##### Table of Contents





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

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2007ORo

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.
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
 þ o o
 o
  Rule 12b-2 o þ
    þ o




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##### 





LEAP
    WIRELESS INTERNATIONAL, INC.
    ANNUAL REPORT ON
    FORM 10-K
  For the
    Year Ended December 31, 2007
  TABLE OF
    CONTENTS
  PagePART IItem 1.


Business

2Item 1A.


Risk Factors

20Item 1B.


Unresolved Staff Comments

37Item 2.


Properties

38Item 3.


Legal Proceedings

38Item 4.


Submission of Matters to a Vote of Security
    Holders

42PART IIItem 5.


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

43Item 6.


Selected Financial Data

45Item 7.


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

47Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk

76Item 8.


Financial Statements and Supplementary Data

77Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure

121Item 9A.


Controls and Procedures

121Item 9A(T).


Controls and Procedures

123Item 9B.


Other Information

123PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance

124Item 11.


Executive Compensation

124Item 12.


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

124Item 13.


Certain Relationships and Related Transactions,
    and Director Independence

124Item 14.


Principal Accountant Fees and Services

124PART IVItem 15.


Exhibits and Financial Statement Schedules

125EXHIBIT 10.4.3EXHIBIT 10.7EXHIBIT 10.10.18EXHIBIT 21EXHIBIT 23EXHIBIT 31EXHIBIT 32   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, including interest rates,
    consumer credit conditions, unemployment and other
    macro-economic factors that could adversely affect the demand
    for the services we provide;
    the impact of competitors initiatives;
    our ability to successfully implement product offerings and
    execute effectively on our planned coverage expansion, launches
    of markets we acquired in the Federal Communications
    Commissions, or FCCs, auction for Advanced Wireless
    Services, or Auction #66, market trials and introductions
    of higher-speed data services and other strategic activities;
    our ability to obtain roaming services from other carriers at
    cost-effective rates;
    delays in our market expansion plans, including delays resulting
    from any difficulties in funding such expansion through our
    existing cash, cash generated from operations or additional
    capital, delays in the availability of handsets for the Advanced
    Wireless Services, or AWS, spectrum we acquired in
    Auction #66, or delays by existing U.S. government and
    other private sector wireless operations in clearing the AWS
    spectrum, some of which users 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.   1




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##### Table of Contents



Item 1.
    Business  Overview
  ®
      Cricket
    Business Overview
  Cricket
    Service
    build-out
  and/or
 2




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##### Table of Contents



and/or
      post-pay
    
    We increased our combined network footprint by approximately
    6 million POPs during 2007. We and Denali License expect to
    cover up to an additional 12 to 28 million POPs by the end
    of 2008, and expect to cover up to an additional 28 to
    50 million POPs by the end of 2010.
    In January 2008, we agreed to exchange an aggregate of
    20 MHz of disaggregated spectrum under certain of our
    existing PCS licenses in Tennessee, Georgia and Arkansas for an
    aggregate of 30 MHz of disaggregated and partitioned
    spectrum in New Jersey and Mississippi under certain of Sprint
    Nextels existing wireless licenses. Completion of this
    transaction is subject to customary closing conditions,
    including FCC approval.
    In April 2007, Denali License was awarded a wireless license
    covering 59.9 million POPs (which includes markets covering
    5.8 million POPs which overlap with certain licenses we
    purchased in Auction #66). 3




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
    In December 2006, we purchased 99 wireless licenses in
    Auction #66 covering 124.9 million POPs (adjusted to
    eliminate duplication among certain overlapping Auction #66
    licenses).
    In November 2006, we completed the purchase of 13 wireless
    licenses in the Carolinas for an aggregate purchase price of
    $31.8 million. During 2007, we launched Cricket service in
    select new markets in North and South Carolina, adding
    approximately 1.9 million POPs to our network footprint.
    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. In June 2007, we launched
    Cricket service in Rochester, New York, resulting in an expanded
    regional network footprint covering 2.4 million POPs.
    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. LCW Wireless launched
    Cricket service in the Portland, Oregon market in December 2006,
    creating a new expanded network footprint in Oregon covering
    2.7 million POPs.  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.
    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 began to offer unlimited wireless broadband
    internet, added unlimited mobile web access to our product
    portfolio, and introduced new higher-priced, higher-value rate
    plans that allow unlimited calling from any Cricket calling
    area. With the completion of our deployment of
    CDMA2000®1xEV-DO, or
    EvDO, technology across all of our existing and new markets, we
    are able to offer an expanded array of services to our
    customers, including high-demand wireless data services such as
    mobile content and high quality music downloads at speeds of up
    to 2.4 Megabits per second. We believe these and other
    enhanced data offerings will be attractive to many of our
    existing customers and will enhance our appeal to new
    data-centric customers. We expect to continue to develop our
    voice and data product and service offerings in 2008 and beyond.
    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 and better target our advertising expenses. We
    have redesigned and re-merchandized our stores and introduced a
    new sales process aimed at improving both the customer
    experience and our revenue per user. We have also established
    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.
    Maintain Industry Leading Cost Structure.  Our
    networks and business model are designed to provide service to
    our customers at a significantly lower cost than many of our
    competitors. As we continue to build out new markets, we expect
    to continue to spread our fixed costs over a growing customer
    base. We seek to maintain low customer acquisition costs through
    focused sales and marketing initiatives and cost-effective
    distribution strategies.
    Enhance Established Existing Markets.  We
    continue to expand our network coverage and capacity in many of
    our existing established markets by deploying additional cell
    sites, allowing us to offer our customers a larger local calling
    area. During 2007, we deployed approximately 300 new cell sites
    in our established existing markets, thereby adding
    approximately 2 million POPs to our network footprint in
    these markets. For example, in Arizona we significantly expanded
    our network footprint in our Phoenix and 4




