
Nonreportable segments		(835	)		(298	)		(4	)
	$	(864	)	$	(315	)	$	(247	)
Gain (loss) on investments:
Americas		—			—			—
EMEA		—			19			—
Nonreportable segments		—			(34	)		766
		—			(15	)		766
Foreign currency gains and losses:
Americas		—			—			—
EMEA		176			(154	)		92
Nonreportable segments		1,260			(1,552	)		890
		1,436			(1,706	)		982

in a private placement. We used the proceeds from the offering 33primarily for general corporate purposes. Cash and cash equivalents were also increased by borrowings of $38.9 million under our lines of credit offset by repayments of $9.7 million under the lines of credit. The effects of foreign exchange also resulted in a $0.8 million increase in cash and cash equivalents.

~~Table~~ The principal requirements for cash during 2007 were as follows: (1) to finance our recent acquisitions; (2) to finance the operating losses of ~~Contents~~the EMEA and the Americas business and our corporate costs; (3) fund the working capital needs of the business; and (4) to provide for the general working capital needs of the non-network deployment services we provide. Customer payment cycles run up to 60 days and, in some cases, longer, but for which we incur cash outflows, primarily for payroll related costs, most of which are paid two times per month. Additionally, while we have made agreements with certain larger customers in EMEA, primarily in Algeria, to shorten customer payment terms to 120 days from 180 days, customer payment cycles continue to remain longer than the related cash outflow cycle in certain of our EMEA operations.

	Years Ended December 31,
	2006			2005			2004
	(In thousands)
All other:
Americas		—			1			107
EMEA		639			(5	)		30
Nonreportable segments		(312	)		842			(352	)
		327			838			(215	)
Total other:
Americas		—			1			107
EMEA		815			(140	)		122
Nonreportable segments		948			(744	)		1,304
	$	1,763		$	(883	)	$	1,533
Total other Income and Expenses:
Americas		1			—			107
EMEA		821			(140	)		(92	)
Nonreportable segments		211			(944	)		1,418
	$	1,033		$	(1,084	)	$	1,433

We have met our cash needs during the period by accelerating the collection of our receivables, primarily in our Americas segment, and from funds from external sources through the issuance of common stock and debt as described below. We accelerated the collection of our receivables from certain of our customers in the Americas by integrating with the customers’ automated payment processes and by retaining more experienced and better trained collection personnel, as well as reinstituting requirements for our sales personnel to be actively engaged assisting in customer collections.

On March 9, 2007, we entered into a revolving credit ~~Interest~~facility with Bank of America and terminated our then existing ~~income~~credit facility with CFC. Under the terms of this credit facility, the aggregate amount owed to Bank of America by us at any time could not exceed $6.5 million. The term of this credit facility was through September 15, 2007. On May 29, 2007, in connection with the agreement to purchase certain assets and liabilities of the U.S. wireless engineering services business of WFI we amended and restated our credit facility with Bank of America. The Amended and Restated Credit Agreement was further amended on November 30, 2007 to, among other things, provide for a bank waiver and amend certain covenants in the agreement for all events of default. The facility now provides revolving loans of up to $21.95 million all of which was outstanding at December 31, 2007, which amounts may be borrowed, repaid and re-borrowed by the Company on a revolving basis until November 29, 2009. It also provides for a term loan of $6.5 million with scheduled principal payments of $3.5 million on June 1, 2008, $1.0 million on each of September 1 and December 1, 2008 and March 1, 2009, with any remaining balance payable on November 29, 2009. The amendment increased the applicable interest rate on borrowings by 1.00% per annum, amended of the financial covenants and required the payment to the bank of a fee of up to $0.6 million. As of December 31, 2007, $-0- was available to be borrowed under this credit facility.

Interest ~~income~~under inthe ~~2006,~~credit ~~2005~~facility ~~and~~is ~~2004~~generally ~~decreased~~payable ~~year~~by ~~over~~the Company ~~year~~on a quarterly basis. Borrowings bear interest, at the ~~due~~Company’s option, at an annual rate equal to ~~lower~~either: ~~average~~a specified ~~balances~~“base ofrate,” ~~cash~~plus onan ~~deposit~~additional ~~and~~margin ~~decreases~~of in2.50% ~~available~~or ~~yields~~3.00%; onor ~~short~~a specified London Inter-~~term~~Bank ~~investments.~~Offered ~~Approximately~~Rate, $0or LIBOR, plus an additional margin of 3.~~1 million~~50% or 4.00%. The additional margin of ~~interest~~a ~~income~~loan ~~was~~for ~~recorded~~each infiscal ~~2006~~quarter ~~due~~will tobe abased ~~refund~~upon ofthe UCompany’s consolidated leverage ratio for the previous fiscal quarter.~~S. taxes.~~

As amended, the credit facility contains customary affirmative ~~Interest~~and negative covenants that apply to the Company and all of its ~~Expense~~subsidiaries, including restrictions on indebtedness, liens, investments, dispositions and dividends. The Company and all of its subsidiaries also are required to maintain certain financial covenants, including a minimum consolidated EBITDA that increases over time, a consolidated leverage ratio that decreases over time and, commencing with calendar quarter ending September 30, 2008, a consolidated fixed charge coverage ratio of not less than 0.70 to 1.0.

InThe ~~2006~~Amended ~~interest~~and ~~expense~~Restated ~~increased~~Credit asAgreement acontains ~~result of higher~~customary ~~borrowings~~events ~~under~~of ~~our~~default, ~~borrowing~~including ~~facility~~for ~~with~~payment ~~Commerce~~defaults, ~~Funding~~breaches of ~~Corporation~~representations, ~~(“CFC”)~~breaches of affirmative or negative covenants, cross adefaults ~~Wells~~to ~~Fargo~~other ~~company~~material indebtedness, asbankruptcy, ~~well~~and asfailure ~~the~~to ~~fees~~discharge ~~associated~~certain ~~with~~judgments. ~~advances~~If ~~from~~an ~~Nokia~~event ~~under~~of ~~the~~default ~~agreement~~occurs toand ~~dispose~~is ofnot ~~our~~cured ~~U.S. Network~~within ~~Deployment~~any applicable grace period or is ~~business.~~not Wewaived, ~~terminated~~the ~~our~~administrative ~~existing~~agent, ~~credit~~on ~~facility~~behalf ~~with~~of ~~CFC~~the onlenders, ~~March 9,~~would ~~2007,~~have ~~and~~the ~~entered~~right ~~into~~to aaccelerate ~~new~~the ~~revolving~~indebtedness ~~credit~~under the ~~facility.~~agreement ~~See~~and ~~Cash~~exercise ~~Requirements~~remedies ~~below~~against the collateral securing the credit facility.

~~Total interest expense for the years ending December 31,~~ ~~2006, 2005 and 2004 was approximately $0.9 million,~~38 $0.3 million and $0.2 million, respectively. Of these amounts, approximately $0.6 million, $0.3 million and $0.0 million, for the years ending December 31, 2006, 2005 and 2004, respectively, were attributable to interest and fees arising from our financing arrangement with CFC. This agreement was terminated March 9, 2007.

In addition, the Company is required to maintain a so-called ~~Gain~~“lockbox arrangement” pursuant to which all monies ~~(loss)~~payable onto ~~investments~~the Company in the U.S. plus certain unrestricted cash balances of the Company’s non-U.S. subsidiaries in excess of $6.0 million must be paid into a specially designated account and automatically applied to the payment of amounts outstanding under the revolving portion of the credit facility, as well as any other obligations under the credit facility that are due and owing. On June 1, 2007, we issued a promissory note to WFI in the amount of $21.6 million in connection with the purchase of WFI’s U.S. wireless engineering services business. The promissory note was subsequently increased to $23.9 million as a result of a purchase price adjustment agreed to by the Company and WFI. This promissory note is subordinated to our obligations under the amended and restated credit facility discussed above. On July 1, 2007, WFI entered into an assignment agreement with SPCP Group L.L.C. whereby the rights, title and interest in the promissory note were transferred to SPCP Group L.L.C. The Company does not believe its loan agreements contain any subjective acceleration clauses.

InAs ~~2004,~~a weresult ~~received~~of ~~cash~~the sale of ~~approximately~~the $0U.8S. ~~million~~Network ~~for~~Deployment Business in 2006, the ~~sale~~restructuring ofactivities ~~our~~implemented during ~~general~~the ~~unsecured~~second ~~claim~~quarter ~~against~~of ~~NextWave~~2007, ~~which~~our continuing focus on westreamlining ~~acquired~~and asconsolidating ~~part~~in all areas of our ~~acquisition~~operations, especially ofthose ~~Koll~~related to general and administrative and ~~Telecommunications~~corporate ~~LLC~~functions, inand ~~1997.~~the Weincreased ~~expect~~revenue towe ~~continue~~expect toin the ~~consider~~Americas ~~business~~segment ~~dispositions,~~as ~~acquisitions~~a ~~and~~result ~~investments~~of asthe WFI U.S. acquisition in aMay ~~way~~2007, ofwe ~~supporting~~expect our ~~longer-term~~cash ~~strategies~~flow to improve during 2008.

~~Foreign~~Due to the more favorable payment terms we have negotiated with ~~currency~~certain ~~gains~~customers in EMEA, and ~~losses~~the automation and integration of certain processes into those of certain of our larger customers, we expect to continue to speed up the receivables to cash cycle.

~~In 2006 we recorded gains on foreign currencies of~~ ~~$1.4 million due to the appreciation of the British Pound~~Cash ~~and Euro with respect to the U.S. Dollar throughout the~~Requirements year. In 2005, we recorded losses on foreign currencies of $1.7 million due to the appreciation of the U.S. Dollar against the Euro and the British Pound throughout the year. In 2004, we recorded gains on foreign currencies of $1.0 million, mostly attributable to the appreciation of the Euro against the U.S. Dollar in the second half of the year. All of our foreign exchange gains and losses result from the revaluation of our intercompany balances.


	December 31,
	2007		2006
	(in thousands)

Cash and cash equivalents	$	9,630	$	6,445
Restricted cash		220		883

Total cash and short-term investments	$	9,850	$	7,328

Borrowing facility and note payable	$	54,339	$	4,226

Working capital	$	22,026	$	33,490

~~Table~~ Our offuture ~~Contents~~cash requirements are dependent on fluctuations in working capital, reducing our operating losses in order to achieve profitability and our need to purchase capital equipment.

