##### Table of Contents



UNITED STATES
    SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
    20549
      FORM 10-K
  ANNUAL REPORT
    PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
  (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, 2006ORo

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(State or Other Jurisdiction
    of Incorporation or Organization)10307 Pacific Center Court,
    San Diego, CA(Address of Principal
    Executive Offices)

33-0811062(I.R.S. Employer
    Identification No.)92121(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
    Common Stock, $.0001 par value

Name of Each Exchange on Which
    Registered
    The NASDAQ Stock Market,
    LLC   Securities registered pursuant to Section 12(g) of the
    Act:
 None.
  þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 Large
    accelerated filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o  Rule 12b-2 o þ
    þ o




---



##### 



LEAP
    WIRELESS INTERNATIONAL, INC.
  ANNUAL
    REPORT ON
    FORM 10-K
    For the Year Ended December 31, 2006
  TABLE OF
    CONTENTS
  PagePART IItem 1.

Business


1Item 1A.

Risk
    Factors


23Item 1B.

Unresolved Staff
    Comments


37Item 2.

Properties


37Item 3.

Legal
    Proceedings


38Item 4.

Submission of
    Matters to a Vote of Security Holders


40PART IIItem 5.

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


41Item 6.

Selected Financial
    Data


43Item 7.

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


45Item 7A.

Quantitative and
    Qualitative Disclosures About Market Risk


67Item 8.

Financial
    Statements and Supplementary Data


69Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


100Item 9A.

Controls and
    Procedures


100Item 9B.

Other
    Information


101PART IIIItem 10.

Directors,
    Executive Officers and Corporate Governance


102Item 11.

Executive
    Compensation


102Item 12.

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


102Item 13.

Certain
    Relationships and Related Transactions, and Director
    Independence


102Item 14.

Principal
    Accountant Fees and Services


102PART IVItem 15.

Exhibits and
    Financial Statement Schedules


102EXHIBIT 10.11.6EXHIBIT 10.11.15EXHIBIT 21EXHIBIT 23.1EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2   i




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##### Table of Contents



PART I    Cautionary
    Statement Regarding Forward-Looking Statements
    
    our ability to attract and retain customers in an extremely
    competitive marketplace;
    changes in economic conditions that could adversely affect the
    market for wireless services;
    the impact of competitors initiatives;
    our ability to successfully implement product offerings and
    execute market expansion plans;
    failure of the Federal Communications Commission, or FCC, to
    approve the transfer to Denali Spectrum License, LLC of the
    wireless license for which it was named the winning bidder in
    Auction #66;
    delays in our market expansion plans resulting from delays in
    the availability of network equipment and handsets for the AWS
    spectrum we acquired in Auction #66, or resulting from
    requirements to clear the AWS spectrum of existing
    U.S. government and other private sector wireless
    operations, some of which are permitted to continue using the
    spectrum for several years;
    our ability to attract, motivate and retain an experienced
    workforce;
    our ability to comply with the covenants in our senior secured
    credit facilities, indenture and any future credit agreement,
    indenture or similar instrument;
    failure of our network or information technology systems to
    perform according to expectations; and
    other factors detailed in Item 1A. Risk Factors
    below.    Item 1.
    Business  Overview
  ® tm
 1




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##### Table of Contents



No. 46-R, FIN No. 46-R,
  ®
    Cricket
    Business Overview
  Cricket
    Service
  ® tm
   2




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##### Table of Contents




    In July 2006, we acquired a non-controlling membership interest
    in LCW Wireless, which held a license for the Portland, Oregon
    market and to which we contributed, among other things, our
    existing Eugene and Salem, Oregon markets to create a new Oregon
    cluster of licenses covering 3.2 million POPs.
    In August 2006, we exchanged our wireless license in Grand
    Rapids, Michigan for a wireless license in Rochester, New York
    to form a new market cluster with our existing Buffalo and
    Syracuse markets in upstate New York. These three licenses cover
    3.1 million POPs.
    In September 2006, Denali License was named the winning bidder
    for one wireless license covering 59.8 million POPs (which
    includes markets covering 5.7 million POPs which overlap
    with certain licenses we purchased in Auction #66). The
    post-Auction grant of the license for which Denali License was
    named the winning bidder remains subject to FCC approval.
    In November 2006, we completed the purchase of 13 wireless
    licenses in North Carolina and South Carolina for an aggregate
    purchase price of $31.8 million. These licenses cover
    5.0 million POPs.
    In December 2006, we purchased 99 wireless licenses in
    Auction #66 covering 123.1 million POPs (adjusted to
    eliminate duplication among certain overlapping Auction
    #66 licenses).
    We, ANB 1 License and LCW Operations launched 14 markets in
    2006, and we currently expect to launch Cricket service covering
    approximately 3.0 million new covered POPs in Rochester, NY
    and areas in North and South Carolina during 2007.  Cricket
    Business Strategy
  
    Target Underserved Customer Segments.  Our
    services are targeted primarily toward market segments
    underserved by traditional communications companies. 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 the national carriers. We believe these
    underserved market segments are among the fastest growing
    population segments in the U.S. 3




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##### Table of Contents




    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 two
    years, we added instant messaging, multimedia (picture)
    messaging, games and our Travel
    Timetm
    roaming option to our product portfolio. In 2006, we broadened
    our data product and service offerings to better meet the needs
    of our customers, and we expect to continue to broaden these
    data product and service offerings in 2007 and beyond. With our
    deployment of 1xEV-DO technology, we believe we will be able to
    offer an expanded array of services to our customers, including
    high demand wireless data services such as mobile content,
    location-based services and high quality music downloads at
    speeds of up to 2.4 Megabits per second. We believe these
    enhanced data offerings will be attractive to many of our
    existing customers and will enhance our appeal to new
    data-centric customers.
    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, we
    have decentralized our marketing programs to support local
    customization while optimizing our advertising expenses. We have
    redesigned and remerchandized our stores and introduced a new
    sales process aimed at improving both the customer experience
    and our revenue per user. We have also initiated our premier
    dealer program, and we are in the process of enabling our
    premier dealers and other indirect dealers to provide greater
    customer support services. We expect these changes will enhance
    the customer experience and improve customer satisfaction.
    Enhance Market Clusters and Expand Into Attractive Strategic
    Markets.  We continue to seek additional
    opportunities to enhance our current market clusters and expand
    into new geographic markets by participating in FCC spectrum
    auctions (including the recently concluded Auction #66), by
    acquiring spectrum and related assets from third parties, or by
    participating in new partnerships or joint ventures. Examples of
    our market cluster strategy include the Fresno, California
    market we launched in 2005 to complement the adjacent Visalia
    and Modesto, California markets in our Central Valley cluster
    and the Oregon cluster we created by contributing our FCC
    licenses serving the Salem and Eugene, Oregon markets to LCW
    Wireless, a joint venture which also owns and operates a license
    serving Portland, Oregon. Examples of our strategic market
    expansion include the five licenses in central Texas, including
    Houston, Austin and San Antonio, and the San Diego,
    California license that we and ANB 1 License acquired in
    Auction #58. All of these markets meet our internally
    developed criteria concerning customer demographics and
    population density which we believe will enable us to offer
    Cricket service on a cost competitive basis in these markets. We
    also anticipate that the licenses we purchased in
    Auction #66 and for which Denali License was named the
    winning bidder will provide the opportunity to substantially
    enhance our coverage area and allow us and Denali License to
    launch Cricket service in numerous new markets in multiple
    construction phases over time.  Cricket
    Business Operations
  Products
    and Services
  Cricket Service Plans.
   4




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##### Table of Contents



Cricket Plan Upgrades. and/or tm
    Handsets.
  Handset Replacement and Returns.
  Jump Mobile.
  Customer
    Care and Billing
  Customer Care.
  Billing and Support Systems.
  Sales
    and Distribution
     5




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##### Table of Contents



www.mycricket.com e-commerce,
    Network
    and Operations
  ®
       6




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##### Table of Contents



Wireless
    Licenses
    PCS
    Licenses
  Cricket
 Total


ChannelLicense

Population


MHz


BlockHouston, TX(1)


5,808,061



10


CPhoenix, AZ(1)


4,159,398



10


CSan Diego, CA(1)


3,075,438



10


CDenver, CO(1)


2,986,252



10


FPittsburgh, PA(1)


2,432,179



10


ECharlotte-Gastonia, NC(1)


2,341,673



10


FKansas City, MO(1)


2,190,298



10


CNashville, TN(1)


1,911,906



15


CSalt Lake City-Ogden, UT(1)


1,761,509



15


CRaleigh-Durham, NC


1,719,443



10


CMemphis, TN(1)


1,618,948



15


CGreensboro-Winston-Salem-High
    Point, NC(1)


1,541,225



10


FDayton-Springfield, OH(1)


1,217,919



10


FKnoxville, TN(1)


1,198,046



15


CBuffalo-Niagara Falls, NY(1)


1,192,930



10


ERochester, NY


1,166,743



10


EOmaha, NE(1)


1,039,835



10


FFresno, CA(1)


1,037,156



30


CLittle Rock, AR(1)


1,004,512



15


CTulsa, OK(1)


995,569



15


CTucson, AZ(1)


958,804



15


CAlbuquerque, NM(1)


909,982



15


CSpokane, WA(1)


794,169



15


CSyracuse, NY(1)


790,280



15


CCharleston, SC


735,733



10


FMacon-Warner Robins, GA(1)


699,722



20


CBoise-Nampa, ID(1)


678,365



30


CWichita, KS(1)


676,006



15


CReno, NV(1)


673,734



10


CAsheville-Hendersonville, NC


646,374



10


FSaginaw-Bay City, MI


641,969



10


DChattanooga, TN(1)


593,337



15


CModesto, CA(1)


587,033



15


CSalem-Corvallis-Albany, OR


570,039



5


CVisalia-Porterville-Hanford, CA(1)


556,174



15


CLakeland-Winter Haven, FL


540,460



10


FLansing, MI


529,744



10


DEvansville, IN


528,728



10


FProvo-Orem, UT(1)


443,917



15


CFayetteville-Springdale-Rogers,
    AR(1)


389,435



20


CTemple, TX(1)


382,285



10


CColumbus, GA(1)


374,504



15


CLincoln, NE(1)


369,018



15


CAlbany-Tifton, GA


365,402



15


CHickory-Lenoir-Morganton, NC


358,054



10


FFort Smith, AR(1)


341,286



20


CPueblo, CO(1)


327,754



20


CFargo, ND


321,609



15


CUtica-Rome, NY


297,060



10


FFt. Collins-Loveland, CO(1)


277,618



10


FClarksville, TN-Hopkinsville, KY(1)


275,273



15


CFlorence, SC


266,438



10


FMerced, CA(1)


265,376



15


CGreenville-Washington, NC


256,830



10


CGoldsboro-Kinston, NC


245,440



10


CGreeley, CO(1)


238,157



10


FSanta Fe, NM(1)


237,705



15


CMuskegon, MI


234,483



10


DMyrtle Beach, SC


226,451



10


FRocky Mount-Wilson, NC


223,716



10


CGrand Forks, ND


193,340



15


CJonesboro-Paragould, AR(1)


187,533



10


CNew Bern, NC


177,426



10


CLufkin-Nacogdoches, TX


168,177



10


COwensboro, KY


167,242



10


FSumter, NC


161,776



10


FPine Buff, AR(1)


149,358



20


CHot Springs, AR(1)