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
    Develop Market Clusters and Expand Into Attractive Strategic
    Markets.  We continue to seek additional
    opportunities to develop and enhance our market clusters and
    expand into new geographic markets by participating in FCC
    spectrum auctions, by acquiring spectrum and related assets from
    third parties, or by participating in new partnerships or joint
    ventures. An example of our market cluster strategy is the
    Rochester, New York market we launched in 2007 to create a new
    market cluster in upstate New York by connecting our existing
    Buffalo and Syracuse markets. Examples of our strategic market
    expansion include the central Texas market cluster (including
    Houston, Austin and San Antonio) and the San Diego,
    California market that we acquired and launched in 2006. All of
    these markets meet our internally developed criteria concerning
    customer demographics and population density which we believe
    enable us to offer Cricket service on a cost-competitive basis
    in these markets. We also anticipate that the licenses we and
    Denali License purchased in Auction #66 will provide the
    opportunity to substantially enhance our coverage area and allow
    us and Denali License to launch Cricket service in numerous new
    markets over time, with new market launches expected to begin in
    2008.  Cricket
    Business Operations
  Products
    and Services
  Cricket Service Plans.
      Cricket Plan Upgrades. and/or ®
  Handsets.
 5




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on-board
  Handset Replacement and Returns.
  Cricket Wireless Internet Service.
  Jump®
    Mobile.
  Customer
    Care and Billing
  Customer Care.
  Billing and Support Systems.
  Sales
    and Distribution
  easy-to-understand
   6




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www.mycricket.com e-commerce, re-merchandized
    Network
    and Operations
      co-located
       7




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and/or
  Arrangements
    with LCW Wireless
        Limited Liability Company Agreement.
   8




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30-day
    Management Agreement. mark-up
  Arrangements
    with Denali
      Limited Liability Company Agreement.
     9




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Senior Secured Credit Agreement.
  Management Agreement.
  Alaska
    Native Broadband
    Competition
  T-Mobile, T-Mobile
 10




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flat-rate T-Mobile
  e-mail
       11




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Chapter 11
    Proceedings Under the Bankruptcy Code
    pay-in-kind
 12




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pay-in-kind
  Government
    Regulation
    Licensing
    of our Wireless Service Systems
    PCS Licenses.
  and/or
  10-year
 13




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AWS Licenses.
  15-year
    Designated Entities.
   14




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de facto
  and/or
  Foreign Ownership. non-U.S. citizens non-U.S. citizens
  Transfer and Assignment.
  case-by-case
  C-Block F-Block
  Auctions #73
    and #76
  698-806 MHz
 15




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FCC
    Regulation Generally
  market-by-market
     16




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back-up
  truth-in-billing,
  State,
    Local and Other Regulation
   17




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Privacy
    Intellectual
    Property
        Availability
    of Public Reports
  Form 10-K, Form 10-Q, Form 8-K, www.leapwireless.com www.sec.gov
 18




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##### Table of Contents



1-800-SEC-0330.
  Financial
    Information Concerning Segments and Geographical
    Information
    Employees
    Seasonality
    Inflation
    Executive
    Officers of the Registrant
  Name

Age

Position with the CompanyS. Douglas Hutcheson


51


Chief Executive Officer, President, Acting Chief Financial
    Officer and DirectorAlbin F. Moschner


55


Executive Vice President and Chief Marketing OfficerGlenn T. Umetsu


58


Executive Vice President and Chief Technical OfficerWilliam Ingram


50


Senior Vice President, Financial Operations and StrategyRobert J. Irving, Jr.


52


Senior Vice President, General Counsel and SecretarySteven R. Martin


47


Acting Chief Accounting OfficerLeonard C. Stephens


51


Senior Vice President, Human Resources   S. Douglas Hutcheson
  Albin F. Moschner
 19




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Glenn T. Umetsu
  William Ingram
  Robert J. Irving, Jr.
  Steven R. Martin
  Leonard C. Stephens 14-year
 20




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Item 1A.  Risk
    Factors  Risks
    Related to Our Business and Industry
  We Have
    Experienced Net Losses, and We May Not Be Profitable in the
    Future.
    We May
    Not Be Successful in Increasing Our Customer Base Which Would
    Negatively Affect Our Business Plans and Financial
    Outlook.
  quarter-by-quarter
  Our
    Business Could Be Adversely Affected By General Economic
    Conditions; If We Experience Low Rates of Customer Acquisition
    or High Rates of Customer Turnover, Our Ability to Become
    Profitable Will Decrease.
    We Have
    Made Significant Investment, and Will Continue to Invest, in
    Joint Ventures That We Do Not Control.
   21




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We Face
    Increasing Competition Which Could Have a Material Adverse
    Effect on Demand for the Cricket Service.
      and/or
  T-Mobile
 22




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T-Mobile
  and/or
    Recent
    Disruptions in the Financial Markets Could Affect Our Ability to
    Obtain Debt or Equity Financing On Reasonable Terms (or At All),
    and Have Other Adverse Effects On Us.
    We May Be
    Unable to Obtain the Roaming Services We Need From Other
    Carriers to Remain Competitive.
   23




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We Are a
    Participant in Auctions #73 and #76, Which May
    Restrict Certain Business and Commercial Arrangements That We
    May Enter Into.
  and/or
    We Have
    Restated Our Prior Consolidated Financial Statements, Which Has
    Led to Additional Risks and Uncertainties, Including Shareholder
    Litigation.
  Form 10-K,
 24




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and/or
  Our
    Business and Stock Price May Be Adversely Affected If Our
    Internal Controls Are Not Effective.
           25




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Our
    Primary Business Strategy May Not Succeed in the Long
    Term.
    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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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.
  and/or
    
    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. 27




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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;
    sell or otherwise dispose of all or substantially all of our
    assets; 28




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
    enter into transactions with affiliates; and
    make acquisitions or merge or consolidate with another entity.      Form 10-Q Form 10-K,
  Rises in
    Interest Rates Could Adversely Affect Our Financial
    Condition.
    A
    Majority of Our Assets Consists of Goodwill and Other Intangible
    Assets.
   29




