Exhibit 10.17

(CRICKET LOGO) [a09135a0913500.gif]

2005 Cricket Non-Sales Bonus Plan

 

SECTION 1 – ESTABLISHMENT AND OBJECTIVE

1.1  Establishment of Plan

Cricket Communications, Inc., together with its parent and their wholly owned
subsidiaries are hereafter referred to as the “Company”. The Company hereby
establishes a Cricket Team Bonus Plan (the “Plan”), for qualified employees of
the Company (as defined in section 3 below).

1.2  Objective of the Plan

The objective of the Plan is to attract, motivate and retain employees who can,
through their collective and individual efforts; help the Company achieve its
2005 business goals. The Plan is intended to share the success of the Company
with eligible employees to the extent that the Company’s performance and an
employee’s individual performance warrant, and to provide compensation for
eligible employees which is competitive in a manner consistent with the
Company’s philosophy of paying for performance.

SECTION 2 – DEFINITIONS

Active Employee is defined as any employee who is performing the regular duties
of his/her assigned work on a full-time or part-time basis

Annual Base Salary Rate
Full-time employees
(i) In the case of a salaried employee, his/her Annual Base Salary rate, or
(ii) in the case of a full time non-exempt employee his/her hourly rate of pay
multiplied by 2080 hours, in each case, prorated to reflect any salary/hourly
rate changes received during the plan year.
Part time employees
The hourly rate of pay multiplied by the number of hours projected to be worked
in one year, prorated to reflect any salary/hourly rate changes received during
the plan year.

Bonus Target Percentage is established for each eligible participant based on
the participant’s grade in the compensation structure, and is described as a
percentage of an employee’s Annual Base Salary Rate.

Performance Metric Results are the results of the Company, Region, or Market for
a particular plan year. The Performance Metric Results are measured against the
year to date budget for the current Plan year/quarter, which are set forth in
the Attachments to the Plan. Goals are set by the Chief Executive Officer and
approved by the Board of Directors and/or Compensation Committee of Leap
Wireless International, Inc.

Page 1 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

Target Bonus is the employee’s Annual Base Salary Rate multiplied by the Bonus
Target Percentage for the employee’s position.

SECTION 3 – ELIGIBILITY

3.1  Eligibility

All regular employees working twenty (20) hours per week or more shall be
eligible to be covered by the Plan. Employees working less than thirty-five
(35) hours but at least twenty (20) hours per week will be eligible for 50% of
the target bonus. Employees working thirty-five (35) hours or more per week will
be eligible for 100% of the target bonus. A participant who joins the Company or
otherwise becomes eligible to participate in the Plan during the year will have
any bonus award under this Plan prorated from the date of first eligibility in
which he/she becomes a participant.

Except as provided in Section 4.2, an employee must be an active employee of the
Company or one of its wholly owned subsidiaries on the day the bonus payment is
made to receive a payment under the plan.

Employees on Performance Improvement Plans and/or a Leave of Absence will be
ineligible to participate in the bonus plan for the period of time while on the
Performance Improvement Plan and/or Leave of Absence. Payments will be
reduced/prorated for periods on a Performance Improvement Plan and/or Leave of
Absence.

Employees who change positions during the plan year will receive payments
prorated for the time and applicable bonus targets for each position.

No participant in the Cricket Communications Sales Bonus Plan may participate in
this Plan, except to the extent that the participant participates in two plans
as a result of a change in position during a Plan year.

SECTION 4 – PAYMENT OF BONUSES

4.1  Calculation of Bonuses

Bonus awards for each quarter can range from 0% to 100% of the participant’s
Target Bonus (prorated for the period covered) and the bonus award for the
entire year can range from 0% to 200% of a participant’s Target Bonus. Bonus
Awards to be paid pursuant to the Plan will be calculated based on three main
components: Annual Base Salary, Bonus Target Percentage, and Performance Metric
Results:

  •   Bonus payments for employees at or below the VP level will occur on a
quarterly basis on the third payroll following the end of the quarter. Bonus
payments for employees at or above the SVP level will occur on a semi-annual
basis, on the third payroll following the end of the second and fourth quarter.

Page 2 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

  •   The plan is a cumulative year-to-date (YTD) plan, which will pay eligible
employees a quarterly (or semi-annual) bonus award if the Company has achieved
the stated business and/or financial objectives. The bonus awards will be
calculated based on YTD Company, Region, Area or Market performance, as
applicable, less any previously paid quarterly bonuses.     •   Bonus awards for
the first three quarters will be capped at 100% of the Target Bonus (prorated
for the period covered). The fourth quarter award will be capped at 200% of the
Target Bonus.     •   Minimum performance against each of the performance
metrics is required for any bonus award to be paid out. The payout levels
associated with various levels of performance can be found in the Attachments to
the Plan.     •   Any employee who changes positions or locations during the
plan year which would result in a bonus calculation which is prorated for the
positions or locations, shall have the metrics associated with any prior
positions “frozen” for the quarter to date in which the change occurred. Those
metrics would not be updated to reflect any metric changes subsequent to the
quarter the employee left the position or location.