We continue to perform deployment services in certain countries ~~All~~in the EMEA region. Historically, a significant number of ~~other~~deployment services contracts limit our ability to bill the customer until certain milestones are met. Additionally, some of the deployment services contracts contain provisions for the customer to withhold a portion of the payment of our billings (retainage) until the contract is complete. As a result of the milestone-based billings and retainages of amounts billed our working capital needs are increased as we incur costs in performing deployment services that require cash expenditures in advance of the billings and collections from our customers. Additionally, deployment services performed in certain countries (U.S., Italy and Spain) historically had very low profit margins. From time to time we have also entered into contracts for non-deployment services where milestone-based billings are used. While such contracts represent a lesser percentage of our business, they nonetheless result in working capital fluctuations.

InWe ~~the~~have ~~second~~significantly ~~quarter~~decreased ofour ~~2006~~dependence weon ~~recorded~~working capital aintensive ~~gain~~and oflower margin deployment services as we $0exited that business in the U.2S. ~~million~~and onBrazil in the ~~favorable~~Americas region ~~settlement~~and ofwound adown ~~dispute~~deployment service contracts in countries ~~relating~~such toas anItaly ~~earn~~and ~~out~~Spain. ~~agreement~~This ~~that~~has wedecreased ~~had~~working ~~entered~~capital fluctuations ~~into~~and inworking capital needs. We will continue to ~~conjunction~~focus ~~with~~our ~~the~~business ~~acquisition~~on engineering services and Operations and Maintenance contracts. As a result of the decreased dependence on the deployment related services, we experienced less fluctuation in our ~~Netherlands~~working ~~subsidiary~~capital as non-deployment services are generally higher margin businesses and require less working capital. Additionally, such services are generally not milestone based or have shorter milestone periods

~~In the second quarter of 2005, the Company received a cash~~ ~~payment of approximately $0.6 million from NextWave for the~~39 exercise of all warrants held by the Company. The exercise was made in accordance with the terms of NextWave’s reorganization plan under bankruptcy proceedings. In the fourth quarter of 2005, we sold off the one remaining tower that we owned for $0.3 million.

Inand ~~2004~~in wemany ~~recorded~~cases ~~impairment~~do ~~charges~~not ofhave $0retainage provisions.~~2 million~~ We have also ~~relating~~been able to lessen some of the working capital needs created by these contracts by negotiating payment terms with our contractors ~~investment~~that inmore ~~LCC/BOCO,~~closely amatch ~~joint~~our ~~venture~~payments to the vendors to the payments we receive from our customers. To increase our liquidity we have entered into accounts receivable or other asset based financing arrangements in the U.S. and certain ~~China~~European countries. InFinally the ~~fourth~~reduced ~~quarter~~activity of ~~2005,~~deployment related ~~our~~services ~~joint~~in ~~venture~~the ~~with~~UK and Algeria have positively impacted ~~LCC/BOCO~~cash ~~was~~flow ~~dissolved~~as ~~and~~we ~~selected~~have ~~projects~~been ~~and~~able ~~employees~~to ~~were~~collect amounts owed to us for ~~transferred~~such past services with no requirement to increase the ~~Company’s~~need ~~wholly-owned~~for working ~~Chinese~~capital as a result of the relatively low level of new ~~subsidiary~~deployment service activity in 2007.

On July 3, 2007, we filed a current report on ~~Income~~Form 8-K ~~(Loss)~~disclosing ~~Before~~that ~~Taxes~~as a result of reduced operations in the UK and Algeria and as part of our recent WFI acquisitions, effective June 27, 2007, we have taken steps towards recognizing integration related and other cost synergies by implementing a workforce reduction that eliminated approximately 60 positions worldwide and consolidated certain facilities in the U.K. Total charges of approximately $1.6 million, were incurred primarily in the second and third quarters of 2007. Approximately $1.0 million of the charge is related to severance and headcount related costs and $0.6 million is related to consolidation of certain facilities and other non-headcount related expenses. During the second quarter of 2007, we recorded a $0.5 million recovery of a prior restructuring charge. We paid the majority of severance and related costs in the third quarter of 2007, with the remaining costs paid in the fourth quarter of 2007. The cash payments related to the consolidation of facilities will be made over the term of the related leases, the longest of which terminates in May 2012.

	Years Ended December 31,
	2006			2005			2004
	(In thousands)
Segment Income (Loss) Before Taxes
Americas	$	(1,571	)	$	(4,168	)	$	(1,779	)
EMEA		11,649			6,809			677
Nonreportable transactions		(13,381	)		(11,518	)		(7,647	)
		(3,303	)		(8,877	)		(8,749	)

We believe that our cash balances, current financing agreements with a borrowing capacity of $0.4 million and funds from operations will provide us with sufficient cash to fund our operations for at least the next 12 months.

Existing contractual obligations are primarily limited to ~~Tax~~operating leases, primarily for office facilities, and to a ~~Expense~~lesser extent, test equipment computers and office furniture.

InThose ~~2006,~~obligations weare ~~recorded~~set ~~tax~~out ~~expense of $1~~below.~~6 million.~~ OfFixed ~~that amount,~~lease ~~$1.9 million~~obligations ~~is for foreign taxes primarily~~are ~~associated~~partly ~~with our profitable operations in Saudi Arabia and Algeria. This is partially~~ offset by a tax benefit of $0.4 million in the United States attributable to the release of a federal tax reserve related to a tax return position for which the statute of limitations closed in 2006. The increase in the income ~~tax~~from ~~provision~~sublease ~~and effective tax rate in 2006 is primarily attributable to additional valuation allowances and other adjustments against net operating losses~~agreements. As a net result of these additional valuation allowances and adjustments, we incurred a charge to the income tax provision of approximately $6.3 million. In addition, the Company continued to have significant branch income that was subject to tax in the branch jurisdiction and only partially offset by foreign tax credits in the parent company jurisdiction.

InOur ~~2005,~~future weminimum ~~recorded~~payments ~~tax~~under ~~expense~~contractual ofobligations ~~$2.7 million. Of that~~at ~~amount, $3.2~~December million is for foreign taxes primarily associated with our profitable operations in Saudi Arabia and Algeria. This is partially offset by a tax benefit of $0.5 million in the United States attributable to an expected tax refund of income tax paid in prior years. The increase in the income tax provision and effective tax rate in 2005 is primarily attributable to additional valuation allowances and other adjustments against net operating losses. As a net result of these additional valuation allowances and adjustments31, in2007 ~~2005,~~are weas ~~incurred~~follows ~~a charge to the income tax provision of approximately $2.9 million. In addition, there were significant increases~~ (in ~~branch income, primarily in Saudi~~thousands): ~~Arabia, which was subject to tax in both the branch jurisdiction and in the parent company jurisdiction.~~

We believe that, as of December 31, 2006, our cumulative historical losses, along with other qualitative factors and uncertainties concerning our business and industry, outweigh the positive evidence supporting the realizability of the tax benefit of our net operating loss carryforwards. As a result a valuation allowance has been established. However, it is possible that an analysis of our financial results in future periods will provide sufficient positive evidence to indicate that the tax benefit of our cumulative loss carryforward can be realized, at which time we would expect a reversal of some or all of the remaining valuation allowance. During the years ended December 31, 2006, 2005 and 2004, we recorded additional valuation allowances of $7.2 million, $3.3 million and $5.6 million, respectively. The change in valuation allowance includes changes due to stock compensation and certain


	Payment Due by Period
				Less than									More than
Contractual Obligations	Total			1 Year			1-3 Years			4-5 Years			5 Years

Lines of credit	$	24,586		$	2,561		$	22,025		$	—		$	—
Notes payable	$	29,753		$	5,788		$	23,965		$	—		$	—
Operating lease obligations	$	22,993		$	4,840		$	8,817		$	3,480		$	5,856
Sublease income	$	(2,442	)	$	(228	)	$	(949	)	$	(633	)	$	(633	)

We have not engaged in any off-balance sheet financing. 35

~~Table~~ Critical Accounting ~~of Contents~~Policies

~~discontinued~~Our ~~operations,~~critical ~~which~~accounting policies are ~~not~~as ~~included in the change in~~follows: ~~valuation allowance for the calculation of the income tax provision for continuing operations.~~

~~Net Loss~~ • revenue recognition; • allowance for doubtful accounts; • accounting for income taxes; and • restructuring charge.

~~In 2006, revenues of $130.0 million generated a pretax loss~~ ~~from continuing operations of $3.3 million. We recorded tax~~Revenue ~~expense of $1.6 million for a loss from continuing~~Recognition ~~operations of $4.9 million. Losses from discontinued operations were $3.2 million in 2006.~~

InOur ~~2005,~~principal ~~revenues~~sources of ~~$145~~revenue consist of design and system deployment services.~~6 million~~ ~~generated~~We provide design services on a ~~pretax~~contract basis, ~~loss~~usually in a customized plan for each client, and ~~from~~generally ~~continuing~~charge ~~operations~~for ofengineering ~~$8.9 million.~~services Weon ~~recorded~~a ~~tax~~time and ~~expense~~materials ofor $2fixed price basis.~~7 million~~ ~~for~~We generally offer deployment services overseas on a ~~loss~~fixed ~~from~~price, ~~continuing~~time-certain basis. The ~~operations~~portion of ~~$11.6 million.~~our ~~Losses~~revenues from ~~discontinued~~continuing operations from ~~operations~~fixed-price ~~were~~contracts ~~$0.9 million in 2005.~~was

~~In 2004, revenues of $118.7 million generated a pretax loss~~ ~~from continuing operations of $8.7 million. We recorded tax~~40 ~~expense of $5.0 million for a loss from continuing operations of $13.7 million. Income from discontinued operations was $7.4 million in 2004.~~

54.7% in 2007 and 52.8% in 2006. We recognize revenues on ~~Liquidity~~fixed-price contracts using the percentage-of-completion method. With the percentage-of-completion method, expenses on each project are recognized as incurred, and ~~Capital~~revenues ~~Resources~~are recognized based on the ratio of the current costs incurred for the project to the then estimated total costs of the project. We compare costs incurred to date against project milestones to determine if the percentage of completion is reasonable. Accordingly, revenues recognized in a given period depend on, among other things, the costs incurred on each individual project and our then current estimate of the total costs at completion for individual projects. Considerable judgment on the part of our management may be required in determining estimates to complete a project including the scope of the work to be completed, and reliance on the customer or other vendors to fulfill some task(s). If in any period we significantly increase the estimate of the total costs to complete a project, we may recognize very little or no additional revenues with respect to that project. If total contract cost estimates increase, gross profit for any single project may be significantly reduced or eliminated. If the total contract cost estimates indicate that there is a loss, the loss is recognized in the period the determination is made. At December 31, 2007 and 2006, we had $22.0 million and $24.8 million, respectively, of unbilled receivables.