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The
    Wireless Industry is Experiencing Rapid Technological Change,
    and We May Lose Customers If We Fail to Keep Up With These
    Changes.
        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.
     30




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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.
    System
    Failures Could Result in Higher Churn, Reduced Revenue and
    Increased Costs, and Could Harm Our Reputation.
     31




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We May
    Not Be Successful in Protecting and Enforcing Our Intellectual
    Property Rights.
        We and
    Our Suppliers May Be Subject to Claims of Infringement Regarding
    Telecommunications Technologies That Are Protected By Patents
    and Other Intellectual Property Rights.
     32




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Regulation
    by Government Agencies May Increase Our Costs of Providing
    Service or Require Us to Change Our Services.
  back-up
      If Call
    Volume Under Our Cricket Service Exceeds Our Expectations, Our
    Costs of Providing Service Could Increase, Which Could Have a
    Material Adverse Effect on Our Competitive Position.
   33




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We May Be
    Unable to Acquire Additional Spectrum in the Future at a
    Reasonable Cost or On a Timely Basis.
    Our
    Wireless Licenses are Subject to Renewal, and May Be Revoked in
    the Event that We Violate Applicable Laws.
  10-year 15-year
  Future
    Declines in the Fair Value of Our Wireless Licenses Could Result
    in Future Impairment Charges.
      
    consolidation in the wireless industry allows or requires
    carriers to sell significant portions of their wireless spectrum
    holdings;
    a sudden large sale of spectrum by one or more wireless
    providers occurs; or
    market prices decline as a result of the sale prices in FCC
    auctions.     34




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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.
      If We
    Experience High Rates of Credit Card, Subscription or Dealer
    Fraud, Our Ability to Generate Cash Flow Will
    Decrease.
    Risks
    Related to Ownership of Our Common Stock
  Our Stock
    Price May Be Volatile, and You May Lose All or Some of Your
    Investment.
    
    variations in our operating results or those of our competitors;
    announcements of technological innovations, new services or
    service enhancements, strategic alliances or significant
    agreements by us or by our competitors; 35




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
    entry of new competitors into our markets;
    significant developments with respect to our intellectual
    property or related litigation;
    the announcements and bidding of auctions for new spectrum;
    recruitment or departure of key personnel;
    changes in the estimates of our operating results or changes in
    recommendations by any securities analysts that elect to follow
    Leap common stock;
    any default under our Credit Agreement or our indenture because
    of a covenant breach or otherwise; and
    market conditions in our industry and the economy as a whole.  We May
    Elect To Raise Additional Equity Capital Which May Dilute
    Existing Stockholders.
  and/or and/or
  Your
    Ownership Interest in Leap Will Be Diluted Upon Issuance of
    Shares We Have Reserved for Future Issuances, and Future
    Issuances or Sales of Such Shares May Adversely Affect The
    Market Price of Leaps Common Stock.
       36




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Our
    Directors and Affiliated Entities Have Substantial Influence
    over Our Affairs, and Our Ownership Is Highly Concentrated.
    Sales of a Significant Number of Shares by Large Stockholders
    May Adversely Affect the Market Price of Leap Common
    Stock.
      Provisions
    in Our Amended and Restated Certificate of Incorporation and
    Bylaws or Delaware Law, and Provisions in Our Credit Agreement
    and Indenture, 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   37




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Item 2.
    Properties            Item 3.
    Legal
    Proceedings  Patent
    Litigation
   38




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39




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American
    Wireless Group
  and/or
   40




---



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and/or
    Securities
    Litigation
  Form 10-K, and/or
  Rule 10b-5, Form 10-K,
  Other
    Litigation
   41




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Item 4.
    Submission
    of Matters to a Vote of Security Holders   42




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


Low($)Calendar Year  2006First Quarter


43.89



34.87Second Quarter


47.41



39.84Third Quarter


48.18



40.87Fourth Quarter


61.37



47.26Calendar Year  2007First Quarter


68.24



58.00Second Quarter


87.46



66.84Third Quarter


98.33



54.47Fourth Quarter


83.74



32.01     Dividends
   43




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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


3,374,051
(1)(2)

$
45.12



3,506,007
(3)Equity compensation plans not approved by security holders










Total


3,374,051


$
45.12



3,506,007     (1)
    
    Represents shares reserved for issuance under the Leap Wireless
    International, Inc. 2004 Stock Option, Restricted Stock and
    Deferred Stock Unit Plan, or 2004 Plan, adopted by the
    compensation committee of our board of directors on
    December 30, 2004, as contemplated by our confirmed plan of
    reorganization and as amended on March 8, 2007. Stock
    options granted prior to May 17, 2007 were granted prior to
    the approval of the 2004 Plan by Leap stockholders. The material
    features of the 2004 Plan are described in our Definitive Proxy
    Statement dated April 6, 2007, as filed with the SEC on
    such date, which description is incorporated herein by reference.(2)
    
    Excludes 1,404,601 shares of restricted stock issued under the
    2004 Plan which are subject to release upon vesting of the
    shares.(3)
    
    Consists of 732,439 shares reserved for issuance under the
    Leap Wireless International, Inc. Employee Stock Purchase Plan
    and 2,773,568 shares reserved for issuance under the 2004
    Plan. 44




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


Predecessor CompanyFive Months


Seven MonthsEnded


Ended


Year EndedYear Ended December 31,


December 31,


July 31,


December 31,2007


2006


2005


2004


2004


2003Statement of Operations Data:Revenues

$
1,630,803


$
1,167,187


$
957,771


$
350,847


$
492,756


$
752,937Operating income (loss)


60,262



23,725



71,002



12,729



(34,412
)


(360,925
)Income (loss) before reorganization items, income taxes and
    cumulative effect of change in accounting principle


(38,561
)


(15,703
)


