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UNITED STATES 
    SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
    20549
      FORM 10-K
      (Mark
    One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2009ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
    THE  SECURITIES EXCHANGE ACT OF 1934For the transition period from
    
    to
    .   Commission file number 0-29752
 LEAP WIRELESS INTERNATIONAL,
    INC.
 (Exact Name of Registrant as
    Specified in its Charter)
  Delaware

33-0811062(State or Other Jurisdiction of
    Incorporation or Organization)

(I.R.S. Employer Identification
    No.)5887 Copley Drive, San Diego, CA

92111(Address of Principal Executive
    Offices)

(Zip Code)   (858) 882-6000
 (Registrants telephone
    number, including area code)
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $.0001 par value

The NASDAQ Stock Market, LLC   Securities registered pursuant to Section 12(g) of the
    Act:
 None.
  þ o
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  þ o
 o o
  Rule 12b-2 o þ
    þ o




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##### 





LEAP
    WIRELESS INTERNATIONAL, INC.
    ANNUAL REPORT ON
    FORM 10-K
    For the Year Ended December 31, 2009
    TABLE OF CONTENTS
  PagePART IItem 1.


Business

1Item 1A.


Risk Factors

21Item 1B.


Unresolved Staff Comments

41Item 2.


Properties

41Item 3.


Legal Proceedings

42Item 4.


Submission of Matters to a Vote of Security
    Holders

45PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities

46Item 6.


Selected Financial Data

47Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations

49Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk

83Item 8.


Financial Statements and Supplementary Data

85Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure

191Item 9A.


Controls and Procedures

191Item 9A(T).


Controls and Procedures

192Item 9B.


Other Information

192PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance

193Item 11.


Executive Compensation

193Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters

193Item 13.


Certain Relationships and Related Transactions,
    and Director Independence

194Item 14.


Principal Accounting Fees and Services

194PART IVItem 15.


Exhibits, Financial Statement Schedules

195EX-3.1EX-3.2EX-4.1EX-10.13.1EX-21EX-23EX-31.1EX-31.2EX-32   i




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PART I    Cautionary
    Statement Regarding Forward-Looking Statements
    
    our ability to attract and retain customers in an extremely
    competitive marketplace;
    the duration and severity of the current economic downturn in
    the United States and changes in economic conditions, including
    interest rates, consumer credit conditions, consumer debt
    levels, consumer confidence, unemployment rates, energy costs
    and other macro-economic factors that could adversely affect
    demand for the services we provide;
    the impact of competitors initiatives;
    our ability to successfully implement product offerings and
    execute effectively on our other strategic activities;
    our ability to obtain roaming services from other carriers at
    cost-effective rates;
    our ability to maintain effective internal control over
    financial reporting;
    our ability to attract, motivate and retain an experienced
    workforce;
    our ability to comply with the covenants in any credit
    agreement, indenture or similar instrument governing any of our
    existing or future indebtedness;
    failure of our network or information technology systems to
    perform according to expectations and risks associated with the
    upgrade of certain of those systems, including our customer
    billing system; and
    other factors detailed in Part I 
    Item 1A. Risk Factors below.    Item 1.
    Business  Overview
  ®
 1




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Cricket
    Business Overview
  Cricket
    Service
    tm
    pay-in-advance
 2




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##### Table of Contents



Cricket
    Business Strategy
  
    Target Growing Market Segments.  Our services
    are targeted primarily toward customers who value unlimited
    wireless services with predictable billing and who use the
    majority of those wireless services from within Cricket service
    areas. On average, our customers tend to be younger and have
    lower incomes than the customers of other wireless carriers.
    Moreover, our customer base also reflects a greater percentage
    of ethnic minorities than those of other carriers. We believe
    these market segments are among the fastest growing population
    segments in the U.S.
    Maintain Industry Leading Cost Structure.  Our
    networks and business model are designed to provide wireless
    services to our customers at a significantly lower cost than
    many of our competitors. We seek to maintain low customer
    acquisition costs through focused sales and marketing
    initiatives and cost-effective distribution strategies. As the
    number of customers using our wireless products and services
    increases, we expect that our fixed costs will continue to be
    spread over a larger customer base.
    Continue to Develop and Evolve Products and
    Services.  We continue to develop and evolve our
    product and service offerings to better meet the needs of our
    target customer segments. For example, during the last three
    years, we introduced our new Cricket Broadband and Cricket PAYGo
    services and added unlimited mobile web access to our product
    portfolio. With the completion of our deployment of
    CDMA2000®

    1xEV-DO, or EvDO, technology across all of our existing and new
    markets, we are able to offer an expanded array of services to
    our customers, including high-demand wireless data services such
    as mobile content and high quality music downloads. We believe
    these and other enhanced data offerings are attractive to many
    of our existing customers and enhance our appeal to new
    data-centric customers. We expect to continue to develop our
    voice and data product and service offerings in 2010 and beyond.
    Continue to Build Our Brand and Strengthen Our
    Distribution.We are focused on building our
    brand awareness in our markets and improving the productivity of
    our distribution system. Since our target customer base is
    diversified geographically, ethnically and demographically, our
    marketing programs are decentralized to support local
    customization and better target our advertising expenses. We are
    continuing to redesign and re-merchandize our stores and we have
    introduced a new sales process aimed at improving our
    customers experience. Our premier dealer program features
    third party retail locations with the look and feel of
    company-owned stores, and we are continuing to enable our
    premier dealers and other indirect dealers to provide greater
    customer support services. In 2009, we began distributing
    Cricket Broadband and daily and monthly pay-as-you-go versions
    of our Cricket PAYGo product through national mass-market
    retailers. 3




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In addition, we have increased our use of sales via the internet
    and telephone, which continue to deliver a growing number of new
    customers. We expect to continue our focus on enhancing the
    customer experience and improving customer satisfaction.  
    Enhance Network Coverage, Capacity and Available Calling
    Area.We continue to enhance our network coverage
    and capacity. As of December 31, 2009, the combined network
    footprint in our operating markets covered approximately 94.2
    million POPs. In 2009, we and Denali Operations launched new
    markets in Chicago, Philadelphia, Washington, D.C., Baltimore
    and Lake Charles covering approximately 24.2 million additional
    POPs. In addition, we have identified new markets covering
    approximately 16 million additional POPs that we could elect to
    build out and launch with Cricket service in the future using
    our wireless licenses, although we have not established a
    timeline for any such build-out or launch. We also continue to
    enhance our network coverage and capacity in many of our
    established markets by deploying additional cell sites, thereby
    allowing us to offer our customers a larger, higher-quality
    local calling area. In addition, we have established strategic
    roaming partnerships with several wireless carriers to provide
    our customers with unlimited usage in areas stretching from New
    York to California and from Wisconsin to Texas. Most
    significantly, through expanded roaming relationships that we
    have recently entered into, effective March 2010 customers
    purchasing our Cricket Wireless and most Cricket PAYGo service
    plans will be able to access a nationwide, extended calling area
    covering 277 million covered POPs.  Cricket
    Business Operations
  Products
    and Services
  Cricket Wireless Service Plans.
  tm
    Cricket Wireless Plan Upgrades. and/or
  Handsets.
 4




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Cricket Broadband Service.
  Cricket PAYGo Service.
  Customer
    Care and Billing
  Customer Care.
  Billing and Support Systems.
    Sales
    and Distribution
  easy-to-understand
   5




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top-up
    www.mycricket.com e-commerce
  Network
    and Operations
       6




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and/or
  Arrangements
    with LCW Wireless
          Line of Credit Agreement. 30-day
 7




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Limited Liability Company Agreement.
    30-day
    Management Agreement. mark-up
  Arrangements
    with Denali
      Limited Liability Company Agreement.
 8




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Senior Secured Credit Agreement. sub-facility sub-facility sub-facility sub-facility
  Management Agreement.
   9




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and/or
  Competition
  voice-over-internet-protocol
    T-Mobile T-Mobile
  and/or
 10




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Chapter 11
    Proceedings Under the Bankruptcy Code
    pay-in-kind pay-in-kind
  Government
    Regulation
   11




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Licensing
    of our Wireless Service Systems
    PCS Licenses.
  and/or
  10-year
  AWS Licenses.
  15-year and/or
   12




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Designated Entities. C-Block F-Block
  de facto
 13




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Foreign Ownership. non-U.S. citizens non-U.S. citizens
  Transfer and Assignment.
  case-by-case
    FCC
    Regulation Generally
  market-by-market
 14




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15




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back-up back-up back-up back-up
        truth-in-billing;
 16




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State,
    Local and Other Regulation
          Privacy
   17




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Intellectual
    Property
      Availability
    of Public Reports
  Form 10-K, Form 10-Q, Form 8-K, www.leapwireless.com www.sec.gov 1-800-SEC-0330.
  Financial
    Information Concerning Segments and Geographical
    Information
    Employees
    Seasonality
    Inflation
   18




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Executive
    Officers of the Registrant
  Name

Age

Position with the CompanyS. Douglas Hutcheson


53


Chief Executive Officer, President and DirectorAlbin F. Moschner


57


Chief Operating OfficerWalter Z. Berger


54


Executive Vice President and Chief Financial OfficerGlenn T. Umetsu


60


Executive Vice President and Chief Technical OfficerWilliam D. Ingram


52


Senior Vice President, StrategyRobert J. Irving, Jr.


54


Senior Vice President, General Counsel and SecretaryJeffrey E. Nachbor


45


Senior Vice President, Financial Operations and Chief Accounting
    OfficerLeonard C. Stephens


53


Senior Vice President, Human Resources   S. Douglas Hutcheson
  Albin F. Moschner
  Walter Z. Berger
  Glenn T. Umetsu
 19




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William D. Ingram
  Robert J. Irving, Jr.
  Jeffrey E. Nachbor
  Leonard C. Stephens 14-year
 20




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Item 1A.
    Risk
    Factors  Risks
    Related to Our Business and Industry
  We Have
    Experienced Net Losses, and We May Not Be Profitable in the
    Future.
    We May
    Not Be Successful in Increasing Our Customer Base Which Would
    Negatively Affect Our Business Plans and Financial
    Outlook.
  quarter-by-quarter
  We Face
    Increasing Competition Which Could Have a Material Adverse
    Effect on Demand for Cricket Service.
  voice-over-internet-protocol
   21




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T-Mobile T-Mobile
  and/or
    General
    Economic Conditions May Adversely Affect Our Business, Financial
    Performance or Ability to Obtain Debt or Equity Financing on
    Reasonable Terms or at All.
     22




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If We
    Experience Low Rates of Customer Acquisition or High Rates of
    Customer Turnover, Our Ability to Become Profitable Will
    Decrease.
    We Have
    Made Significant Investment, and May Continue to Invest, in
    Joint Ventures That We Do Not Control.
   23




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and/or
      We May Be
    Unable to Obtain the Roaming Services We Need From Other
    Carriers to Remain Competitive.
   24




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We
    Restated Certain of Our Prior Consolidated Financial Statements,
    Which Led to Additional Risks and Uncertainties, Including
    Shareholder Litigation.
  Form 10-K,
    Our
    Business and Stock Price May Be Adversely Affected If Our
    Internal Controls Are Not Effective.
   25




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Form 10-K Form 10-K
      Our
    Primary Business Strategy May Not Succeed in the Long
    Term.
    We Expect
    to Incur Higher Operating Expenses in Recently Launched Markets,
    and We Could Incur Substantial Costs if We Were to Elect to
    Build Out Additional New Markets.
     26




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and/or
    If We Are
    Unable to Manage Our Planned Growth, Our Operations Could Be
    Adversely Impacted.
      Our
    Significant Indebtedness Could Adversely Affect Our Financial
    Health and Prevent Us From Fulfilling Our Obligations.
      
    make it more difficult for us to service all of our debt
    obligations;
    increase our vulnerability to general adverse economic and
    industry conditions;
    impair our ability to obtain additional financing in the future
    for working capital needs, capital expenditures, network
    build-out and other activities, including acquisitions and
    general corporate purposes;
    require us to dedicate a substantial portion of our cash flows
    from operations to the payment of principal and interest on our
    indebtedness, thereby reducing the availability of our cash
    flows to fund working capital needs, capital expenditures,
    acquisitions and other general corporate purposes; 27




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
    limit our flexibility in planning for, or reacting to, changes
    in our business and the industry in which we operate; and
    place us at a disadvantage compared to our competitors that have
    less indebtedness.    Despite
    Current Indebtedness Levels, We Are Permitted to Incur
    Additional Indebtedness. This Could Further Increase the Risks
    Associated With Our Leverage.
    and/or
    To
    Service Our Indebtedness and Fund Our Working Capital and
    Capital Expenditures, We Will Require a Significant Amount of
    Cash. Our Ability to Generate Cash Depends on Many Factors
    Beyond Our Control.
    We or Our
    Joint Ventures May Be Unable to Refinance Our
    Indebtedness.
   28




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Covenants
    in Our Indentures and Other Credit Agreements or Indentures That
    We May Enter Into in the Future May Limit Our Ability to Operate
    Our Business.
    
    incur additional indebtedness;
    create liens or other encumbrances;
    place limitations on distributions from restricted subsidiaries;
    pay dividends, make investments, prepay subordinated
    indebtedness or make other restricted payments;
    issue or sell capital stock of restricted subsidiaries;
    issue guarantees;
    sell or otherwise dispose of all or substantially all of our
    assets;
    enter into transactions with affiliates; and
    make acquisitions or merge or consolidate with another entity.      Form 10-Q
  Our
    Ability to Use Net Operating Loss Carryforwards to Reduce Future
    Tax Payments Could be Negatively Impacted if There is an
    Ownership Change as Defined Under Section 382
    of the Internal Revenue Code.
  20-year
   29




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A
    Significant Portion of Our Assets Consists of Goodwill and
    Intangible Assets.
    The
    Wireless Industry is Experiencing Rapid Technological Change,
    Which May Require Us to Significantly Increase Capital
    Investment, and We May Lose Customers If We Fail to Keep Up With
    These Changes.
       30




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The Loss
    of Key Personnel and Difficulty Attracting and Retaining
    Qualified Personnel Could Harm Our Business.
      Risks
    Associated With Wireless Handsets Could Pose Product Liability,
    Health and Safety Risks That Could Adversely Affect Our
    Business.
         31




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We Rely
    Heavily on Third Parties to Provide Specialized Services; a
    Failure by Such Parties to Provide the Agreed Upon Products or
    Services Could Materially Adversely Affect Our Business, Results
    of Operations and Financial Condition.
    System
    Failures, Security Breaches, Business Disruptions and
    Unauthorized Use or Interference with our Network or other
    Systems Could Result in Higher Churn, Reduced Revenue and
    Increased Costs, and Could Harm Our Reputation.
    We Are in the Process of Upgrading a Number of Significant
    Business Systems, including our Customer Billing System, and Any
    Unanticipated Difficulties, Delays or Interruptions with the
    Transition Could Negatively Impact Our Business.
   32




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We May
    Not Be Successful in Protecting and Enforcing Our Intellectual
    Property Rights.
        We and
    Our Suppliers May Be Subject to Claims of Infringement Regarding
    Telecommunications Technologies That Are Protected By Patents
    and Other Intellectual Property Rights.
     33




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Action by
    Congress or Government Agencies May Increase Our Costs of
    Providing Service or Require Us to Change Our
    Services.
       34




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non-U.S. citizens non-U.S. citizens
  truth-in-billing;
    If Call
    Volume or Wireless Broadband Usage Exceeds Our Expectations, Our
    Costs of Providing Service Could Increase, Which Could Have a
    Material Adverse Effect on Our Operating Expenses.
     35




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We May Be
    Unable to Acquire Additional Spectrum in the Future at a
    Reasonable Cost or on a Timely Basis.
    Our
    Wireless Licenses are Subject to Renewal and May Be Revoked in
    the Event that We Violate Applicable Laws.
  10-year 15-year
  Future
    Declines in the Fair Value of Our Wireless Licenses Could Result
    in Future Impairment Charges.
   36