145,773



15


CBurlington, NC


142,574



10


CGallup, NM


139,302



15


CSteubenville, OH-Weirton, WV(1)


125,474



10


CEagle Pass-Del Rio, TX


125,374



15


CLewiston-Moscow, ID


124,110



15


COrangeburg, SC


121,578



10


FMarion, OH


102,264



10


C   7




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##### Table of Contents



Total


ChannelLicense

Population


MHz


BlockRoswell, NM


82,253



15


CRoanoke Rapids, NC


77,374



10


CBlytheville, AR


65,385



15


CNogales, AZ


42,308



20


CSubtotal Cricket PCS
    Licenses


61,726,125   ANB 1
    License
 Total


ChannelLicense

Population


MHz


BlockCincinnati, OH(1)


2,256,483



10


CSan Antonio, TX(1)


2,080,241



10


CAustin, TX(1)


1,572,826



10


CLouisville, KY(1)


1,559,178



10


CLexington, KY(1)


980,952



10


CEl Paso, TX(1)


805,243



10


CColorado Springs, CO(1)


598,215



10


CLas Cruces, NM(1)


265,257



10


CBryan, TX(1)


206,830



10


CSubtotal ANB 1 License PCS
    Licenses


10,325,225   LCW
    Operations
 Total


ChannelLicense

Population


MHz


BlockPortland, OR(1)


2,336,371



10


CSalem-Corvallis-Albany, OR(1)


570,039



15


CEugene-Springfield, OR(1)


339,894



10


CSubtotal LCW Operations PCS
    Licenses


3,246,304Total Cricket, ANB 1
    License and LCW Operations PCS Licenses(3)


74,727,615   AWS
    Licenses
  Cricket
 Total


ChannelLicense

Population


MHz


BlockCentral(2)


44,666,749



10


EPhiladelphia, PA


5,175,878



20


AWashington, DC


4,652,569



20


ASan Diego, CA


3,075,438



10


CMinneapolis-St. Paul, MN


3,042,492



20


ABaltimore, MD


2,634,915



20


ANashville, TN


2,632,099



10


CSt. Louis, MO


2,578,871



20


ASeattle-Everett, WA


2,485,737



20


AMilwaukee-Racine, WI


2,305,844



10


CSalt Lake City-Ogden, UT


2,300,977



10


CCharlotte-Gastonia, NC


2,295,040



10


CRaleigh-Durham-Chapel Hill, NC


2,084,830



10


CPortland, OR


1,994,858



20


AMemphis, TN


1,954,859



10


CGreensboro-Winston-Salem, NC


1,953,924



10


CLexington, KY


1,910,520



10


CNorfolk-Virginia Beach, VA


1,825,956



10


CLas Vegas, NV


1,789,113



20


AOklahoma City, OK


1,778,885



10


CKansas City, MO


1,754,048



20


ARochester, NY


1,501,940



10


CLouisville, KY


1,487,007



10


CBuffalo-Niagara Falls, NY


1,483,005



10


CGreenville-Spartanburg, SC


1,324,064



20


BNew Orleans, LA


1,198,415



20


AMcAllen-Edinburg-Mission, TX


1,185,695



10


CKnoxville, TN


1,050,239



10


CBirmingham, AL


974,439



20


ARichmond, VA


943,397



20


ASpokane, WA


882,365



10


CEugene-Springfield, OR


841,089



10


CTacoma, WA


779,716



20


AChattanooga, TN


756,193



10


CWilmington, DE


697,501



20


ASyracuse, NY


659,486



20


ABaton Rouge, LA


642,124



20


ACharleston-North Charleston, SC


638,687



10


CLittle Rock, AR


619,879



20


AColumbia, SC


583,368



20


AMobile, AL


563,920



20


ACorpus Christi, TX


556,146



10


CMaryland
    2-Kent


530,013



20


AModesto, CA


528,421



20


AColumbus, GA


511,972



10


CHuntsville, AL


460,207



20


ABeaumont-Port Arthur, TX


455,597



10


CCalifornia 4-Madera


449,066



20


AVisalia-Tulare-Porterville, CA


410,441



20


ABiloxi-Gulfport-Pascagoula, MS


409,603



10


CLouisiana 5-Beauregard


405,163



20


AReno, NV


404,375



20


A 8




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##### Table of Contents



Total


ChannelLicense

Population


MHz


BlockVirginia 11-Madison


394,870



20


AAtlantic City, NJ


377,809



20


AAlabama 1-Franklin


370,034



20


ADelaware
    1-Kent


324,164



20


ASavannah, GA


316,521



20


AWashington 1-Clallam


304,969



20


ASt. Cloud, MN


266,890



20


ALafayette, LA


250,319



20


ABremerton, WA


247,073



20


AOregon 4-Lincoln


236,878



20


ALaredo, TX


236,696



20


AMaryland 3-Frederick


232,111



20


AOlympia, WA


230,983



20


AGeorgia 12-Liberty


226,313



20


AArkansas 4-Clay


214,349



20


AIllinois
    4-Adams


214,336



20


AOregon 1-Clatsop


203,705



20


AHouma-Thibodaux, LA


201,137



20


AVirginia 12-Caroline


199,861



20


ALouisiana 7-West Feliciana


197,680



20


AWashington 6-Pacific


195,318



20


AArizona 1-Mohave


188,339



20


ALake Charles, LA


185,169



20


ALouisiana 6-Iberville


182,407



20


ATennessee 6-Giles


180,889



20


AArkansas 10-Garland


175,181



20


AGeorgia 8-Warrren


174,455



20


ATuscaloosa, AL


168,536



20


ANevada 3-Storey


155,990



20


ASouth Carolina 7-Calhoun


155,629



20


ACalifornia
    12-Kings


145,733



20


AAlabama 4-Bibb


145,541



20


AFlorence, AL


140,330



20


AMissouri 8-Callaway


134,743



20


APetersburg-Hopewell, VA


134,311



20


AAlabama 3-Lamar


131,544



20


AArkansas 7-Pope


125,432



20


AWashington 4-Grays Harbor


124,764



20


AKansas 5-Brown


122,736



20


ALouisiana 8-St. James


118,510



20


AKansas 10-Franklin


115,007



20


AArkansas 3-Sharp


104,542



20


AWisconsin 5-Pierce


103,474



20


APine Bluff, AR


81,663



20


ALouisiana 9-Plaquemines


29,661



20


AAlton-Granite City, IL


22,803



20


AGulf of Mexico






20


ATotal Cricket AWS
    Licenses


127,616,540   Denali
    License
    Total


ChannelLicense

Population


MHz


BlockGreat Lakes(4)


59,836,265



10


D    (1)
    
    Designates a wireless license or a
    portion of a wireless license in a market where Cricket service
    is offered.(2)
    
    Portions of this wireless license
    cover markets in which Cricket service is currently being
    offered, including Albuquerque, Austin, Denver, El Paso,
    Houston, Lincoln, Omaha, Phoenix, Pueblo, San Antonio,
    Santa Fe, Tucson, Tulsa and Wichita.(3)
    
    Excludes the effect of the
    duplication of Salem-Corvallis-Albany, Oregon wireless licenses
    included in the Cricket and LCW Operations PCS license tables.(4)
    
    Portions of this wireless license
    cover markets in which Cricket service is currently being
    offered, including Cincinnati, Dayton and Pittsburgh.  and/or
  Arrangements
    with Alaska Native Broadband
   9




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##### Table of Contents



Limited Liability Company Agreement.
      Senior Secured Credit Agreement.
 10




---



##### Table of Contents



Management Agreement.
  Arrangements
    with LCW Wireless
        Limited Liability Company Agreement.
 11




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##### Table of Contents



30-day
    Management Agreement. mark-up
  Arrangements
    with Denali
      Limited Liability Company Agreement.
   12




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##### Table of Contents



Senior Secured Credit Agreement. sub-facility
  Management Agreement.
  Competition
  T-Mobile, e-mail
   13




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##### Table of Contents



14




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##### Table of Contents



Chapter 11
    Proceedings Under the Bankruptcy Code
    pay-in-kind pay-in-kind
  Government
    Regulation
    Licensing
    of our Wireless Service Systems
   15




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##### Table of Contents



PCS Licenses.
  and/or
  10-year
  AWS Licenses.
  15-year and/or
  and/or
 16




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##### Table of Contents



Designated Entities.
  de facto
  and/or
  Foreign Ownership. non-U.S. citizens non-U.S. citizens
 17




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##### Table of Contents



Transfer and Assignment.
  case-by-case
    FCC
    Regulation Generally
  market-by-market
     18




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##### Table of Contents



truth-in-billing,
  State,
    Local and Other Regulation
        Privacy
    Intellectual
    Property
   19




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##### Table of Contents



Availability
    of Public Reports
  Form 10-K, Form 10-Q, Form 8-K, 1-800-SEC-0330.
  Financial
    Information Concerning Segments and Geographical
    Information
    Employees
    Seasonality
    Inflation
   20




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##### Table of Contents



Executive
    Officers of the Registrant
  Name

Age

Position with the CompanyS. Douglas Hutcheson


50


Chief Executive Officer,
    President and DirectorAmin I. Khalifa


53


Executive Vice President and Chief
    Financial OfficerAlbin F. Moschner


54


Executive Vice President and Chief
    Marketing OfficerGlenn T. Umetsu


57


Executive Vice President and Chief
    Technical OfficerRobert J. Irving, Jr.


51


Senior Vice President, General
    Counsel and SecretaryLeonard C. Stephens


50


Senior Vice President, Human
    ResourcesGrant A. Burton


42


Vice President, Chief Accounting
    Officer and Controller   S. Douglas Hutcheson
  Amin I. Khalifa
  Albin F. Moschner
  Glenn T. Umetsu
 21




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##### Table of Contents



Robert J. Irving, Jr.
  Leonard C. Stephens 14-year
  Grant A. Burton
 22




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##### Table of Contents



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




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##### Table of Contents



We Face
    Increasing Competition Which Could Have a Material Adverse
    Effect on Demand for the Cricket Service.
  and/or
     24




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##### Table of Contents



We May Be
    Unable to Obtain the Roaming Services We Need From Other
    Carriers to Remain Competitive
    We
    Previously Identified Material Weaknesses in Our Internal
    Control Over Financial Reporting, and Our Business and Stock
    Price May Be Adversely Affected If Our Internal Controls Are Not
    Effective.
    Our
    Primary Business Strategy May Not Succeed in the Long
    Term.
   25




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##### Table of Contents



We Expect
    to Incur Substantial Costs in Connection with the Build-Out of
    Our New Markets, and any Delays or Cost Increases in the
    Build-Out of Our New Markets Could Adversely Affect Our
    Business.
    and/or
     26




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##### Table of Contents



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 satisfy 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, building out
    our network, 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;
    limit our flexibility in planning for, or reacting to, changes
    in our business and the industry in which we operate;
    place us at a disadvantage compared to our competitors that have
    less indebtedness; and
    expose us to higher interest expense in the event of increases
    in interest rates because indebtedness under our senior secured
    credit facility bears interest at a variable rate. For a
    description of our senior secured credit facility, see
    Item 7. Managements Discussion and Analysis of
    Financial Condition and Results of Operations 
    Liquidity and Capital Resources  Senior Secured
    Credit Facilities in Part II of this report.   27