52,300



(2,170
)


(38,900
)


(443,682
)Reorganization items, net


















962,444



(146,242
)Income tax expense


(37,366
)


(9,277
)


(21,615
)


(3,930
)


(4,166
)


(8,052
)Income (loss) before cumulative effect of change in accounting
    principle


(75,927
)


(24,980
)


30,685



(6,100
)


919,378



(597,976
)Cumulative effect of change in accounting principle






623















Net income (loss)

$
(75,927
)

$
(24,357
)

$
30,685


$
(6,100
)

$
919,378


$
(597,976
)Basic earnings (loss) per share:Income (loss) before cumulative effect of change in accounting
    principle

$
(1.13
)

$
(0.41
)

$
0.51


$
(0.10
)

$
15.68


$
(10.20
)Cumulative effect of change in accounting principle






0.01















Basic earnings (loss) per share(1)

$
(1.13
)

$
(0.40
)

$
0.51


$
(0.10
)

$
15.68


$
(10.20
)Diluted earnings (loss) per share:Income (loss) before cumulative effect of change in accounting
    principle

$
(1.13
)

$
(0.41
)

$
0.50


$
(0.10
)

$
15.68


$
(10.20
)Cumulative effect of change in accounting principle






0.01















Diluted earnings (loss) per share(1)

$
(1.13
)

$
(0.40
)

$
0.50


$
(0.10
)

$
15.68


$
(10.20
)Shares used in per share calculations:(1)Basic


67,100



61,645



60,135



60,000



58,623



58,604Diluted


67,100



61,645



61,003



60,000



58,623



58,604   45




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##### Table of Contents



As of December 31,Successor Company

Predecessor Company2007

2006

2005

2004

2003Balance Sheet Data:Cash and cash equivalents

$
433,337


$
372,812


$
293,073


$
141,141


$
84,070Working capital (deficit)(2)


380,384



185,191



245,366



150,868



(2,255,349
)Restricted cash, cash equivalents and short-term investments


15,550



13,581



13,759



31,427



55,954Total assets


4,432,998



4,084,947



2,499,946



2,213,312



1,756,843Capital leases


61,538















Long-term debt(2)


2,033,902



1,676,500



588,333



371,355



Total stockholders equity (deficit)


1,724,322



1,771,793



1,517,601



1,472,347



(893,895
)     (1)
    
    Refer to Notes 2 and 5 to the consolidated financial
    statements included in Item 8. Financial Statements
    and Supplementary Data of this report for an explanation
    of the calculation of basic and diluted earnings (loss) per
    share.(2)
    
    We have presented the principal and interest balances related to
    our outstanding debt obligations as current liabilities in the
    consolidated balance sheet as of December 31, 2003 as a
    result of the then existing defaults under the underlying
    agreements. 46




---



##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Overview
  FIN 46-R,
         47




---



##### Table of Contents



and/or
           48




---



##### Table of Contents



Critical
    Accounting Policies and Estimates
      Principles
    of Consolidation
    Revenues
    No. 00-21, No. 00-21, No. 00-21
   49




---



##### Table of Contents



and/or
    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     Short-Term
    Investments
     50




---



##### Table of Contents



Wireless
    Licenses
  and/or
  Goodwill
    and Other Intangible Assets
    Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
     51




---



##### Table of Contents



Share-Based
    Compensation
             52




---



##### Table of Contents



Income
    Taxes
    No. 90-7, SOP 90-7,
  Subscriber
    Recognition and Disconnect Policies
     53




---



##### Table of Contents



Results
    of Operations
  Operating
    Items
    Year Ended


% of 2007


Year Ended


% of 2006


Change fromDecember 31,


Service


December 31,


Service


Prior Year2007


Revenues


2006


Revenues


Dollars


PercentRevenues:Service revenues

$
1,395,667






$
956,365






$
439,302



45.9
%Equipment revenues


235,136







210,822







24,314



11.5
%Total revenues


1,630,803







1,167,187







463,616



39.7
%Operating expenses:Cost of service (exclusive of items shown separately below)


384,128



27.5
%


264,162



27.6
%


119,966



45.4
%Cost of equipment


405,997



29.1
%


310,834



32.5
%


95,163



30.6
%Selling and marketing


206,213



14.8
%


159,257



16.7
%


46,956



29.5
%General and administrative


271,536



19.5
%


196,604



20.6
%


74,932



38.1
%Depreciation and amortization


302,201



21.7
%


226,747



23.7
%


75,454



33.3
%Impairment of assets


1,368



0.1
%


7,912



0.8
%


(6,544
)


(82.7
)%Total operating expenses


1,571,443



112.6
%


1,165,516



121.9
%


405,927



34.8
%Gain on sale or disposal of assets


902



0.1
%


22,054



2.3
%


(21,152
)


(95.9
)%Operating income

$
60,262



4.3
%

$
23,725



2.5
%

$
36,537



154.0
%   54




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##### Table of Contents



Year Ended


% of 2006


Year Ended


% of 2005


Change fromDecember 31,


Service


December 31,


Service


Prior Year2006


Revenues


2005


Revenues


Dollars


PercentRevenues:Service revenues

$
956,365






$
768,916






$
187,449



24.4
%Equipment revenues


210,822







188,855







21,967



11.6
%Total revenues


1,167,187







957,771







209,416



21.9
%Operating expenses:Cost of service (exclusive of items shown separately below)


264,162



27.6
%


203,548



26.5
%


60,614



29.8
%Cost of equipment


310,834



32.5
%


230,520



30.0
%


80,314



34.8
%Selling and marketing


159,257



16.7
%


100,042



13.0
%


59,215



59.2
%General and administrative


196,604



20.6
%


159,741



20.8
%


36,863



23.1
%Depreciation and amortization


226,747



23.7
%


195,462



25.4
%


31,285



16.0
%Impairment of assets


7,912



0.8
%


12,043



1.6
%


(4,131
)