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
    consolidation in the wireless industry allows or requires
    carriers to sell significant portions of their wireless spectrum
    holdings;
    a sudden large sale of spectrum by one or more wireless
    providers occurs; or
    market prices decline as a result of the sale prices in FCC
    auctions.      Declines
    in Our Operating or Financial Performance Could Result in an
    Impairment of Our Indefinite-Lived Assets, Including
    Goodwill.
  and/or
  We May
    Incur Higher Than Anticipated Intercarrier Compensation
    Costs.
   37




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If We
    Experience High Rates of Credit Card, Subscription or Dealer
    Fraud, Our Ability to Generate Cash Flow Will
    Decrease.
    Risks
    Related to Ownership of Leap Common Stock
  Our Stock
    Price May Be Volatile, and You May Lose All or Some of Your
    Investment.
    
    variations in our operating results or those of our competitors;
    announcements of technological innovations, new services or
    service enhancements, strategic alliances or significant
    agreements by us or by our competitors;
    entry of new competitors into our markets, changes in product
    and service offerings by us or our competitors, or changes in
    the prices charged for product and service offerings by us or
    our competitors;
    significant developments with respect to intellectual property,
    securities or related litigation;
    announcements of and bidding in auctions for new spectrum;
    recruitment or departure of key personnel;
    changes in the estimates of our operating results or changes in
    recommendations by any securities analysts that elect to follow
    Leap common stock; 38




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
    any default under any of the indentures governing our secured or
    unsecured senior notes or convertible senior notes because of a
    covenant breach or otherwise;
    rumors or speculation in the marketplace regarding acquisitions
    or consolidation in our industry, including regarding
    transactions involving Leap; and
    market conditions in our industry and the economy as a whole.    We Could
    Elect to Raise Additional Equity Capital Which Could Dilute
    Existing Stockholders.
  and/or
  Your
    Ownership Interest in Leap Will Be Diluted Upon Issuance of
    Shares We Have Reserved for Future Issuances, and Future
    Issuances or Sales of Such Shares May Adversely Affect the
    Market Price of Leap Common Stock.
     39




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Our
    Directors and Affiliated Entities Have Substantial Influence
    over Our Affairs, and Our Ownership Is Highly Concentrated.
    Sales of a Significant Number of Shares by Large Stockholders
    May Adversely Affect the Market Price of Leap Common
    Stock.
     40




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Provisions
    in Our Amended and Restated Certificate of Incorporation and
    Bylaws, under Delaware Law, or in Our Indentures Might
    Discourage, Delay or Prevent a Change in Control of Our Company
    or Changes in Our Management and, Therefore, Depress the Trading
    Price of Leap Common Stock.
    
    require super-majority voting to amend some provisions in our
    amended and restated certificate of incorporation and bylaws;
    authorize the issuance of blank check preferred
    stock that our board of directors could issue to increase the
    number of outstanding shares to discourage a takeover attempt;
    prohibit stockholder action by written consent, and require that
    all stockholder actions be taken at a meeting of our
    stockholders;
    provide that the board of directors is expressly authorized to
    make, alter or repeal our bylaws; and
    establish advance notice requirements for nominations for
    elections to our board or for proposing matters that can be
    acted upon by stockholders at stockholder meetings.      Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties       41




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Item 3.
    Legal
    Proceedings      and/or
  Patent
    Litigation
  Freedom
    Wireless
  ® tm
  DNT
  and/or
 42




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Digital
    Technology Licensing
  and/or ® and/or and/or
  On The
    Go
    DownUnder
    Wireless
    American
    Wireless Group
     43




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and/or
  and/or
  Securities
    and Derivative Litigation
    and/or
  Rule 10b-5, class-wide
 44




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Department
    of Justice Inquiry
    Other
    Litigation
    Item 4.
    Submission
    of Matters to a Vote of Security Holders   45




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PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market
    Price of and Dividends on the Registrants Common Equity
    and Related Stockholder Matters
      High($)


Low($)Calendar Year  2008First Quarter


49.76



36.24Second Quarter


61.09



43.17Third Quarter


48.85



35.73Fourth Quarter


39.16



15.46Calendar Year  2009First Quarter


38.49



23.27Second Quarter


41.05



30.87Third Quarter


30.55



15.85Fourth Quarter


18.13



12.25     Dividends
   46




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Item 6.
    Selected
    Financial Data (in thousands, except per share
    data)    Year Ended December 31,2009


2008


2007


2006


2005Statement of Operations Data:Revenues

$
2,383,162


$
1,958,862


$
1,630,803


$
1,167,187


$
957,771Operating income


31,124



46,700



60,262



23,725



71,002Income (loss) before income taxes and cumulative effect of
    change in accounting principle


(197,354
)


(104,411
)


(40,521
)


(17,635
)


52,300Income tax expense


(40,609
)


(38,970
)


(35,924
)


(8,469
)


(21,615
)Income (loss) before cumulative effect of change in accounting
    principle


(237,963
)


(143,381
)


(76,445
)


(26,104
)


30,685Cumulative effect of change in accounting principle














623



Net income (loss)


(237,963
)


(143,381
)


(76,445
)


(25,481
)


30,685Accretion of redeemable noncontrolling interests, net of tax


(1,529
)


(6,820
)


(3,854
)


(1,321
)


Net income (loss) attributable to common stockholders

$
(239,492
)

$
(150,201
)

$
(80,299
)

$
(26,802
)

$
30,685Basic earnings (loss) per share attributable to common
    stockholders:Income (loss) before cumulative effect of change in accounting
    principle

$
(3.30
)

$
(2.21
)

$
(1.20
)

$
(0.44
)

$
0.51Cumulative effect of change in accounting principle














0.01



Basic earnings (loss) per share(1)

$
(3.30
)

$
(2.21
)

$
(1.20
)

$
(0.43
)

$
0.51Diluted earnings (loss) per share attributable to common
    stockholders:Income (loss) before cumulative effect of change in accounting
    principle

$
(3.30
)

$
(2.21
)

$
(1.20
)

$
(0.44
)

$
0.50Cumulative effect of change in accounting principle














0.01



Diluted earnings (loss) per share(1)

$
(3.30
)

$
(2.21
)

$
(1.20
)

$
(0.43
)

$
0.50Shares used in per share calculations:(1)Basic


72,515



68,021



67,100



61,645



60,135Diluted


72,515



68,021



67,100



61,645



61,003   47




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##### Table of Contents



As of December 31,2009


2008


2007


2006


2005Balance Sheet Data:Cash and cash equivalents

$
174,999


$
357,708


$
433,337


$
372,812


$
293,073Short-term investments


389,154



238,143



179,233



66,400



90,981Working capital


272,974



278,576



380,384



185,191



245,366Restricted cash, cash equivalents and short-term investments


3,866



4,780



15,550



13,581



13,759Total assets


5,371,721



5,052,857



4,432,998



4,084,947



2,499,946Capital leases


12,285



13,993



53,283



16,459



17,243Long-term debt


2,735,318



2,566,025



2,033,902



1,676,500



588,333Total stockholders equity


1,690,530



1,612,676



1,717,505



1,769,348



1,517,601     (1)
    
    Refer to Notes 2 and 5 to the consolidated financial
    statements included in Item 8. Financial Statements
    and Supplementary Data of this report for an explanation
    of the calculation of basic and diluted earnings (loss) per
    share. 48




---



##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Overview
  Company
    Overview
           49




---



##### Table of Contents



voice-over-internet-protocol
    end-of-period
   50




---



##### Table of Contents



Critical
    Accounting Policies and Estimates
      Principles
    of Consolidation
    Revenues
  month-to-month
     51




---



##### Table of Contents



and/or
    E-911
  Fair
    Value of Financial Instruments
     52




---



##### Table of Contents



Depreciation
    and Amortization
    DepreciableLifeNetwork equipment:Switches


10Switch power equipment


15Cell site equipment and site improvements


7Towers


15Antennae


5Computer hardware and software


3-5Furniture, fixtures, retail and office equipment


3-7   Wireless
    Licenses
    and/or
  Goodwill
    and Other Intangible Assets
   53




---



##### Table of Contents



Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
    Wireless
    Licenses
       54




---



##### Table of Contents



Goodwill
       55




---



##### Table of Contents



Share-Based
    Compensation
         56




---



##### Table of Contents



Income
    Taxes
    20-year
             57




---



##### Table of Contents



Subscriber
    Recognition and Disconnect Policies
  Pay-in-advance
   58




---



##### Table of Contents



Results
    of Operations
  Operating
    Items
    Year Ended


% of 2009


Year Ended


% of 2008


Change fromDecember 31,


Service


December 31,


Service


Prior Year2009


Revenues


2008


Revenues


Dollars


PercentRevenues:Service revenues

$
2,143,829






$
1,709,101






$
434,728



25.4
%Equipment revenues


239,333







249,761







(10,428
)


(4.2
)%Total revenues


2,383,162







1,958,862







424,300



21.7
%Operating expenses:Cost of service (exclusive of items shown separately below)


609,006



28.4
%


488,298



28.6
%


120,708



24.7
%Cost of equipment


561,262



26.2
%


465,422



27.2
%


95,840



20.6
%Selling and marketing


411,564



19.2
%


294,917



17.3
%


116,647



39.6
%General and administrative


358,452



16.7
%


331,691



19.4
%


26,761



8.1
%Depreciation and amortization


410,697



19.2
%


331,448



19.4
%


79,249



23.9
%Impairment of assets


639



0.0
%


177



0.0
%


462



261.0
%Total operating expenses


2,351,620



109.7
%


1,911,953



111.9
%


439,667



23.0
%Loss on sale or disposal of assets


(418
)


0.0
%


(209
)


0.0
%


(209
)


(100.0
)%Operating income

$
31,124



1.5
%

$
46,700



2.7
%

$
(15,576
)


(33.4
)%   59




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##### Table of Contents



Year Ended


% of 2008


Year Ended


% of 2007


Change fromDecember 31,


Service


December 31,


Service


Prior Year2008


Revenues


2007


Revenues


Dollars


PercentRevenues:Service revenues

$
1,709,101






$
1,395,667






$
313,434



22.5
%Equipment revenues


249,761







235,136







14,625



6.2
%Total revenues


1,958,862







1,630,803







328,059



20.1
%Operating expenses:Cost of service (exclusive of items shown separately below)


488,298



28.6
%


384,128



27.5
%


104,170



27.1
%Cost of equipment


465,422



27.2
%


405,997



29.1
%


59,425



14.6
%Selling and marketing


294,917



17.3
%


206,213



14.8
%


88,704



43.0
%General and administrative


331,691



19.4
%


271,536



19.5
%


60,155



22.2
%Depreciation and amortization


331,448



19.4
%


302,201



21.7
%


29,247



9.7
%Impairment of assets


177



0.0
%


1,368



0.1
%


(1,191
)


(87.1
)%Total operating expenses


1,911,953



111.9
%


1,571,443



112.6
%


340,510



21.7
%Gain (loss) on sale or disposal of assets


(209
)


0.0
%


902



0.1
%


(1,111
)


(123.2
)%Operating income

$
46,700



2.7
%

$
60,262



4.3
%

$
(13,562
)


(22.5
)%     Year Ended December 31,2009


2008


2007Gross customer additions


3,500,113



2,487,579



1,974,504Net customer additions(1)


1,109,445



942,304



633,693Weighted-average number of customers


4,440,822



3,272,347



2,589,312Total customers, end of period


4,954,105



3,844,660



2,863,519     (1)
    
    Net customer additions for the year ended December 31, 2008
    exclude changes in customers that occurred during the nine
    months ended September 30, 2008 in the Hargray Wireless
    markets in South Carolina and Georgia that we acquired in April
    2008. We completed the upgrade of the Hargray Wireless networks
    and introduced Cricket service in these markets in October 2008.
    Commencing with the fourth quarter of 2008, our net customer
    additions include customers in the former Hargray Wireless
    markets.  Service
    Revenues
   60




---



##### Table of Contents



Equipment
    Revenues
      Cost of
    Service
      Cost of
    Equipment
     61




---



##### Table of Contents



Selling
    and Marketing Expenses
      General
    and Administrative Expenses
      Depreciation
    and Amortization
      Impairment
    of Assets
   62




---



##### Table of Contents



Gain
    (Loss) on Sale or Disposal of Assets
      Non-Operating
    Items
    Year Ended December 31,2009

2008

ChangeEquity in net income (loss) of investee


3,946



(298
)


4,244Interest income


3,806



14,571



(10,765
)Interest expense


(210,389
)


(158,259
)


(52,130
)Other income (expense), net


469



(7,125
)


7,594Loss on extinguishment of debt


(26,310
)






(26,310
)Income tax expense


(40,609
)


(38,970
)


(1,639
)   Year Ended December 31,2008

2007

ChangeEquity in net loss of investee


(298
)


(2,309
)


2,011Interest income


14,571



28,939



(14,368
)Interest expense


(158,259
)


(121,231
)


(37,028
)Other expense, net


(7,125
)


(6,182
)


(943
)Income tax expense


(38,970
)


(35,924
)


(3,046
)   Equity in
    Net Income (Loss) of Investee
    Interest
    Income
     63




---



##### Table of Contents



Interest
    Expense
      Other
    Income (Expense), Net
    other-than-temporary
  Loss on
    Extinguishment of Debt
    Income
    Tax Expense
     64




---



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65




---



##### Table of Contents



Quarterly
    Financial Data (Unaudited)
    Three Months EndedMarch 31,

June 30,

September 30,

December 31,2009

2009

2009

2009Revenues

$
586,987


$
597,408


$
599,468


$
599,299Operating income (loss)


(1,005
)


26,265



1,374



4,490Net loss


(47,360
)


(61,183
)


(65,407
)


(64,013
)Net loss attributable to common stockholders


(50,296
)


(62,751
)


(64,573
)


(61,872
)Basic loss per share attributable to common stockholders


(0.74
)


(0.89
)


(0.85
)


(0.82
)Diluted loss per share attributable to common stockholders


(0.74
)


(0.89
)


(0.85
)


(0.82
)   Three Months EndedMarch 31,

June 30,

September 30,

December 31,2008

2008

2008

2008Revenues

$
468,384


$
474,858


$
496,697


$
518,923Operating income


26,056



14,450



2,391



3,803Net loss


(16,896
)


(24,646
)


(47,270
)


(54,569
)Net loss attributable to common stockholders


(18,819
)


(26,556
)


(49,262
)


(55,564
)Basic loss per share attributable to common stockholders


(0.28
)


(0.39
)


(0.72
)


(0.82
)Diluted loss per share attributable to common stockholders


(0.28
)


(0.39
)


(0.72
)


(0.82
)  66




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##### Table of Contents



Quarterly
    Results of Operations Data (Unaudited)
    Three Months EndedMarch 31,


June 30,


September 30,


December 31,2009


2009


2009


2009Revenues:Service revenues

$
514,005


$
541,585


$
541,268


$
546,971Equipment revenues


72,982



55,823



58,200



52,328Total revenues


586,987



597,408



599,468



599,299Operating expenses:Cost of service (exclusive of items shown separately below)


144,344



154,567



156,707



153,388Cost of equipment


157,796



127,775



133,502



142,189Selling and marketing


103,523



96,688



111,702



99,651General and administrative


96,177



90,938



87,077



84,260Depreciation and amortization


89,733



99,621



107,876



113,467Impairment of assets










639



Total operating expenses


591,573



569,589



597,503



592,955Gain (loss) on sale or disposal of assets


3,581



(1,554
)


(591
)


(1,854
)Operating income (loss)


(1,005
)


26,265



1,374



4,490Equity in net income of investee


1,479



515



996



956Interest income


945



642



727



1,492Interest expense


(41,851
)


(49,060
)


(59,129
)


(60,349
)Other income (expense), net


(63
)


(46
)


(17
)


595Loss on extinguishment of debt






(26,310
)






Loss before income taxes


(40,495
)


(47,994
)


(56,049
)


(52,816
)Income tax expense


(6,865
)


(13,189
)


(9,358
)


(11,197
)Net loss


(47,360
)


(61,183
)