The Performance Metric Results on which each Participant’s bonus award is based
are set forth in the Attachments to the Plan and are determined by the Chief
Executive Officer. If the combined minimum performance metrics do not meet or
exceed the minimum threshold for any bonus calculation period, under no
circumstances will employees be required to repay previously paid bonus awards,
except to correct an error as described by section 4.3.

For Directors and Above: Bonuses for participants who are in a Director level or
above position will be determined based on two components: 75% Performance
Metric results and 25% based on the achievement of the participant’s individual
objectives. Objectives should be established early in the performance year and
measured by two levels of supervision.

The bonus associated with the achievement of the participant’s individual
objectives will be payable as part of each quarter’s bonus award and can range
from 0% to 100% for the first 3 quarters, and up to 200% for the full year,
based on the scale found in the Attachments to the plan. (i.e., prorated for the
period covered, the individual component may be calculated at 0% to 25% of the
Target Bonus for each quarter and from 0% to 50% of the Target Bonus for the
full plan year)

4.2  Payment of Bonuses

The employee’s bonus, as calculated under subsection 4.1, shall be earned by and
paid to the employee only if he/she is an active employee on the payroll on the
date the bonus payment is made. If an employee is on a Leave of Absence on the
day the payment is made, the employee will be paid a prorated bonus upon his or
her return from the Leave of Absence. If an employee dies or becomes disabled
during the plan year, he/she or his/her estate, personal representative or
beneficiary shall be paid a prorated bonus which represents the days of active
employment during the plan year.

The Company will withhold, or require the withholding from any payment, any
federal, state, or local taxes required by law to be withheld with respect to
such payment.

Page 3 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

No payments will occur from this plan if the minimum performance against
measures has not been achieved. Performance measures will be established each
year by the Chief Executive Officer with approval by the Board of Directors
and/or Compensation Committee of Leap Wireless International.

Page 4 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

4.3  Correction of Errors

The Company reserves the right to recalculate and correct any bonus awards that
were made based on any clerical or administrative errors. This includes, but is
not limited to, changes to performance metrics, dates in position, dates on PIPs
or LOA’s, changes in bonus targets or salaries, etc. Any bonus award that was
overpaid in error must be repaid by the employee within 30 days of notification
of the error.

4.4  401(k) Plan

An employee’s bonus is not considered eligible compensation for purposes of
employee contributions or employer matching contributions to the employees’
401(k) Plan.

SECTION 5 – GENERAL PROVISIONS

5.1  Administration

The Chief Executive Officer, Sr. Vice President Human Resources, and the
Director, Compensation and Benefits responsible for compensation systems (the
“Committee”) shall administer this Plan for the Company. The Committee shall
have the authority to delegate responsibility for performance of administrative
functions necessary for administration of the plan.

The interpretation of any provisions of the Plan by the Chief Executive Officer
shall be final unless otherwise determined by the Board of Directors and/or the
Compensation Committee of the Company. The Chief Executive Officer is authorized
to interpret the Plan, to prescribe, amend and rescind rules and regulations
relating to it, and to make all other determinations necessary for its
administration. The Plan is intended to be reviewed and approved by the Chief
Executive Officer not less often than semi-annually and may be amended or
terminated at any time in the Chief Executive Officer’s sole discretion.

The Chief Executive Officer shall have the authority to establish performance
criteria and calculate bonus award amounts.

Bonuses for all participants must be reviewed and approved by the Chief
Executive Officer. As unpredictable windfalls and shortfalls can result in
rewarding or penalizing a participant for developments unrelated to his or her
own efforts, the Chief Executive Officer reserves the right to make adjustments
when, in the Chief Executive Officer’s opinion, inequities may result. It also
remains the Chief Executive Officer’s prerogative, in the Chief Executive
Officer’s sole discretion, to refrain from paying bonuses to participants who
may attain the payment criteria specified in this Plan but who have otherwise
failed to perform satisfactorily or manage in a correct and efficient manner in
accordance with the known or published policies and procedures of the Company.
In addition, the Chief Executive Officer may adjust bonuses otherwise payable
under the plan to the extent he or she determines that the financial results or
position of the Company make it prudent, in the Chief Executive Officer’s sole
discretion, to make such adjustments.

Page 5 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

5.2  Employment Rights

The establishment of this Plan shall not confer legal rights upon any employee
for the continuation of employment, nor shall it interfere with the rights of
the Company to discharge any person and/or treat him/her without regard to the
effect that such treatment might have upon him/her under this Plan. All
employees covered by this Plan remain “at will” employees, unless otherwise
expressly agreed in writing in a separate contract.

5.3  Applicable Laws

The Plan shall be governed by and construed according to the laws of the State
of California.