(34.3
)%Total operating expenses


1,165,516



121.9
%


901,356



117.2
%


264,160



29.3
%Gain on sale or disposal of assets


22,054



2.3
%


14,587



1.9
%


7,467



51.2
%Operating income

$
23,725



2.5
%

$
71,002



9.2
%

$
(47,277
)


(66.6
)%     Year Ended December 31,2007

2006

2005Gross customer additions


1,974,504



1,455,810



872,271Net customer additions


633,693



592,237



117,376Weighted-average number of customers


2,589,312



1,861,477



1,610,170Total customers, end of period


2,863,519



2,229,826



1,668,293   Service
    Revenues
      Equipment
    Revenues
   55




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##### Table of Contents



Cost of
    Service
      Cost of
    Equipment
      Selling
    and Marketing Expenses
      General
    and Administrative Expenses
   56




---



##### Table of Contents



Depreciation
    and Amortization
      Impairment
    Charges
    Gains on
    Sale or Disposal of Assets
   57




---



##### Table of Contents



Non-Operating
    Items
    Year Ended December 31,2007


2006


ChangeMinority interests in consolidated subsidiaries

$
1,817


$
1,493


$
324Equity in net loss of investee


(2,309
)





$
(2,309
)Interest income


28,939



23,063



5,876Interest expense


(121,231
)


(61,334
)


(59,897
)Other expense, net


(6,039
)


(2,650
)


(3,389
)Income tax expense


(37,366
)


(9,277
)


(28,089
)   Year Ended December 31,2006

2005

ChangeMinority interests in consolidated subsidiaries

$
1,493


$
(31
)

$
1,524Interest 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


(9,277
)


(21,615
)


12,338   Minority
    Interests in Consolidated Subsidiaries
    Equity in
    Net Loss of Investee
    Interest
    Income
    Interest
    Expense
   58




---



##### Table of Contents



Other
    Income (Expense), Net
      Income
    Tax Expense
       59




---



##### Table of Contents



SOP 90-7,
    pay-in-kind
 60




---



##### Table of Contents



Quarterly
    Financial Data (Unaudited)
    Three Months EndedMarch 31,

June 30,

September 30,

December 31,2007(1)

2007

2007

2007(2)Revenues

$
393,425


$
397,914


$
409,656


$
429,808Operating income (loss)


(1,543
)


30,704



9,393



21,708Net income (loss)


(24,224
)


9,638



(43,289
)


(18,052
)Basic earnings (loss) per share


(0.36
)


0.14



(0.64
)


(0.27
)Diluted earnings (loss) per share


(0.36
)


0.14



(0.64
)


(0.27
)   Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006(3)


2006Revenues

$
281,850


$
277,459


$
293,266


$
314,612Operating income (loss)


21,435



11,742



7,050



(16,502
)Income (loss) before cumulative effect of change in accounting
    principle


18,658



2,800



(801
)


(45,637
)Cumulative effect of change in accounting principle


623











Net income (loss)

$
19,281


$
2,800


$
(801
)

$
(45,637
)Basic earnings (loss) per share:Income (loss) before cumulative effect of change in accounting
    principle

$
0.30


$
0.05


$
(0.01
)

$
(0.69
)Cumulative effect of change in accounting principle


0.01











Basic earnings (loss) per share

$
0.31


$
0.05


$
(0.01
)

$
(0.69
)Diluted earnings (loss) per share:Income (loss) before cumulative effect of change in accounting
    principle

$
0.30


$
0.05


$
(0.01
)

$
(0.69
)Cumulative effect of change in accounting principle


0.01











Diluted earnings (loss) per share

$
0.31


$
0.05


$
(0.01
)

$
(0.69
)     (1)
    
    During the quarter ended March 31, 2007, we recognized a
    net gain of $1.3 million from our sale of wireless licenses
    in our Peoria, Illinois, Macon-Warner Robins, Georgia and
    Johnstown, Pennsylvania markets.(2)
    
    For the three months ended December 31, 2007, we recorded
    adjustments related to service revenues and interest income
    previously reported in our 2006 annual and 2007 interim periods.
    These adjustments resulted from an overstatement of service
    revenues of $0.4 million in 2006, and $0.7 million and
    $0.5 million for the quarterly periods ended March 31 and
    June 30, 2007, respectively, and an overstatement of
    interest income of $1.0 million and $0.3 million for
    the quarterly periods ended June 30 and September 30, 2007,
    respectively. These adjustments resulted in a $2.9 million
    increase ($0.04 per share) to our net loss for the three
    months ended December 31, 2007. We assessed the
    quantitative and qualitative effects of these adjustments on
    each of our previously reported periods and concluded that the
    adjustments were not material to any period. 61




---



##### Table of Contents



(3)
    
    During the quarter ended September 30, 2006, we recognized
    a gain of $21.6 million from our sale of wireless licenses
    and operating assets in our Toledo and Sandusky, Ohio markets.  Quarterly
    Results of Operations Data (Unaudited)
    Three Months EndedMarch 31,


June 30,


September 30,


December 31,2007


2007


2007


2007(1)Revenues:Service revenues

$
321,691


$
347,253


$
354,495


$
372,228Equipment revenues


71,734



50,661



55,161



57,580Total revenues


393,425



397,914



409,656



429,808Operating expenses:Cost of service (exclusive of items shown separately below)


(90,440
)


(90,559
)


(100,907
)


(102,222
)Cost of equipment


(122,665
)


(90,818
)


(97,218
)


(95,296
)Selling and marketing


(48,769
)


(47,011
)


(54,265
)


(56,168
)General and administrative


(65,234
)


(66,407
)


(68,686
)


(71,209
)Depreciation and amortization


(68,800
)


(72,415
)


(77,781
)


(83,205
)Impairment of assets










(1,368
)


Total operating expenses


(395,908
)


(367,210
)


(400,225
)


(408,100
)Gain (loss) on sale or disposal of assets


940







(38
)