(65,407
)


(64,013
)Accretion of redeemable noncontrolling interests, net of tax


(2,936
)


(1,568
)


834



2,141Net loss attributable to common stockholders

$
(50,296
)

$
(62,751
)

$
(64,573
)

$
(61,872
)   Performance
    Measures
  Regulation S-K
 67




---



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68




---



##### Table of Contents



pay-in-advance
        
    it does not reflect capital expenditures;
    although it does not include depreciation and amortization, the
    assets being depreciated and amortized will often have to be
    replaced in the future and adjusted OIBDA does not reflect cash
    requirements for such replacements;
    it does not reflect costs associated with share-based awards
    exchanged for employee services;
    it does not reflect the interest expense necessary to service
    interest or principal payments on current or future indebtedness;
    it does not reflect expenses incurred for the payment of income
    taxes and other taxes; and
    other companies, including companies in our industry, may
    calculate this measure differently than we do, limiting its
    usefulness as comparative measures.   69




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##### Table of Contents



Three Months Ended

Year EndedMarch 31,

June 30,

September 30,

December 31,

December 31,2009

2009

2009

2009

2009ARPU

$
42.21


$
40.73


$
39.60


$
38.66


$
40.23CPGA

$
195


$
201


$
208


$
181


$
196CCU

$
20.03


$
18.42


$
17.73


$
17.10


$
18.26Churn


3.3
%


4.4
%


5.4
%


4.7
%


4.5
%Adjusted OIBDA

$
96,802


$
137,847


$
121,487


$
129,455


$
485,591   Reconciliation
    of Non-GAAP Financial Measures
  Regulation S-K
    Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2009


2009


2009


2009


2009Selling and marketing expense

$
103,523


$
96,688


$
111,702


$
99,651


$
411,564Less share-based compensation expense included in selling and
    marketing expense


(1,583
)


(1,466
)


(1,866
)


(1,349
)


(6,264
)Plus cost of equipment


157,796



127,775



133,502



142,189



561,262Less equipment revenue


(72,982
)


(55,823
)


(58,200
)


(52,328
)


(239,333
)Less net loss on equipment transactions unrelated to initial
    customer acquisition


(13,448
)


(8,392
)


(7,708
)


(12,521
)


(42,069
)Total costs used in the calculation of CPGA

$
173,306


$
158,782


$
177,430


$
175,642


$
685,160Gross customer additions


889,911



790,933



851,230



968,039



3,500,113CPGA

$
195


$
201


$
208


$
181


$
196  70




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##### Table of Contents



Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2009


2009


2009


2009


2009Cost of service

$
144,344


$
154,567


$
156,707


$
153,388


$
609,006Plus general and administrative expense


96,177



90,938



87,077



84,260



358,452Less share-based compensation expense included in cost of
    service and general and administrative expense


(10,072
)


(8,941
)


(9,141
)


(8,295
)


(36,449
)Plus net loss on equipment transactions unrelated to initial
    customer acquisition


13,448



8,392



7,708



12,521



42,069Total costs used in the calculation of CCU

$
243,897


$
244,956


$
242,351


$
241,874


$
973,078Weighted-average number of customers


4,058,819



4,432,381



4,555,605



4,716,185



4,440,822CCU

$
20.03


$
18.42


$
17.73


$
17.10


$
18.26     Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2009


2009


2009


2009


2009Operating income (loss)

$
(1,005
)

$
26,265


$
1,374


$
4,490


$
31,124Plus depreciation and amortization


89,733



99,621



107,876



113,467



410,697OIBDA

$
88,728


$
125,886


$
109,250


$
117,957


$
441,821Less (gain) loss on sale or disposal of assets


(3,581
)


1,554



591



1,854



418Plus impairment of indefinite-lived intangible assets










639







639Plus share-based compensation expense


11,655



10,407



11,007



9,644



42,713Adjusted OIBDA

$
96,802


$
137,847


$
121,487


$
129,455


$
485,591   Liquidity
    and Capital Resources
  Overview
   71




---



##### Table of Contents



slower-than-anticipated
       72




---



##### Table of Contents



Cash
    Flows
    Year Ended December 31,2009

2008

2007Net cash provided by operating activities

$
284,317


$
350,646


$
316,181Net cash used in investing activities


(875,792
)


(909,978
)


(622,728
)Net cash provided by financing activities


408,766



483,703



367,072   Operating
    Activities
       73




---



##### Table of Contents



Investing
    Activities
    
    During the year ended December 31, 2009, we and our
    consolidated joint ventures purchased $699.5 million of
    property and equipment for the build-out of our new markets and
    the expansion and improvement of our existing markets.
    In June 2009, we completed our purchase of certain wireless
    spectrum in St. Louis for approximately $27.2 million.
    During the year ended December 31, 2009, we made investment
    purchases of $883.2 million, offset by sales or maturities
    of investments of $733.3 million.    
    During the year ended December 31, 2008, we purchased
    Hargray Communications Groups wireless subsidiary, Hargray
    Wireless, for $31.2 million, including acquisition-related
    costs of $0.7 million.
    During the year ended December 31, 2008, we and our
    consolidated joint ventures purchased $795.7 million of
    property and equipment for the build-out of our new markets and
    the expansion and improvement of our existing markets.
    During the year ended December 31, 2008, we made investment
    purchases of $598.0 million, offset by sales or maturities
    of investments of $532.5 million.    
    During January 2007, we completed the sale of three wireless
    licenses that we were not using to offer commercial service for
    an aggregate sales price of $9.5 million.
    During March 2007, Cricket acquired the remaining 25% of the
    membership interests in Alaska Native Broadband 1, LLC, or
    ANB 1, for $4.7 million, following our joint venture
    partners exercise of its option to sell its entire 25%
    controlling interest in ANB 1 to Cricket.
    During the year ended December 31, 2007, we purchased
    approximately 20% of the outstanding membership units of a
    regional wireless service provider for an aggregate purchase
    price of $19.0 million.
    During the year ended December 31, 2007, we made investment
    purchases of $642.5 million from proceeds received from the
    issuances of our unsecured senior notes due 2014, offset by
    sales or maturities of investments of $531.0 million.
    During the year ended December 31, 2007, we and our
    consolidated joint ventures purchased $504.8 million of
    property and equipment for the build-out of our new markets and
    the expansion and improvement of our existing markets.  Financing
    Activities
    
    During the year ended December 31, 2009, we issued
    $1,100 million of senior secured notes, and we used a
    portion of the $1,057.5 million net cash proceeds from the
    issuance to repay all principal amounts outstanding under our
    Credit Agreement, which amounted to $875.3 million. In
    addition, we incurred $16.2 million in debt issuance costs
    in connection with the issuance of the senior secured notes.
    Additionally, we made payments of $2.3 million under our
    former Credit Agreement during the first quarter of 2009 and LCW
    Operations made payments of $20.3 million under its senior
    secured credit agreement during the year 74




---



##### Table of Contents



ended December 31, 2009, which included a
    $17.0 million payment in connection with the amendment to
    LCW Operations senior secured credit agreement, as more
    fully described below.  
    During the year ended December 31, 2009, we sold an
    aggregate of 7,000,000 shares of Leap common stock in an
    underwritten public offering, resulting in aggregate net
    proceeds of $263.7 million. In addition, during the year
    ended December 31, 2009, we issued common stock upon the
    exercise of stock options held by our employees, resulting in
    aggregate net proceeds of $3.4 million.    
    During the year ended December 31, 2008, we issued
    $300 million of unsecured senior notes, which resulted in
    net proceeds of $293.3 million, and $250 million of
    convertible senior notes, which resulted in net proceeds of
    $242.5 million. These note issuances were offset by
    payments of $9.0 million on our $895.5 million senior
    secured term loan and a payment of $1.5 million on LCW
    Operations $40 million senior secured term loans.
    These note issuances were further offset by the payment of
    $7.7 million in debt issuance costs.
    During the year ended December 31, 2008, we made payments
    of $41.8 million on our capital lease obligations, a large
    portion of which related to our acquisition of the VeriSign
    billing system software.
    During the year ended December 31, 2008, we issued common
    stock upon the exercise of stock options held by our employees
    and upon employee purchases of common stock under our Employee
    Stock Purchase Plan, resulting in aggregate net proceeds of
    $7.9 million.    
    During the year ended December 31, 2007, we made payments
    of $5.2 million on our capital lease obligations relating
    to software licenses.
    During the year ended December 31, 2007, we issued an
    additional $350 million of unsecured senior notes due 2014
    at an issue price of 106% of the principal amount, which
    resulted in gross proceeds of $371 million, offset by
    payments of $9.0 million on our $895.5 million senior
    secured term loan.
    During the year ended December 31, 2007, we issued common
    stock upon the exercise of stock options held by our employees
    and upon employee purchases of common stock under our Employee
    Stock Purchase Plan, resulting in aggregate net proceeds of
    $9.7 million.  Senior
    Secured Credit Facilities
  Cricket
    Communications
    LCW
    Operations
   75




---



##### Table of Contents



Senior
    Notes
  Unsecured
    Senior Notes Due 2014
       76




---



##### Table of Contents



Convertible
    Senior Notes Due 2014
         77




---



##### Table of Contents



Unsecured
    Senior Notes Due 2015
         78




---



##### Table of Contents



Senior
    Secured Notes Due 2016
        pari passu
   79




---



##### Table of Contents



90-day 90-day Form S-4
  Fair
    Value of Financial Instruments
   80




---



##### Table of Contents



Capital
    Expenditures and Other Asset Acquisitions and
    Dispositions
  Capital
    Expenditures
        Other
    Acquisitions and Dispositions
   81




---



##### Table of Contents



1 2
  Contractual
    Obligations
    2010


2011-2012


2013-2014


Thereafter


TotalLong-term debt(1)

$
8,000


$
10,096


$
1,350,000


$
1,400,000


$
2,768,096Capital leases(2)


2,466



4,932



4,932



1,526



13,856Operating leases


235,517



462,603



462,602



688,311



1,849,033Purchase obligations(3)


339,283



289,057



36,351







664,691Contractual interest(4)


230,400



459,394



436,906



137,021



1,263,721Total

$
815,666


$
1,226,082


$
2,290,791


$
2,226,858


$
6,559,397     (1)
    
    Amounts shown for Crickets long-term debt include
    principal only and exclude the effects of premium amortization
    on our $350 million of 9.375% unsecured senior notes due
    2014 and discount accretion on our $1,100 million of
    7.75% senior secured notes due 2016. Interest on the debt,
    calculated at the current interest rate, is stated separately.(2)
    
    Amounts shown for Crickets capital leases include
    principal and interest.(3)
    
    Purchase obligations are defined as agreements to purchase goods
    or services that are enforceable and legally binding on us and
    that specify all significant terms including (a) fixed or
    minimum quantities to be purchased, (b) fixed, minimum or
    variable price provisions, and (c) the approximate timing
    of the transaction.(4)
    
    Contractual interest is based on the current interest rates in
    effect at December 31, 2009 for debt outstanding as of that
    date.   82




---



##### Table of Contents



sub-facility sub-facility sub-facility
    30-day
  Off-Balance
    Sheet Arrangements
    Recent
    Accounting Pronouncements
      Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Interest
    Rate Risk
   83




---



##### Table of Contents



Hedging
    Policy
   84




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
    Internal Control  Integrated Framework
           85




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED BALANCE SHEETS
 (In thousands, except share amounts)
  December 31,2009


2008AssetsCash and cash equivalents

$
174,999


$
357,708Short-term investments


389,154



238,143Restricted cash, cash equivalents and short-term investments


3,866



4,780Inventories


107,912



99,086Deferred charges


38,872



27,207Other current assets


73,204



51,948Total current assets


788,007



778,872Property and equipment, net


2,121,094



1,842,718Wireless licenses


1,921,973



1,841,798Assets held for sale


2,381



45,569Goodwill


430,101



430,101Intangible assets, net


24,535



29,854Other assets


83,630



83,945Total assets

$
5,371,721


$
5,052,857Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
310,386


$
325,294Current maturities of long-term debt


8,000



13,000Other current liabilities


196,647



162,002Total current liabilities


515,033



500,296Long-term debt


2,735,318



2,566,025Deferred tax liabilities


259,512



217,631Other long-term liabilities


99,696



84,350Total liabilities


3,609,559



3,368,302Redeemable noncontrolling interests


71,632



71,879Commitments and contingencies (Note 13)Stockholders equity:Preferred stock  authorized 10,000,000 shares,
    $.0001 par value; no shares issued and outstanding






Common stock  authorized 160,000,000 shares,
    $.0001 par value; 77,524,040 and 69,515,526 shares
    issued and outstanding at December 31, 2009 and 2008,
    respectively


8



7Additional paid-in capital


2,148,194



1,839,313Accumulated deficit


(458,685
)


(220,722
)Accumulated other comprehensive income (loss)


1,013



(5,922
)Total stockholders equity


1,690,530



1,612,676Total liabilities and stockholders equity

$
5,371,721


$
5,052,857    86




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
    CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except per share
    data)
  Year Ended December 31,2009


2008


2007Revenues:Service revenues

$
2,143,829


$
1,709,101


$
1,395,667Equipment revenues


239,333



249,761



235,136Total revenues


2,383,162



1,958,862



1,630,803Operating expenses:Cost of service (exclusive of items shown separately below)


609,006



488,298



384,128Cost of equipment


561,262



465,422



405,997Selling and marketing


411,564



294,917



206,213General and administrative


358,452



331,691



271,536Depreciation and amortization


410,697



331,448



302,201Impairment of assets


639



177



1,368Total operating expenses


2,351,620



1,911,953



1,571,443Gain (loss) on sale or disposal of assets


(418
)


(209
)


902Operating income


31,124



46,700



60,262Equity in net income (loss) of investee


3,946



(298
)


(2,309
)Interest income


3,806



14,571



28,939Interest expense


(210,389
)


(158,259
)


(121,231
)Other income (expense), net


469



(7,125
)


(6,182
)Loss on extinguishment of debt


(26,310
)






Loss before income taxes


(197,354
)


(104,411
)


(40,521
)Income tax expense


(40,609
)


(38,970
)


(35,924
)Net loss


(237,963
)


(143,381
)


(76,445
)Accretion of redeemable noncontrolling interests, net of tax


(1,529
)


(6,820
)


(3,854
)Net loss attributable to common stockholders

$
(239,492
)

$
(150,201
)

$
(80,299
)Loss per share attributable to common stockholders:Basic

$
(3.30
)

$
(2.21
)

$
(1.20
)Diluted

$
(3.30
)

$
(2.21
)

$
(1.20
)Shares used in per share calculations:Basic


72,515



68,021



67,100Diluted


72,515



68,021



67,100    87




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
    CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands)
  Year Ended December 31,2009


2008


2007Operating activities:Net loss

$
(237,963
)

$
(143,381
)

$
(76,445
)Adjustments to reconcile net loss to net cash provided by
    operating activities:Share-based compensation expense


42,713



35,215



29,339Depreciation and amortization


410,697



331,448



302,201Accretion of asset retirement obligations


1,888



1,153



1,666Non-cash interest items, net


8,357



13,057



(4,425
)Non-cash loss on extinguishment of debt


8,805







669Deferred income tax expense


38,164



36,310



34,642Impairment of assets


639



177



1,368Impairment of short-term investments






7,538



5,440(Gain) loss on sale or disposal of assets


418



209



(902
)Gain on extinguishment of asset retirement obligations










(6,089
)Equity in net (income) loss of investee


(3,946
)


298



2,309Changes in assets and liabilities:Inventories and deferred charges


(20,491
)


(60,899
)


24,977Other assets


(17,287
)


(20,759
)


31,164Accounts payable and accrued liabilities


5,674



75,344



(53,310
)Other liabilities


46,649



74,936



23,577Net cash provided by operating activities


284,317



350,646



316,181Investing activities:Acquisition of a business, net of cash acquired






(31,217
)


Purchases of property and equipment


(699,525
)


(795,678
)


(504,770
)Change in prepayments for purchases of property and equipment


5,691



(5,876
)