~~The following discussion relates to our sources and uses of cash~~Allowance ~~and~~for ~~cash~~Doubtful ~~requirements during 2006, 2005, and 2004.~~Accounts

The preparation of the consolidated financial statements ~~Sources~~requires management to make estimates and assumptions that affect the reported amount of assets, liabilities, contingent assets and ~~Uses~~liabilities and the reported amounts of ~~Cash~~revenues and expenses during the reported period. Specifically, our management must make estimates of the probability of collection of accounts receivable. Management specifically analyzes accounts receivable balances, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the valuation allowance for doubtful accounts. For the years ended December 31, 2007 and 2006, we derived 63.3% and 82.7%, respectively, of total revenues from our ten largest customers, indicating significant customer concentration risk with our receivables. These ten largest customers constituted 62.9% and 80.3% of our net accounts receivable balance as of December 31, 2007 and 2006, respectively. Lastly, we frequently perform services for development stage customers, which carry a higher degree of risk, particularly as to the collection of accounts receivable. These customers may be particularly vulnerable to the tightening of available credit or a general economic slowdown.

	Years Ended December 31,
	2006			2005			2004
	(in thousands)
Net cash used in operating activities	$	(9,992	)	$	(8,079	)	$	(4,696	)
Net cash used in investing activities		(103	)		(2,462	)		(3,347	)
Net cash provided by financing activities		1,869			3,421			723
Effect of exchange rates on cash and cash equivalents		475			(614	)		307
Net decrease in cash and cash equivalents	$	(7,751	)	$	(7,734	)	$	(7,013	)

Accounting for Income Taxes

~~During~~As ~~2006,~~part of the ~~Company’s~~process ~~balance~~ of ~~cash~~preparing ~~and~~our ~~cash~~consolidated financial ~~equivalents~~statements, ~~decreased~~an byestimate $7for income taxes is required for each of the jurisdictions in which we operate.~~8 million.~~ This ~~decrease~~process inrequires ~~cash~~estimating the actual current tax expense together with assessing temporary differences resulting from differing treatment of items, such as depreciation, for financial reporting and ~~cash~~tax ~~equivalents~~accounting purposes. These differences result in ~~2006~~deferred ~~was~~tax ~~primarily~~assets and liabilities, which are included in the ~~result~~consolidated ofbalance sheet. We must then assess the ~~our~~likelihood ~~use~~that ofthe ~~cash~~deferred oftax ~~$10.0 million~~assets ~~for~~will ~~operating~~be ~~activities~~recovered from future taxable income and ~~$0.1 million~~to ~~used~~the inextent ~~investing~~we ~~activities~~believe ~~offset~~that byrecovery $1is not likely, we must establish a valuation allowance.~~9 million~~ ~~net~~The valuation ~~generated~~allowance is based on our estimates of taxable income by ~~financing~~jurisdiction ~~activities~~in which we operate and the period over which $0the deferred tax assets will be recoverable.~~5 million~~ In the event the actual results differ from these estimates, we may need to increase or decrease the ~~effect~~valuation ofallowance, ~~foreign~~which ~~exchange~~could ~~rate~~have a ~~changes~~material impact on ~~cash~~the financial position and ~~cash~~results ~~equivalents~~of operations.

~~Our~~Considerable ~~operations~~management ~~and~~judgment ~~liquidity~~may ~~were~~be ~~also~~required ~~impacted~~in ~~by the decision~~determining toour ~~exit~~provision ~~the~~for ~~U.S. Network~~income ~~Deployment~~taxes, ~~business~~the ~~and~~deferred ~~the~~tax ~~sale~~assets and ofliabilities aand ~~portion~~any ofvaluation ~~that~~allowance ~~business~~recorded onagainst ~~June 30, 2006 and~~ the net ~~decision~~deferred totax ~~exit~~assets. ~~our~~We ~~operations~~have inrecorded ~~Brazil~~a ~~(also~~valuation ~~consisting~~allowance of ~~primarily~~$31.8 million ~~of network deployment services)~~ and ~~sell~~$24.3 million ~~our~~as ~~Brazilian~~of ~~subsidiary.~~December 31, ~~These~~2007 ~~actions~~and ~~significantly~~2006, ~~reduced~~respectively, ~~our~~due ~~Americas~~to ~~segment~~uncertainties ~~operating~~related ~~activity~~to ~~during~~our ~~the~~ability ~~second~~to ~~half~~utilize some of the ~~year.~~ Indeferred ~~conjunction~~tax ~~with~~assets ~~the~~before ~~sale~~they ofexpire. ~~our~~The ~~U.S. Network~~additional ~~Deployment~~valuation ~~business,~~allowances we ~~were~~recorded ~~owed~~on ~~approximately~~the ~~$7.6 million~~deferred attax assets for the year ended December 31, ~~2006,~~2007 ~~which~~and ~~related~~2006 towere ~~unbilled~~approximately ~~accounts~~$7.3 ~~receivable~~million ~~transferred~~and ~~to Nokia Inc~~$7. ~~(“Nokia”). As of November~~0 30million, ~~2007,~~respectively. ~~the~~These ~~amount~~deferred ~~outstanding from Nokia was~~tax ~~approximately~~assets ~~$4.4 million,~~primarily ~~and~~consist weof ~~expect~~net ~~this~~operating ~~amount~~losses toand betax credits ~~recoverable~~carried forward. The ~~discontinued~~net ~~operations~~deferred ~~generated~~tax aassets ~~loss~~as of ~~$3.2~~December ~~million~~31, ~~which~~2007 ~~included~~and a2006 ~~gain~~were of $02.40 million onand ~~the sale of the U~~$1.S.4 ~~Network Deployment business. Accordingly~~million, ~~the losses incurred with respect to the discontinued operations negatively impacted our cash balance during 2006~~respectively.

~~During~~The ~~2006,~~Company ~~our~~adopted ~~loss~~the ~~from~~provisions ~~continuing~~of ~~operations~~FIN 48 ~~decreased by~~on ~~$6.7~~January ~~million~~1, ~~to $4~~2007.~~9 million~~ asAs ~~compared to~~ a ~~loss~~result of ~~$11.6 million~~ inthe ~~2005.~~implementation ~~Operating activities caused cash and~~of ~~cash equivalents to decrease in 2006 by $10.0~~FIN ~~million.~~48, ~~The $4.9 million loss from continuing operations combined with~~ the ~~$3.1 million~~Company ~~loss~~recognized ~~from discontinued operations resulted in~~ a ~~net loss of~~ $8.0.9 million ~~for the year. Non-cash~~increase ~~charges included~~ in the ~~net~~liability ~~loss~~for ~~were~~unrecognized ~~$2.6 million~~tax ~~related to depreciation and amortization~~benefits, ~~$1.3 million~~which ~~of non-cash compensation and~~ was ~~offset by $0.4 million related to the~~ gain on the sales of certain portions of the U.S. Network Deployment business. Changes to assets and liabilities related to our operations that impacted cash and cash equivalents included a

3641

~~Table~~ accounted for as an addition to the January 1, 2007 accumulated deficit balance. The total amount of ~~Contents~~recognized tax benefits as of the date of adoption was approximately $0.9 million and includes both taxes and penalties. Additionally, at January 1, 2007, the Company’s deferred tax asset and corresponding valuation allowance were reduced by $1.9 million for cumulative FIN 48 adjustments related to years prior to 2007 that were not recognized as a cumulative adjustment to the accumulated deficit at January 1, 2007. In years prior to 2007, interest and penalties related to adjustments to income taxes as filed has not been significant. The Company intends to include such interest and penalties in its tax provision. There has been no changes in the liability for unrecognized tax benefits during the year ended December 31, 2007.

~~reduction of accounts payable, accrued expenses and other~~ ~~current liabilities of $21.8 million and a reduction of~~Restructuring ~~other current and non-current operating items of~~Charge ~~$4.0 million offset by a reduction of billed and unbilled accounts receivable of $20.2 million.~~

~~Investing~~During ~~activities~~2002 ~~decreased~~we ~~cash~~recorded ~~and~~restructuring ~~cash~~charges ~~equivalents by~~of $013.15 million. ~~net~~Included ~~and~~in ~~consisted~~these ofrestructuring ~~purchases~~charges ofwas a ~~property~~charge for excess facilities aggregating $12.5 million ~~plant~~and employee severance and ~~equipment~~associated expenses of approximately $1.50 million. ~~offset~~This byfacility ~~proceeds~~charge ~~from~~primarily related to leased office space, which we no longer occupied. During 2004, the ~~sale~~Company reversed $1.2 million of ~~certain~~the ~~portions~~payable ofdue to reoccupied office space in McLean, Virginia and a decrease in the Uestimated time period expected to sublease space in our former corporate office in McLean and our London offices.S During 2005, we recorded a net restructuring charge of $0.6 ~~Network~~million ~~Deployment~~for employee severance costs related to the ~~business~~elimination of 48 positions in corporate, North America and Asia-Pacific ~~investments~~and costs associated with closing affiliates and disposing of $1assets.~~4 million.~~

~~Financing~~The ~~activities~~facility ~~increased~~charge ~~cash~~equals ~~and~~the ~~cash~~existing ~~equivalents~~lease byobligation less ~~$1.9 million~~anticipated ~~net~~rental receipts to be received from existing and potential ~~consisted~~subleases. ofThe ~~borrowings~~estimation of the facility charge ~~$17.8 million~~requires ~~under~~significant judgments about the ~~line~~length of ~~credit~~time the space will remain vacant, anticipated cost escalators and ~~$4.2 million~~operating ~~under~~costs ~~the~~associated ~~note~~with ~~payable~~the toleases, the ~~buyer~~market ofrate aat ~~certain~~which ~~portion~~the ofspace will be subleased and the ~~U.S. Network~~broker ~~Deployment~~fees ~~business~~or other ~~offset~~costs bynecessary ~~repayments~~to ofmarket ~~$19~~the space.~~9 million~~ ~~under~~These ~~the~~judgments ~~line~~were ofbased ~~credit~~upon ~~and~~independent ~~$1.2 million~~market ~~applied~~analysis ~~against~~and ~~the~~assessment ~~note~~from ~~payable.~~experienced real estate brokers. The ~~effects~~restructuring charge calculation assumes as of ~~foreign~~December 31, ~~exchange~~2007 ~~also~~that ~~resulted~~we inwill areceive $02.54 million ~~increase~~ in ~~cash~~sublease ~~and~~income, ~~cash~~all ~~equivalents~~of which is committed.