Operating income (loss)


(1,543
)


30,704



9,393



21,708Minority interests in consolidated subsidiaries


1,579



673



182



(617
)Equity in net loss of investee










(807
)


(1,502
)Interest income


5,285



7,134



10,148



6,372Interest expense


(26,496
)


(27,090
)


(33,336
)


(34,309
)Other expense, net


(637
)






(4,207
)


(1,195
)Income (loss) before income taxes


(21,812
)


11,421



(18,627
)


(9,543
)Income tax expense


(2,412
)


(1,783
)


(24,662
)


(8,509
)Net income (loss)

$
(24,224
)

$
9,638


$
(43,289
)

$
(18,052
)     (1)
    
    See footnote 2 to the Quarterly Financial Data
    (Unaudited) table above.  Performance
    Measures
  Regulation S-K
 62




---



##### Table of Contents



pay-in-advance
 63




---



##### Table of Contents



Three Months Ended

Year EndedMarch 31,

June 30,

September 30,

December 31,

December 31,2007

2007

2007

2007

2007ARPU

$
44.81


$
44.75


$
44.51


$
45.57


$
44.92CPGA

$
166


$
182


$
199


$
178


$
180CCU

$
21.27


$
19.87


$
21.24


$
21.00


$
20.84Churn


3.4
%


4.3
%


5.2
%


4.2
%


4.3
%   Reconciliation
    of Non-GAAP Financial Measures
  Regulation S-K
    Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2007


2007


2007


2007


2007Selling and marketing expense

$
48,769


$
47,011


$
54,265


$
56,168


$
206,213Less share-based compensation expense included in selling and
    marketing expense


(1,001
)


(560
)


(843
)


(926
)


(3,330
)Plus cost of equipment


122,665



90,818



97,218



95,296



405,997Less equipment revenue


(71,734
)


(50,661
)


(55,161
)


(57,580
)


(235,136
)Less net loss on equipment transactions unrelated to initial
    customer acquisition


(4,762
)


(2,591
)


(5,747
)


(4,766
)


(17,866
)Total costs used in the calculation of CPGA

$
93,937


$
84,017


$
89,732


$
88,192


$
355,878Gross customer additions


565,055



462,434



450,954



496,061



1,974,504CPGA

$
166


$
182


$
199


$
178


$
180  64




---



##### Table of Contents



Three Months Ended


Year EndedMarch 31,


June 30,


September 30,


December 31,


December 31,2007


2007


2007


2007


2007Cost of service

$
90,440


$
90,559


$
100,907


$
102,222


$
384,128Plus general and administrative expense


65,234



66,407



68,686



71,209



271,536Less share-based compensation expense included in cost of
    service and general and administrative expense


(7,742
)


(5,335
)


(6,231
)


(6,701
)


(26,009
)Plus net loss on equipment transactions unrelated to initial
    customer acquisition


4,762



2,591



5,747



4,766



17,866Total costs used in the calculation of CCU

$
152,694


$
154,222


$
169,109


$
171,496


$
647,521Weighted-average number of customers


2,393,161



2,586,900



2,654,555



2,722,631



2,589,312CCU

$
21.27


$
19.87


$
21.24


$
21.00


$
20.84   Liquidity
    and Capital Resources
  Overview
    and/or
   65




---



##### Table of Contents



and/or and/or
    Form 10-K, Form 10-Q
 66




---



##### Table of Contents



Cash
    Flows
    Year Ended December 31,2007

2006

2005Net cash provided by operating activities

$
316,181


$
289,871


$
308,280Net cash used in investing activities


(622,728
)


(1,550,624
)


(332,112
)Net cash provided by financing activities


367,072



1,340,492



175,764   Operating
    Activities
      pay-in-kind
  Investing
    Activities
    
    During January 2007, we completed the sale of three wireless
    licenses that we were not using to offer commercial service for
    an aggregate sales price of $9.5 million.
    During March 2007, Cricket acquired the remaining 25% of the
    membership interests in ANB 1 for $4.7 million,
    following ANBs exercise of its option to sell its entire
    25% controlling interest in ANB 1 to Cricket. 67




---



##### Table of Contents




    During the year ended December 31, 2007, we purchased
    approximately 20% of the outstanding membership units of a
    regional wireless service provider for an aggregate purchase
    price of $19.0 million.
    During the year ended December 31, 2007, we made investment
    purchases of $642.5 million from proceeds received from the
    issuances of our unsecured senior notes due 2014, offset by
    sales or maturities of investments of $531.0 million.
    During the year ended December 31, 2007, we and our
    consolidated joint ventures purchased $504.8 million of
    property and equipment for the build-out of our new markets and
    the expansion and improvement of our existing markets.    
    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 a license it subsequently purchased 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 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
    
    During the year ended December 31, 2007, we made payments
    of $5.2 million on our capital lease obligations relating
    to software licenses.
    During the year ended December 31, 2007, we issued an
    additional $350 million of unsecured senior notes due 2014
    at an issue price of 106% of the principal amount, which
    resulted in gross proceeds of $371 million, offset by
    payments of $9.0 million on our $895.5 million senior
    secured term loan.
    During the year ended December 31, 2007, we issued common
    stock upon the exercise of stock options held by our employees
    and upon employee purchases of common stock under our Employee
    Stock Purchase Plan, resulting in aggregate net proceeds of
    $9.7 million.    
    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  Cricket Communications below. 68




---



##### 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 
    LCW Operations below.  pay-in-kind
  Senior
    Secured Credit Facilities
  Cricket
    Communications
      Form 10-Q
     69




---



##### Table of Contents



Form 10-K, Form 10-Q
    LCW
    Operations
   70




---



##### Table of Contents



Forward
    Sale Agreements
    Senior
    Notes
           71




---



##### Table of Contents



90-day 90-day
  System
    Equipment Purchase Agreements
  and/or
  Capital
    Expenditures and Other Asset Acquisitions and
    Dispositions
  Capital
    Expenditures
   72