12,831Purchases of and deposits for wireless licenses and spectrum
    clearing costs


(35,356
)


(78,451
)


(5,292
)Return of deposit for wireless licenses






70,000



Proceeds from sale of wireless licenses and operating assets


2,965







9,500Purchases of investments


(883,173
)


(598,015
)


(642,513
)Sales and maturities of investments


733,268



532,468



530,956Purchase of noncontrolling interest










(4,706
)Purchase of membership units of equity method investment






(1,033
)


(18,955
)Change in restricted cash


338



(2,176
)


221Net cash used in investing activities


(875,792
)


(909,978
)


(622,728
)Financing activities:Proceeds from issuance of long-term debt


1,057,474



535,750



370,480Repayment of long-term debt


(897,904
)


(10,500
)


(9,000
)Payment of debt issuance costs


(16,200
)


(7,658
)


(7,765
)Noncontrolling interest contributions










8,880Proceeds from issuance of common stock, net


267,105



7,885



9,690Other


(1,709
)


(41,774
)


(5,213
)Net cash provided by financing activities


408,766



483,703



367,072Net increase (decrease) in cash and cash equivalents


(182,709
)


(75,629
)


60,525Cash and cash equivalents at beginning of period


357,708



433,337



372,812Cash and cash equivalents at end of period

$
174,999


$
357,708


$
433,337    88




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
    CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY(In thousands, except share amounts)
  AccumulatedRetained


OtherAdditional


Earnings


ComprehensiveCommon Stock


Paid-In


(Accumulated


IncomeShares


Amount


Capital


Deficit)


(Loss)


TotalBalance at December 31, 2006


67,892,512



7



1,768,451



(896
)


1,786



1,769,348Components of comprehensive loss:Net loss














(76,445
)






(76,445
)Net unrealized holding losses on investments


















(70
)


(70
)Unrealized losses on derivative instruments


















(10,391
)


(10,391
)Comprehensive loss






















(86,906
)Share-based compensation expense










29,227











29,227Accretion of redeemable noncontrolling interests, net of tax










(3,854
)










(3,854
)Issuance of common stock under share-based compensation plans,
    net of repurchases


781,923







9,690











9,690Balance at December 31, 2007


68,674,435



7



1,803,514



(77,341
)


(8,675
)


1,717,505Components of comprehensive loss:Net loss














(143,381
)






(143,381
)Net unrealized holding gains on investments, net of tax


















273



273Unrealized losses on derivative instruments


















(1,471
)


(1,471
)Swaplet amortization on derivative instruments, net of tax


















3,951



3,951Comprehensive loss






















(140,628
)Share-based compensation expense










34,734











34,734Accretion of redeemable noncontrolling interests, net of tax










(6,820
)










(6,820
)Issuance of common stock under share-based compensation plans,
    net of repurchases


841,091







7,885











7,885Balance at December 31, 2008


69,515,526



7



1,839,313



(220,722
)


(5,922
)


1,612,676Components of comprehensive loss:Net loss














(237,963
)






(237,963
)Net unrealized holding gains on investments, net of tax


















816



816Swaplet amortization and reclassification of losses included in
    earnings on derivative instruments, including tax effect


















6,119



6,119Comprehensive loss






















(231,028
)Share-based compensation expense










43,306











43,306Accretion of redeemable noncontrolling interests, net of tax










(1,529
)










(1,529
)Issuance of common stock


7,000,000



1



263,718











263,719Issuance of common stock under share-based compensation plans,
    net of repurchases


1,008,514







3,386











3,386Balance at December 31, 2009


77,524,040


$
8


$
2,148,194


$
(458,685
)

$
1,013


$
1,690,530    89




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Note 1.
    The
    Company  ®
  Note 2.
    Basis of
    Presentation and Significant Accounting Policies  Basis
    of Presentation
        Principles
    of Consolidation
   90




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Subsequent
    Events
    Segment
    and Geographic Data
  tm
  Revenues
  month-to-month
     91




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      and/or
    E-911
  Costs
    and Expenses
    Cost of Service.
  Cost of Equipment.
  Selling and Marketing.
  General and Administrative.
 92




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Cash
    and Cash Equivalents
    Short-Term
    Investments
    available-for-sale available-for-sale other-than-temporary,
  Restricted
    Cash, Cash Equivalents and Short-Term Investments
    Fair
    Value of Financial Instruments
      Inventories
  first-in,
 93




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property
    and Equipment
      DepreciableLifeNetwork equipment:Switches


10Switch power equipment


15Cell site equipment and site improvements


7Towers


15Antennae


5Computer hardware and software


3-5Furniture, fixtures, retail and office equipment


3-7   construction-in-progress construction-in-progress construction-in-progress
      Wireless
    Licenses
   94




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Goodwill
    and Other Intangible Assets
    Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
   95




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Wireless
    Licenses
       96




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Goodwill
       97




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Derivative
    Instruments and Hedging Activities
        Investments
    in Other Entities
   98




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    other-than-temporary other-than-temporary,
  Concentrations
      Operating
    Leases
    Asset
    Retirement Obligations
   99




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedDecember 31,2009


2008Asset retirement obligations, beginning of year

$
16,997


$
15,813Liabilities incurred


7,434



3,079Liabilities settled(1)






(3,048
)Accretion expense


1,888



1,153Decommissioned sites


(570
)


Asset retirement obligations, end of year

$
25,749


$
16,997     (1)
    
    The Company negotiated amendments to agreements that reduced its
    liability for the removal of equipment on certain of its cell
    sites at the end of the lease term, resulting in a reduction to
    its liability of $3.0 million in 2008.  Debt
    Issuance Costs
    Advertising
    Costs
    Share-Based
    Compensation
    Income
    Taxes
     100




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
                 101




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Basic
    and Diluted Earnings (Loss) Per Share
    Recent
    Accounting Pronouncements
     102




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 3.
    Fair
    Value of Financial Instruments    Level 1
    Quoted prices in active markets for identical assets or
    liabilities. The Company did not have any Level 1 assets or
    liabilities as of December 31, 2009 or 2008.Level 2
    Observable inputs other than Level 1 prices, such as quoted
    prices for similar assets or liabilities, quoted prices in
    markets that are not active or other inputs that are observable
    or can be corroborated by observable market data for
    substantially the full term of the assets or liabilities. The
    Companys Level 2 assets and liabilities as of
    December 31, 2009 and 2008 included its cash equivalents,
    its short-term investments in obligations of the
    U.S. government and government agencies, a majority of its
    short-term investments in commercial paper and, as of
    December 31, 2008, its interest rate swaps.Level 3
    Unobservable inputs that are supported by little or no market
    activity and that are significant to the fair value of the
    assets or liabilities. Such assets and liabilities may have
    values determined using pricing models, discounted cash flow
    methodologies, or similar techniques, and include instruments
    for which the determination of fair value requires significant
    management judgment or estimation. The Companys
    Level 3 asset as of December 31, 2009 and 2008
    comprised its short-term investment in asset-backed commercial
    paper.    At Fair Value as of December 31, 2009Level 1


Level 2


Level 3


TotalAssets:Cash equivalents

$



$
154,396


$



$
154,396Short-term investments






386,423



2,731



389,154Total

$



$
540,819


$
2,731


$
543,550   103




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  At Fair Value as of December 31, 2008Level 1


Level 2


Level 3


TotalAssets:Cash equivalents

$



$
331,268


$



$
331,268Short-term investments






236,893



1,250



238,143Total

$



$
568,161


$
1,250


$
569,411Liabilities:Interest rate swaps

$



$
(11,045
)

$



$
(11,045
)Total

$



$
(11,045
)

$



$
(11,045
)       Year EndedDecember 31,2009


2008Beginning balance, January 1

$
1,250


$
16,200Total gains (losses) (realized/unrealized):Included in net loss

$
667


$
(7,613
)Included in comprehensive loss


1,680



Settlements


(866
)


(7,337
)Transfers in (out) of Level 3






Ending balance, December 31

$
2,731


$
1,250     Cash
    Equivalents and Short-Term Investments
  available-for-sale.
 104




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Available-for-sale
  As of December 31, 2009Cost


Fair ValueMoney markets and certificates of deposits

$
81,432


$
81,432Commercial paper


108,955



108,952Asset-backed commercial paper


1,051



2,731U.S. government or government agency securities


350,402



350,435$
541,840


$
543,550   As of December 31, 2008Cost


Fair ValueMoney markets and certificates of deposits

$
161,319


$
161,319Commercial paper


125,850



125,866Asset-backed commercial paper


1,250



1,250U.S. government or government agency securities


280,596



280,976$
569,015


$
569,411   Interest
    Rate Swaps
      Long-Term
    Debt
   105




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 4.
    Supplementary
    Financial Information  Supplementary
    Balance Sheet Information (in thousands):
  As of December 31,2009


2008Other current assets:Accounts receivable, net(1)

$
37,456


$
31,177Prepaid expenses


21,109



19,367Other


14,639



1,404$
73,204


$
51,948Property and equipment, net:(2)Network equipment

$
2,722,863


$
1,911,173Computer hardware and software


246,546



203,720Construction-in-progress


303,167



574,773Other


101,616



60,9723,374,192



2,750,638Accumulated depreciation


(1,253,098
)


(907,920
)$
2,121,094


$
1,842,718Intangible assets, net(3)Customer relationships

$
7,347


$
7,347Trademarks


37,000



37,00044,347



44,347Accumulated amortization customer relationships


(5,496
)


(2,820
)Accumulated amortization trademarks


(14,316
)


(11,673
)$
24,535


$
29,854Accounts payable and accrued liabilities:Trade accounts payable

$
180,711


$
201,843Accrued payroll and related benefits


47,651



50,462Other accrued liabilities


82,024



72,989$
310,386


$
325,294Other current liabilities:Deferred service revenue(4)

$
82,403


$
62,998Deferred equipment revenue(5)


28,218



20,614Accrued sales, telecommunications, property and other taxes
    payable


33,712



32,799Accrued interest


47,101



38,500Other


5,213



7,091$
196,647


$
162,002     (1)
    
    Accounts receivable, net consists primarily of amounts billed to
    third-party dealers for handsets and accessories net of an
    allowance for doubtful accounts. 106




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (2)
    
    As of December 31, 2009 and 2008, approximately
    $8.5 million of assets were held by the Company under
    capital lease arrangements. Accumulated amortization relating to
    these assets totaled $3.8 million and $3.2 million as
    of December 31, 2009 and 2008, respectively.(3)
    
    Amortization expense for intangible assets, net for the years
    ended December 31, 2009, 2008 and 2007 was
    $5.3 million, $23.6 million and $33.7 million,
    respectively. Estimated amortization expense for intangible
    assets for 2010 is $4.1 million, for 2011 is
    $3.0 million, for 2012 is $2.7 million, for 2013 is
    $2.6 million, for 2014 is $2.6 million and is
    $9.5 million thereafter.(4)
    
    Deferred service revenue consists primarily of cash received
    from customers in advance of their service period.(5)
    
    Deferred equipment revenue relates to devices sold to
    third-party dealers.  Supplementary
    Cash Flow Information (in thousands):
  December 31,2009


2008


2007Supplementary disclosure of cash flow information:Cash paid for interest

$
223,343


$
178,880


$
161,280Cash paid for income taxes

$
1,950


$
1,914


$
506Supplementary disclosure of non-cash investing activities:Contribution of wireless licenses

$



$



$
25,130Supplementary disclosure of non-cash financing activities:Assets acquired through capital lease arrangements

$



$



$
40,799   Note 5.
    Basic and
    Diluted Earnings (Loss) Per Share    Note 6.
    Long-Term
    Debt    As of December 31,2009


2008Term loans under senior secured credit facilities

$
18,096


$
916,000Unamortized deferred lender fees






(4,527
)Unsecured senior notes due 2014 and 2015


1,400,000



1,400,000Unamortized premium on $350 million unsecured senior notes
    due 2014


15,111



17,552Senior secured notes due 2016


1,100,000



Unamortized discount on $1,100 million senior secured notes
    due 2016


(39,889
)


Convertible senior notes due 2014


250,000



250,0002,743,318



2,579,025Current maturities of long-term debt


(8,000
)


(13,000
)$
2,735,318


$
2,566,025  107




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Senior
    Secured Credit Facilities
  Cricket
    Communications
    LCW
    Operations
        Senior
    Notes
  Unsecured
    Senior Notes Due 2014
   108




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Convertible
    Senior Notes Due 2014
     109




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Unsecured
    Senior Notes Due 2015
   110




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Senior
    Secured Notes Due 2016
     111




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      pari passu
         112




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    90-day 90-day Form S-4
    Years Ended December 31:2010

$
8,0002011


10,0962012


2013


2014


1,350,000Thereafter


1,400,000$
2,768,096   Note 7.
    Income
    Taxes    December 31,2009


2008


2007Current provision:Federal

$



$



$
(422
)State


2,445



2,660



1,7042,445



2,660



1,282Deferred provision:Federal


36,537



32,415



37,736State


1,627



3,895



(3,094
)38,164



36,310



34,642$
40,609


$
38,970


$
35,924  113




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2009


2008


2007Amounts computed at statutory federal rate

$
(69,073
)

$
(38,217
)

$
(13,496
)Non-deductible expenses


865



2,474



2,910State income tax expense (benefit), net of federal income tax
    impact


3,218



5,603



(950
)Net tax expense related to joint venture


1,384



2,375



1,337Change in valuation allowance


104,215



66,735



46,123$
40,609


$
38,970


$
35,924     As of December 31,2009


2008Deferred tax assets:Net operating loss carryforwards

$
559,912


$
390,463Wireless licenses


33,780



17,913Capital loss carryforwards


1,510



1,621Reserves and allowances


16,006



13,002Share-based compensation


31,053



16,685Deferred charges


39,583



35,254Investments and deferred tax on unrealized losses


9,669



19,158Other


7,630



12,831Gross deferred tax assets


699,143



506,927Deferred tax liabilities:Intangible assets


(12,903
)


(10,012
)Property and equipment


(151,868
)


(80,437
)Other


(513
)


Net deferred tax assets


533,859



416,478Valuation allowance


(531,826
)


(414,030
)Other deferred tax liabilities:Wireless licenses


(236,409
)


(205,474
)Goodwill


(13,540
)


(11,093
)Investment in joint ventures


(6,398
)


(2,692
)Net deferred tax liabilities

$
(254,314
)

$
(216,811
)  114




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of December 31,2009


2008Current deferred tax assets (included in other current assets)

$
5,198


$
820Long-term deferred tax liabilities


(259,512
)


(217,631
)$
(254,314
)

$
(216,811
)         Note 8.
    Stockholders
    Equity  Common
    Stock Offering
    Warrants
   115




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 9.
    Share-Based
    Compensation    Stock
    Options
    As of December 31,2009


2008Expected volatility


54
%


51
%Expected term (in years)


5.75



6.0Risk-free interest rate


2.15
%


2.80
%Expected dividend yield






    116




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Weighted-


Weighted-Average


AverageExercise


RemainingNumber of


Price per


Contractual


AggregateShares


Share


Term


Intrinsic Value(In years)Options outstanding at December 31, 2007


3,374


$
45.12



8.28


$
28,419Options exercisable at December 31, 2007


270


$
38.71



7.85


$
3,370Options granted


1,392


$
43.61Options forfeited


(129
)


48.75Options exercised


(229
)


27.03Options outstanding at December 31, 2008


4,408


$
45.48



8.04


$
679Options exercisable at December 31, 2008


1,004


$
34.44



6.61


$
213Options granted


791


$
28.74Options forfeited


(228
)


44.30Options exercised


(35
)


28.38Options outstanding at December 31, 2009


4,936


$
42.97



7.08


$
247Options exercisable at December 31, 2009


1,596


$
40.15



6.16


$
         Restricted
    Stock
   117




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Weighted-AverageGrant DateNumber of


Fair ValueShares


Per ShareRestricted stock awards outstanding at December 31, 2007


1,405


$
42.70Shares issued


593



43.13Shares forfeited


(49
)