InSubstantially ~~2005,~~all ~~revenues~~the ~~from~~activities ~~continuing~~related ~~operations~~to ofthese restructurings ~~$145.6 million~~have ~~resulted~~been ~~in a pre-tax operating loss of $7~~completed.~~8 million.~~ ~~Cash~~However, ~~used~~we incontinue ~~operating~~to ~~activities~~be inobligated ~~2005 was~~under ~~$8.1 million,~~facility ~~primarily~~leases asthat aexpire ~~result~~from of2008 ~~the~~through ~~loss from operations~~2014. ~~Cash~~The ~~used in investing activities was~~accrual of approximately $20.54 million, aremaining ~~large part of which was attributable to the~~at ~~purchase~~December 31, of2007 ~~test~~relates ~~and~~to ~~measurement~~remaining ~~equipment~~obligations ~~in the EMEA region.~~through ~~Cash~~the ~~generated~~year by2014 ~~financing activities was $3.4 million primarily~~ associated with ~~$2.9 million~~offices ofexited ~~increased~~or downsized, ~~borrowings.~~offset ~~The~~by ~~effect~~our estimates of ~~exchange~~future ~~rates~~income ~~caused~~from ~~cash to decrease~~sublease $0agreements.~~6 million. Overall, cash decreased by $7.7 million~~ ~~in 2005.~~

InDuring ~~2004,~~the ~~revenues~~second ~~from~~quarter ~~continuing~~of ~~operations~~2007, ofthe Company took steps ~~$118.7 million~~towards ~~resulted~~recognizing inintegration arelated ~~pre-tax~~and ~~operating~~other ~~loss~~cost ofsynergies ~~$10.2 million~~by ~~after~~implementing ~~expensing~~a ~~compensation~~workforce ~~expense~~reduction ofthat eliminated ~~$1.2 million~~approximately ~~relating~~60 topositions ~~the~~worldwide ~~satisfaction~~and ofconsolidated ~~a shareholder~~certain ~~note~~facilities ~~receivable.~~in ~~Cash~~the ~~used~~U.K., inby ~~operations~~adopting ~~decreased~~a torestructuring plan ~~$4.7 million~~(“2007 Restructuring”), ~~which~~and ~~consisted~~recorded a net restructuring charge of $31.56 million. Approximately $1.0 million of the charge was related to ~~fund~~severance and ~~operating~~headcount ~~losses~~related costs and $10.26 million towas ~~finance~~related ~~growth in our~~to ~~operating~~other ~~assets~~non-headcount ~~and~~related ~~liabilities~~expenses. ~~Cash~~The ~~used~~Company inrecorded ~~investing~~the ~~activities~~severance ~~was~~charges ~~$3.3 million,~~related ofto ~~which~~these ~~$3.0 million~~headcount ~~was~~reductions as an ~~for~~operating ~~property~~expense ~~and~~in ~~equipment~~the ~~purchases~~second and $0third quarters of 2007.~~4 million~~ ~~for~~The ~~the~~facilities ~~joint~~and ~~venture~~other innon ~~China.~~headcount ~~Financing~~related ~~activities~~charges ~~generated~~were recorded ~~$0.7 million,~~as ofoperating ~~which~~expense ~~$1.4 million~~in ~~was~~ the ~~net~~second and third quarters of 2007. ~~proceeds~~The ~~from~~Company paid the ~~exercise~~majority of ~~options~~severance ~~$0.1 million~~and ~~from~~related costs in ~~issuance~~the ofthird ~~stock,~~quarter ~~and~~with ~~$1.1 million~~the ~~from~~remaining ~~the~~costs ~~sale~~paid ofin ~~short~~the fourth ~~term~~quarter ~~investments~~of ~~and~~2007. ~~reduction~~The ofCompany ~~restricted~~also ~~cash,~~recorded ~~offset~~a ~~by net~~restructuring ~~repayments~~charge of $10.95 million onrelated ~~the~~to ~~line~~personnel ofseverance ~~credit~~costs ~~established~~in ~~for~~connection ~~Detron~~with ~~Netherlands.~~the ~~The~~acquisition ~~effect~~ of ~~exchange~~certain ~~rates~~assets and ~~caused~~liabilities ~~cash~~of tothe ~~increase $0~~U.~~3 million~~S. wireless ~~Overall,~~engineering ~~cash~~services ~~decreased~~business byof $7WFI.~~0 million~~ inThe ~~2004~~Company included these severance charges in goodwill.

~~Cash~~Goodwill ~~Requirements~~and Purchased and Other Intangibles

	Years Ended December 31,
	2006		2005
	(in thousands)
Cash and cash equivalents	$	6,445	$	14,196
Restricted cash		883		1,141
Total cash and short-term investments	$	7,328	$	15,337
Borrowing facility and note payable	$	4,226	$	2,975
Working capital	$	33,490	$	37,770

In accordance with SFAS No. 142 (“SFAS 142”), “Goodwill and Other Intangibles Assets,” we review our goodwill for impairment annually, or more frequently, if facts and circumstances warrant a review. We completed our annual impairment test in the fourth quarter of fiscal 2007 and determined that there was no impairment.

~~Our~~Upon ~~future~~acquisition, ~~cash~~our ~~requirements~~intangible ~~are~~assets, ~~dependent~~which onare ~~fluctuations~~subject into ~~working capital~~amortization, ~~profitability~~are ofrecorded ~~the~~at ~~business~~fair ~~and~~value. ~~capital~~SFAS 142 requires ~~purchase~~that ~~requirements.~~intangible ~~These~~assets ~~fluctuations~~with ~~are~~finite ~~caused~~lives ~~primarily~~be amortized over their byestimated ~~several~~useful ~~factors.~~lives and reviewed for

~~We continue to perform deployment services in certain countries~~ ~~in the EMEA region. Historically, a significant number of~~42 deployment services contracts limit our ability to bill the customer until certain milestones are met. Additionally, some of the deployment services contracts contain provisions for the customer to withhold a portion of the payment of our billings (retainage) until the contract is complete. As a result of the milestone-based billings and retainages of amounts billed our working capital needs are increased as we incur costs in performing deployment services that require cash expenditures in advance of the billings and collections from our customers. Additionally, deployment services performed in certain countries (U.S., Italy and Spain) historically had very low profit margins. From time to time the company has also entered into contracts for non-deployment services where

impairment whenever an impairment indicator exists under SFAS 37No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” We continually monitor events and changes in circumstances that could indicate carrying amounts of our intangible assets may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of intangible assets by determining whether the carrying value of such assets will be recovered through the undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of the intangible assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. We did not recognize intangible asset impairment charges in fiscal 2007, 2006 or 2005.

~~Table~~ Our intangible assets are amortized over their estimated useful lives of ~~Contents~~1 to 15 years. Generally, amortization is based on the pattern in which the economic benefits of the intangible asset will be consumed.

~~milestone-based billings are used. While such contracts~~ ~~represent a lesser percentage of our business, they nonetheless~~Related ~~result~~Party ~~in working capital fluctuations.~~Transactions

~~During~~As ~~2006~~is wediscussed ~~have~~more ~~significantly~~fully ~~decreased~~in ~~our dependence on~~Note 13, ~~working~~Shareholders’ ~~capital~~Equity, ~~intensive~~on ~~and~~December 22, ~~lower~~2006, ~~margin deployment services~~RF asInvestors, ~~we exited that business in the U~~L.SL.C. ~~and~~(“RF ~~Brazil~~Investors”) intransferred ~~the~~all but ~~Americas~~425,577 shares ~~region~~of ~~and~~its ~~wound~~Class B ~~down~~common ~~deployment~~stock ~~service~~to ~~contracts in~~The ~~countries~~Rajendra ~~such as Italy~~ and ~~Spain.~~Neera ~~This~~Singh ~~has~~Charitable ~~decreased~~Foundation, ~~working~~Inc. (“the ~~capital~~Foundation”), ~~fluctuations~~ and ~~working~~upon ~~capital~~such ~~needs.~~transfer ~~Additionally,~~the wetransferred ~~will~~Class B ~~continue~~common tostock ~~focus~~and ~~our~~the ~~business~~remaining onshares RFheld ~~engineering~~by ~~services~~RF ~~and~~Investors ~~Operations~~converted ~~and~~to ~~Maintenance~~Class A ~~contracts~~common stock. WeAs ~~believe~~a ~~we will~~result, ~~experience~~the ~~less~~Company ~~fluctuation~~has inonly ~~our~~Class A ~~working~~shares ~~capital~~outstanding, asall ~~these~~of ~~services~~which are ~~generally~~voted ~~higher~~on ~~margin~~a ~~businesses~~one-to-one ~~and~~basis. ~~require~~The ~~less~~shares of ~~working~~Class A ~~capital~~common ~~because~~stock ofheld by the ~~fact~~Foundation, ~~that~~and ~~such~~by ~~services are~~RF ~~generally~~Investors ~~not~~constituted ~~milestone~~approximately ~~based~~15.8% orand ~~have shorter milestone periods~~1.7%, ~~and~~respectively, inof ~~many~~the ~~cases~~outstanding dovoting ~~not~~power ~~have~~of ~~retainage~~the ~~provisions. We have also~~common ~~been~~stock. ~~able~~The toaggregate ~~lessen~~balance ~~some~~ of the ~~working~~voting ~~capital~~power ~~needs~~of ~~created by~~the ~~these~~Class A ~~contracts~~common bystock, ~~negotiating~~approximately ~~payment~~82.5% ~~terms~~at ~~with our contractors that more closely match our payments to~~ the ~~vendors~~time of to the ~~payments we receive from our customers. Additionally~~transfer, ~~to increase~~was ~~our~~held ~~liquidity~~by wethe ~~have~~Company’s ~~entered into accounts receivable or~~ other ~~asset based financing arrangements~~stockholders.

OnTelcom ~~April 19~~Ventures, ~~2007~~L.L.C. (“Telcom Ventures”), weis ~~raised~~the parent ~~$17~~company of RF Investors, an entity controlled by Company founders Dr.0 ~~million~~Rajendra ~~through~~and Neera Singh and members of their family. Dr. Singh is also a director of the Company. Prior to ~~sale~~the Company’s initial public offering, both the Company’s employees and the employees of 5Telcom Ventures were eligible to participate in our life,~~100~~ medical,~~000~~ ~~newly~~dental ~~issued~~and 401(k) ~~Class A~~plans. ~~common~~In ~~shares~~connection atwith athe initial public offering in ~~price~~1996, we agreed pursuant to an Overhead and Administrative Services Agreement to allow the employees of ~~$3.35~~Telcom ~~per~~Ventures ~~share~~to continue to participate in aour ~~private~~employee ~~placement.~~benefit plans in exchange for full reimbursement of the cash costs and expenses. We ~~used~~billed Telcom Ventures $77,000, $128,000 and $74,000 during the years ended December 31, 2007, 2006, and 2005, ~~proceeds~~respectively, for payments made by us pursuant to this agreement. We received reimbursements from Telcom Ventures of $70,000, $135,000 and $67,000 during the ~~offering~~years ~~for~~ended December 31, ~~working~~2007, ~~capital~~2006, and ~~general~~2005, respectively. At ~~corporate~~December 31, ~~purposes~~2007 and 2006, outstanding amounts associated with payments made by us under this agreement were $7,000 and $1,000, respectively, and are included as due from related parties and affiliates within the consolidated balance sheets in the accompanying financial statements.