---



##### Table of Contents



Auction #66
    Properties and Build-Out Plans
    Other
    Acquisitions and Dispositions
         73




---



##### Table of Contents



Contractual
    Obligations
     2008


2009-2010


2011-2012


Thereafter


TotalLong-term debt(1)

$
12,748


$
35,093


$
469,008


$
1,529,451


$
2,046,300Capital leases(2)


16,716



33,432



4,932



6,458



61,538Operating leases


121,712



242,658



230,206



461,518



1,056,094Purchase obligations(3)


291,032



128,034



16,197



1,877



437,039Contractual interest(4)


174,852



346,610



334,546



206,742



1,062,750Total

$
617,060


$
785,827


$
1,054,889


$
2,206,046


$
4,663,721     (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.(2)
    
    Amounts shown for the Companys capital leases include
    principal and interest.(3)
    
    Purchase obligations are defined as agreements to purchase goods
    or services that are enforceable and legally binding on us and
    that specify all significant terms including (a) fixed or
    minimum quantities to be purchased, (b) fixed, minimum or
    variable price provisions, and (c) the approximate timing
    of the transaction.(4)
    
    Contractual interest is based on the current interest rates in
    effect at December 31, 2007, after giving effect to our
    interest rate swaps, for debt outstanding as of that date.        Short-Term
    Investments
   74




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##### Table of Contents



Off-Balance
    Sheet Arrangements
    Recent
    Accounting Pronouncements
         75




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Interest Rate Risk.
      Hedging Policy.
 76




---



##### 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.:
  Internal Control - Integrated Framework
     77




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##### Table of Contents



78




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED BALANCE SHEETS
 (In thousands, except share data)
  December 31,2007


2006AssetsCash and cash equivalents

$
433,337


$
372,812Short-term investments


179,233



66,400Restricted cash, cash equivalents and short-term investments


15,550



13,581Inventories


65,208



90,185Other current assets


38,099



52,981Total current assets


731,427



595,959Property and equipment, net


1,316,657



1,078,521Wireless licenses


1,866,353



1,563,958Assets held for sale






8,070Goodwill


425,782



425,782Other intangible assets, net


46,102



79,828Deposits for wireless licenses






274,084Other assets


46,677



58,745Total assets

$
4,432,998


$
4,084,947Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
225,735


$
317,093Current maturities of long-term debt


10,500



9,000Other current liabilities


114,808



84,675Total current liabilities


351,043



410,768Long-term debt


2,033,902



1,676,500Deferred tax liabilities


182,835



148,335Other long-term liabilities


90,172



47,608Total liabilities


2,657,952



2,283,211Minority interests


50,724



29,943Commitments 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; 
    68,674,435 and 67,892,512 shares issued and outstanding at
    December 31, 2007 and 2006, respectively


7



7Additional paid-in capital


1,808,689



1,769,772Retained earnings (accumulated deficit)


(75,699
)


228Accumulated other comprehensive income (loss)


(8,675
)


1,786Total stockholders equity


1,724,322



1,771,793Total liabilities and stockholders equity

$
4,432,998


$
4,084,947    79




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
  Year Ended December 31,2007


2006


2005Revenues:Service revenues

$
1,395,667


$
956,365


$
768,916Equipment revenues


235,136



210,822



188,855Total revenues


1,630,803



1,167,187



957,771Operating expenses:Cost of service (exclusive of items shown separately below)


(384,128
)


(264,162
)


(203,548
)Cost of equipment


(405,997
)


(310,834
)


(230,520
)Selling and marketing


(206,213
)


(159,257
)


(100,042
)General and administrative


(271,536
)


(196,604
)


(159,741
)Depreciation and amortization


(302,201
)


(226,747
)


(195,462
)Impairment of assets


(1,368
)


(7,912
)


(12,043
)Total operating expenses


(1,571,443
)


(1,165,516
)


(901,356
)Gain on sale or disposal of assets


902



22,054



14,587Operating income


60,262



23,725



71,002Minority interests in consolidated subsidiaries


1,817



1,493



(31
)Equity in net loss of investee


(2,309
)






Interest income


28,939



23,063



9,957Interest expense


(121,231
)


(61,334
)


(30,051
)Other income (expense), net


(6,039
)


(2,650
)


1,423Income (loss) before income taxes and cumulative effect of
    change in accounting principle


(38,561
)


(15,703
)


52,300Income tax expense


(37,366
)


(9,277
)


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


(75,927
)


(24,980
)


30,685Cumulative effect of change in accounting principle






623



Net income (loss)

$
(75,927
)

$
(24,357
)

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

$
(1.13
)

$
(0.41
)

$
0.51Cumulative effect of change in accounting principle






0.01



Basic earnings (loss) per share

$
(1.13
)

$
(0.40
)

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

$
(1.13
)

$
(0.41
)

$
0.50Cumulative effect of change in accounting principle






0.01



Diluted earnings (loss) per share

$
(1.13
)

$
(0.40
)

$
0.50Shares used in per share calculations:Basic


67,100



61,645



60,135Diluted


67,100



61,645



61,003    80




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##### Table of Contents





LEAP
    WIRELESS INTERNATIONAL, INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
    (In thousands)
  Year Ended December 31,2007


2006


2005Operating activities:Net income (loss)

$
(75,927
)

$
(24,357
)

$
30,685Adjustments to reconcile net income (loss) to net cash provided
    by operating activities:Share-based compensation expense


29,339



19,725



12,479Depreciation and amortization


302,201



226,747



195,462Accretion of asset retirement obligations


1,666



1,617



1,323Non-cash interest items, net


(4,425
)


(266
)


(620
)Loss on extinguishment of debt


669



6,897



1,219Deferred income tax expense


36,084



8,831



21,552Impairment of assets


1,368



7,912



12,043Impairment of short-term investments


5,440







Gain on sale or disposal of assets


(902
)