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##### Table of Contents



Despite
    Current Indebtedness Levels, We May Incur Substantially More
    Indebtedness. This Could Further Increase the Risks Associated
    with Our Leverage.
      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 May Be
    Unable to Refinance Our Indebtedness.
    Covenants
    in Our Indenture and Credit Agreement 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; 28




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##### Table of Contents




    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-K Form 10-Q Form 10-K
    Rises in
    Interest Rates Could Adversely Affect our Financial
    Condition.
    The
    Wireless Industry is Experiencing Rapid Technological Change,
    and We May Lose Customers if We Fail to Keep Up with These
    Changes.
       29




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##### Table of Contents



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.
          We Rely
    Heavily on Third Parties to Provide Specialized Services; a
    Failure by Such Parties to Provide the Agreed Upon Services
    Could Materially Adversely Affect Our Business, Results of
    Operations and Financial Condition.
   30




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##### Table of Contents



System
    Failures Could Result in Higher Churn, Reduced Revenue and
    Increased Costs, and Could Harm Our Reputation.
      We May
    Not be Successful in Protecting and Enforcing Our Intellectual
    Property Rights.
    No. 2-06-CV-00240-TJW, Method for Providing Wireless Communication Services
    and Network and System for Delivering Same,
 31




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##### Table of Contents



No. 8:06-CV-01754-T-23TBM, Method for
    Providing Wireless Communication Services and Network and System
    for Delivering Same
  No. 3-06CV1399-D, Operations Method for Providing
    Wireless Communication Services and Network and System for
    Delivering Same
    We May Be
    Subject to Claims of Infringement Regarding Telecommunications
    Technologies That Are Protected by Patents and Other
    Intellectual Property Rights.
     32




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##### Table of Contents



Regulation
    by Government Agencies May Increase Our Costs of Providing
    Service or Require Us to Change Our Services.
        If Call
    Volume under Our Cricket and Jump Mobile Services Exceeds Our
    Expectations, Our Costs of Providing Service Could Increase,
    Which Could Have a Material Adverse Effect on Our Competitive
    Position.
    We May Be
    Unable to Acquire Additional Spectrum in the Future at a
    Reasonable Cost or on a Timely Basis.
   33




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##### Table of Contents



Our
    Wireless Licenses are Subject to Renewal and Potential
    Revocation in the Event that We Violate Applicable
    Laws.
  15-year
  Future
    Declines in the Fair Value of Our Wireless Licenses Could Result
    in Future Impairment Charges.
  90-7, SOP 90-7,
    
    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 sales prices in FCC
    auctions.     34




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##### Table of Contents



Declines
    in Our Operating Performance Could Ultimately Result in an
    Impairment of Our Indefinite-Lived Assets, Including Goodwill,
    or Our Long-Lived Assets, Including Property and
    Equipment.
  and/or and/or
  We May
    Incur Higher Than Anticipated Intercarrier Compensation
    Costs.
      Because
    Our Consolidated Financial Statements Reflect Fresh-Start
    Reporting Adjustments Made Upon Our Emergence From Bankruptcy,
    Financial Information in Our Current and Future Financial
    Statements Will Not Be Comparable to Our Financial Information
    for Periods Prior to Our Emergence from Bankruptcy.
    If We
    Experience High Rates of Credit Card, Subscription or Dealer
    Fraud, Our Ability to Become Profitable Will Decrease.
   35




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##### Table of Contents



Risks
    Related to Ownership of Our Common Stock
  Our Stock
    Price May Be Volatile, and You May Lose All or Some of Your
    Investment.
    
    variations in our operating results;
    announcements of technological innovations, new services or
    service enhancements, strategic alliances or significant
    agreements by us or by our competitors;
    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; and
    market conditions in our industry and the economy as a whole.  The
    16,460,077 Shares of Leap Common Stock Registered for
    Resale By Our Shelf Registration Statement May Adversely Affect
    The Market Price of Leaps Common Stock.
    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s Common Stock.
       36




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##### Table of Contents



Our
    Directors and Affiliated Entities Have Substantial Influence
    over Our Affairs.
    Provisions
    in Our Amended and Restated Certificate of Incorporation and
    Bylaws or Delaware Law Might Discourage, Delay or Prevent a
    Change in Control of Our Company or Changes in Our Management
    and, Therefore, Depress The Trading Price of Our 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     37




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##### Table of Contents



Item 3.
    Legal
    Proceedings  Outstanding
    Bankruptcy Claims
  03-03470-All 03-035335-All
  Patent
    Litigation
  No. 2-06H-CV-00240-TJW, Method for Providing Wireless Communication Services
    and Network and System for Delivering Same, No. 8:06-CV-01754-T-23TBM, Method for
    Providing Wireless Communication Services and Network and System
    for Delivering Same
 38




---



##### Table of Contents



No. 3-06CV1399-D, Operations Method for Providing
    Wireless Communication Services and Network and System for
    Delivering Same
    Tortious
    Interference and Unfair Competition Litigation
  T-Mobile T-Mobile, No. 2006-42215, T-Mobile T-Mobile T-Mobiles
  Other
  and/or
 39




---



##### Table of Contents



and/or
      Item 4.
    Submission
    of Matters to a Vote of Security Holders   40




---



##### Table of Contents



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
    Over-the-counter mark-up,
  High($)


Low($)Calendar Year 
    2005First Quarter


29.87



25.01Second Quarter


28.90



23.00Third Quarter


37.47



25.87Fourth Quarter


39.45



31.15Calendar Year 
    2006First Quarter


43.89



34.87Second Quarter


47.41



39.84Third Quarter


48.18



40.87Fourth Quarter


61.37



47.26     Dividends
   41




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##### Table of Contents



Securities
    Authorized For Issuance Under Equity Compensation
    Plans
    Weighted-averageNumber of securities to be


exercise price of


Number of securitiesissued upon exercise of


outstanding


remaining available for futureoutstanding options,


options, warrants


issuance under equityPlan Category

warrants and rights


and rights


compensation plansEquity compensation plans approved
    by security holders(1)





$




767,413Equity compensation plans not
    approved by security holders(2)


3,070,197
(3)


37.55



309,878Total


3,070,197


$
37.55



1,077,291     (1)
    
    Consists of shares reserved for issuance under the Leap Wireless
    International, Inc. Employee Stock Purchase Plan.(2)
    
    Consists of shares reserved for issuance under the Leap Wireless
    International, Inc. 2004 Stock Option, Restricted Stock and
    Deferred Stock Unit Plan (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. The material features of the 2004 Plan are
    described in our Current Report on
    Form 8-K
    dated December 30, 2004, as filed with the Securities and
    Exchange Commission on January 6, 2005, which description
    is incorporated herein by reference.(3)
    
    Excludes 1,118,341 outstanding shares of restricted stock issued
    under the 2004 Plan which are subject to release upon vesting of
    the shares. 42




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##### Table of Contents



Item 6.
    Selected
    Financial Data (in thousands, except per share
    data)    Successor Company


Predecessor CompanyFive Months


Seven MonthsEnded


EndedYear Ended December 31,


December 31,


July 31,


Year Ended December 31,2006


2005


2004


2004


2003


2002Statement of Operations
    Data:Revenues

$
1,136,700


$
914,663


$
344,360


$
481,647


$
751,296


$
618,475Operating income (loss)


43,824



69,819



10,438



(40,600
)


(360,375
)


(454,100
)Income (loss) before reorganization
    items, income taxes and cumulative effect of change in
    accounting principle


4,339



51,117



(4,461
)


(45,088
)


(443,143
)


(640,978
)Reorganization items, net














962,444



(146,242
)


Income tax expense


(9,101
)


(21,151
)


(3,930
)


(4,166
)


(8,052
)


(23,821
)Income (loss) before cumulative
    effect of change in accounting principle


(4,762
)


29,966



(8,391
)


913,190



(597,437
)


(664,799
)Cumulative effect of change in
    accounting principle


623



















Net income (loss)

$
(4,139
)

$
29,966


$
(8,391
)

$
913,190


$
(597,437
)

$
(664,799
)Net income (loss) per share:Basic net income (loss) per share:Income (loss) before cumulative
    effect of change in accounting principle

$
(0.08
)

$
0.50


$
(0.14
)

$
15.58


$
(10.19
)

$
(14.91
)Cumulative effect of change in
    accounting principle


0.01



















Basic net income (loss) per share(1)

$
(0.07
)

$
0.50


$
(0.14
)

$
15.58


$
(10.19
)

$
(14.91
)Diluted net income (loss) per share:Income (loss) before cumulative
    effect of change in accounting principle

$
(0.08
)

$
0.49


$
(0.14
)

$
15.58


$
(10.19
)

$
(14.91
)Cumulative effect of change in
    accounting principle


0.01



















Diluted net income (loss) per
    share(1)

$
(0.07
)

$
0.49


$
(0.14
)

$
15.58


$
(10.19
)

$
(14.91
)Shares used in per share
    calculations:(1)Basic


61,645



60,135



60,000



58,623



58,604



44,591Diluted


61,645



61,003



60,000



58,623



58,604



44,591   43




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##### Table of Contents



As of December 31,Successor Company


Predecessor Company2006


2005


2004


2003


2002Balance Sheet Data:Cash and cash equivalents

$
374,939


$
293,073


$
141,141


$
84,070


$
100,860Working capital (deficit)(2)


198,501



240,862



145,762



(2,254,809
)


(2,144,420
)Restricted cash, cash equivalents
    and short-term investments


13,581



13,759



31,427



55,954



25,922Total assets


4,092,968



2,506,318



2,220,887



1,756,843



2,163,702Long-term debt(2)


1,676,500



588,333



371,355







Total stockholders equity
    (deficit)


1,789,001



1,514,357



1,470,056



(893,356
)


(296,786
)     (1)
    
    Refer to Notes 2 and 5 to the
    consolidated financial statements included in Item 8 of
    this report for an explanation of the calculation of basic and
    diluted net income (loss) per common share.(2)
    
    We have presented the principal and
    interest balances related to our outstanding debt obligations as
    current liabilities in the consolidated balance sheets as of
    December 31, 2003 and 2002, as a result of the then
    existing defaults under the underlying agreements. 44




---



##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Overview
  ® tm
       45




---



##### Table of Contents




    In July 2006, we acquired a non-controlling membership interest
    in LCW Wireless, which held a license for the Portland, Oregon
    market and to which we contributed, among other things, our
    existing Eugene and Salem, Oregon markets to create a new Oregon
    cluster of licenses covering 3.2 million POPs.
    In August 2006, we exchanged our wireless license in Grand
    Rapids, Michigan for a wireless license in Rochester, New York
    to form a new market cluster with our existing Buffalo and
    Syracuse markets in upstate New York. These three licenses cover
    3.1 million POPs.
    In September 2006, Denali License was named the winning bidder
    for one wireless license covering 59.8 million POPs (which
    includes markets covering 5.7 million POPs which overlap
    with certain licenses we purchased in Auction #66). The
    post-Auction grant of the license for which Denali License was
    named the winning bidder remains subject to FCC approval, and we
    cannot assure you that the FCC will award this license to Denali
    License.
    In November 2006, we completed the purchase of 13 wireless
    licenses in North Carolina and South Carolina for an aggregate
    purchase price of $31.8 million. These licenses cover
    5.0 million POPs.
    In December 2006, we purchased 99 wireless licenses in
    Auction #66 covering 123.1 million POPs (adjusted to
    eliminate duplication among certain overlapping Auction #66
    licenses). The use of the licenses that we acquired or that
    Denali License might acquire in Auction #66 may be affected
    by the requirements to clear the spectrum of existing
    U.S. government and other private sector wireless
    operations, some of which are permitted to continue for several
    years.
    We, ANB 1 License and LCW Operations launched 14 markets in
    2006, and we currently expect to launch Cricket service covering
    approximately 3.0 million new covered POPs in Rochester, NY
    and areas in North Carolina and South Carolina during 2007.       46