OnDuring ~~March 9, 2007, we entered into a revolving credit facility with Bank of America, N.A., (“Bank of America”) and terminated our existing credit facility with CFC. Under~~ the ~~terms~~year ofended ~~this credit facility, the aggregate amount owed to Bank of America by us at any time could not exceed $6.5~~December ~~million. The term of this credit facility was through September 15~~31, 2007~~. On May 29~~, ~~2007,~~we inprovided ~~connection~~services ~~with the agreement~~ to ~~purchase~~one ~~certain~~customer ~~assets~~where ~~and liabilities~~Telcom ofVentures ~~the~~has ~~U.S.~~a ~~wireless engineering services business~~minority ~~of Wireless Facilities, Inc~~investment., ~~(WFI)~~Revenues weearned ~~amended~~from ~~and~~this ~~restated~~customer ~~our outstanding~~during ~~credit~~the ~~facility with Bank of America. The Amended~~year ~~and~~ended ~~Restated Credit Agreement (which was amended on November~~December 3031, 2007, towere ~~among~~approximately ~~other things, provide for a bank waiver and amend certain covenants in the agreement for all events of default) provides for a total principal borrowing amount of up to~~ $21101,000.~~95 million~~ ~~which may be borrowed,~~Billed ~~repaid~~ and ~~reborrowed~~unbilled byreceivables ~~the Company on a revolving basis until November 29, 2009. It also provides for a term loan~~ of ~~$6.5 million~~ ~~with~~approximately ~~scheduled principal payments of~~ $~~3.5 million on June 1~~35,000 ~~2008,~~from ~~$1.0 million on~~this ~~each~~customer ofwere ~~September 1~~outstanding ~~and~~at December 131, ~~2008 and March 1~~2007, ~~2009~~ and ~~any balance on November 29, 2009. In addition, we~~ are ~~required to maintain a so-called “lockbox~~ ~~arrangement”~~included ~~pursuant to which all monies payable to us~~ in ~~the~~ ~~U.S. plus~~trade ~~certain~~accounts ~~unrestricted~~receivable ~~cash~~and ~~balances~~unbilled ~~of our~~receivables ~~non-U.S. subsidiaries~~ in ~~excess of $6.0 million must be paid into a specially designated account and automatically applied to~~ the ~~payment~~accompanying ofconsolidated ~~principal~~balance ~~amounts~~sheet. ~~outstanding~~During ~~under~~ the ~~revolving portion of the credit facility as well as any~~year ~~other~~ended ~~obligations under the credit facility that are due and owing. On June~~December 131, 2007, we ~~issued~~provided ano ~~promissory~~services ~~note~~ to ~~WFI~~Telcom inVentures ~~the amount of $22~~directly.~~0 million in connection with the~~ purchase. This promissory note, which WFI subsequently assigned to SPCP Group, L.L.C., is subordinated to the Company’s obligations under the amended and restated credit facility discussed above.

~~On July 3, 2007, we filed a current report on~~ ~~Form 8-K~~Subsequent ~~disclosing that as part of our recent WFI acquisitions,~~Events effective June 27, 2007, we have taken steps towards recognizing integration related and other cost synergies by implementing a workforce reduction that eliminated approximately 60 positions worldwide and consolidated certain facilities in the U.K. Total charges of approximately $2.3 million, were incurred primarily in the second and third quarters of 2007. Approximately $1.1 million of the charge is related to severance and headcount related costs and $1.2 million is related to consolidation of certain facilities and other non-headcount related expenses. We paid the majority of severance and related costs in the third quarter with the remaining costs expected to be paid in the fourth quarter. The cash payments related to the consolidation of facilities will be made over the term of the related leases, the longest of which terminates in May 2012.

WeAs ~~believe~~discussed ~~that~~more ~~our~~fully ~~cash~~in ~~balances~~Note 22. Subsequent Events, to ~~current~~the ~~financing~~consolidated ~~agreements~~financial statements, proceedings were pending before the NASDAQ Listing and ~~access~~Hearing Review Council with respect to ~~additional~~a ~~financing~~potential ~~will~~delisting ~~provide~~of usour ~~with~~Class A common ~~sufficient~~stock ~~cash~~as a result of the Company’s failure to ~~fund~~file ~~our~~with ~~operations~~the SEC its quarterly reports on Form 10-Q for ateach ~~least~~of the ~~next~~quarters ended March 31, June 30 and 12September ~~months~~30, 2007 and Form 8-K/A with respect to a significant acquisition completed in 2007. On February 21, 2008, the Company completed all such filings. On March 3, 2008, the Company received a letter from NASDAQ that it is now compliant with Marketplace Rule 4310 (c)(14). As such, the Board of Directors of NASDAQ has withdrawn its February 14, 2008 call for review of the December 19, 2007 decision of the Listing Council.

~~Existing contractual obligations are primarily limited to~~ ~~operating leases, mostly for office facilities. Those~~43 ~~obligations are set out below. Fixed lease obligations are partly offset by income from sublease agreements.~~

On April 4, 2008, the Company filed a current report on 38Form 8-K disclosing that, in accordance with NASDAQ’s rules, the Company had received a NASDAQ staff determination letter stating that the Company was not in compliance with NASDAQ Marketplace Rule 4310(c)(14) because it had not timely filed its Annual Report on Form 10-K for the year ended December 31, 2007. The Company requested, and was granted, a hearing before the NASDAQ Listing Qualifications Panel that is scheduled for May 8, 2008.

~~Table~~ Recent Accounting ~~of Contents~~Pronouncements

~~Our~~In ~~operating~~December ~~lease~~2007, ~~obligations~~the atFinancial ~~December~~Accounting Standards Board (“FASB”) issued SFAS 31No. 141(R), “Business ~~2006~~Combinations,” (“SFAS No. 141(R)”),which ~~are~~replaces SFAS No. 141 asand issued SFAS No. 160, ~~follows~~“Noncontrolling Interests in Consolidated Financial Statements,” (“SFAS No. 160”), an amendment of Accounting Research Bulletin No. 51. These two new standards will change the accounting for and the reporting for business combination transactions and noncontrolling (minority) interests in ~~thousands~~the consolidated financial statements, respectively. SFAS No. 141(R): will change how business acquisitions are accounted for and will impact financial statements both on the acquisition date and in subsequent periods. SFAS No. 160 will change the accounting and reporting for minority interests, which will be re-characterized as noncontrolling interests and classified as a component of equity. These two standards will be effective for the Company for financial statements issued for fiscal years beginning after December 31, 2008. Early adoption is prohibited. The Company is currently evaluating the impact of SFAS No. 141R and SFAS No. 160 on its consolidated financial position, results of operations and cash flows.

	Payment Due by Period
			Less than						More than
Contractual Obligations	Total		1 Year		1-3 Years		4-5 Years		5 Years
Operating lease obligations	$	10,807	$	5,075	$	3,623	$	1,210	$	899
Sublease income	$	2,689	$	734	$	791	$	582	$	582

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities — Including an Amendment of Statement of Financial Accounting Standards No. 115” (“SFAS No. 159”). SFAS No. 159 permits companies to choose to measure, on an instrument-by-instrument basis, financial instruments and certain other items at fair value that are not currently required to be measured at fair value. Unrealized gains and losses on items for which the fair value option is elected will be recognized in earnings at each subsequent reporting date. SFAS No. 159 is effective for the Company as of January 1, 2008. The Company is in the process of determining the effect of the adoption of SFAS No. 159 on its consolidated financial position, results of operations and cash flows.

~~Purchases~~In ofSeptember ~~property~~2006, ~~and~~the ~~equipment~~FASB ~~are~~issued ~~primarily~~SFAS No. 157, “Fair ~~related~~Value toMeasurements”, ~~project~~(“SFAS No. 157”) ~~requirements,~~which ~~but~~defines ~~are~~fair ~~relatively insignificant compared~~value, toestablishes ~~other~~a ~~requirements.~~framework ~~From~~for ~~time~~measuring tofair ~~time,~~value wein ~~have~~GAAP, ~~made~~and ~~acquisitions~~expands ~~and~~disclosures ~~investments~~about infair ~~joint~~value ~~ventures~~measurements. ~~On March 9,~~ ~~2007,~~SFAS No. 157 wedoes ~~purchased~~not ~~the~~require ~~equity~~any ~~interests~~new offair ~~WFI’s Europe,~~value ~~Middle~~measurements ~~East~~but ~~and~~rather ~~Africa~~eliminates ~~(EMEA)~~inconsistencies ~~business~~in ~~for~~guidance found ain ~~cash~~various ~~purchase~~prior ~~price of~~accounting $4pronouncements.0 SFAS ~~million~~No. 157 Onis ~~June~~effective for fiscal years beginning after November 115, 2007, weand ~~acquired~~interim ~~certain~~periods within those ~~assets~~fiscal ~~and~~years. ~~liabilities~~FASB ofalso ~~WFI’s~~issued USFASB ~~wireless~~Staff ~~engineering~~Position ~~services~~(“FSP”) ~~business~~No. ~~for~~157-2, a“Effective ~~purchase~~Date ~~price~~ of ~~approximately~~FASB ~~$39~~Statement No.~~0 million.~~ It157” iswhich ~~possible~~delayed ~~that~~for weone ~~may~~year ~~make~~the effective ~~further~~date of SFAS No. 157 for certain ~~acquisitions~~non-financial assets and ~~investments~~liabilities. The Company is in the ~~future.~~process ~~Taxes~~of determining ~~are~~the ~~likely~~effect toof the adoption of SFAS No. 157 beand aFSP ~~cash~~No ~~requirement~~157-2 inon ~~the~~its ~~future~~consolidated ~~for~~financial ~~profitable~~position, ~~foreign~~results of operations and cash flows.