Page 6 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

ATTACHMENTS TO THE PLAN

     Attachment I – Calculation of Bonus Payment to Business Unit Level
Performance by Participant

                                                                            Tied
to                       Tied to           Employee     Functional Area or    
Level     Total     Tied to     Tied to     Tied to     Indiv     Total    
Group     Position           Company     Region     Area     Market     Results
    Bonus      
Corporate Employees
    < Director     100%                             100%    
Corporate Employees
    Director +     75%                       25%     100%      
Regional Employees
                                             
 
    Field IT     < Director     50%     50%                       100%    
 
    Field HR     < Director     50%     50%                       100%    
 
    Field Finance     < Director     50%     50%                       100%    
 
    Tech Ops-Region     < Director     50%     50%                       100%  
 
 
    Tech Ops-Market     < Director     50%     50%                       100%  
 
 
    Reg’l G&A     < Director     50%     50%                       100%    
 
    Reg’l Marketing Mgrs     < Director     50%     50%                      
100%    
 
    Reg’l COM’s     < Director     50%     50%                       100%    
 
    Field HR     Director +     37.5%     37.5%                 25%     100%    
 
    Field Finance     Director +     37.5%     37.5%                 25%    
100%    
 
    Tech Ops (All)     Director +     37.5%     37.5%                 25%    
100%    
 
    Reg’l Sales Directors     Director +     37.5%     37.5%                 25%
    100%      
Area Employees
                                             
 
    AGM     Director +     37.5%           37.5%           25%     100%    
 
    Area COM’s     < Director     50%           50%                 100%    
 
    Admin Assist to AGM     < Director     50%           50%                
100%    
 
    Receptionist     < Director     50%           50%                 100%      
Market Employees
                                             
 
    Market GM’s     Director +     37.5%                 37.5%     25%     100%
   
 
    Market Mgrs     < Director     50%                 50%           100%    
 
    Market COM’s     < Director     50%                 50%           100%    
 
    Marketing Mgrs     < Director     50%                 50%           100%    
 
    Admin Assistants     < Director     50%                 50%           100%  
 
 
    Customer Svc Assist     < Director     50%                 50%          
100%    
 
    Analyst Project     < Director     50%                 50%           100%  
 

* Market refers to the specific Market where an employee works.
** Area refers to the combined Markets assigned to an Area General Manager.
*** Participants, positions listed are for example purposes only, not intended
to include all non-sales positions.

Page 7 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

Attachment II – Weighting & Definition of Performance Metrics

                                Metric     Measurement     Weighting    
Definition    
EBITDA
    YTD v. Plan     50%     Earnings before Interest, Tax, Depreciation and
Amortization, adjusted to exclude the effects of: reorganization items; other
income (expense); gains on sale of wireless licenses; impairment of intangible
or long-lived assets and related charges; and stock-based compensation awards.
This measure is generally used to approximate the cash generated by operations
(before capital expenditures).    
Net Adds
    YTD v. Plan     50%     Net growth in the customer base; equals gross
additions minus First Bill Non Pays (FBNP) minus net deactivations    
Total
          100%          

Attachment III – Payout Scale for Individual Performance Component at Various
Levels of Attainment

              Quarter End Rating     % Payout     Top Performer     200%    
Outstanding Performer     150%     Successful Performer     100%     Needs
Improvement     0    

* Please note that any payments for Q1, Q2 or Q3 are capped at 100% payout. The
amounts noted for payout above 100% are available only at the end of the fourth
quarter, up to the maximum of 200%.

Page 8 of 9

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

 

2005 Leap Non-Sales Bonus Plan

 

Attachment IV – Payout Scale for Performance Metrics at Various Levels of
Attainment

                                                  EBITDA (50%) Total Company
Region Area Market   YTD           YTD           YTD           YTD          
Achievement     % Payout     Achievement     % Payout     Achievement     %
Payout     Achievement     % Payout     Level % *     **     Level % *     **  
  Level % *     **     Level % *     **     <92.45%     0%     <90.57%     0%  
  <84.91%     0%     <80.19%     0%     92.45%     50%     90.57%     50%    
84.91%     50%     80.19%     50%     96.23%     100%     96.23%     100%    
96.23%     100%     96.23%     100%     100.00%     125%     100.00%     125%  
  100.00%     125%     100.00%     125%     111.32%     200%     113.21%    
200%     118.87%     200%     123.58%     200%    

                                                  Net Adds (50%) Total Company
Region Area Market   YTD           YTD           YTD           YTD          
Achievement     % Payout     Achievement     % Payout     Achievement     %
Payout     Achievement     % Payout     Level % *     **     Level % *     **  
  Level % *     **     Level % *     **     <70.00%     0%     <70.00%     0%  
  <66.88%     0%     <63.75%     0%     70.00%     50%     70.00%     50%    
66.88%     50%     63.75%     50%     82.50%     100%     82.50%     100%    
82.50%     100%     82.50%     100%     100.00%     125%     100.00%     125%  
  100.00%     125%     100.00%     125%     150.00%     200%     150.00%    
200%     153.13%     200%     156.25%     200%    

* Please note that any payments for Q1, Q2 or Q3 are capped at 100% payout. The
amounts noted for payout above 100% are available only at the end of the fourth
quarter, up to the maximum of 200%.

** The above payout levels contain only specific points of achievement and %
payouts. Amounts achieved between the specific points noted and the
corresponding bonus award multipliers will be determined by a calculation based
on the known points and payout factors.

Page 9 of 9