---



##### Table of Contents



Critical
    Accounting Policies and Estimates
      Principles
    of Consolidation
  No. 46-R,
  Revenues
  month-to-month
   47




---



##### Table of Contents



and/or
  Costs
    and Expenses
    Cost of Service.
  Cost of Equipment. lower-of-cost-or-market
  Selling and Marketing.
  General and Administrative.
  Depreciation and Amortization.
  DepreciableLifeNetwork equipment:Switches


10Switch power equipment


15Cell site equipment, and site
    acquisitions and improvements


7Towers


15Antennae


3Computer hardware and software


3-5Furniture, fixtures, retail and
    office equipment


3-7     Wireless
    Licenses
    Goodwill
    and Other Intangible Assets
   48




---



##### Table of Contents



Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
    Share-Based
    Compensation
         49




---



##### Table of Contents



Income
    Taxes
    90-7,
  Subscriber
    Recognition and Disconnect Policies
     50




---



##### Table of Contents



Seasonality
    Results
    of Operations
    Operating
    Items
    Year Ended


% of 2006


Year Ended


% of 2005


Change fromDecember 31,


Service


December 31,


Service


Prior Year2006


Revenues


2005


Revenues


Dollars


PercentRevenues:Service revenues

$
972,781






$
763,680






$
209,101



27.4
%Equipment revenues


163,919







150,983







12,936



8.6
%Total revenues


1,136,700







914,663







222,037



24.3
%Operating expenses:Cost of service (exclusive of
    items shown separately below)


261,614



26.9
%


200,430



26.2
%


61,184



30.5
%Cost of equipment


262,330



27.0
%


192,205



25.2
%


70,125



36.5
%Selling and marketing


159,257



16.4
%


100,042



13.1
%


59,215



59.2
%General and administrative


197,070



20.3
%


159,249



20.9
%


37,821



23.7
%Depreciation and amortization


226,747



23.3
%


195,462



25.6
%


31,285



16.0
%Impairment of indefinite-lived
    intangible assets


7,912



0.8
%


12,043



1.6
%


(4,131
)


(34.3
)%Total operating expenses


1,114,930



114.6
%


859,431



112.5
%


255,499



29.7
%Gains on sales of wireless
    licenses and operating assets


22,054



2.3
%


14,587



1.9
%


7,467



51.2
%Operating income

$
43,824



4.5
%

$
69,819



9.1
%

$
(25,995
)


(37.2
)%   51




---



##### Table of Contents



Year Ended


% of 2005


Year Ended


% of 2004


Change fromDecember 31,


Service


December 31,


Service


Prior Year2005


Revenues


2004


Revenues


Dollars


PercentRevenues:Service revenues

$
763,680






$
684,098






$
79,582



11.6
%Equipment revenues


150,983







141,909







9,074



6.4
%Total revenues


914,663







826,007







88,656



10.7
%Operating expenses:Cost of service (exclusive of
    items shown separately below)


200,430



26.2
%


193,136



28.2
%


7,294



3.8
%Cost of equipment


192,205



25.2
%


179,562



26.2
%


12,643



7.0
%Selling and marketing


100,042



13.1
%


91,935



13.4
%


8,107



8.8
%General and administrative


159,249



20.9
%


138,624



20.3
%


20,625



14.9
%Depreciation and amortization


195,462



25.6
%


253,444



37.0
%


(57,982
)


(22.9
)%Impairment of indefinite-lived
    intangible assets


12,043



1.6
%










12,043



100.0
%Total operating expenses


859,431



112.5
%


856,701



125.2
%


2,730



0.3
%Gains on sales of wireless
    licenses and operating assets


14,587



1.9
%


532



0.1
%


14,055



2641.9
%Operating income

$
69,819



9.1
%

$
(30,162
)


(4.4
)%

$
99,981



331.5
%     Year Ended December 31,2006

2005

2004Gross customer additions


1,455,810



872,271



807,868Net customer additions


592,237



117,376



97,090Weighted-average number of
    customers


1,861,477



1,608,782



1,529,020Total customers, end of period


2,229,826



1,668,293



1,569,630   Service
    Revenues
      Equipment
    Revenues
   52




---



##### Table of Contents



Cost of
    Service
      Cost of
    Equipment
      Selling
    and Marketing Expenses
      General
    and Administrative Expenses
   53




---



##### Table of Contents



Depreciation
    and Amortization
      Impairment
    Charges
    Gains on
    Sales of Wireless Licenses and Operating Assets
      Non-Operating
    Items
    Year Ended December 31,2006

2005

ChangeMinority interests in consolidated
    subsidiaries

$
1,436


$
(31
)

$
1,467Interest income


23,063



9,957



13,106Interest expense


(61,334
)


(30,051
)


(31,283
)Other income (expense), net


(2,650
)


1,423



(4,073
)Income tax expense


(9,101
)


(21,151
)


12,050   54




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##### Table of Contents



Year Ended December 31,2005

2004

ChangeMinority interests in consolidated
    subsidiaries

$
(31
)

$



$
(31
)Interest income


9,957



1,812



8,145Interest expense


(30,051
)


(20,789
)


(9,262
)Other income (expense), net


1,423



(410
)


1,833Reorganization items, net






962,444



(962,444
)Income tax expense


(21,151
)


(8,096
)


(13,055
)   Minority
    Interests in Consolidated Subsidiaries
    Interest
    Income
    Interest
    Expense
    SOP 90-7
  Other
    Income (Expense), Net
   55




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##### Table of Contents



Reorganization
    Items, Net
    Income
    Tax Expense
      Quarterly
    Financial Data (Unaudited)
    Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006


2006Revenues

$
266,688


$
267,854


$
287,613


$
314,545Operating income (loss)(1)


19,878



16,452



17,002



(9,508
)Income (loss) before cumulative
    effect of change in accounting principle(1)


17,101



7,510



9,979



(39,352
)Cumulative effect of change in
    accounting principle


623











Net income (loss)(1)

$
17,724


$
7,510


$
9,979


$
(39,352
) 56




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##### Table of Contents



Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006


2006Basic net income (loss) per share:Income (loss) before cumulative
    effect of change in accounting principle

$
0.28


$
0.12


$
0.17


$
(0.60
)Cumulative effect of change in
    accounting principle


0.01











Basic net income (loss) per share

$
0.29


$
0.12


$
0.17


$
(0.60
)Diluted net income (loss) per
    share:Income (loss) before cumulative
    effect of change in accounting principle

$
0.28


$
0.12


$
0.16


$
(0.60
)Cumulative effect of change in
    accounting principle


0.01











Diluted net income (loss) per share

$
0.29


$
0.12


$
0.16


$
(0.60
)   Three Months EndedMarch 31,


June 30,


September 30,


December 31,2005


2005


2005


2005Revenues

$
228,370


$
226,829


$
230,527


$
228,937Operating income(2)


21,861



8,554



28,634



10,770Net income(2)


7,516



1,103



16,397



4,950Basic net income per share


0.13



0.02



0.27



0.08Diluted net income per share


0.12



0.02



0.27



0.08     (1)
    
    During the quarter ended September 30, 2006, we recognized
    a gain of $21.5 million (subsequently increased by
    $0.1 million due to post-closing adjustments during the
    quarter ended December 31, 2006) from our sale of
    wireless licenses and operating assets in our Toledo and
    Sandusky, Ohio markets.(2)
    
    During the quarter ended September 30, 2005, we recognized
    a gain of $14.6 million from our sale of wireless licenses
    and operating assets in our Michigan markets.  Quarterly
    Results of Operations Data (Unaudited)
    Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006


2006Revenues:Service revenues

$
215,840


$
230,786


$
249,081


$
277,074Equipment revenues


50,848



37,068



38,532



37,471Total revenues


266,688



267,854



287,613



314,545 57




---



##### Table of Contents



Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006


2006Operating expenses:Cost of service (exclusive of
    items shown separately below)


(55,204
)


(60,255
)


(70,722
)


(75,433
)Cost of equipment


(58,886
)


(52,081
)


(68,711
)


(82,652
)Selling and marketing


(29,102
)


(35,942
)


(42,948
)


(51,265
)General and administrative


(49,582
)


(46,576
)


(49,110
)


(51,802
)Depreciation and amortization


(54,036
)


(53,337
)


(56,409
)


(62,965
)Impairment of indefinite-lived
    intangible assets






(3,211
)


(4,701
)


Total operating expenses


(246,810
)


(251,402
)


(292,601
)


(324,117
)Gains on sales of wireless
    licenses and operating assets










21,990



64Operating income (loss)


19,878



16,452



17,002



(9,508
)Minority interests in consolidated
    subsidiaries


(75
)


(134
)


(138
)


1,783Interest income


4,194



5,533



5,491



7,845Interest expense


(7,431
)


(8,423
)


(15,753
)


(29,727
)Other income (expense), net


535



(5,918
)


272



2,461Income (loss) before income taxes
    and cumulative effect of change in accounting principle


17,101



7,510



6,874



(27,146
)Income tax benefit (expense)










3,105



(12,206
)Income (loss) before cumulative
    effect of change in accounting principle


17,101



7,510



9,979



(39,352
)Cumulative effect of change in
    accounting principle


623











Net income (loss)

$
17,724


$
7,510


$
9,979


$
(39,352
)   Performance
    Measures
  Regulation S-K
   58




---



##### Table of Contents



59




---



##### Table of Contents



Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2006


2006


2006


2006


2006ARPU

$
41.87


$
42.97


$
44.39


$
44.68


$
43.55CPGA

$
130


$
198


$
176


$
179


$
172CCU

$
19.57


$
19.18


$
20.74


$
20.21


$
19.95Churn


3.3
%


3.6
%


4.3
%


4.1
%


3.9
%   Reconciliation
    of Non-GAAP Financial Measures
  Regulation S-K
    Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2006


2006


2006


2006


2006Selling and marketing expense

$
29,102


$
35,942


$
42,948


$
51,265


$
159,257Less share-based compensation
    expense included in selling and marketing expense


(327
)


(473
)


(637
)


(533
)


(1,970
)Plus cost of equipment


58,886



52,081



68,711



82,652



262,330Less equipment revenue


(50,848
)


(37,068
)


(38,532
)


(37,471
)


(163,919
)Less net loss on equipment
    transactions unrelated to initial customer acquisition


(521
)


(412
)


(983
)


(3,026
)


(4,942
)Total costs used in the
    calculation of CPGA

$
36,292


$
50,070


$
71,507


$
92,887


$
250,756Gross customer additions


278,370



253,033



405,178



519,229



1,455,810CPGA

$
130


$
198


$
176


$
179


$
172  60




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##### Table of Contents



Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2006


2006


2006


2006


2006Cost of service

$
55,204


$
60,255


$
70,722


$
75,433


$
261,614Plus general and administrative
    expense


49,582



46,576



49,110



51,802



197,070Less share-based compensation
    expense included in cost of service and general and
    administrative expense


(4,399
)


(4,215
)


(4,426
)


(4,949
)


(17,989
)Plus net loss on equipment
    transactions unrelated to initial customer acquisition