OnItem ~~July 18, 2005, we entered into a financing agreement with CFC~~7A. ~~Under~~Quantitative ~~this~~and ~~agreement~~Qualitative weDisclosures ~~could~~about ~~elect~~Market to transfer certain accounts receivables to CFC in exchange for cash. CFC had the right to determine, in its sole discretion, the amount of cash, if any, it was willing to advance with respect to any specified account receivable, which amount shall not have exceeded 80% of the face amount of the receivables presented. Interest on the advances bore interest at the prime rate as reported in The Wall Street Journal. We terminated this agreement on March 9, 2007. Risk

AsWe ofare ~~December 31,~~exposed ~~2006,~~to the ~~maximum~~impact ~~funding~~of ~~available under~~foreign ~~this~~currency ~~agreement with CFC was $5~~fluctuations.~~0 million. At~~ ~~December 31,~~The ~~2006~~exposure ~~and 2005, we had approximately $0.9 million and $3.0 million outstanding under this financing agreement, respectively. Advances made~~ to ~~the U.S. have~~exchange ~~been~~rates ~~utilized~~relates ~~for~~primarily ~~working capital purposes, including the payment of amounts owed~~ to ~~subcontractors~~our ~~under~~foreign ~~certain~~subsidiaries. ~~customer~~Subsidiaries ~~contracts~~with ~~where~~material ~~the~~foreign ~~payments from the customer~~currency ~~have~~exposure ~~been delayed or~~ are ~~otherwise~~in ~~not yet due. Total interest expense for~~ the ~~years ending December 31~~U.K., ~~2006~~Algeria, ~~2005~~Saudi Arabia and ~~2004~~ ~~was approximately $0~~Italy.~~9 million,~~ ~~$0.3 million and~~For ~~$0.2 million,~~our ~~respectively.~~foreign Ofsubsidiaries, ~~these~~exchange ~~amounts,~~rates ~~approximately $0.6 million,~~can ~~$0.3 million~~have ~~and~~an ~~$0.0 million,~~impact ~~for~~on the ~~years ending December~~U.S. ~~31,~~Dollar ~~2006,~~value ~~2005~~of ~~and~~their ~~2004, respectively,~~reported ~~was~~earnings ~~attributable to interest~~ and ~~fees arising from~~the ~~our~~intercompany ~~financing~~transactions ~~arrangement~~ with ~~CFC~~the subsidiaries.

InCustomers ~~2003,~~outside weof ~~established~~the aUnited ~~line~~States accounted for 67.8%, 77.1% and 75.2% of ~~credit~~our revenues for ~~our~~the ~~subsidiary~~years inended December 31, 2007, 2006 and 2005, respectively. In connection with the ~~Netherlands~~increased availability of 3G equipment in Europe, ~~collateralized~~we byanticipate ~~its~~continued ~~outstanding~~growth ~~accounts~~of our international ~~receivable~~operations, particularly in Europe, the Middle East and Africa, in ~~2004~~2008 weand ~~have~~beyond. ~~repaid~~As ~~advances~~a soresult, ~~that~~fluctuations ~~only~~in the value of $0foreign currencies against the U.1S. ~~million~~Dollar ofmay ~~the~~have ~~line~~a significant ofimpact ~~credit~~on ~~was~~our ~~outstanding~~reported atresults. Revenues and ~~December~~expenses denominated in foreign currencies are translated monthly into U.S. ~~31,~~Dollars ~~2004~~at the weighted average exchange rate. ~~This~~Consequently, ~~line~~as the value of ~~credit~~the ~~was~~U.S. Dollar strengthens ~~terminated~~or weakens relative to other currencies in our major markets the ~~first~~resulting ~~quarter~~translated ofrevenues, ~~2005~~expenses and operating profits become lower or higher, respectively.

~~We have not engaged in any off-balance sheet financing.~~ 44

Fluctuations in currency exchange rates also can have an impact ~~Critical~~on the United States Dollar amount of our shareholders’ ~~Accounting~~equity. ~~Policies~~The assets and liabilities of the non-U.S. subsidiaries are translated into United States Dollars at the exchange rate in effect on the date of the balance sheet for the respective reporting period. The resulting translation adjustments are recorded in shareholders’ equity as accumulated other comprehensive income or loss. The Euro and British Pound were stronger relative to other foreign currencies at December 31, 2007 compared to December 31, 2006. Consequently, the accumulated other comprehensive income component of shareholders’ equity increased $3.8 million during the year ended December 31, 2007. As of December 31, 2007, the net amount invested in non-U.S. subsidiaries subject to this equity adjustment, using the exchange rate as of the same date, was $24.9 million.

~~Our~~We ~~critical~~are ~~accounting~~exposed ~~policies~~to the impact of foreign currency fluctuations due to the operations of short-term intercompany transactions between the London office and its consolidated foreign subsidiaries and between the McLean office and its consolidated foreign subsidiaries. While these intercompany balances are eliminated asin ~~follows:~~consolidation, exchange rate changes do affect consolidated earnings. Foreign subsidiaries with amounts owed to or from the London operations at December 31, 2007 (denominated in Euros or Saudi Arabia Riyals) include a receivable from Algeria in the amount of $9.8 million, a receivable from Saudi Arabia in the amount of $6.9 million, a receivable from Italy in the amount of $4.2 million, and a payable to United Arab Emirates of $4.6 million. Foreign subsidiaries with amounts owed to or from the McLean operations at December 31, 2007 (denominated in Euros or British Pounds) include a receivable from Italy in the amount of $4.8 million and a receivable from the United Kingdom in the amount of $14.0 million. These balances generated a foreign exchange gain of $2.5 million and is included in our consolidated results at December 31, 2007. A hypothetical appreciation of the Euro and British Pound of 10% would result in a $1.2 million decrease to our operating losses in 2007 generated outside the United States. This was estimated using a 10% appreciation factor to the average monthly exchange rates applied to net income or loss for each of our subsidiaries in the respective period. Foreign exchange gains and losses recognized on any transactions are included in our consolidated statements of operations.

• Although ~~revenue~~currency ~~recognition;~~fluctuations •can ~~allowance~~have ~~for~~an ~~doubtful~~impact ~~accounts;~~on •our reported ~~accounting~~results ~~for~~and ~~income~~shareholders’ ~~taxes~~equity, such fluctuations can affect our cash flow and could result in economic gains or losses. We currently do not hedge any of these risks in our foreign subsidiaries because: (i) our subsidiaries generally earn revenues and incur expenses within a single country and, consequently, do not incur currency risks in connection with the conduct of their normal operations; (ii) other foreign operations are minimal; and (iii) we •do ~~restructuring~~not ~~charge~~believe that hedging transactions are justified by the current exposure and cost at this time.

We are also exposed to interest rate risk. On November 30, ~~Revenue~~2007, we amended and restated our outstanding credit facility ~~Recognition~~with Bank of America. As a result of this amendment, an amount of up to $21.95 million may be borrowed, repaid and reborrowed on a revolving basis. In addition, the interest rate on this credit facility was increased by 1.0% per annum. The interest payable under our credit facility varies with fluctuations in the applicable lending rates. As a result, in the event these rates increase, the Company is subject to increases in its cash interest payments.

~~Our principal sources of revenue consist of design and system~~ ~~deployment services. We provide design services on a contract~~45 basis, usually in a customized plan for each client, and generally charge for engineering services on a time and materials or fixed price basis. We generally offer deployment services overseas on a fixed price, time-certain basis. The portion of our revenues from continuing operations from fixed-price contracts was 52.8% in 2006 and 71.0% in 2005. We recognize revenues on fixed-price contracts using the percentage-of-completion method. With the percentage-of-completion method, expenses on each project are recognized as incurred, and revenues are recognized based on the ratio of the current costs incurred for the project to the then estimated total costs of the project. We compare costs incurred to date against project milestones to determine if the percentage of

39 Item 8. Financial Statements and Supplementary Data


	Page

Report of Independent Registered Public Accounting Firm		47
Report of Independent Registered Public Accounting Firm		48
Consolidated Statements of Operations for the years ended December 31, 2007, 2006 and 2005		49
Consolidated Balance Sheets as of December 31, 2007 and 2006		50
Consolidated Statements of Shareholders’ Equity and Comprehensive Loss for the years ended December 31, 2007, 2006 and 2005		51
Consolidated Statements of Cash Flows for the years ended December 31, 2007, 2006, and 2005		52
Notes to Consolidated Financial Statements		53

~~completion is reasonable. Accordingly, revenues recognized in a~~ ~~given period depend on, among other things, the costs incurred~~46 on each individual project and our then current estimate of the total costs at completion for individual projects. Considerable judgment on the part of our management may be required in determining estimates to complete a project including the scope of the work to be completed, and reliance on the customer or other vendors to fulfill some task(s). If in any period we significantly increase the estimate of the total costs to complete a project, we may recognize very little or no additional revenues with respect to that project. If total contract cost estimates increase, gross profit for any single project may be significantly reduced or eliminated. If the total contract cost estimates indicate that there is a loss, the loss is recognized in the period the determination is made. At December 31, 2006 and 2005, we had $24.8 million and $35.8 million, respectively, of unbilled receivables.

~~Allowance~~REPORT OF ~~for~~INDEPENDENT ~~Doubtful~~REGISTERED ~~Accounts~~PUBLIC ACCOUNTING FIRM

~~The~~Board ~~preparation~~ of ~~the~~Directors ~~consolidated financial statements requires management to make estimates~~ and ~~assumptions that~~Shareholders affect the reported amount of assets, liabilities, contingent assets and liabilities and the reported amounts of revenues and expenses during the reported period. Specifically, our management must make estimates of the probability of collection of accounts receivable. Management specifically analyzes accounts receivable balances, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the valuation allowance for doubtful accounts. For the years ended December 31, 2006 and 2005, we derived 82.7% and 83.6%, respectively, of total revenues from our ten largest customers, indicating significant customer concentration risk with our receivables. These ten largest customers constituted 80.3% and 55.6% of our net receivable balance as of December 31, 2006 and 2005, respectively. Lastly, we frequently perform services for development stage customers, which carry a higher degree of risk, particularly as to the collection of accounts receivable. These customers may be particularly vulnerable to the tightening of available credit or a general economic slowdown.