50.94Shares vested


(572
)


28.25Restricted stock awards outstanding at December 31, 2008


1,377



48.60Shares issued


627



27.76Shares forfeited


(98
)


43.46Shares vested


(175
)


50.33Restricted stock awards outstanding at December 31, 2009


1,731


$
41.17     Year Ended December 31,2009


2008


2007Fair value on vesting date of vested restricted stock awards

$
3,912


$
24,104


$
10,525       Employee
    Stock Purchase Plan
    Deferred
    Stock Units
   118




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Allocation
    of Share-Based Compensation Expense
    Year Ended December 31,2009


2008


2007Cost of service

$
3,546


$
3,060


$
2,156Selling and marketing expenses


6,264



4,580



3,330General and administrative expenses


32,903



27,575



23,853Share-based compensation expense

$
42,713


$
35,215


$
29,339Share-based compensation expense per share:Basic

$
0.59


$
0.52


$
0.44Diluted

$
0.59


$
0.52


$
0.44   Note 10.
    Employee
    Savings and Retirement Plan    Note 11.
    Significant
    Acquisitions and Dispositions           119




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  1 2
  Note 12.
    Arrangements
    with Variable Interest Entities    mark-to-market)
  Arrangements
    with LCW Wireless
    Limited
    Liability Company Agreement
  30-day
 120




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Line of
    Credit Agreement
  30-day
  Management
    Agreement
  mark-up
  Other
    Arrangements
    with Denali
    Limited
    Liability Company Agreement
   121




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Senior
    Secured Credit Agreement
  sub-facility sub-facility sub-facility
  Management
    Agreement
    and/or
  Values
    of Redeemable Noncontrolling Interests
    Year EndedDecember 31,2009


2008


2007Beginning balance, January 1

$
71,879


$
61,868


$
33,981Accretion of redeemable noncontrolling interests, before tax


(247
)


8,588



23,572Noncontrolling interest contributions






1,423



4,315Ending balance, December 31

$
71,632


$
71,879



61,868   Note 13.
    Commitments
    and Contingencies   122




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Patent
    Litigation
  Freedom
    Wireless
  ® tm
  DNT
  and/or
  Digital
    Technology Licensing
  and/or ®
 123




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  and/or and/or
  On The
    Go
    DownUnder
    Wireless
    American
    Wireless Group
    and/or
 124




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Securities
    and Derivative Litigation
    and/or
  Rule 10b-5, class-wide
   125




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Department
    of Justice Inquiry
    Other
    Litigation
    Indemnification
    Agreements
    Capital
    and Operating Leases
    Capital


OperatingYears Ended December 31:

Leases


Leases2010

$
2,466


$
235,5172011


2,466



230,9812012


2,466



231,6212013


2,466



231,8102014


2,466



230,792Thereafter


1,526



688,311Total minimum lease payments

$
13,856


$
1,849,032Less amount representing interest


(1,571
)Present value of minimum lease payments

$
12,285  126




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Tower
    Provider Commitments
    Outstanding
    Letters of Credit and Surety Bonds
      Note 14.
    Guarantor
    Financial Information       127




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Balance Sheet as of December 31, 2009 (in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
66


$
160,834


$



$
14,099


$



$
174,999Short-term investments






386,423







2,731







389,154Restricted cash, cash equivalents and short-term investments


2,231



1,625







10







3,866Inventories






102,883







5,029







107,912Deferred charges






38,872















38,872Other current assets


83



69,009







3,619



493



73,204Total current assets


2,380



759,646







25,488



493



788,007Property and equipment, net


2



1,853,898







267,194







2,121,094Investments in and advances to affiliates and consolidated
    subsidiaries


1,965,842



2,233,669



86,405



7,381



(4,293,297
)


Wireless licenses






7,889



1,580,174



333,910







1,921,973Assets held for sale










2,381











2,381Goodwill






430,101















430,101Intangible assets, net






24,535















24,535Other assets


6,663



74,558







2,409







83,630Total assets

$
1,974,887


$
5,384,296


$
1,668,960


$
636,382


$
(4,292,804
)

$
5,371,721Liabilities and
    Stockholders EquityAccounts payable and accrued liabilities

$
16


$
303,520


$



$
6,850


$



$
310,386Current maturities of long-term debt














8,000







8,000Intercompany payables


29,194



347,468







19,416



(396,078
)


Other current liabilities


5,147



172,202







18,803



495



196,647Total current liabilities


34,357



823,190







53,069



(395,583
)


515,033Long-term debt


250,000



2,475,222







714,640



(704,544
)


2,735,318Deferred tax liabilities






259,512















259,512Other long-term liabilities






90,233







9,463







99,696Total liabilities


284,357



3,648,157







777,172



(1,100,127
)


3,609,559Redeemable noncontrolling interests






23,981







47,651







71,632Stockholders equity (deficit)


1,690,530



1,712,158



1,668,960



(188,441
)


(3,192,677
)


1,690,530Total liabilities and stockholders equity

$
1,974,887


$
5,384,296


$
1,668,960


$
636,382


$
(4,292,804
)

$
5,371,721  128




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Balance Sheet as of December 31, 2008 (in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
27


$
333,119


$



$
24,562


$



$
357,708Short-term investments






236,893







1,250







238,143Restricted cash, cash equivalents and short-term investments


1,611



3,129







40







4,780Inventories






97,512







1,574







99,086Deferred charges






27,207















27,207Other current assets


83



50,915







2,062



(1,112
)


51,948Total current assets


1,721



748,775







29,488



(1,112
)


778,872Property and equipment, net


2



1,586,346







256,370







1,842,718Investments in and advances to affiliates and consolidated
    subsidiaries


1,892,457



2,169,293



79,001



9,227



(4,149,978
)


Wireless licenses






7,889



1,501,632



332,277







1,841,798Assets held for sale










45,569











45,569Goodwill






430,101















430,101Intangible assets, net






29,854















29,854Other assets


8,043



72,434







3,468







83,945Total assets

$
1,902,223


$
5,044,692


$
1,626,202


$
630,830


$
(4,151,090
)

$
5,052,857Liabilities and
    Stockholders EquityAccounts payable and accrued liabilities

$
20


$
297,461


$



$
27,813


$



$
325,294Current maturities of long-term debt






9,000







4,000







13,000Intercompany payables


33,714



343,257







23,687



(400,658
)


Other current liabilities


5,813



150,919







6,382



(1,112
)


162,002Total current liabilities


39,547



800,637







61,882



(401,770
)


500,296Long-term debt


250,000



2,281,525







524,007



(489,507
)


2,566,025Deferred tax liabilities






217,631















217,631Other long-term liabilities






78,861







5,489







84,350Total liabilities


289,547



3,378,654







591,378



(891,277
)


3,368,302Redeemable noncontrolling interests






28,610







43,269







71,879Stockholders equity (deficit)


1,612,676



1,637,428



1,626,202



(3,817
)


(3,259,813
)


1,612,676Total liabilities and stockholders equity

$
1,902,223


$
5,044,692


$
1,626,202


$
630,830


$
(4,151,090
)

$
5,052,857  129




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Operations for the Year Ended December 31,
    2009 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
2,010,578


$



$
133,208


$
43


$
2,143,829Equipment revenues






220,651







18,682







239,333Other revenues






7,630



89,022



1,761



(98,413
)


Total revenues






2,238,859



89,022



153,651



(98,370
)


2,383,162Operating expenses:Cost of service (exclusive of items shown separately below)






646,429







53,224



(90,647
)


609,006Cost of equipment






495,367







65,895







561,262Selling and marketing






363,321







48,243







411,564General and administrative


8,728



314,486



910



42,051



(7,723
)


358,452Depreciation and amortization






367,927







42,770







410,697Impairment of assets










639











639Total operating expenses


8,728



2,187,530



1,549



252,183



(98,370
)


2,351,620Gain (loss) on sale or disposal of assets






(4,718
)


4,426



(126
)






(418
)Operating income (loss)


(8,728
)


46,611



91,899



(98,658
)






31,124Equity in net loss of consolidated subsidiaries


(242,607
)


(92,552
)










335,159



Equity in net income of investee






3,946















3,946Interest income


24,455



88,562







2,537



(111,748
)


3,806Interest expense


(12,612
)


(225,578
)






(83,947
)


111,748



(210,389
)Other income, net






469















469Loss on extinguishment of debt






(26,310
)














(26,310
)Income (loss) before income taxes


(239,492
)


(204,852
)


91,899



(180,068
)


335,159



(197,354
)Income tax expense






(40,609
)














(40,609
)Net income (loss)


(239,492
)


(245,461
)


91,899



(180,068
)


335,159



(237,963
)Accretion of redeemable noncontrolling interests, net of tax






2,854







(4,383
)






(1,529
)Net income (loss) attributable to common stockholders

$
(239,492
)

$
(242,607
)

$
91,899


$
(184,451
)

$
335,159


$
(239,492
)  130




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Operations for the Year Ended December 31,
    2008 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
1,658,293


$



$
50,808


$



$
1,709,101Equipment revenues






245,403







4,358







249,761Other revenues






66



72,509







(72,575
)


Total revenues






1,903,762



72,509



55,166



(72,575
)


1,958,862Operating expenses:Cost of service (exclusive of items shown separately below)






519,226







41,213



(72,141
)


488,298Cost of equipment






454,620







10,802







465,422Selling and marketing






271,261







23,656







294,917General and administrative


4,821



300,662



905



25,737



(434
)


331,691Depreciation and amortization


27



322,529







8,892







331,448Impairment of assets










177











177Total operating expenses


4,848



1,868,298



1,082



110,300



(72,575
)


1,911,953Gain (loss) on sale or disposal of assets






(1,483
)


1,274











(209
)Operating income (loss)


(4,848
)


33,981



72,701



(55,134
)






46,700Equity in net loss of consolidated subsidiaries


(151,898
)


(45,896
)










197,794



Equity in net loss of investee






(298
)














(298
)Interest income


12,549



62,456







2,512



(62,946
)


14,571Interest expense


(6,371
)


(180,604
)






(34,230
)


62,946



(158,259
)Other income (expense), net


367



(7,492
)














(7,125
)Income (loss) before income taxes


(150,201
)


(137,853
)


72,701



(86,852
)


197,794



(104,411
)Income tax expense






(11,192
)


(27,778
)










(38,970
)Net income (loss)


(150,201
)


(149,045
)


44,923



(86,852
)


197,794



(143,381
)Accretion of redeemable noncontrolling interests, net of tax






(2,853
)






(3,967
)






(6,820
)Net income (loss) attributable to common stockholders

$
(150,201
)

$
(151,898
)

$
44,923


$
(90,819
)

$
197,794


$
(150,201
)  131




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Operations for the Year Ended December 31,
    2007 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
1,360,801


$



$
34,866


$



$
1,395,667Equipment revenues






230,457







4,679







235,136Other revenues






38



54,424







(54,462
)


Total revenues






1,591,296



54,424



39,545



(54,462
)


1,630,803Operating expenses:Cost of service (exclusive of items shown separately below)






424,022







14,494



(54,388
)


384,128Cost of equipment






392,062







13,935







405,997Selling and marketing






196,811







9,402







206,213General and administrative


4,988



259,316



132



7,174



(74
)


271,536Depreciation and amortization


87



293,599







8,515







302,201Impairment of assets






383



985











1,368Total operating expenses


5,075



1,566,193



1,117



53,520



(54,462
)


1,571,443Gain (loss) on sale or disposal of assets






(349
)


1,251











902Operating income (loss)


(5,075
)


24,754



54,558



(13,975
)






60,262Equity in net loss of consolidated subsidiaries


(75,187
)


(11,052
)










86,239



Equity in net loss of investee






(2,309
)














(2,309
)Interest income


38



63,024







985



(35,108
)


28,939Interest expense






(122,043
)






(34,296
)


35,108



(121,231
)Other expense, net


(75
)


(6,076
)






(31
)






(6,182
)Income (loss) before income taxes


(80,299
)


(53,702
)


54,558



(47,317
)


86,239



(40,521
)Income tax expense






(19,400
)


(16,524
)










(35,924
)Net income (loss)


(80,299
)


(73,102
)


38,034



(47,317
)


86,239



(76,445
)Accretion of redeemable noncontrolling interests, net of tax






(2,085
)






(1,769
)






(3,854
)Net income (loss) attributable to common stockholders

$
(80,299
)

$
(75,187
)

$
38,034


$
(49,086
)

$
86,239


$
(80,299
)  132




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Cash Flows for the Year Ended December 31,
    2009 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by (used in) operating activities

$
39


$
357,564


$



$
(73,107
)

$
(179
)

$
284,317Investing activities:Purchases of and change in prepayments for purchases of property
    and equipment






(648,330
)






(45,504
)






(693,834
)Purchases of and deposits for wireless licenses and spectrum
    clearing costs






(33,807
)






(1,549
)






(35,356
)Proceeds from sale of wireless licenses and operating assets






2,965















2,965Purchases of investments






(883,173
)














(883,173
)Sales and maturities of investments






733,268















733,268Investments in and advances to affiliates and consolidated
    subsidiaries


(267,105
)














267,105



Other






58







280







338Net cash used in investing activities


(267,105
)


(829,019
)






(46,773
)


267,105



(875,792
)Financing activities:Proceeds from issuance of long-term debt






1,057,474















1,057,474Issuance of related party debt






(130,000
)






130,000







Repayment of long-term debt






(877,500
)






(20,404
)






(897,904
)Payment of debt issuance costs






(16,200
)














(16,200
)Capital contributions, net


267,105



267,105











(267,105
)


267,105Noncontrolling interest distribution














(179
)


179



Other






(1,709
)














(1,709
)Net cash provided by (used in) financing activities


267,105



299,170







109,417



(266,926
)


408,766Net increase (decrease) in cash and cash equivalents


39



(172,285
)






(10,463
)






(182,709
)Cash and cash equivalents at beginning of period


27



333,119







24,562







357,708Cash and cash equivalents at end of period

$
66


$
160,834


$



$
14,099


$



$
174,999  133




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Cash Flows for the Year Ended December 31,
    2008 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by (used in) operating activities

$
1,033


$
355,576






$
(5,885
)

$
(78
)

$
350,646Investing activities:Acquisition of a business, net of cash acquired






(31,217
)














(31,217
)Purchases of and change in prepayments for purchases of property
    and equipment






(622,008
)






(179,546
)






(801,554
)Purchases of and deposits for wireless licenses and spectrum
    clearing costs






(75,780
)






(2,671
)






(78,451
)Return of deposit for wireless licenses






70,000















70,000Purchases of investments






(598,015
)














(598,015
)Sales and maturities of investments






521,168







11,300







532,468Investments in and advances to affiliates and consolidated
    subsidiaries


(7,885
)














7,885



Purchase of membership units of equity method investment






(1,033
)














(1,033
)Other


(19
)


(2,502
)






345







(2,176
)Net cash used in investing activities


(7,904
)


(739,387
)






(170,572
)


7,885



(909,978
)Financing activities:Proceeds from issuance of long-term debt


242,500



293,250















535,750Issuance of related party debt


(242,500
)


74,025







168,475







Repayment of long-term debt






(9,000
)






(1,500
)






(10,500
)Payment of debt issuance costs


(1,049
)


(6,609
)














(7,658
)Capital contributions, net


7,885



7,885











(7,885
)


7,885Noncontrolling interest distribution














(78
)


78



Other






(41,774
)














(41,774
)Net cash provided by financing activities


6,836



317,777







166,897



(7,807
)


483,703Net decrease in cash and cash equivalents


(35
)


(66,034
)






(9,560
)






(75,629
)Cash and cash equivalents at beginning of period


62



399,153







34,122







433,337Cash and cash equivalents at end of period

$
27


$
333,119


$



$
24,562


$



$
357,708  134




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Cash Flows for the Year Ended December 31,
    2007 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiary


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by (used in) operating activities

$
(1,166
)

$
312,990


$



$
(16,168
)

$
20,525


$
316,181Investing activities:Purchases of and change in prepayments for purchases of property
    and equipment






(463,389
)






(28,550
)






(491,939
)Purchases of and deposits for wireless licenses and spectrum
    clearing costs






(5,744
)






452







(5,292
)Proceeds from sale of wireless licenses and operating assets






9,500















9,500Purchases of investments






(642,513
)














(642,513
)Sales and maturities of investments






530,956















530,956Investments in and advances to affiliates and consolidated
    subsidiaries


(9,690
)


(4,706
)










9,690



(4,706
)Purchase of membership units of equity method investment






(18,955
)














(18,955
)Other


1,022



(426
)






(375
)






221Net cash used in investing activities


(8,668
)


(595,277
)






(28,473
)


9,690



(622,728
)Financing activities:Proceeds from issuance of long-term debt






370,480















370,480Issuance of related party debt






(6,000
)






6,000







Repayment of long-term debt






(9,000
)














(9,000
)Payment of debt issuance costs






(7,757
)






(8
)






(7,765
)Capital contributions, net


9,690



9,690







29,405



(30,215
)


18,570Other






(5,213
)














(5,213
)Net cash provided by financing activities


9,690



352,200







35,397



(30,215
)


367,072Net increase (decrease) in cash and cash equivalents


(144
)


69,913







(9,244
)






60,525Cash and cash equivalents at beginning of period


206



329,240







43,366







372,812Cash and cash equivalents at end of period

$
62


$
399,153


$



$
34,122


$



$
433,337  135




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
           136




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
    CONSOLIDATED BALANCE SHEETS(In thousands, except share amounts)
  December 31,2009


2008AssetsCash and cash equivalents

$
174,933


$
357,681Short-term investments


389,154



238,143Restricted cash, cash equivalents and short-term investments


1,635



3,169Due from Leap Wireless International, Inc., net


18,012



21,185Inventories


107,912



99,086Deferred charges


38,872



27,207Other current assets


73,121



51,865Total current assets


803,639



798,336Property and equipment, net


2,121,092



1,842,716Wireless licenses


1,921,973



1,841,798Assets held for sale


2,381



45,569Goodwill


430,101



430,101Intangible assets, net


24,535



29,854Other assets


76,976



75,905Total assets

$
5,380,697


$
5,064,279Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
310,370


$
325,274Current maturities of long-term debt


8,000



13,000Other current liabilities


191,500



156,189Total current liabilities


509,870



494,463Long-term debt


2,485,318



2,316,025Long-term debt due to Leap Wireless International, Inc.