521



412



983



3,026



4,942Total costs used in the
    calculation of CCU

$
100,908


$
103,028


$
116,389


$
125,312


$
445,637Weighted-average number of
    customers


1,718,349



1,790,232



1,870,204



2,067,122



1,861,477CCU

$
19.57


$
19.18


$
20.74


$
20.21


$
19.95   Liquidity
    and Capital Resources
  Overview
       61




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##### Table of Contents



Cash
    Flows
    Year Ended December 31,2006


2005


2004Net cash provided by operating
    activities

$
291,232


$
308,280


$
190,375Net cash used in investing
    activities


(1,549,858
)


(332,112
)


(96,577
)Net cash provided by (used in)
    financing activities


1,340,492



175,764



(36,727
)   Operating
    Activities
    pay-in-kind
  Investing
    Activities
    
    During July and October 2006, we paid to the FCC
    $710.2 million for the purchase of 99 licenses acquired in
    Auction #66, and Denali License paid $274.1 million as
    a deposit for the license for which it was named the winning
    bidder in Auction #66.
    During November 2006, we purchased 13 wireless licenses in North
    Carolina and South Carolina for an aggregate purchase price of
    $31.8 million.
    During the year ended December 31, 2006, we, ANB 1
    License and LCW Operations made over $590 million in
    purchases of property and equipment for the build-out of our new
    markets.    
    During the year ended December 31, 2005, we paid
    $208.8 million for the purchase of property and equipment.
    During the year ended December 31, 2005, subsidiaries of
    Cricket and ANB 1 paid $244.0 million for the purchase
    of wireless licenses, partially offset by proceeds received of
    $108.8 million from the sale of wireless licenses and
    operating assets.    Financing
    Activities
    
    In June 2006, we replaced our previous $710 million senior
    secured credit facility with a new amended and restated senior
    secured credit facility consisting of a $900 million term
    loan and a $200 million revolving credit facility. The
    replacement term loan generated net proceeds of approximately
    $307 million, after repayment of the principal balances of
    the old term loan and prior to the payment of fees and expenses.
    See  Senior Secured Credit Facilities
    below. 62




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##### Table of Contents




    In October 2006, we physically settled 6,440,000 shares of
    Leap common stock pursuant to our forward sale agreements and
    received aggregate cash proceeds of $260 million (before
    expenses) from such physical settlements. See
     Forward Sale Agreements below.
    In October 2006, we borrowed $570 million under our
    $850 million unsecured bridge loan facility to finance a
    portion of the remaining amounts owed by us and Denali License
    to the FCC for Auction #66 licenses.
    In October 2006, we issued $750 million of
    9.375% senior notes due 2014, and we used a portion of the
    approximately $739 million of cash proceeds (after
    commissions and before expenses) from the sale to repay our
    outstanding obligations, including accrued interest, under our
    bridge loan facility. Upon repayment of our outstanding
    indebtedness, the bridge loan facility was terminated. See
     Senior Notes below.
    In October 2006, LCW Operations entered into a senior secured
    credit agreement consisting of two term loans for
    $40 million in the aggregate. The loans bear interest at
    LIBOR plus the applicable margin ranging from 2.70% to 6.33% and
    must be repaid in varying quarterly installments beginning in
    2008, with the final payment due in 2011. The loans are
    non-recourse to Leap, Cricket and their other subsidiaries. See
     Senior Secured Credit Facilities below.  pay-in-kind
    Senior
    Secured Credit Facilities
       63




---



##### Table of Contents



Forward
    Sale Agreements
    Senior
    Notes
   64




---



##### Table of Contents



Capital
    Expenditures and Other Asset Acquisitions and
    Dispositions
  Capital
    Expenditures
        Auction #66 Properties and Build-Outs
   65




---



##### Table of Contents



Other Acquisitions and Dispositions
          Contractual
    Obligations
    2007


2008-2009


2010-2011


Thereafter


TotalLong-term debt(1)

$
9,000


$
23,500


$
52,500


$
1,600,500


$
1,685,500Contractual interest(2)


145,544



288,930



284,539



287,582



1,006,595Operating leases


88,275



171,917



165,548



371,809



797,549Purchase obligations(3)


204,482



89,935



53,800







348,217Origination fees for ANB 1
    investment


2,700















2,700Total

$
450,001


$
574,282


$
556,387


$
2,259,891


$
3,840,561     (1)
    
    Amounts shown for Crickets long-term debt include
    principal only. Interest on the debt, calculated at the current
    interest rate, is stated separately. 66




---



##### Table of Contents



(2)
    
    Contractual interest is based on the current interest rates in
    effect at December 31, 2006 for debt outstanding as of that
    date.(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.        Off-Balance
    Sheet Arrangements
    Recent
    Accounting Pronouncements
      Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Interest Rate Risk.
 67




---



##### Table of Contents



Hedging Policy.
 68




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  To the Board
    of Directors and Stockholders of Leap Wireless International,
    Inc.:
    Consolidated
    Financial Statements
          Internal
    Control Over Financial Reporting
  Internal Control  Integrated Framework Internal Control 
    Integrated Framework
 69




---



##### Table of Contents



70




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  To the Board
    of Directors and Stockholders of Leap Wireless International,
    Inc.:
         
 71




---



##### Table of Contents



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


December 31,2006


2005AssetsCash and cash equivalents

$
374,939


$
293,073Short-term investments


66,400



90,981Restricted cash, cash equivalents
    and short-term investments


13,581



13,759Inventories


90,185



37,320Other current assets


53,527



29,237Total current assets


598,632



464,370Property and equipment, net


1,077,755



621,946Wireless licenses


1,563,958



821,288Assets held for sale


8,070



15,145Goodwill


431,896



431,896Other intangible assets, net


79,828



113,554Deposits for wireless licenses


274,084



Other assets


58,745



38,119Total assets

$
4,092,968


$
2,506,318Liabilities and
    Stockholders EquityAccounts payable and accrued
    liabilities

$
316,494


$
167,770Current maturities of long-term
    debt


9,000



6,111Other current liabilities


74,637



49,627Total current liabilities


400,131



223,508Long-term debt


1,676,500



588,333Deferred tax liabilities


149,728



141,935Other long-term liabilities


47,608



36,424Total liabilities


2,273,967



990,200Minority interests


30,000



1,761Commitments 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; 
    67,892,512 and 61,202,806 shares issued and outstanding at
    December 31, 2006 and 2005, respectively


7



6Additional paid-in capital


1,769,772



1,511,580Unearned share-based compensation






(20,942
)Retained earnings


17,436



21,575Accumulated other comprehensive
    income


1,786



2,138Total stockholders equity


1,789,001



1,514,357Total liabilities and
    stockholders equity

$
4,092,968


$
2,506,318    72




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
  PredecessorSuccessor Company


CompanyFive Months


Seven MonthsYear Ended


Year Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Revenues:Service revenues

$
972,781


$
763,680


$
285,647


$
398,451Equipment revenues


163,919



150,983



58,713



83,196Total revenues


1,136,700



914,663



344,360



481,647Operating expenses:Cost of service (exclusive of items
    shown separately below)


(261,614
)


(200,430
)


(79,148
)


(113,988
)Cost of equipment


(262,330
)


(192,205
)


(82,402
)


(97,160
)Selling and marketing


(159,257
)


(100,042
)


(39,938
)


(51,997
)General and administrative


(197,070
)


(159,249
)


(57,110
)


(81,514
)Depreciation and amortization


(226,747
)


(195,462
)


(75,324
)


(178,120
)Impairment of indefinite-lived
    intangible assets


(7,912
)


(12,043
)






Total operating expenses


(1,114,930
)


(859,431
)


(333,922
)


(522,779
)Gains on sales of wireless licenses
    and operating assets


22,054



14,587







532Operating income (loss)


43,824



69,819



10,438



(40,600
)Minority interests in consolidated
    subsidiaries


1,436



(31
)






Interest income


23,063



9,957



1,812



Interest expense (contractual
    interest expense was $156.3 million for the seven months
    ended July 31, 2004)


(61,334
)


(30,051
)


(16,594
)


(4,195
)Other income (expense), net


(2,650
)


1,423



(117
)


(293
)Income (loss) before reorganization
    items, income taxes and cumulative effect of change in
    accounting principle


4,339



51,117



(4,461
)


(45,088
)Reorganization items, net














962,444Income (loss) before income taxes
    and cumulative effect of change in accounting principle


4,339



51,117



(4,461
)


917,356Income tax expense


(9,101
)


(21,151
)


(3,930
)


(4,166
)Income (loss) before cumulative
    effect of change in accounting principle


(4,762
)


29,966



(8,391
)


913,190Cumulative effect of change in
    accounting principle


623











Net income (loss)

$
(4,139
)

$
29,966


$
(8,391
)

$
913,190Basic net income (loss) per share:Income (loss) before cumulative
    effect of change in accounting principle

$
(0.08
)

$
0.50


$
(0.14
)

$
15.58Cumulative effect of change in
    accounting principle


0.01











Basic net income (loss) per share

$
(0.07
)

$
0.50


$
(0.14
)

$
15.58Diluted net income (loss) per share:Income (loss) before cumulative
    effect of change in accounting principle

$
(0.08
)

$
0.49


$
(0.14
)

$
15.58Cumulative effect of change in
    accounting principle


0.01











Diluted net income (loss) per share

$
(0.07
)

$
0.49


$
(0.14
)

$
15.58Shares used in per share
    calculations:Basic


61,645



60,135



60,000



58,623Diluted


61,645



61,003



60,000



58,623    73




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
    (In thousands)
  PredecessorSuccessor Company


CompanyFive Months


Seven MonthsYear Ended


Year Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Operating activities:Net income (loss)

$
(4,139
)

$
29,966


$
(8,391
)

$
913,190Adjustments to reconcile net income
    (loss) to net cash provided by operating activities:Share-based compensation expense


19,959



12,245







Depreciation and amortization


226,747



195,462



75,324



178,120Amortization of debt issuance costs


2,491



565







Loss on extinguishment of debt


6,897



1,219







Deferred income tax expense


8,367



21,088



3,823



3,370Impairment of indefinite-lived
    intangible assets


7,912



12,043







Gains on sales of wireless licenses
    and operating assets


(22,054
)


(14,587
)






(532
)Minority interest activity


(1,436
)


31







Cumulative effect of change in
    accounting principle


(623
)










Reorganization items, net














(962,444
)Other














(805
)Changes in assets and liabilities:Inventories


(52,898
)


(11,504
)


8,923



(17,059
)Other assets


(30,270
)


3,570



(21,132
)


(5,343
)Accounts payable and accrued
    liabilities


95,303



57,101



(4,421
)


4,761Other liabilities


34,976



1,081



15,626



12,861Net cash provided by operating
    activities before reorganization activities


291,232



308,280



69,752



126,119Net cash used for reorganization
    activities














(5,496
)Net cash provided by operating
    activities


291,232



308,280



69,752



120,623Investing activities:Purchases of property and equipment


(590,529
)


(208,808
)


(49,043
)


(34,456
)Prepayments for purchases of
    property and equipment


(3,846
)


(9,828
)


5,102



1,215Purchases of and deposits for
    wireless licenses


(1,018,832
)


(243,960
)






Proceeds from sales of wireless
    licenses and operating assets


40,372



108,800







2,000Purchases of investments


(150,488
)


(307,021
)


(47,368
)


(87,201
)Sales and maturities of investments


177,932



329,043



32,494



58,333Changes in restricted cash, cash
    equivalents and short-term investments, net