~~Accounting for~~LCC ~~Income~~International, ~~Taxes~~Inc. and subsidiaries

AsWe ~~part~~have ofaudited the ~~process~~accompanying ~~of preparing our~~ consolidated ~~financial statements~~balance ansheet ~~estimate for income taxes is required for each~~ of ~~the~~LCC ~~jurisdictions~~International, ~~in which we operate~~Inc. ~~This~~and ~~process~~its ~~requires estimating~~subsidiaries (the ~~actual~~Company) ~~current~~as ~~tax expense together with~~of ~~assessing~~December 31, ~~temporary~~2007, ~~differences~~and ~~resulting~~the ~~from~~related ~~differing~~consolidated statements ~~treatment~~ of ~~items~~operations, ~~such~~shareholders’ asequity ~~depreciation,~~and ~~for~~comprehensive ~~tax accounting~~loss, ~~purposes.~~and ~~These~~cash ~~differences~~flows ~~result~~for inthe ~~deferred~~year ~~tax~~ended ~~assets and liabilities~~December 31, ~~which~~2007. ~~are included in the consolidated balance~~Our ~~sheet.~~audit Weof ~~must~~the ~~then~~basic ~~assess~~financial ~~the~~statements ~~likelihood~~included ~~that~~ the ~~deferred tax~~financial ~~assets~~statement ~~will~~schedule belisted ~~recovered~~in ~~from~~the ~~future~~index ~~taxable~~appearing ~~income and to the~~under ~~extent~~Item 15 we(a)(2) ~~believe~~for ~~that~~the ~~recovery~~year isended ~~not likely~~December 31, ~~we must establish a valuation allowance~~2007. ~~The valuation allowance is based on our~~ ~~estimates~~These offinancial ~~taxable~~statements ~~income~~and byfinancial ~~jurisdiction~~statement inschedule ~~which we operate~~are ~~and~~ the ~~period~~responsibility ~~over~~of ~~which~~ the ~~deferred~~Company’s ~~tax assets will be recoverable~~management. ~~In the event the actual results differ from these~~Our ~~estimates,~~responsibility weis ~~may need~~ to ~~increase~~express oran ~~decrease~~opinion ~~the~~on ~~valuation~~these financial ~~allowance,~~statements ~~which~~and ~~could~~financial ~~have~~statement aschedule ~~material~~based ~~impact~~ on ~~the~~our ~~financial position and results of operations~~audit.

~~Considerable~~We ~~management~~conducted ~~judgment~~our ~~may~~audit ~~be required~~ in ~~determining our~~accordance ~~provision~~with ~~for income taxes,~~ the ~~deferred~~standards ~~tax~~of ~~assets and~~the ~~liabilities~~Public ~~and~~Company ~~any~~Accounting ~~valuation~~Oversight ~~allowance~~Board ~~recorded~~(United ~~against~~States). ~~the net~~Those ~~deferred~~standards ~~tax~~require ~~assets.~~that Wewe ~~have~~plan ~~recorded~~and aperform ~~valuation~~the ~~allowance~~audit ~~of $24.3 million~~to ~~and $17.3 million as of~~obtain ~~December 31,~~reasonable ~~2006~~assurance ~~and~~about ~~2005,~~whether ~~respectively,~~the ~~due~~financial tostatements are ~~uncertainties~~free ~~related~~of tomaterial ~~our~~misstatement. ~~ability~~An toaudit ~~utilize~~includes ~~some~~examining, ofon ~~the~~a ~~deferred~~test ~~tax~~basis, ~~assets~~evidence ~~before~~supporting ~~they~~the ~~expire.~~amounts ~~The~~and ~~additional~~disclosures ~~valuation~~in ~~allowances~~the wefinancial ~~recorded~~statements. onAn ~~the~~audit ~~deferred~~also ~~tax~~includes ~~assets~~assessing ~~for~~ the ~~year~~ ~~ended~~accounting ~~December 31,~~principles ~~2006~~used and ~~2005~~significant ~~were~~estimates ~~approximately~~made by ~~$7.0 million and $3.3 million~~management, ~~respectively.~~as ~~These deferred~~well ~~tax~~as ~~assets~~evaluating ~~primarily~~the ~~consist~~overall ~~of net operating losses~~financial ~~and~~statement ~~tax credits carried forward~~presentation. ~~The~~We ~~net~~believe ~~deferred~~that ~~tax~~our ~~assets~~audit asprovides a ofreasonable ~~December 31,~~basis ~~2006~~for ~~and~~our ~~2005 were $1~~opinion.~~4 million and~~ ~~$1.1 million, respectively.~~

In our opinion, the financial statements referred to above ~~Restructuring~~present fairly, in all material respects, the financial position ~~Charge~~of LLC International, Inc. and its subsidiaries as of December 31, 2007, and the results of its operations and its cash flows for the year ended December 31, 2007 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

~~During~~As ~~2002~~discussed wein ~~recorded restructuring charges of $13.5~~Note ~~million.~~2 ~~Included~~to inthe ~~these~~Notes ~~restructuring~~to ~~charges was~~Consolidated aFinancial ~~charge~~Statements, ~~for~~the ~~excess~~Company ~~facilities~~adopted ~~aggregating $12.5 million~~Financial ~~and~~Interpretation ~~employee severance and associated expenses of approximately $1~~No.0 ~~million.~~48, ~~This~~“Accounting ~~facility~~for ~~charge primarily related to~~Uncertainty ~~leased~~in ~~office~~Income ~~space~~Taxes,” ~~which~~effective ~~we no longer occupied. During 2004~~January 1, ~~the~~ ~~Company reversed $1~~2007.~~2 million of the payable due to~~ ~~reoccupied office space in McLean, Virginia and a decrease in the estimated time period expected to sublease space in our former corporate~~

We also have audited, in accordance with the standards of the 40Public Company Accounting Oversight Board (United States), LCC International Inc.’s internal control over financial reporting as of December 31, 2007, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated April 28, 2008 expressed an adverse opinion on internal control effectiveness.

~~Table~~ /s/ ofGRANT ~~Contents~~THORNTON LLP

~~office in~~ McLean ~~and our London offices. During 2005~~, weVirginia recorded a net restructuring charge of $0.6 million for employee severance costs related to the elimination of 48 positions in corporate, North America and Asia-Pacific and costs associated with closing affiliates and disposing of assets.

The facility charge equals the existing lease obligation less anticipated rental receipts to be received from existing and potential subleases. The estimation of the facility charge requires significant judgments about the length of time the space will remain vacant, anticipated cost escalators and operating costs associated with the leases, the market rate at which the space will be subleased and the broker fees or other costs necessary to market the space. These judgments were based upon independent market analysis and assessment from experienced real estate brokers. The restructuring charge calculation assumes as of DecemberApril 3128, ~~2006 that we will receive~~2008 ~~$3.3 million in sublease income, all of which is committed.~~

~~Substantially all the activities related to these restructurings~~ ~~have been completed. However, we continue to be obligated under~~47 facility leases that expire from 2007 through 2014. The accrual of approximately $1.0 million remaining at December 31, 2006 relates to remaining obligations through the year 2014 associated with offices exited or downsized, offset by our estimates of future income from sublease agreements.

~~Related~~REPORT OF ~~Party~~INDEPENDENT ~~Transactions~~REGISTERED PUBLIC ACCOUNTING FIRM

AsTo is discussed more fully in Note 15, Shareholders’ Equity, on December 22, 2006, RF Investors, L.L.C. (“RF Investors”) transferred all but 425,577 shares of its class B common stock to The Raj and Neera Singh Charitable Foundation, Inc. (“the ~~Foundation”),~~ ~~and~~Board upon such transfer the transferred class B common stock and the remaining shares held by RF Investors converted to class A common stock. As a result, the Company has only class A shares outstanding, all of ~~which~~ ~~are~~Directors ~~voted on a one-to-one basis. The shares of class A common stock held by the Foundation,~~ and ~~by RF Investors constituted approximately 15.8%~~Shareholders and 1.7%, respectively, of the outstanding voting power of the common stock. The aggregate balance of the voting power of the class A common stock, approximately 82.5%, was held by the Company’s other stockholders.

~~Telcom~~LCC ~~Ventures~~International, ~~L.L.C.~~Inc ~~(“Telcom Ventures”), is the parent company of RF Investors, an entity controlled by Company founders~~ and ~~directors Dr. Rajendra and Neera Singh and~~subsidiaries: members of their family. Prior to the Company’s initial public offering, both the Company’s employees and the employees of Telcom Ventures were eligible to participate in our life, medical, dental and 401(k) plans. In connection with the initial public offering in 1996, we agreed pursuant to an Overhead and Administrative Services Agreement to allow the employees of Telcom Ventures to continue to participate in our employee benefit plans in exchange for full reimbursement of the cash costs and expenses. We billed Telcom Ventures $128,000, $74,000 and $77,000 during the years ended December 31, 2006, 2005, and 2004, respectively, for payments made by us pursuant to this agreement. We received reimbursements from Telcom Ventures of $135,000, $67,000 and $82,000 during the years ended December 31, 2006, 2005, and 2004, respectively. At December 31, 2006 and 2005, outstanding amounts associated with payments made by us under this agreement were $1,000 and $8,000, respectively, and are included as due from related parties and affiliates within the consolidated balance sheets in the accompanying financial statements.

~~During~~We have audited the ~~year~~accompanying ~~ended~~consolidated ~~December 31,~~balance ~~2006~~sheet of LCC International, weInc. ~~provided~~and subsidiaries (the ~~services~~“Company”) toas ~~two~~of ~~customers~~December 31, ~~where~~2006 ~~Telcom~~and ~~Ventures~~the related ~~has~~consolidated astatements ~~minority~~of operations, ~~investment.~~stockholders’ ~~Revenues~~equity ~~earned~~and ~~from~~cash ~~these~~flows ~~customers~~for ~~during~~each of the ~~year~~years in the two-year period ended December 31, 2006 ~~were approximately $66,000~~. ~~Billed~~In ~~and~~connection ~~unbilled~~with ~~receivables~~our audits of ~~approximately~~the ~~$66,000~~consolidated ~~were~~financial ~~outstanding at December 31~~statements, ~~2006,~~we ~~and~~also ~~are~~have ~~included~~audited inthe ~~trade~~financial statement ~~accounts~~schedule ~~receivable~~listed ~~and~~in ~~unbilled~~Item 15(a)(2) ~~receivables~~for ineach of the ~~accompanying~~years in ~~consolidated Balance Sheet. During~~ the two-year period ended December 31, 2006,. weThese consolidated ~~provided~~financial ~~services~~statements toand ~~Telcom~~financial ~~Ventures~~statement ~~directly,~~schedule ~~generating~~are ~~revenues~~the responsibility of ~~approximately~~the ~~$33,000,~~Company’s management. ~~which~~Our responsibility is to express an opinion on these ~~have~~consolidated ~~been~~financial ~~collected~~statements and financial statement schedule based on our audits.