242,500



242,500Deferred tax liabilities


259,512



217,631Other long-term liabilities


99,696



84,350Total liabilities


3,596,896



3,354,969Redeemable noncontrolling interests


71,632



71,879Commitments and contingencies (Note 12)Stockholders equity:Common stock  authorized 1,000 shares,
    $.0001 par value; 100 shares issued and outstanding at
    December 31, 2009 and 2008, respectively






Additional paid-in capital


2,148,201



1,839,320Accumulated deficit


(437,045
)


(195,967
)Accumulated other comprehensive income (loss)


1,013



(5,922
)Total stockholders equity


1,712,169



1,637,431Total liabilities and stockholders equity

$
5,380,697


$
5,064,279    137




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
    CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands)
  Year Ended December 31,2009


2008


2007Revenues:Service revenues

$
2,143,829


$
1,709,101


$
1,395,667Equipment revenues


239,333



249,761



235,136Total revenues


2,383,162



1,958,862



1,630,803Operating expenses:Cost of service (exclusive of items shown separately below)


609,006



488,298



384,128Cost of equipment


561,262



465,422



405,997Selling and marketing


411,564



294,917



206,213General and administrative


349,724



326,870



266,548Depreciation and amortization


410,697



331,421



302,114Impairment of assets


639



177



1,368Total operating expenses


2,342,892



1,907,105



1,566,368Gain (loss) on sale or disposal of assets


(418
)


(209
)


902Operating income


39,852



51,548



65,337Equity in net income (loss) of investee


3,946



(298
)


(2,309
)Interest income


3,601



14,551



28,901Interest expense


(197,777
)


(151,887
)


(121,231
)Related party interest expense


(24,250
)


(12,529
)


Other income (expense), net


469



(7,492
)


(6,107
)Loss on extinguishment of debt


(26,310
)






Loss before income taxes


(200,469
)


(106,107
)


(35,409
)Income tax expense


(40,609
)


(38,970
)


(35,924
)Net loss


(241,078
)


(145,077
)


(71,333
)Accretion of redeemable noncontrolling interests, net of tax


(1,529
)


(6,820
)


(3,854
)Net loss attributable to common stockholder

$
(242,607
)

$
(151,897
)

$
(75,187
)    138




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
    CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands)
  Year Ended December 31,2009


2008


2007Operating activities:Net loss

$
(241,078
)

$
(145,077
)

$
(71,333
)Adjustments to reconcile net loss to net cash provided by
    operating activities:Share-based compensation expense


42,713



35,215



29,339Depreciation and amortization


410,697



331,420



302,114Accretion of asset retirement obligations


1,888



1,153



1,666Non-cash interest items, net


8,357



13,057



(4,425
)Non-cash loss on extinguishment of debt


8,805







669Deferred income tax expense


38,164



36,310



34,642Impairment of assets


639



177



1,368Impairment of short-term investments






7,538



5,440(Gain) loss on sale or disposal of assets


418



209



(902
)Gain on extinguishment of asset retirement obligations










(6,089
)Equity in net (income) loss of investee


(3,946
)


298



2,309Changes in assets and liabilities:Inventories and deferred charges


(20,491
)


(60,899
)


24,977Other assets


(18,674
)


(20,281
)


31,161Accounts payable and accrued liabilities


5,678



81,783



(52,881
)Other liabilities


50,488



75,838



18,692Net cash provided by operating activities


283,658



356,741



316,747Investing activities:Acquisition of a business, net of cash acquired






(31,217
)


Purchases of property and equipment


(699,525
)


(795,678
)


(504,770
)Change in prepayments for purchases of property and equipment


5,691



(5,876
)


12,831Purchases of and deposits for wireless licenses and spectrum
    clearing costs


(35,356
)


(78,451
)


(5,292
)Return of deposit for wireless licenses






70,000



Proceeds from sale of wireless licenses and operating assets


2,965







9,500Purchases of investments


(883,173
)


(598,015
)


(642,513
)Sales and maturities of investments


733,268



532,468



530,956Purchase of noncontrolling interest










(4,706
)Purchase of membership units of equity method investment






(1,033
)


(18,955
)Change in restricted cash


958



(8,236
)


(200
)Net cash used in investing activities


(875,172
)


(916,038
)


(623,149
)Financing activities:Proceeds from issuance of long-term debt


1,057,474



535,750



370,480Repayment of long-term debt


(897,904
)


(10,500
)


(9,000
)Payment of debt issuance costs


(16,200
)


(7,658
)


(7,765
)Noncontrolling interest contributions










8,880Capital contributions, net


267,105



7,885



9,690Other


(1,709
)


(41,774
)


(5,213
)Net cash provided by financing activities


408,766



483,703



367,072Net increase (decrease) in cash and cash equivalents


(182,748
)


(75,594
)


60,670Cash and cash equivalents at beginning of period


357,681



433,275



372,605Cash and cash equivalents at end of period

$
174,933


$
357,681


$
433,275    139




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
    CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY(In thousands)
  AccumulatedRetained


OtherAdditional


Earnings


ComprehensivePaid-in


(Accumulated


IncomeCapital


Deficit)


(Loss)


TotalBalance at December 31, 2006


1,768,458



20,443



1,786



1,790,687Components of comprehensive loss:Net loss






(71,333
)






(71,333
)Net unrealized holding losses on investments










(70
)


(70
)Unrealized losses on derivative instruments










(10,391
)


(10,391
)Comprehensive loss














(81,794
)Share-based compensation expense


29,227











29,227Accretion of redeemable noncontrolling interests, net of tax


(3,854
)










(3,854
)Capital contributions


9,690











9,690Balance at December 31, 2007


1,803,521



(50,890
)


(8,675
)


1,743,956Components of comprehensive loss:Net loss






(145,077
)






(145,077
)Net unrealized holding gains on investments, net of tax










273



273Unrealized losses on derivative instruments










(1,471
)


(1,471
)Swaplet amortization on derivative instruments, net of tax










3,951



3,951Comprehensive loss














(142,324
)Share-based compensation expense


34,734











34,734Accretion of redeemable noncontrolling interests, net of tax


(6,820
)










(6,820
)Capital contributions


7,885











7,885Balance at December 31, 2008


1,839,320



(195,967
)


(5,922
)


1,637,431Components of comprehensive loss:Net loss






(241,078
)






(241,078
)Net unrealized holding gains on investments, net of tax










816



816Swaplet amortization and reclassification of losses included in
    earnings on derivative instruments, including tax effect










6,119



6,119Comprehensive loss














(234,143
)Share-based compensation expense


43,306











43,306Accretion of redeemable noncontrolling interests, net of tax


(1,529
)










(1,529
)Capital contributions


267,104











267,104Balance at December 31, 2009

$
2,148,201


$
(437,045
)

$
1,013


$
1,712,169    140




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Note 1.
    The
    Company  ®
  Note 2.
    Basis of
    Presentation and Significant Accounting Policies  Basis
    of Presentation
      Principles
    of Consolidation
   141




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Subsequent
    Events
    Segment
    and Geographic Data
  tm
  Revenues
  month-to-month
     142




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      and/or
    E-911
  Costs
    and Expenses
    Cost of Service.
  Cost of Equipment.
  Selling and Marketing.
  General and Administrative.
  Cash
    and Cash Equivalents
   143




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Short-Term
    Investments
    available-for-sale available-for-sale other-than-temporary,
  Restricted
    Cash, Cash Equivalents and Short-Term Investments
    Fair
    Value of Financial Instruments
      Due
    From Leap Wireless International, Inc., Net
    Inventories
  first-in,
 144




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property
    and Equipment
      DepreciableLifeNetwork equipment:Switches


10Switch power equipment


15Cell site equipment and site improvements


7Towers


15Antennae


5Computer hardware and software


3-5Furniture, fixtures, retail and office equipment


3-7   construction-in-progress construction-in-progress construction-in-progress
      Wireless
    Licenses
   145




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Goodwill
    and Intangible Assets
    Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
   146




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Wireless
    Licenses
       147




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Goodwill
       148




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Derivative
    Instruments and Hedging Activities
        Investments
    in Other Entities
   149




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    other-than-temporary other-than-temporary,
  Concentrations
      Operating
    Leases
    Asset
    Retirement Obligations
   150




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedDecember 31,2009


2008Asset retirement obligations, beginning of year

$
16,997


$
15,813Liabilities incurred


7,434



3,079Liabilities settled(1)






(3,048
)Accretion expense


1,888



1,153Decommissioned sites


(570
)


Asset retirement obligations, end of year

$
25,749


$
16,997     (1)
    
    The Company negotiated amendments to agreements that reduced its
    liability for the removal of equipment on certain of its cell
    sites at the end of the lease term, resulting in a reduction to
    its liability of $3.0 million in 2008.  Debt
    Issuance Costs
    Advertising
    Costs
    Share-Based
    Compensation
    Income
    Taxes
   151




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  20-year
             152




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Recent
    Accounting Pronouncements
     153




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 3.
    Fair
    Value of Financial Instruments    Level 1
    Quoted prices in active markets for identical assets or
    liabilities. The Company did not have any Level 1 assets or
    liabilities as of December 31, 2009 or 2008.Level 2
    Observable inputs other than Level 1 prices, such as quoted
    prices for similar assets or liabilities, quoted prices in
    markets that are not active or other inputs that are observable
    or can be corroborated by observable market data for
    substantially the full term of the assets or liabilities. The
    Companys Level 2 assets and liabilities as of
    December 31, 2009 and 2008 included its cash equivalents,
    its short-term investments in obligations of the
    U.S. government and government agencies, a majority of its
    short-term investments in commercial paper and, as of
    December 31, 2008, its interest rate swaps.Level 3
    Unobservable inputs that are supported by little or no market
    activity and that are significant to the fair value of the
    assets or liabilities. Such assets and liabilities may have
    values determined using pricing models, discounted cash flow
    methodologies, or similar techniques, and include instruments
    for which the determination of fair value requires significant
    management judgment or estimation. The Companys
    Level 3 asset as of December 31, 2009 and 2008
    comprised its short-term investment in asset-backed commercial
    paper.    At Fair Value as of December 31, 2009Level 1


Level 2


Level 3


TotalAssets:Cash equivalents

$



$
152,165


$



$
152,165Short-term investments






386,423



2,731



389,154Total

$



$
538,588


$
2,731


$
541,319   154




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  At Fair Value as of December 31, 2008Level 1


Level 2


Level 3


TotalAssets:Cash equivalents

$



$
329,657


$



$
329,657Short-term investments






236,893



1,250



238,143Total

$



$
566,550


$
1,250


$
567,800Liabilities:Interest rate swaps

$



$
(11,045
)

$



$
(11,045
)Total

$



$
(11,045
)

$



$
(11,045
)       Year EndedDecember 31,2009


2008Beginning balance, January 1

$
1,250


$
16,200Total gains (losses) (realized/unrealized):Included in net loss

$
667


$
(7,613
)Included in comprehensive loss


1,680



Settlements


(866
)


(7,337
)Transfers in (out) of Level 3






Ending balance, December 31

$
2,731


$
1,250     Cash
    Equivalents and Short-Term Investments
  available-for-sale.
 155




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##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Available-for-sale
  As of December 31, 2009Cost


Fair ValueMoney markets and certificates of deposits

$
79,201


$
79,201Commercial paper


108,955



108,952Asset-backed commercial paper


1,051



2,731U.S. government or government agency securities


350,402



350,435$
539,609


$
541,319   As of December 31, 2008Cost


Fair ValueMoney markets and certificates of deposits

$
159,708


$
159,708Commercial paper


125,850



125,866Asset-backed commercial paper


1,250



1,250U.S. government or government agency securities


280,596



280,976$
567,404


$
567,800   Interest
    Rate Swaps
      Long-Term
    Debt
   156




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##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 4.
    Supplementary
    Financial Information  Supplementary
    Balance Sheet Information (in thousands):
  As of December 31,2009


2008Other current assets:Accounts receivable, net(1)

$
37,456


$
31,177Prepaid expenses


21,026



19,284Other


14,639



1,404$
73,121


$
51,865Property and equipment, net:(2)Network equipment

$
2,722,863


$
1,911,173Computer hardware and software


246,546



203,274Construction-in-progress


303,167



574,773Other


101,616



60,0963,374,192



2,749,316Accumulated depreciation


(1,253,100
)


(906,600
)$
2,121,092


$
1,842,716Intangible assets, net:(3)Customer relationships

$
7,347


$
7,347Trademarks


37,000



37,00044,347



44,347Accumulated amortization customer relationships


(5,496
)


(2,820
)Accumulated amortization trademarks


(14,316
)


(11,673
)$
24,535


$
29,854Accounts payable and accrued liabilities:Trade accounts payable

$
180,711


$
201,843Accrued payroll and related benefits


47,651



50,462Other accrued liabilities


82,008



72,969$
310,370


$
325,274Other current liabilities:Deferred service revenue(4)

$
82,403


$
62,998Deferred equipment revenue(5)


28,218



20,614Accrued sales, telecommunications, property and other taxes
    payable


33,776



32,799Accrued interest


41,913



32,687Other


5,190



7,091$
191,500


$
156,189     (1)
    
    Accounts receivable, net consists primarily of amounts billed to
    third-party dealers for handsets and accessories net of an
    allowance for doubtful accounts. 157




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##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (2)
    
    As of December 31, 2009 and 2008, approximately
    $8.5 million of assets were held by the Company under
    capital lease arrangements. Accumulated amortization relating to
    these assets totaled $3.8 million and $3.2 million as
    of December 31, 2009 and 2008, respectively.(3)
    