(4,467
)


(338
)


12,537



9,810Net cash used in investing
    activities


(1,549,858
)


(332,112
)


(46,278
)


(50,299
)Financing activities:Proceeds from long-term debt


2,260,000



600,000







Repayment of long-term debt


(1,168,944
)


(418,285
)


(36,727
)


Payment of debt issuance costs


(22,864
)


(6,951
)






Minority interest contributions


12,402



1,000







Proceeds from issuance of common
    stock, net


1,119











Proceeds from physical settlement
    of forward equity sale


260,036











Payment of fees related to forward
    equity sale


(1,257
)










Net cash provided by (used in)
    financing activities


1,340,492



175,764



(36,727
)


Net increase (decrease) in cash and
    cash equivalents


81,866



151,932



(13,253
)


70,324Cash and cash equivalents at
    beginning of period


293,073



141,141



154,394



84,070Cash and cash equivalents at end of
    period

$
374,939


$
293,073


$
141,141


$
154,394    74




---



##### Table of Contents



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


OtherAdditional


Unearned


Earnings


ComprehensiveCommon Stock


Paid-In


Share-Based


(Accumulated


IncomeShares


Amount


Capital


Compensation


Deficit)


(Loss)


TotalPredecessor Company balance at
    December 31, 2003


58,704,224


$
6


$
1,156,410


$
(421
)

$
(2,048,431
)

$
(920
)

$
(893,356
)Components of comprehensive income:Net income


















913,190







913,190Net unrealized holding gains on
    investments






















47



47Comprehensive income


























913,237Issuance of common stock under
    share-based compensation plans










31















31Unearned share-based compensation










(1,205
)


1,205











Amortization of share-based
    compensation














(837
)










(837
)Application of fresh-start
    reporting:Elimination of Predecessor Company
    common stock


(58,704,224
)


(6
)


(1,155,236
)


53







873



(1,154,316
)Issuance of Successor Company
    common stock and fresh-start adjustments


60,000,000



6



1,478,392







1,135,241







2,613,639Successor Company balance at
    August 1, 2004


60,000,000



6



1,478,392















1,478,398Components of comprehensive loss:Net loss


















(8,391
)






(8,391
)Net unrealized holding gains on
    investments






















49



49Comprehensive loss


























(8,342
)Successor Company balance at
    December 31, 2004


60,000,000



6



1,478,392







(8,391
)


49



1,470,056Components of comprehensive income:Net income


















29,966







29,966Net unrealized holding losses on
    investments






















(57
)


(57
)Unrealized gains on derivative
    instruments






















2,146



2,146Comprehensive income


























32,055Issuance of common stock under
    share-based compensation plans, net of repurchases


1,202,806







6,871















6,871Unearned share-based compensation










26,317



(26,317
)










Amortization of share-based
    compensation














5,375











5,375Successor Company balance at
    December 31, 2005


61,202,806



6



1,511,580



(20,942
)


21,575



2,138



1,514,357Components of comprehensive loss:Net loss


















(4,139
)






(4,139
)Net unrealized holding gains on
    investments






















4



4Unrealized losses on derivative
    instruments






















(356
)


(356
)Comprehensive loss


























(4,491
)Cumulative effect of change in
    accounting principle










(623
)














(623
)Reclassification of unearned
    share-based compensation related to the adoption of
    SFAS No. 123R










(20,942
)


20,942











Issuance of common stock under
    forward sale agreements


6,440,000



1



258,679















258,680Share-based compensation expense










19,959















19,959Issuance of common stock under
    share-based compensation plans, net of repurchases


249,706







1,119















1,119Successor Company balance at
    December 31, 2006


67,892,512


$
7


$
1,769,772


$



$
17,436


$
1,786


$
1,789,001    75




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Note 1.  The
    Company
  ® TM
    Note 2.  Basis
    of Presentation and Significant Accounting Policies
  Basis
    of Presentation
        Revenues
  month-to-month
 76




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      and/or
  Costs
    and Expenses
    Cost of Service.
  Cost of Equipment.
  Selling and Marketing.
  General and Administrative.
  Cash
    and Cash Equivalents
    Short-Term
    Investments
   77




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   available-for-sale available-for-sale other-than-temporary,
  Restricted
    Cash, Cash Equivalents and Short-Term Investments
    Inventories
  first-in,
  Property
    and Equipment
      Depreciable LifeNetwork equipment:Switches


10Switch power equipment


15Cell site equipment, and site
    acquisitions and improvements


7Towers


15Antennae


3Computer hardware and software


3-5Furniture, fixtures, retail and
    office equipment


3-7   construction-in-progress construction-in-progress, No. FAS 13-1, construction-in-progress.
 78




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Wireless
    Licenses
    Goodwill
    and Other Intangible Assets
    Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
   79




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Derivative
    Instruments and Hedging Activities
        Concentrations
    Operating
    Leases
    Asset
    Retirement Obligations
   80




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Year Ended December 31,2006


2005Asset retirement obligations,
    beginning of year

$
13,961


$
12,726Liabilities incurred


5,174



615Liabilities settled


(263
)


(703
)Accretion expense


1,617



1,323Asset retirement obligations, end
    of year

$
20,489


$
13,961   Debt
    Issuance Costs
    Fair
    Value of Financial Instruments
    Advertising
    Costs
    Share-Based
    Compensation
     81




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Income
    Taxes
    90-7, (SOP 90-7),
  Basic
    and Diluted Earnings (Loss) Per Share
    Fresh-Start
    Reporting and Reorganization Items
  SOP 90-7. SOP 90-7,
  SOP 90-7
 82




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    SOP 90-7,
    Seven MonthsEndedJuly 31, 2004Professional fees

$
(5,005
)Gain on settlement of liabilities


2,500Adjustment of liabilities to
    allowed amounts


(360
)Post-petition interest income


1,436Net gain on discharge of
    liabilities and the net effect of application of fresh-start
    reporting


963,873Total reorganization items, net

$
962,444   Recent
    Accounting Pronouncements
     83




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 3.  Financial
    Instruments
  Short-Term
    Investments
  available-for-sale. Available-for-sale
  As of December 31, 2006Unrealized


UnrealizedCost


Gain


Loss


Fair ValueAsset-backed commercial paper

$
42,498


$



$
(5
)

$
42,493Commercial paper


8,238











8,238Certificate of deposit


15,669











15,669$
66,405


$



$
(5
)

$
66,400   As of December 31, 2005Unrealized


UnrealizedCost


Gain


Loss


Fair ValueCommercial paper

$
49,884


$



$
(2
)

$
49,882U.S. government or government
    agency securities


40,857



3



(11
)


40,849Certificate of deposit


250











250$
90,991


$
3


$
(13
)

$
90,981   Note 4.
    Supplementary
    Financial Information  Supplementary
    Balance Sheet Information (in thousands):
  As of December 31,2006


2005Other current assets:Accounts receivable, net

$
37,422


$
17,397Prepaid expenses


11,808



9,884Other


4,297



1,956$
53,527


$
29,237Property and equipment, net:Network equipment

$
1,134,807


$
654,993Computer equipment and other


93,816



38,778Construction-in-progress


237,813



134,9291,466,436



828,700Accumulated depreciation


(388,681
)


(206,754
)$
1,077,755


$
621,946 84




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  As of December 31,2006


2005Other intangible assets, net:Customer relationships

$
124,715


$
124,715Trademarks


37,000



37,000161,715



161,715Accumulated amortization customer
    relationships


(75,500
)


(44,417
)Accumulated amortization trademarks


(6,387
)


(3,744
)$
79,828


$
113,554     Accounts payable and accrued
    liabilities:Trade accounts payable

$
218,019


$
117,140Accrued payroll and related
    benefits


29,450



13,185Other accrued liabilities


69,025



37,445$
316,494


$
167,770Other current liabilities:Accrued sales, telecommunications,
    property and other taxes payable

$
26,899


$
22,281Deferred revenue


27,933



21,391Accrued interest


13,671



Other


6,134



5,955$
74,637


$
49,627  85




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Supplementary
    Cash Flow Information (in thousands):
  PredecessorSuccessor Company


CompanyYear


Year


Five Months


Seven MonthsEnded


Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Supplementary disclosure of cash
    flow information:Cash paid for interest

$
61,360


$
55,653


$
8,227


$
Cash paid for income taxes


1,034



305



240



76Cash provided by (paid for)
    reorganization activities:Payments to Leap Creditor Trust














(990
)Payments for professional fees














(7,975
)Cure payments, net














1,984Interest income














1,485Supplementary disclosure of
    non-cash investing activities:Contribution of wireless licenses

$
16,100


$



$



$
   Note 5.
    Earnings
    Per Share    PredecessorSuccessor Company


CompanyYear


Year


Five Months


Seven MonthsEnded


Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Weighted-average shares
    outstanding  basic earnings per share


61,645



60,135



60,000



58,623Effect of dilutive securities:Stock options






130







Restricted stock awards






472







Warrants






266







Adjusted weighted-average shares
    outstanding  diluted earnings per share


61,645



61,003



60,000



58,623    86




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Note 6.
    Long-Term
    Debt    As of December 31,2006


2005Term loans under senior secured
    credit facilities

$
935,500


$
594,444Senior notes


750,000



1,685,500



594,444Current maturities of long-term
    debt


(9,000
)


(6,111
)$
1,676,500


$
588,333   Senior
    Secured Credit Facilities
         87




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Senior
    Notes
     88




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Note 7.
    Income
    Taxes    PredecessorSuccessor Company


CompanyFive Months


Seven MonthsYear Ended


Year Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Current provision:Federal

$
713


$



$



$
State


21



63



107



13734



63



107



13Deferred provision:Federal


6,973



17,571



3,186



3,725State


1,394



3,517



637



4288,367



21,088



3,823



4,153$
9,101


$
21,151


$
3,930


$
4,166  89




---



##### Table of Contents



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


CompanyFive Months


Seven MonthsYear Ended


Year Ended


Ended


EndedDecember 31,


December 31,


December 31,


July 31,2006


2005


2004


2004Amounts computed at statutory
    federal rate

$
1,737


$
17,891


$
(1,561
)

$
321,075Non-deductible expenses


421



929



2,096



175State income tax, net of federal
    benefit


383



2,285



171



287Net tax expense related to
    wireless licenses and tax-deductible goodwill










3,224



Net tax expense related to joint
    venture


1,335











Gain on reorganization and
    adoption of fresh-start reporting














(337,422
)Other






46







Change in valuation allowance


5,225











20,051$
9,101


$
21,151


$
3,930


$
4,166     As of December 31,2006


2005Deferred tax assets:Net operating loss carryforwards

$
164,967


$
174,802Wireless licenses


41,854



59,639Capital loss carryforwards


29,592



14,141Reserves and allowances


12,446



10,027Share-based compensation


9,006



2,110Deferred rent and deferred loan
    costs


6,419



Property and equipment






3,476Other


4,125



3,750Gross deferred tax assets


268,409



267,945Deferred tax liabilities:Intangible assets


(31,168
)


(45,171
)Property and equipment


(7,680
)


Deferred tax on unrealized gains


(1,243
)


(1,382
)Other


(390
)


Net deferred tax assets


227,928



221,392Valuation allowance


(227,928
)


(221,392
) 90




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  As of December 31,2006


2005Other deferred tax liabilities:Wireless licenses


(139,278
)


(136,364
)Goodwill


(6,169
)