InWe ~~December~~conducted ~~1999,~~our weaudits ~~issued~~in ~~approximately~~accordance ~~108,000 shares~~with the standards of the ~~class A~~Public ~~common~~Company ~~stock~~Accounting inOversight ~~exchange~~Board ~~for~~(United ~~a $1~~States).~~6 million~~ Those ~~note~~standards ~~receivable~~require ~~from~~that ~~our~~we ~~then~~plan ~~President~~ and ~~Chief~~perform ~~Executive~~the audit to obtain ~~Officer.~~reasonable ~~The~~assurance ~~note~~about ~~was~~whether ~~payable~~the onfinancial ~~the~~statements ~~earlier~~are free of ~~December~~material ~~2004~~misstatement. ~~or the~~An ~~date~~audit heincludes ~~was~~examining, noon ~~longer~~a test ~~our~~basis, ~~President~~evidence supporting the amounts and ~~Chief~~disclosures ~~Executive~~in ~~Officer.~~the ~~Interest~~financial ~~accrued~~statements. atAn ~~the~~audit ~~federal~~also ~~mid-term~~includes ~~rate~~assessing on the ~~date~~accounting ofprinciples ~~the~~used ~~note~~ and ~~was~~significant ~~payable~~estimates ~~quarterly.~~made ~~The note, where~~by ~~outstanding~~management, isand ~~reflected~~evaluating asthe aoverall ~~reduction~~financial ~~of shareholders’~~statement ~~equity~~presentation. inWe ~~the~~believe ~~accompanying~~that ~~statement~~our ofaudit ~~shareholders’~~provides a reasonable ~~equity.~~basis ~~The~~for ~~note~~our ~~was deemed~~opinion.

In our opinion, the financial statements referred to above 41present fairly, in all material respects, the financial position of LCC International, Inc. and subsidiaries as of December 31, 2006 and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2006 in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

~~Table~~ /s/ ofKPMG ~~Contents~~LLP

~~discharged in 2004. On December 10~~McLean, ~~2004, we entered into~~Virginia an agreement with our former President and Chief Executive Officer, pursuant to which we purchased certain shares that were held in our company and returned these shares to our treasury account, where they are available for reissue. The proceeds from the sale of these shares, of approximately $0.9 million, were used to reduce the indebtedness under the loan agreement, and we deemed the balance of the loan, approximately $0.7 million, to have been paid in full. This represented non-cash compensation to our former President and Chief Executive Officer. We also paid cash compensation in the form of a bonus of approximately $0.5 million to assist in covering the personal income tax obligations resulting from this agreement. The total of the non-cash compensation of $0.7 million and the cash compensation of $0.5 million is included in operating expenses for the year ended December 31, 2004. As part of this agreement, our former President and Chief Executive Officer surrendered 825,000 vested options to purchase shares of our class A common stock; 500,000, 150,000, 150,000 and 25,000 options at $13.56, $12.25, $5.00 and $5.55 per share, respectively.

~~Subsequent~~December 11, 2007 ~~Events~~

~~In March 2007, we purchased the equity interests in the Europe,~~ ~~Middle East and Africa business of WFI and in June 2007 we~~48 ~~acquired certain assets and liabilities of WFI’s U.S. wireless engineering services business. See Note 21. Subsequent Events, in the consolidated financial statements.~~

~~As discussed more fully in Note 21. Subsequent~~LCC ~~Events~~INTERNATIONAL, inINC. ~~the~~AND ~~consolidated financial statements,~~SUBSIDIARIES ~~proceedings are pending before the NASDAQ Listing and Hearing Review Council with respect to a potential delisting of our class A common stock.~~

~~Recent Accounting~~CONSOLIDATED ~~Pronouncements~~STATEMENTS OF OPERATIONS

InYears ~~February~~ended ~~2007, the FASB issued SFAS~~December ~~No. 159~~31, ~~“The~~ Fair Value Option for Financial Assets and Financial liabilities — Including an Amendment of Statement of Financial Accounting Standards No. 115” (“SFAS No. 159”) SFAS No. 159 permits companies to choose to measure2007, on2006 ~~an instrument-by-instrument basis, financial instruments~~ and ~~certain other items at fair~~2005 value that are not currently required to be measured at fair value. Unrealized gains and losses on items for which the fair value option is elected will be recognized in earnings at each subsequent reporting date SFAS No. 159 is effective as of the beginning of fiscal 2009 (January 1, 2009). The application of SFAS No. 159 is not expected to have a material effect on our consolidated position, results of operations or cash flows.

(In ~~September 2006~~thousands, ~~the~~except ~~FASB~~per ~~issued SFAS No. 158,“Employers~~share ~~Accounting for Defined Benefit Pension and other Postretirement Plans — an amendment of Statement of Financial Accounting Standards No. 87, 88,106 and 132R” (“SFAS No. 158”~~data)~~. SFAS No. 158~~ requires an employer that is a business entity and sponsors one or more single-employer defined benefit plans to recognize the funded status of a benefit plan, measured as the difference between plan assets at fair value (with limited exceptions) and the benefit obligation, in its statement of financial position. For a pension plan, the benefit obligation is the projected benefit obligation; for any other postretirement benefit plan, such as a retiree health care plan, the benefit obligation is the accumulated postretirement benefit obligation. SFAS No. 158 is effective for fiscal years ending after December 15, 2006. Because we do not currently maintain any defined benefit plans, the application of SFAS No. 158 did not have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

In September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 157, Fair Value Measurements, (“SFAS No. 157”) which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. SFAS No. 157 does not require any new fair value measurements but rather eliminates inconsistencies in guidance found in various prior accounting pronouncements. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. We are still evaluating the impact of SFAS No. 157 on our consolidated financial statements, but do not believe the adoption of SFAS No. 157 will have a material impact on our consolidated financial position, results of operations or cash flows.


	2007			2006			2005

REVENUES	$	145,723		$	129,953		$	145,642
COST OF REVENUES (exclusive of depreciation shown separately below)		120,071			97,194			114,214

GROSS PROFIT		25,652			32,759			31,428

OPERATING EXPENSES:
Sales and marketing		15,086			7,910			8,131
General and administrative		24,215			26,699			27,893
Restructuring charge (Note 10)		1,107			108			404
Depreciation and amortization		4,224			2,378			2,793

Total operating expenses		44,632			37,095			39,221

OPERATING LOSS		(18,980	)		(4,336	)		(7,793	)

OTHER INCOME (EXPENSE):
Interest income		95			134			114
Interest expense		(3,602	)		(864	)		(315	)
Other		(4,811	)		1,763			(883	)

Total other income (expense)		(8,318	)		1,033			(1,084	)

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(27,298	)		(3,303	)		(8,877	)
PROVISION FOR INCOME TAXES (Note 11)		1,387			1,576			2,717

LOSS FROM CONTINUING OPERATIONS		(28,685	)		(4,879	)		(11,594	)

DISCONTINUED OPERATIONS (Note 5):
Income (loss) from discontinued operations (net of applicable taxes of zero)		(520	)		(3,529	)		(933	)
Gain (loss) on disposal of discontinued operations (net of applicable taxes of zero)		(1,550	)		378			—

INCOME (LOSS) FROM DISCONTINUED OPERATIONS		(2,070	)		(3,151	)		(933	)

NET LOSS		(30,755	)		(8,030	)		(12,527	)
Preferred stock dividend		12			—			—

NET LOSS APPLICABLE TO COMMON STOCK	$	(30,767	)	$	(8,030	)	$	(12,527	)

NET LOSS PER SHARE (Note 15):
Continuing operations
Basic and diluted	$	(0.97	)	$	(0.20	)	$	(0.47	)

Discontinued operations
Basic and diluted	$	(0.07	)	$	(0.13	)	$	(0.04	)

Net loss per share
Basic and diluted	$	(1.04	)	$	(0.33	)	$	(0.51	)

WEIGHTED AVERAGE SHARES USED IN CALCULATION OF NET LOSS PER SHARE:
Basic and diluted		29,657			24,893			24,524

See accompanying notes to consolidated financial statements. 42

~~Table of Contents~~ 49

~~In September 2006, the SEC released Staff Accounting~~ ~~Bulletin No. 108, Considering the Effects of Prior~~LCC Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”). SAB 108 provides guidance on the SEC’s views regarding quantifying the materiality of financial statement misstatementsINTERNATIONAL, ~~including misstatements that were not material to prior years’ financial statements~~INC. ~~The~~AND ~~interpretations in~~SUBSIDIARIES SAB 108 are being issued to address diversity in practice in quantifying financial statement misstatements and the potential under current practice for the build up of improper amounts on the balance sheet. SAB 108 requires registrants to quantify misstatements using both a balance sheet approach and an income statement approach and evaluate whether either approach results in quantifying a misstatement that, when all relevant quantitative and qualitative factors are considered, is material. Upon initial application, SAB 108 permits a one-time cumulative effect adjustment to beginning retained earnings. The adoption of SAB 108 did not have any impact on our consolidated financial position, results of operations or cash flows.

InCONSOLIDATED ~~July~~BALANCE ~~2006, the FASB issued FASB Interpretation No. 48~~SHEETS (“FIN 48”), Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109, which clarifies the accounting for uncertainty in tax positions. FIN 48 requires that we recognize the impact of a tax position in our financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The provisions of FIN 48 are effective as of the beginning of the Company’s 2007 fiscal year, with the cumulative effect of the change in accounting principle recorded as an adjustment to opening retained earnings. The adoption of FIN 48 is not expected to have a material impact on our consolidated financial position, results of operations or cash flows.

~~Item~~ (In ~~7A.~~thousands, ~~Quantitative~~except ~~and~~per ~~Qualitative~~share ~~Disclosures about Market Risk~~data)

We are exposed to the impact of foreign currency fluctuations. The exposure to exchange rates relates primarily to our foreign subsidiaries. Subsidiaries with material foreign currency exposure are in the U.K., Algeria and Italy. For our foreign subsidiaries, exchange rates can have an impact on the U.S. Dollar value of their reported earnings and the intercompany transactions with the subsidiaries.


	December 31,
	2007		2006

ASSETS:
Current assets:
Cash and cash equivalents	$	9,630	$	6,445
Restricted cash		220		883
Receivables, net of allowance for doubtful accounts of $279 and $200 at December 31, 2007 and 2006, respectively
Trade accounts receivable (Note 6)		43,943		34,755
Unbilled receivables (Note 6)		21,979		24,807
Due from related parties and affiliates (Note 17)		32		3
Due from disposal of business (Note 5)		1,800		7,610
Deferred income taxes (Note 11)		—		118
Prepaid expenses and other current assets		4,100		3,798
Prepaid tax receivable and prepaid taxes		13		356
Assets held for sale		269		587

Total current assets		81,986		79,362
Property and equipment, net (Note 7)		5,949		2,779
Deferred income taxes, net (Note 11)		1,952		1,453
Goodwill (Note 8)		44,080		13,989
Other intangibles, net		15,875		293

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