    Amortization expense for intangible assets, net for the years
    ended December 31, 2009, 2008 and 2007 was
    $5.3 million, $23.6 million and $33.7 million,
    respectively. Estimated amortization expense for intangible
    assets for 2010 is $4.1 million, for 2011 is
    $3.0 million, for 2012 is $2.7 million, for 2013 is
    $2.6 million, for 2014 is $2.6 million and is
    $9.5 million thereafter.(4)
    
    Deferred service revenue consists primarily of cash received
    from customers in advance of their service period.(5)
    
    Deferred equipment revenue relates to devices sold to
    third-party dealers.  Supplementary
    Cash Flow Information (in thousands):
  December 31,2009


2008


2007Supplementary disclosure of cash flow information:Cash paid for interest

$
211,468


$
178,880


$
161,280Cash paid for income taxes

$
1,950


$
1,914


$
506Supplementary disclosure of non-cash investing activities:Contribution of wireless licenses

$



$



$
25,130Supplementary disclosure of non-cash financing activities:Assets acquired through capital lease arrangements

$



$



$
40,799   Note 5.
    Long-Term
    Debt    As of December 31,2009


2008Term loans under senior secured credit facilities

$
18,096


$
916,000Unamortized deferred lender fees






(4,527
)Unsecured senior notes due 2014 and 2015


1,400,000



1,400,000Unamortized premium on $350 million unsecured senior notes
    due 2014


15,111



17,552Senior secured notes due 2016


1,100,000



Unamortized discount on $1,100 million senior secured notes
    due 2016


(39,889
)


2,493,318



2,329,025Current maturities of long-term debt


(8,000
)


(13,000
)$
2,485,318


$
2,316,025Long-term debt due to Leap Wireless International, Inc. due 2014

$
242,500


$
242,500   Senior
    Secured Credit Facilities
  Cricket
    Communications
   158




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    LCW
    Operations
        Senior
    Notes
  Unsecured
    Senior Notes Due 2014
     159




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Unsecured
    Senior Notes Due 2015
     160




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Senior
    Secured Notes Due 2016
       161




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  pari passu
           162




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  90-day 90-day Form S-4
  Intercompany
    Loan Due to Leap Wireless International, Inc.
      Years Ended December 31:2010

$
8,0002011


10,0962012


2013


2014


1,342,500Thereafter


1,400,000Total

$
2,760,596   Note 6.
    Income
    Taxes    December 31,2009


2008


2007Current provision:Federal

$



$



$
(422
)State


2,445



2,660



1,7042,445



2,660



1,282Deferred provision:Federal


36,537



32,416



37,736State


1,627



3,894



(3,094
)38,164



36,310



34,642$
40,609


$
38,970


$
35,924  163




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2009


2008


2007Amounts computed at statutory federal rate

$
(69,592
)

$
(38,963
)

$
(13,496
)Non-deductible expenses


865



2,473



2,910State income tax expense (benefit), net of federal income tax
    impact


3,218



5,603



(950
)Net tax expense related to joint venture


1,384



2,375



1,337Change in valuation allowance


104,734



67,482



46,123$
40,609


$
38,970


$
35,924     As of December 31,2009


2008Deferred tax assets:Net operating loss carryforwards

$
556,034


$
386,248Wireless licenses


33,780



17,913Capital loss carryforwards


1,510



1,621Reserves and allowances


16,006



13,002Share-based compensation


31,053



16,685Deferred charges


39,583



35,254Investments and deferred tax on unrealized losses


9,669



19,158Other


7,630



12,801Gross deferred tax assets


695,265



502,682Deferred tax liabilities:Intangible assets


(12,903
)


(10,012
)Property and equipment


(151,868
)


(81,318
)Other


(513
)


Net deferred tax assets


529,981



411,352Valuation allowance


(527,948
)


(408,903
)Other deferred tax liabilities:Wireless licenses


(236,409
)


(205,474
)Goodwill


(13,540
)


(11,093
)Investment in joint venture


(6,398
)


(2,702
)Net deferred tax liabilities

$
(254,314
)

$
(216,820
)  164




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of December 31,2009


2008Current deferred tax assets (included in other current assets)

$
5,198


$
811Long-term deferred tax liabilities


(259,512
)


(217,631
)$
(254,314
)

$
(216,820
)         Note 7.
    Stockholders
    Equity    Note 8.
    Share-Based
    Compensation   165




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Stock
    Options
    As of December 31,2009


2008Expected volatility


54
%


51
%Expected term (in years)


5.75



6.0Risk-free interest rate


2.15
%


2.80
%Expected dividend yield






    166




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Weighted-


Weighted-Average


AverageExercise


RemainingNumber of


Price per


Contractual


AggregateShares


Share


Term


Intrinsic Value(In years)Options outstanding at December 31, 2007


3,374


$
45.12



8.28


$
28,419Options exercisable at December 31, 2007


270


$
38.71



7.85


$
3,370Options granted


1,392


$
43.61Options forfeited


(129
)


48.75Options exercised


(229
)


27.03Options outstanding at December 31, 2008


4,408


$
45.48



8.04


$
679Options exercisable at December 31, 2008


1,004


$
34.44



6.61


$
213Options granted


791


$
28.74Options forfeited


(228
)


44.30Options exercised


(35
)


28.38Options outstanding at December 31, 2009


4,936


$
42.97



7.08


$
247Options exercisable at December 31, 2009


1,596


$
40.15



6.16


$
         Restricted
    Stock
   167




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Weighted-AverageGrant DateNumber of


Fair ValueShares


per ShareRestricted stock awards outstanding at December 31, 2007


1,405



42.70Shares issued


593



43.13Shares forfeited


(49
)


50.94Shares vested


(572
)


28.25Restricted stock awards outstanding at December 31, 2008


1,377



48.60Shares issued


627



27.76Shares forfeited


(98
)


43.46Shares vested


(175
)


50.33Restricted stock awards outstanding at December 31, 2009


1,731


$
41.17     Year Ended December 31,2009


2008


2007Fair value on vesting date of vested restricted stock awards

$
3,912


$
24,104


$
10,525       Employee
    Stock Purchase Plan
    Deferred
    Stock Units
   168




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Allocation
    of Share-Based Compensation Expense
    Year Ended December 31,2009


2008


2006Cost of service

$
3,546


$
3,060


$
2,156Selling and marketing expenses


6,264



4,580



3,330General and administrative expenses


32,903



27,575



23,853Share-based compensation expense

$
42,713


$
35,215


$
29,339   Note 9.
    Employee
    Savings and Retirement Plan    Note 10.
    Significant
    Acquisitions and Dispositions          1 2
 169




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Note 11.
    Arrangements
    with Variable Interest Entities    mark-to-market)
  Arrangements
    with LCW Wireless
    Limited
    Liability Company Agreement
  30-day
   170




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Line of
    Credit Agreement
  30-day
  Management
    Agreement
  mark-up
  Other
    Arrangements
    with Denali
    Limited
    Liability Company Agreement
    Senior
    Secured Credit Agreement
  sub-facility
 171




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  sub-facility sub-facility
  Management
    Agreement
    and/or
  Noncontrolling
    Interests Assets and Liabilities
    As of December 31,2009


2008AssetsCash and cash equivalents

$
14,099


$
24,562Short-term investments


2,731



1,250Inventories


5,029



1,574Property and equipment, net


267,194



256,370Wireless licenses


333,910



332,277LiabilitiesAccounts payable and accrued liabilities

$
6,850


$
27,813Current maturities of long-term debt


8,000



4,000Other current liabilities


18,803



6,382Long-term debt


10,096



34,500Other long-term liabilities


9,463



5,489  172




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Values
    of Redeemable Noncontrolling Interests
    Year Ended December 31,2009


2008


2007Beginning balance, January 1

$
71,879


$
61,868



33,981Accretion of redeemable noncontrolling interests, before tax


(247
)


8,588



23,572Noncontrolling interest contributions






1,423



4,315Ending balance, December 31

$
71,632


$
71,879


$
61,868   Note 12.
    Commitments
    and Contingencies      and/or
  Patent
    Litigation
  Freedom
    Wireless
  ® tm
 173




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    DNT
  and/or
  Digital
    Technology Licensing
  and/or ® and/or and/or
  On The
    Go
    DownUnder
    Wireless
  Cal-Comp,
 174




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    American
    Wireless Group
    and/or
  and/or
  Securities
    and Derivative Litigation
    and/or
 175




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Rule 10b-5, class-wide
    Department
    of Justice Inquiry
    Other
    Litigation
    Indemnification
    Agreements
   176




---



##### Table of Contents



CRICKET
    COMMUNICATIONS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Capital
    and Operating Leases
    Capital


OperatingYears Ended December 31:

Leases


Leases2010

$
2,466


$
235,5172011


2,466



230,9812012


2,466



231,6212013


2,466



231,8102014


2,466



230,792Thereafter


1,526



688,311Total minimum lease payments

$
13,856


$
1,849,032Less amount representing interest


(1,571
)Present value of minimum lease payments

$
12,285   Tower
    Provider Commitments
    Outstanding
    Letters of Credit and Surety Bonds
     177




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
           178




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  BALANCE
    SHEETS
 (In
    thousands)
  December 31,2009


2008AssetsDue from Cricket Communications, Inc., net

$
156,725


$
149,547Total current assets


156,725



149,547Wireless licenses


1,580,174



1,501,631Assets held for sale


2,381



45,569Total assets

$
1,739,280


$
1,696,747Liabilities and Members EquityDeferred tax liabilities

$
155,436


$
133,817Total liabilities


155,436



133,817Members equity:Additional paid-in capital


1,583,844



1,562,930Retained earnings






Total members equity


1,583,844



1,562,930Total liabilities and members equity

$
1,739,280


$
1,696,747    179




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  STATEMENTS
    OF OPERATIONS
 (In
    thousands)
  Year Ended December 31,2009


2008


2007Related party revenues

$
89,022


$
72,509


$
54,424Operating expenses:Related party general and administrative


910



903



130Impairment of assets


639



177



985(Gain) on sale or disposal of assets


(4,426
)


(1,274
)


(1,251
)Total operating expenses (income)


(2,877
)


(194
)


(136
)Income before income taxes


91,899



72,703



54,560Income tax expense


(21,763
)


(27,033
)


(5,581
)Net income

$
70,136


$
45,670


$
48,979    180




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  STATEMENTS
    OF CASH FLOWS
 (In
    thousands)
  Year Ended December 31,2009


2008


2007Operating activities:Net income

$
70,136


$
45,670


$
48,979Adjustments to reconcile net loss to net cash provided by
    operating activities:Deferred income tax expense


21,169



26,929



5,543Impairment of assets


639



177



985(Gain) on sale or disposal of assets


(4,426
)


(1,274
)


(1,251
)Changes in assets and liabilities:Change in due from Cricket Communications, Inc., net


(87,968
)


(71,502
)


(54,256
)Net cash provided by operating activities










Investing activities:Cash provided by investing activities










Financing activities:Cash provided by financing activities










Net increase in cash and cash equivalents










Cash and cash equivalents at beginning of period










Cash and cash equivalents at end of period

$



$



$
Non-cash financing activities:Contribution of wireless licenses and spectrum clearing costs
    from Cricket Communications, Inc.

$
33,721


$
15,894


$
72,362Dividends to parent


(82,943
)

$
(115,737
)

$
    181




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  STATEMENTS
    OF MEMBERS EQUITY
 (In
    thousands)
  AdditionalPaid-in


RetainedCapital


Earnings


TotalBalance at December 31, 2006


1,527,808



(32,046
)


1,495,762Net income






48,979



48,979Parent contributions


72,362







72,362Balance at December 31, 2007


1,600,170



16,933



1,617,103Net income






45,670



45,670Parent dividends


(53,134
)


(62,603
)


(115,737
)Parent contributions


15,894







15,894Balance at December 31, 2008


1,562,930







1,562,930Net income






70,136



70,136Parent dividends


(12,807
)


(70,136
)


(82,943
)Parent contributions


33,721







33,721Balance at December 31, 2009

$
1,583,844


$



$
1,583,844    182




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS
  Note 1.
    The
    Company  ®
    Note 2.
    Basis of
    Presentation and Significant Accounting Policies  Basis
    of Presentation
    Subsequent
    Events
    Revenues
    General
    and Administrative Expenses
  and/or
 183




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  Wireless
    Licenses
    and/or
  Impairment
    of Indefinite-Lived Intangible Assets
     184




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
           185




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
      Income
    Taxes
         186




---



##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
      Note 3.
    Income
    Taxes    December 31,2009


2008


2007Current provision:Federal

$



$



$
State


145



102



38145



102



38Deferred provision:Federal


28,404



25,446



(3,532
)State


(6,786
)


1,485



9,07521,618



26,931



5,543$
21,763


$
27,033


$
5,581     December 31,2009


2008


2007Amounts computed at statutory federal rate

$
32,164


$
25,446


$
19,096State income tax benefit, net of federal income tax impact


4,126



3,440



3,818Change in state tax rate


(7,761
)


(836
)


1,319Change in valuation allowance


(6,766
)


(1,017
)


(18,652
)$
21,763


$
27,033


$
5,581  187




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##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    As of December 31,2009


2008Deferred tax assets:Net operating loss carryforwards

$
64,264


$
80,965Wireless licenses


33,869



14,514Capital loss carryforwards






4,254Net deferred tax assets


98,133



99,733Valuation allowance


(3,115
)


(9,881
)Other deferred tax liabilities:Wireless licenses


(237,031
)


(212,294
)Goodwill


(13,422
)


(11,375
)Net deferred tax liabilities

$
(155,435
)

$
(133,817
)       Note 4.
    Members
    Equity    Note 5.
    Significant
    Acquisitions and Dispositions  Dallas-Ft. Worth,
       188




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##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  1 2
  Note 6.
    Related
    Party Agreements  Intangible
    Property License Agreement
    Rent
    Reimbursement Agreement
  month-to-month
  Senior
    Secured Notes Due 2016
    pari passu
 189




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##### Table of Contents



CRICKET
    LICENSE COMPANY, LLC
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
      Unsecured
    Senior Notes Due 2014
    Unsecured
    Senior Notes Due 2015
   190




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  (a) Evaluation of Disclosure Controls and Procedures
    Rule 13a-15(b), Form 10-K, Rule 13a-15(e)
  (b) Managements Report on Internal Control over
    Financial Reporting
  Rule 13a-15(f).
    Internal Control 
    Integrated Framework Internal
    Control  Integrated Framework
   191




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##### Table of Contents



(c) Changes in Internal Control over Financial
    Reporting
    Item 9A(T).
    Controls
    and Procedures    Item 9B.
    Other
    Information   192




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##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance  www.leapwireless.com.
  Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters  Equity
    Compensation Plan Information
    Weighted-averageNumber of securities to be


exercise price of


Number of securitiesissued upon exercise of


outstanding


remaining available for futureoutstanding options


options


issuance under equityPlan Category

and rights


and rights


compensation plansEquity compensation plans approved by security holders


4,701,251
(1)(3)

$
43.39



1,675,669
(4)Equity compensation plans not approved by security holders


235,000
(2)(3)

$
34.49



13,500Total


4,936,251


$
42.97



1,689,169     (1)
    
    Represents shares reserved for issuance under the 2004 Plan
    adopted by the compensation committee of our board of directors
    on December 30, 2004 (as contemplated by our confirmed plan
    of reorganization) and as amended on March 8, 2007. Stock
    options granted prior to May 17, 2007 were granted prior to
    the approval of the 2004 Plan by Leap stockholders. The material
    features of the 2004 Plan are described in our Definitive Proxy
    Statement dated April 6, 2007, as filed with the SEC on
    such date, which description is incorporated herein by reference.(2)
    
    Represents shares reserved for issuance under the 2009
    Employment Inducement Equity Incentive Plan, or the 2009
    Inducement Plan, which was adopted in February 2009 without
    stockholder approval, as permitted under the rules and
    regulations of the NASDAQ Stock Market. The material features of
    the 2009 Inducement Plan are described in our Definitive Proxy
    Statement dated April 10, 2009, as filed with the SEC on
    such date, which description is incorporated herein by
    reference. The 2009 Inducement Plan was amended on
    January 14, 2010 by our Board to increase the number of
    shares reserved for issuance under the 2009 Inducement Plan by
    100,000 shares of Leap common stock, which shares are not
    reflected in the amounts shown above.(3)
    