(3,616
)Investment in joint venture


(2,900
)


Net deferred tax liabilities

$
(148,347
)

$
(139,980
)     As of December 31,2006


2005Current deferred tax assets
    (included in other current assets)

$
1,381


$
1,955Long-term deferred tax liability


(149,728
)


(141,935
)$
(148,347
)

$
(139,980
)       SOP 90-7,
  Note 8.
    Stockholders
    Equity  Forward
    Sale Agreements
   91




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Warrants
    Note 9.
    Share-Based
    Compensation    Stock
    Options
    As of December 31,2006


2005Expected volatility


46
%


86
%Expected term (in years)


6.3



5.8Risk-free interest rate


4.72
%


3.68
%Expected dividend yield






    92




---



##### 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, 2004









$
Options granted






2,251



28.68Options forfeited






(359
)


27.31Options exercised










Options outstanding at
    December 31, 2005






1,892


$
28.94Options exercisable at
    December 31, 2005


35






$
26.50Options granted






1,277


$
50.04Options forfeited






(99
)


34.21Options exercised










Options outstanding at
    December 31, 2006






3,070


$
37.55



8.87


$
67,702Options exercisable at
    December 31, 2006


76






$
26.50



8.19


$
2,517         Restricted
    Stock
   93




---



##### 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, 2004





$
Shares issued


969



28.52Shares forfeited


(46
)


28.45Shares vested


(28
)


27.35Restricted stock awards
    outstanding at December 31, 2005


895


$
28.56Shares issued


286



51.86Shares forfeited


(35
)


30.40Shares vested


(28
)


27.35Restricted stock awards
    outstanding at December 31, 2006


1,118


$
34.50     Year Ended December 31,2006


2005


2004Fair value on vesting date of
    vested restricted stock awards

$
1,519


$
993


$
       Employee
    Stock Purchase Plan
    Deferred
    Stock Units
   94




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Allocation
    of Share-Based Compensation Expense
    Year Ended December 31,2006


2005Cost of service

$
1,245


$
1,204Selling and marketing expenses


1,970



1,021General and administrative expenses


16,744



10,020Share-based compensation expense
    before tax


19,959



12,245Related income tax benefit






Share-based compensation expense,
    net of tax

$
19,959


$
12,245Net share-based compensation
    expense per share:Basic

$
0.32


$
0.20Diluted

$
0.32


$
0.20   Effect
    of SFAS 123R Adoption
    Pro
    Forma Information under SFAS 123 for Periods Prior to
    Fiscal 2006
    PredecessorSuccessor Company


CompanyFive Months


Seven MonthsYear Ended


Ended


EndedDecember 31,


December 31,


July 31,2005


2004


2004As reported net income (loss)

$
29,966


$
(8,391
)

$
913,190Add: Share-based compensation
    expense (benefit) included in net income (loss)


12,245







(837
)Deduct: Net pro forma compensation
    (expense) benefit


(20,085
)






6,209Pro forma net income (loss)

$
22,126


$
(8,391
)

$
918,562Basic net income (loss) per share:As reported

$
0.50


$
(0.14
)

$
15.58Pro forma

$
0.37


$
(0.14
)

$
15.67Diluted net income (loss) per
    share:As reported

$
0.49


$
(0.14
)

$
15.58Pro forma

$
0.36


$
(0.14
)

$
15.67  95




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Note 10.
    Employee
    Savings and Retirement Plan    Note 11.
    Significant
    Acquisitions and Dispositions          Note 12.
    Segment
    and Geographic Data    Note 13.
    Commitments
    and Contingencies  Outstanding
    Bankruptcy Claims
   96




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Patent
    Litigation
  Method for
    Providing Wireless Communication Services and Network and System
    for Delivering Same,
  Operations Method
    for Providing Wireless Communication Services and Network and
    System for Delivering Same
   97




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Tortious
    Interference and Unfair Competition Litigation
  T-Mobile (T-Mobile) T-Mobile T-Mobile T-Mobiles
  Other
  and/or
  and/or
 98




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Purchase
    Obligations
    Operating
    Leases
    Year Ended
    December 31:2007

$
88,2752008


86,5692009


85,3482010


85,0032011


80,545Thereafter


371,809Total

$
797,549  99




---



##### 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  Disclosure
    Controls and Procedures
    Rule 13a-15(b), Form 10-K, Rule 13a-15(e)
  Remediation
    of Previous Material Weaknesses    
    We did not have sufficient personnel with the appropriate
    skills, training and Company-specific experience to identify and
    address the application of generally accepted accounting
    principles in complex or non-routine transactions. We also
    experienced staff turnover and an associated loss of
    Company-specific experience within our accounting, financial
    reporting and tax functions.
    We did not maintain effective controls over our accounting for
    income taxes. Specifically, we did not have adequate controls
    designed and in place to ensure the completeness and accuracy of
    the deferred income tax provision and the related deferred tax
    assets and liabilities and the related goodwill in conformity
    with generally accepted accounting principles. This control
    deficiency resulted in the restatement of our consolidated
    financial statements for the five months ended December 31,
    2004, the two months ended September 30, 2004 and the
    quarters ended March 31, 2005, June 30, 2005 and
    September 30, 2005.    
    We have filled existing vacancies and we have created and filled
    a number of new management positions within our accounting,
    financial reporting and tax functions with qualified and
    experienced individuals. These include the following positions:  
    a new vice president, chief accounting officer hired in May 2005,
    a new director of tax to lead our tax function hired in June
    2006,
    a new executive vice president, chief financial officer hired in
    August 2006,
    a new assistant controller hired in December 2006,
    a new director of financial reporting hired in December
    2006, and
    a number of other new accounting management personnel hired
    since February 2005. 100




---



##### Table of Contents




    We improved our internal controls over accounting for income
    taxes by establishing detailed procedures for the preparation
    and review of the income tax provision, including review and
    oversight by our director of tax and our chief accounting
    officer.    (b)
    Managements
    Report on Internal Control over Financial Reporting  Rule 13a-15(f).
    Internal Control 
    Integrated Framework Internal
    Control  Integrated Framework
    (c)
    Changes
    in Internal Control over Financial Reporting    Item 9B.
    Other
    Information   101




---



##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance    Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services   PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules  (a)
    Financial
    Statements and Financial Statement Schedules  Documents
    filed as part of this report:  1.
    Financial
    Statements:           102




---



##### Table of Contents



2.
    Financial
    Statement Schedules:    (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(2)

Disclosure Statement Accompanying
    Fifth Amended Joint Plan of Reorganization dated as of
    July 30, 2003.2.3(3)

Order Confirming Debtors
    Fifth Amended Joint Plan of Reorganization dated as of
    July 30, 2003.3.1(4)

Amended and Restated Certificate
    of Incorporation of Leap Wireless International, Inc.3.2(4)

Amended and Restated Bylaws of
    Leap Wireless International, Inc.4.1(5)

Form of Common Stock Certificate.4.2(4)

Registration Rights Agreement
    dated as of August 16, 2004, by and among Leap Wireless
    International Inc., MHR Institutional Partners II LP, MHR
    Institutional Partners IIA LP and Highland Capital
    Management, L.P.4.2.1(6)

Amendment No. 1 to
    Registration Rights Agreement dated as of June 7, 2005 by
    and among Leap Wireless International, Inc., MHR Institutional
    Partners II LP, MHR Institutional Partners IIA LP and
    Highland Capital Management, L.P.4.3(7)

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(7)

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).4.4(7)

Registration Rights Agreement,
    dated as of October 23, 2006, by and among Cricket
    Communications, Inc., the Guarantors (as defined therein),
    Citigroup Global Markets Inc. and Goldman, Sachs & Co.,
    as representatives of the Initial Purchasers named therein.4.5(8)

Confirmation of Forward Sale
    Transaction, dated August 15, 2006, by and between Leap
    Wireless International, Inc. and Goldman Sachs Financial
    Markets, L.P.4.6(8)

Confirmation of Forward Sale
    Transaction, dated August 15, 2006, by and between Leap
    Wireless International, Inc. and Citibank, N.A.10.1(9)

Amended and Restated System
    Equipment Purchase Agreement, entered into as of June 30,
    2000, by and between Cricket Communications, Inc. and Lucent
    Technologies Inc. (including exhibits thereto).10.1.1(10)

Amendment No. 1 to the
    Amended and Restated System Equipment Purchase Agreement by and
    between Lucent Technologies Inc. and Cricket Communications,
    Inc., entered into as of March 22, 2002.10.1.2(10)

Amendment No. 2 to the
    Amended and Restated System Equipment Purchase Agreement by and
    between Lucent Technologies Inc. and Cricket Communications,
    Inc., entered into as of March 22, 2002. 103




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##### Table of Contents



ExhibitNumber

Description10.1.3(11)

Amendment No. 3 to Amended
    and Restated System Equipment Purchase Agreement by and between
    Cricket Communications, Inc. and Lucent Technologies Inc.,
    effective March 22, 2002.10.1.4(11)

Amendment No. 4 to Amended
    and Restated System Equipment Purchase Agreement by and between
    Cricket Communications, Inc. and Lucent Technologies Inc.,
    effective March 22, 2002.10.1.5(12)

Amendment No. 5 to the
    Amended and Restated System Equipment Purchase Agreement by and
    between Cricket Communications, Inc. and Lucent Technologies
    Inc., executed as of September 23, 2003.10.1.6(13)

Amendment No. 6 to the
    Amended and Restated System Equipment Purchase Agreement by and
    between Cricket Communications, Inc. and Lucent Technologies
    Inc., effective as of February 4, 2004.10.1.7(14)

Amendment No. 7 to the
    Amended and Restated System Equipment Purchase Agreement by and
    between Cricket Communications, Inc. and Lucent Technologies
    Inc., effective as of January 1, 2005.10.1.8(15)

Amendment No. 8 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of October 1, 2005, between Cricket Communications, Inc.
    and Lucent Technologies Inc.10.1.9(16)

Amendment No. 9 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of January 11, 2006, between Cricket Communications, Inc.
    and Lucent Technologies Inc.10.2(17)

Amended and Restated System
    Equipment Purchase Agreement, effective as of December 23,
    2002, by and between Cricket Communications, Inc. and Nortel
    Networks Inc. (including exhibits thereto).10.2.1(17)

Amendment No. 1 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of February 7, 2003, by and between Cricket Communications,
    Inc. and Nortel Networks Inc. (including exhibits thereto).10.2.2(14)

Amendment No. 2 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of December 22, 2004, by and between Cricket
    Communications, Inc. and Nortel Networks Inc.10.2.3(15)

Amendment No. 3 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of October 11, 2005, by and between Cricket Communications,
    Inc. and Nortel Networks Inc.10.2.4(16)

Amendment No. 4 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of December 22, 2005, by and between Cricket
    Communications, Inc. and Nortel Networks Inc.10.2.5(18)

Amendment No. 5 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of May 22, 2006, by and between Cricket Communications,
    Inc. and Nortel Networks Inc.10.2.6(19)

Amendment No. 6 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of August 31, 2006, by and between Cricket Communications,
    Inc. and Nortel Networks Inc.10.2.7(19)

Amendment No. 7 to Amended
    and Restated System Equipment Purchase Agreement, effective as
    of October 18, 2006, by and between Cricket Communications,
    Inc. and Nortel Networks Inc.10.3(20)