    Excludes 1,679,787 and 51,500 shares of restricted stock
    issued under the 2004 Plan and 2009 Inducement Plan,
    respectively, which are subject to release upon vesting of the
    shares. 193




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##### Table of Contents



(4)
    
    Consists of 531,607 shares reserved for issuance under the
    Leap Wireless International, Inc. Employee Stock Purchase Plan,
    and 1,144,062 shares reserved for issuance under the 2004 Plan.    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accounting Fees and Services   194




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##### Table of Contents



PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules  (a)
    Financial
    Statements and Financial Statement Schedules  Documents
    filed as part of this report:
  1.
    Financial
    Statements:                                            2.
    Financial
    Statement Schedules:   195




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##### Table of Contents



(b)
    Exhibits
  EXHIBIT INDEX
  ExhibitNumber

Description2.1(1)

Fifth Amended Joint Plan of Reorganization, dated as of
    July 30, 2003, as modified to reflect all technical
    amendments subsequently approved by the Bankruptcy Court.2.2(1)

Disclosure Statement Accompanying Fifth Amended Joint Plan of
    Reorganization dated as of July 30, 2003.2.3(1)

Order Confirming Debtors Fifth Amended Joint Plan of
    Reorganization dated as of July 30, 2003.3.1*

Amended and Restated Certificate of Incorporation of Leap
    Wireless International, Inc.3.2*

Amended and Restated Bylaws of Leap Wireless International, Inc.4.1*

Form of Common Stock Certificate.4.2(2)

Amended and Restated Registration Rights Agreement, dated as of
    September 3, 2009, by and among Leap, MHR Capital Partners
    Master Account LP, MHR Capital Partners (100) LP, MHR
    Institutional Partners II LP, MHR Institutional Partners
    IIA LP and MHR Institutional Partners III LP.4.3(3)

Indenture, dated as of October 23, 2006, by and among
    Cricket Communications, Inc., the Initial Guarantors (as defined
    therein) and Wells Fargo Bank, N.A., as trustee.4.3.1(3)

Form of 9.375% Senior Note of Cricket Communications, Inc.
    due 2014 (attached as Exhibit A to the Indenture filed as
    Exhibit 4.3.1 hereto).4.3.2(4)

Third Supplemental Indenture, dated as of April 30, 2007,
    among Cricket Communications, Inc., Wells Fargo Bank, N.A., as
    trustee, Leap Wireless International, Inc. and the other
    guarantors under the Indenture.4.4(5)

Indenture, dated as of June 25, 2008, between Cricket
    Communications, Inc., the Guarantors and Wells Fargo Bank, N.A.,
    as trustee.4.4.1(5)

Form of 10% Senior Note of Cricket Communications, Inc. due
    2015 (attached as Exhibit A to the Indenture filed as
    Exhibit 4.4 hereto).4.5(5)

Registration Rights Agreement, dated as of June 25, 2008,
    between Cricket Communications, Inc., the Guarantors and
    Goldman, Sachs & Co. and Morgan Stanley &
    Co. Incorporated, as representatives of the Initial Purchasers.4.6(6)

Indenture, dated as of June 25, 2008, between Leap Wireless
    International and Wells Fargo Bank, N.A., as trustee.4.6.1(6)

Form of 4.50% Convertible Senior Note of Leap Wireless
    International, Inc. due 2014 (attached as Exhibit A to the
    Indenture filed as Exhibit 4.6 hereto).4.7(6)

Registration Rights Agreement, dated as of June 25, 2008,
    between Leap Wireless International, Inc. and Goldman,
    Sachs & Co. and Morgan Stanley & Co.
    Incorporated, as representatives of the Initial Purchasers.4.8(7)

Indenture, dated as of June 5, 2009, by and among Cricket
    Communications, Inc., the Initial Guarantors (as defined
    therein) and Wilmington Trust FSB, as trustee.4.8.1(7)

Form of 7.75% Senior Secured Note of Cricket
    Communications, Inc. due 2016 (attached as Exhibit A to the
    Indenture filed as Exhibit 4.8 hereto).4.9(7)

Security Agreement, dated as of June 5, 2009, by and among
    Cricket Communications, Inc., the Guarantors (as defined
    therein) and Wilmington Trust FSB, as collateral trustee.4.10(7)

Collateral Trust Agreement, dated as of June 5, 2009,
    by and among Cricket Communications, Inc., the Guarantors (as
    defined therein) and Wilmington Trust FSB, as trustee and
    collateral trustee. 196




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##### Table of Contents



ExhibitNumber

Description4.11(7)

Registration Rights Agreement, dated as of June 5, 2009, by
    and among Cricket Communications, Inc., the Guarantors (as
    defined therein), and Goldman, Sachs & Co. and
    Deutsche Bank Securities Inc., as representatives of the Initial
    Purchasers named therein.10.1(8)

System Equipment Purchase Agreement, dated as of June 11,
    2007, by and among Cricket Communications, Inc., Alaska Native
    Broadband 1 License LLC and Nortel Networks Inc.10.2(8)

System Equipment Purchase Agreement, dated as of June 14,
    2007, by and among Cricket Communications, Inc., Alaska Native
    Broadband 1 License LLC and Lucent Technologies, Inc.10.3(1)

Amended and Restated System Equipment Purchase Agreement, dated
    as of May 24, 2007, by and between Cricket Communications,
    Inc. and Futurewei Technologies, Inc.10.4(9)

Credit Agreement, dated as of July 13, 2006, by and among
    Cricket Communications, Inc., Denali Spectrum License, LLC and
    Denali Spectrum, LLC.10.4.1(10)

Amendment No. 1 to Credit Agreement by and among Cricket
    Communications, Inc., Denali Spectrum License, LLC and Denali
    Spectrum, LLC, dated as of September 28, 2006, between
    Cricket Communications, Inc., Denali Spectrum License, LLC and
    Denali Spectrum, LLC.10.4.2(11)

Amendment No. 2 to Credit Agreement by and among Cricket
    Communications, Inc., Denali Spectrum License, LLC and Denali
    Spectrum, LLC, dated as of April 16, 2007, between Cricket
    Communications, Inc., Denali Spectrum License, LLC and Denali
    Spectrum, LLC.10.4.3(12)

Amendment No. 3 to Credit Agreement by and among Cricket
    Communications, Inc., Denali Spectrum License, LLC, Denali
    Spectrum, LLC, Denali Spectrum Operations, LLC and Denali
    Spectrum License Sub, LLC dated as of March 6, 2008.10.4.4(13)

Letter of Credit and Reimbursement Agreement by and between
    Cricket Communications, Inc. and Denali Spectrum Operations,
    LLC, dated as of February 21, 2008.10.5(14)#

Form of Indemnification Agreement to be entered into by and
    between Leap Wireless International, Inc. and its directors and
    officers.10.6(15)#

Amended and Restated Executive Employment Agreement among Leap
    Wireless International, Inc., Cricket Communications, Inc., and
    S. Douglas Hutcheson, dated as of January 10, 2005.10.6.1(16)#

First Amendment to Amended and Restated Executive Employment
    Agreement among Leap Wireless International, Inc., Cricket
    Communications, Inc., and S. Douglas Hutcheson, effective as of
    June 17, 2005.10.6.2(17)#

Second Amendment to Amended and Restated Executive Employment
    Agreement among Leap Wireless International, Inc., Cricket
    Communications, Inc., and S. Douglas Hutcheson, effective as of
    February 17, 2006.10.6.3(1)#

Third Amendment to Amended and Restated Executive Employment
    Agreement among Leap Wireless International, Inc., Cricket
    Communications, Inc., and S. Douglas Hutcheson, effective as of
    December 31, 2008.10.7(13)#

Form of Executive Vice President and Senior Vice President
    Amended and Restated Severance Benefits Agreement.10.8(15)#

Employment Offer Letter dated January 31, 2005, between
    Cricket Communications, Inc. and Albin F. Moschner.10.9(18)#

Employment Offer Letter dated April 7, 2008, between
    Cricket Communications, Inc. and Jeffrey E. Nachbor.10.10(18)#

Employment Offer Letter dated June 2, 2008, between Cricket
    Communications, Inc. and Walter Z. Berger.10.11(19)#

Leap Wireless International, Inc. 2004 Stock Option Restricted
    Stock and Deferred Stock Unit Plan. 197




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##### Table of Contents



ExhibitNumber

Description10.11.1(11)#

First Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.11.2(8)#

Second Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.11.3(20)

Third Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan10.11.4(16)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (February 2008 Vesting).10.11.5(16)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Five-Year Vesting) entered into prior to
    October 26, 2005.10.11.6(17)#

Amendment No. 1 to Form of Stock Option Grant Notice and
    Non-Qualified Stock Option Agreement (Five-Year Vesting) entered
    into prior to October 26, 2005.10.11.7(17)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Five-Year Vesting) entered into on or after
    October 26, 2005.10.11.8(20)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Four-Year Time Based Vesting).10.11.9(18)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Revised May 2008).10.11.10(17)#

Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement, effective as of October 26, 2005, between Leap
    Wireless International, Inc. and Albin F. Moschner.10.11.11(18)#

Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement, effective as of June 23, 2008, between Leap
    Wireless International, Inc. and Walter Z. Berger.10.11.12(16)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (February 2008 Vesting).10.11.13(16)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Five-Year Vesting) entered into prior to
    October 26, 2005.10.11.14(17)#

Amendment No. 1 to Form of Restricted Stock Award Grant
    Notice and Restricted Stock Award Agreement (Five-Year Vesting)
    entered into prior to October 26, 2005.10.11.15(17)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Five-Year Vesting) entered into on or after
    October 26, 2005.10.11.16(21)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Four-Year Time Based Vesting).10.11.17(18)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Revised May 2008).10.11.18(17)#

Restricted Stock Award Grant Notice and Restricted Stock Award
    Agreement, effective as of October 26 2005, between Leap
    Wireless International, Inc. and Albin F. Moschner.10.11.19(18)#

Restricted Stock Award Grant Notice and Restricted Stock Award
    Agreement, effective as of June 23, 2008, between Leap
    Wireless International, Inc. and Walter Z. Berger.10.11.20(19)#

Form of Deferred Stock Unit Award Grant Notice and Deferred
    Stock Unit Award Agreement.10.11.21(15)#

Form of Non-Employee Director Stock Option Grant Notice and
    Non-Qualified Stock Option Agreement.10.11.22(22)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (for Non-Employee Directors).10.12(23)#

Leap Wireless International, Inc. Executive Incentive Bonus Plan.10.13(1)#

2009 Employment Inducement Equity Incentive Plan of Leap
    Wireless International, Inc.10.13.1*#

First Amendment to the 2009 Employment Inducement Equity
    Incentive Plan of Leap Wireless International, Inc. 198




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##### Table of Contents



ExhibitNumber

Description10.13.2(1)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Four-Year Time Based Vesting) granted under the 2009
    Employment Inducement Equity Incentive Plan of Leap Wireless
    International, Inc.10.13.3(1)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Four-Year Time Based Vesting) granted under the
    2009 Employment Inducement Equity Incentive Plan of Leap
    Wireless International, Inc.21*

Subsidiaries of Leap Wireless International, Inc.23*

Consent of Independent Registered Public Accounting Firm.31.1*

Certification of Chief Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.31.2*

Certification of Chief Financial Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.32**

Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.     *
    
    Filed herewith.**
    
    This certification is being furnished solely to accompany this
    report pursuant to U.S.C. § 1350, and is not being filed
    for purposes of Section 18 of the Securities Exchange Act
    of 1934, as amended, and is not to be incorporated by reference
    into any filing of Leap Wireless International, Inc. whether
    made before or after the date hereof, regardless of any general
    incorporation language in such filing.
    
    Portions of this exhibit (indicated by asterisks) have been
    omitted pursuant to a request for confidential treatment
    pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.#
    
    Management contract or compensatory plan or arrangement in which
    one or more executive officers or directors participates.(1)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2008, filed with the
    SEC on February 27, 2009, and incorporated herein by
    reference.(2)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated September 3, 2009, filed with the SEC on
    September 4, 2009, and incorporated herein by reference.(3)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated October 18, 2006, filed with the SEC on
    October 24, 2006, and incorporated herein by reference.(4)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated April 30, 2007, filed with the SEC on May 4,
    2007, and incorporated herein by reference.(5)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 25, 2008, filed with the SEC on June 30,
    2008, and incorporated herein by reference.(6)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 25, 2008, filed with the SEC on June 30,
    2008, and incorporated herein by reference.(7)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 5, 2009, filed with the SEC on June 8,
    2009, and incorporated herein by reference.(8)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2007, filed with the
    SEC on August 9, 2007, and incorporated herein by reference.(9)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2006, filed with the
    SEC on August 8, 2006, and incorporated herein by reference.(10)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2006, filed with
    the SEC on November 9, 2006, and incorporated herein by
    reference.(11)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2007, filed with the
    SEC on May 10, 2007, and incorporated herein by reference. 199




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##### Table of Contents



(12)
    
    Filed as an exhibit to Leaps Registration Statement on
    Form S-4
    (File
    No. 333-149937),
    filed with the SEC on March 28, 2008, and incorporated
    herein by reference.(13)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2007, filed with the
    SEC on February 29, 2008, and incorporated herein by
    reference.(14)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated November 2, 2009, filed with the SEC on
    November 5, 2009, and incorporated herein by reference.(15)
    
    Filed as an exhibit to Leaps Annual Report on From 10-K
    for the fiscal year ended December 31, 2004, filed with the
    SEC on May 16, 2005, and incorporated herein by reference.(16)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 17, 2005, filed with the SEC on June 23,
    2005, and incorporated herein by reference.(17)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2005, filed with the
    SEC on March 27, 2006, and incorporated herein by reference.(18)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2008, filed with the
    SEC on August 7, 2008, and incorporated herein by reference.(19)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated November 2, 2009, filed with the SEC on
    November 5, 2009, and incorporated herein by reference.(20)
    
    Filed as Appendix A to Leaps Definitive Proxy
    Statement filed with the SEC on April 10, 2009, and
    incorporated herein by reference.(21)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2006, filed with the
    SEC on March 1, 2007, and incorporated herein by reference.(22)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated May 18, 2006, filed with the SEC on June 6,
    2006, and incorporated herein by reference.(23)
    
    Filed as Appendix B to Leaps Definitive Proxy
    Statement filed with the SEC on April 6, 2007, and
    incorporated herein by reference. 200




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##### Table of Contents



SIGNATURES
       By:
    /s/  S.
    Douglas Hutcheson   Chief Executive Officer, President and Director
    Signature

Title

Date/s/  S.
    Douglas HutchesonS.
    Douglas Hutcheson

Chief Executive Officer, President and Director (Principal
    Executive)

February 26, 2010/s/  Walter
    Z. BergerWalter
    Z. Berger

Executive Vice President and Chief Financial Officer (Principal
    Financial Officer)

February 26, 2010/s/  Jeffrey
    E. NachborJeffrey
    E. Nachbor

Senior Vice President and Chief Accounting Officer (Principal
    Accounting Officer)

February 26, 2010/s/  John
    H. ChappleJohn
    H. Chapple

Director

February 26, 2010/s/  John
    D. Harkey, Jr.John
    D. Harkey, Jr.

Director

February 26, 2010/s/  Ronald
    KramerRonald
    Kramer

Director

February 26, 2010/s/  Robert
    V. LaPentaRobert
    V. LaPenta

Director

February 26, 2010/s/  Mark
    H. Rachesky, M.D.Mark
    H. Rachesky, M.D.

Chairman of the Board and Director

February 26, 2010/s/  William
    A. Roper, Jr.William
    A. Roper, Jr.

Director

February 26, 2010/s/  Michael
    B. TargoffMichael
    B. Targoff

Director

February 26, 2010  201