Amended and Restated Credit
    Agreement, dated June 16, 2006, by and among Cricket
    Communications, Inc., Leap Wireless International, Inc., the
    Lenders party thereto and Bank of America, N.A., as
    administrative agent and
    L/C issuer.10.3.1(20)

Amended and Restated Security
    Agreement, dated June 16, 2006, made by Cricket
    Communications, Inc., Leap Wireless International, Inc., and the
    Subsidiary Guarantors to Bank of America, N.A., as collateral
    agent. 104




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##### Table of Contents



ExhibitNumber

Description10.3.2(19)

Letter Amendment to the Amended
    and Restated Security Agreement dated as of June 16, 2006
    by and among Cricket Communications, Inc., Leap Wireless
    International, Inc. and Bank of America, N.A., as administrative
    agent, dated October 16, 2006.10.3.3(20)

Amended and Restated Parent
    Guaranty, dated June 16, 2006, made by Leap Wireless
    International, Inc. in favor of the secured parties under the
    Credit Agreement (the Secured Parties).10.3.4(20)

Amended and Restated Subsidiary
    Guaranty, dated June 16, 2006, made by the Subsidiary
    Guarantors in favor of the Secured Parties.10.4(21)

Credit Agreement, dated as of
    December 22, 2004, among Cricket Communications, Inc.,
    Alaska Native Broadband 1 License, LLC, and Alaska Native
    Broadband 1, LLC.10.4.1(21)

Amendment, dated January 26,
    2005, to the Credit Agreement, dated as of December 22,
    2004, among Cricket Communications, Inc., Alaska Native
    Broadband 1 License, LLC, and Alaska Native Broadband 1,
    LLC.10.4.2(6)

Amendment No. 2, dated
    June 24, 2005, to the Credit Agreement, dated as of
    December 22, 2004, among Cricket Communications, Inc.,
    Alaska Native Broadband 1 License, LLC, and Alaska Native
    Broadband 1, LLC.10.4.3(15)

Amendment No. 3, dated
    August 26, 2005, to the Credit Agreement, dated as of
    December 22, 2004, among Cricket Communications, Inc.,
    Alaska Native Broadband 1 License, LLC, and Alaska Native
    Broadband 1, LLC.10.4.4(22)

Amendment No. 4, dated
    January 9, 2006, to the Credit Agreement, dated as of
    December 22, 2004, among Cricket Communications, Inc.,
    Alaska Native Broadband 1 License, LLC, and Alaska Native
    Broadband 1, LLC.10.4.5(23)

Amendment No. 5, dated
    April 24, 2006, to the Credit Agreement, dated as of
    December 22, 2004, among Cricket Communications, Inc.,
    Alaska Native Broadband 1 License, LLC, and Alaska Native
    Broadband 1, LLC.10.5(24)

Credit Agreement, dated as of
    July 13, 2006, by and among Cricket Communications, Inc.,
    Denali Spectrum License, LLC and Denali Spectrum, LLC.10.5.1(19)

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.10.6(25)#

Form of Indemnity Agreement to be
    entered into by and between Leap Wireless International, Inc.
    and its directors and officers.10.7(21)#

Amended and Restated Executive
    Employment Agreement among Leap Wireless International, Inc.,
    Cricket Communications, Inc., and S. Douglas Hutcheson, dated as
    of January 10, 2005.10.7.1(26)#

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, 2005.10.7.2(16)#

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, 2006.10.8(15)#

Form of Executive Vice President
    and Senior Vice President Severance Benefits Agreement.10.8.1(27)#

Severance Benefits Agreement,
    effective as of January 16, 2006, between Leap Wireless
    International, Inc., Cricket Communications, Inc. and Dean M.
    Luvisa.10.9(21)#

Employment Offer Letter dated
    January 31, 2005, between Cricket Communications, Inc. and
    Albin F. Moschner.10.10(28)#

Employment Offer Letter, dated
    March 24, 2005, between Cricket Communications, Inc., and
    Grant Burton. 105




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##### Table of Contents



ExhibitNumber

Description10.10.1(16)#

Retention Agreement, dated
    December 5, 2005, between Cricket Communications, Inc., and
    Grant Burton.10.11(29)#

Leap Wireless International, Inc.
    2004 Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.11.1(26)#

Form of Stock Option Grant Notice
    and Non-Qualified Stock Option Agreement (February 2008 Vesting).10.11.2(26)#

Form of Stock Option Grant Notice
    and Non-Qualified Stock Option Agreement (Five-Year Vesting)
    entered into prior to October 26, 2005.10.11.3(16)#

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, 2005.10.11.4(16)#

Form of Stock Option Grant Notice
    and Non-Qualified Stock Option Agreement (Five-Year Vesting)
    entered into on or after October 26, 2005.10.11.5(16)#

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.10.11.6*#

Form of Stock Option Grant Notice
    and Non-Qualified Stock Option Agreement (Four-Year Time Based
    Vesting).10.11.7(26)#

Form of Restricted Stock Award
    Grant Notice and Restricted Stock Award Agreement (February 2008
    Vesting).10.11.8(26)#

Form of Restricted Stock Award
    Grant Notice and Restricted Stock Award Agreement (Five-Year
    Vesting) entered into prior to October 26, 2005.10.11.9(16)#

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, 2005.10.11.10(30)#

Restricted Stock Award Grant
    Notice and Restricted Stock Award Agreement, dated as of July 8
    2005, between Leap Wireless International, Inc. and David B.
    Davis.10.11.11(30)#

Restricted Stock Award Grant
    Notice and Restricted Stock Award Agreement, dated as of July 8
    2005, between Leap Wireless International, Inc. and Robert J.
    Irving, Jr.10.11.12(30)#

Restricted Stock Award Grant
    Notice and Restricted Stock Award Agreement, dated as of July 8
    2005, between Leap Wireless International, Inc. and Leonard C.
    Stephens.10.11.13(16)#

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.10.11.14(16)#

Form of Restricted Stock Award
    Grant Notice and Restricted Stock Award Agreement (Five-Year
    Vesting) entered into on or after October 26, 2005.10.11.15*#

Form of Restricted Stock Award
    Grant Notice and Restricted Stock Award Agreement (Four-Year
    Time Based Vesting).10.11.16(29)#

Form of Deferred Stock Unit Award
    Grant Notice and Deferred Stock Unit Award Agreement.10.11.17(21)#

Form of Non-Employee Director
    Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement.10.11.18(31)#

Form of Restricted Stock Award
    Grant Notice and Restricted Stock Award Agreement (for
    Non-Employee Directors).10.12(32)#

2006 Cricket Non-Sales Bonus Plan.21*

Subsidiaries of Leap Wireless
    International, Inc.23*

Consent of Independent Registered
    Public Accounting Firm.31.1*

Certification of the Chief
    Executive Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002. 106




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##### Table of Contents



ExhibitNumber

Description31.2*

Certification of the Chief
    Financial Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.32.1**

Certification of the Chief
    Executive Officer pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.32.2**

Certification of the Chief
    Financial Officer pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.     *
    
    Filed herewith.**
    
    These certifications are being furnished solely to accompany
    this annual report pursuant to U.S.C. § 1350, and are
    not being filed for purposes of Section 18 of the
    Securities Exchange Act of 1934, as amended, and are 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 Current Report on
    Form 8-K/A,
    dated July 30, 2003, filed with the SEC on May 7,
    2004, and incorporated herein by reference.(2)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated July 30, 2003, filed with the SEC on August 11,
    2003, and incorporated herein by reference.(3)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated October 22, 2003, filed with the SEC on
    November 6, 2003, and incorporated herein by reference.(4)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated August 16, 2004, filed with the SEC on
    August 20, 2004, and incorporated herein by reference.(5)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K,
    for the year ended 2004, filed with the SEC on May 16,
    2005, and incorporated herein by reference.(6)
    
    Filed as an exhibit to Leaps Registration Statement on
    Form S-1
    (File
    No. 333-126246),
    as filed with the SEC on June 30, 2005, and incorporated
    herein by reference.(7)
    
    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.(8)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated August 15, 2006, filed with the SEC on
    October 30, 2006, and incorporated herein by reference.(9)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2000, as filed with the
    SEC on November 14, 2000, and incorporated herein by
    reference.(10)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2002, as filed with
    the SEC on May 14, 2002, and incorporated herein by
    reference.(11)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2002, as filed
    with the SEC on November 13, 2002, and incorporated herein
    by reference.(12)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2003, as filed
    with the SEC on November 21, 2003, and incorporated herein
    by reference.(13)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2004, as filed with
    the SEC on May 17, 2004, and incorporated herein by
    reference.(14)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated December 31, 2004, filed with the SEC on
    March 28, 2005, and incorporated herein by reference.(15)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2005, as filed with the
    SEC on November 14, 2005, and incorporated herein by
    reference. 107




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##### Table of Contents



(16)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the year ended December 31, 2005, as filed with the SEC
    on March 27, 2006, and incorporated herein by reference.(17)
    
    Filed as an exhibit to Leaps Amendment No. 1 to
    Annual Report on
    Form 10-K/A
    for the year ended December 31, 2002, as filed with the SEC
    on April 16, 2003, and incorporated herein by reference.(18)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated May 22, 2006, as filed with the SEC on August 1,
    2006, and incorporated herein by reference.(19)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2006, as filed
    with the SEC on November 9, 2006, and incorporated herein
    by reference.(20)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 16, 2006, as filed with the SEC on June 19,
    2006, 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, 2004, as filed with
    the SEC on May 16, 2005, and incorporated herein by
    reference.(22)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated January 9, 2006, filed with the SEC on
    January 12, 2006, and incorporated herein by reference.(23)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated April 24, 2006, as filed with the SEC on
    April 27, 2006, and incorporated herein by reference.(24)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2006, as filed with
    the SEC on August 8, 2006, and incorporated herein by
    reference.(25)
    
    Filed as an exhibit to Leaps Registration Statement on
    Form 10, as amended (File
    No. 0-29752),
    as filed with the SEC on August 21, 1998 and incorporated
    herein by reference.(26)
    
    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.(27)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated as of January 16, 2006, filed with the SEC on
    January 19, 2006, and incorporated herein by reference.(28)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2005, as filed with
    the SEC on June 15, 2005, and incorporated herein by
    reference.(29)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated January 5, 2005, filed with the SEC on
    January 11, 2005, and incorporated herein by reference.(30)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated July 8, 2005, filed with the SEC on July 14,
    2005, and incorporated herein by reference.(31)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated May 18, 2006, as filed with the SEC on June 6,
    2006, and incorporated herein by reference.(32)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated July 25, 2006, as filed with the SEC on
    August 2, 2006, and incorporated herein by reference. 108




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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 Officer)

March 1, 2007/s/  Amin
    I. KhalifaAmin
    I. Khalifa

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

March 1, 2007/s/  Grant
    A. BurtonGrant
    A. Burton

Vice President, Chief
    Accounting
    Officer and Controller
    (Principal Accounting Officer)

March 1, 2007/s/  James
    D. DonderoJames
    D. Dondero

Director

March 1, 2007/s/  John
    D.
    Harkey, Jr.John
    D. Harkey, Jr.

Director

March 1, 2007/s/  Robert
    V. LaPentaRobert
    V. LaPenta

Director

March 1, 2007/s/  Mark
    H.
    Rachesky, M.D.Mark
    H. Rachesky, M.D.

Chairman of the Board and Director

March 1, 2007/s/  Michael
    B. TargoffMichael
    B. Targoff

Director

March 1, 2007  109