(22,054
)


(14,587
)Gain on extinguishment of asset retirement obligations


(6,089
)






Minority interest activity


(1,817
)


(1,493
)


31Equity in net loss of investee


2,309







Cumulative effect of change in accounting principle






(623
)


Changes in assets and liabilities:Inventories


24,977



(52,898
)


(11,504
)Other assets


31,164



(26,912
)


5,408Accounts payable and accrued liabilities


(53,310
)


95,502



57,514Other liabilities


23,434



51,243



(2,725
)Net cash provided by operating activities


316,181



289,871



308,280Investing activities:Purchases of property and equipment


(504,770
)


(591,295
)


(208,808
)Change in prepayments for purchases of property and equipment


12,831



(3,846
)


(9,828
)Purchases of and deposits for wireless licenses and spectrum
    clearing costs


(5,292
)


(1,018,832
)


(243,960
)Proceeds from sale of wireless licenses and operating assets


9,500



40,372



108,800Purchases of investments


(642,513
)


(150,488
)


(307,021
)Sales and maturities of investments


530,956



177,932



329,043Purchase of minority interest


(4,706
)






Purchase of membership units


(18,955
)






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


221



(4,467
)


(338
)Net cash used in investing activities


(622,728
)


(1,550,624
)


(332,112
)Financing activities:Principal payments on capital lease obligation


(5,213
)






Proceeds from long-term debt


370,480



2,260,000



600,000Repayment of long-term debt


(9,000
)


(1,168,944
)


(418,285
)Payment of debt issuance costs


(7,765
)


(22,864
)


(6,951
)Minority interest contributions


8,880



12,402



1,000Proceeds from issuance of common stock, net


9,690



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 financing activities


367,072



1,340,492



175,764Net increase in cash and cash equivalents


60,525



79,739



151,932Cash and cash equivalents at beginning of period


372,812



293,073



141,141Cash and cash equivalents at end of period

$
433,337


$
372,812


$
293,073    81




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##### Table of Contents



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


OtherAdditional


Unearned


Earnings


ComprehensiveCommon Stock


Paid-In


Share-Based


(Accumulated


IncomeShares


Amount


Capital


Compensation


Deficit)


(Loss)


TotalSuccessor Company balance at December 31, 2004


60,000,000


$
6


$
1,478,392


$



$
(6,100
)

$
49


$
1,472,347Components of comprehensive income:Net income


















30,685







30,685Net unrealized holding losses on investments






















(57
)


(57
)Unrealized gains on derivative instruments






















2,146



2,146Comprehensive income


























32,774Issuance of common stock under share-based compensation plans,
    net of repurchases


1,202,806







7,105















7,105Unearned share-based compensation










26,317



(26,317
)










Amortization of share-based compensation














5,375











5,375Balance at December 31, 2005


61,202,806



6



1,511,814



(20,942
)


24,585



2,138



1,517,601Components of comprehensive loss:Net loss


















(24,357
)






(24,357
)Net unrealized holding gains on investments






















4



4Unrealized losses on derivative instruments






















(356
)


(356
)Comprehensive loss


























(24,709
)Cumulative effect of change in accounting principle










(623
)














(623
)Reclassification of unearned share-based compensation related to
    the adoption of SFAS 123(R)










(20,942
)


20,942











Issuance of common stock under forward sale agreements


6,440,000



1



258,679















258,680Share-based compensation expense










19,725















19,725Issuance of common stock under share-based compensation plans,
    net of repurchases


249,706







1,119















1,119Balance at December 31, 2006


67,892,512



7



1,769,772







228



1,786



1,771,793Components of comprehensive loss:Net loss


















(75,927
)






(75,927
)Net unrealized holding losses on investments






















(70
)


(70
)Unrealized losses on derivative instruments






















(10,391
)


(10,391
)Comprehensive loss


























(86,388
)Share-based compensation expense










29,227















29,227Issuance of common stock under share-based compensation plans,
    net of repurchases


781,923







9,690















9,690Balance at December 31, 2007


68,674,435


$
7


$
1,808,689


$



$
(75,699
)

$
(8,675
)

$
1,724,322    82




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##### Table of Contents





LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Note 1.  The
    Company
  ®
    Note 2.
    Basis of
    Presentation and Significant Accounting Policies  Basis
    of Presentation
        Revenues
   83




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  No. 00-21, (EITF 00-21) EITF 00-21, EITF 00-21
      and/or
    Costs and
    Expenses
    Cost of Service.
  Cost of Equipment.
  Selling and Marketing.
 84




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  General and Administrative.
  Cash
    and Cash Equivalents
    Short-Term
    Investments
      Restricted
    Cash, Cash Equivalents and Short-Term Investments
    Inventories
  first-in,
  Property
    and Equipment
   85




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     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   construction-in-progress construction-in-progress construction-in-progress
    Wireless
    Licenses
   86




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Goodwill
    and Other Intangible Assets
    Impairment
    of Long-Lived Assets
    Impairment
    of Indefinite-Lived Intangible Assets
     87




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Derivative
    Instruments and Hedging Activities
        Investments
    in Other Entities
     88




---



##### Table of Contents



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


2006Asset retirement obligations, beginning of year

$
20,489


$
13,961Liabilities incurred


1,602



5,174Liabilities settled(1)


(7,944
)


(263
)Accretion expense


1,666



1,617Asset retirement obligations, end of year

$
15,813


$
20,489     (1)
    
    During 2007, the Company negotiated amendments to agreements
    that reduced its liability for the removal of equipment on
    certain of its cell sites at the end of the lease term,
    resulting in a reduction to its liability of $7.9 million. 89




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Debt
    Issuance Costs
    Fair
    Value of Financial Instruments
    Advertising
    Costs
    Share-Based
    Compensation
      Income
    Taxes
     90




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    90-7, (SOP 90-7),
      Basic
    and Diluted Earnings (Loss) Per Share
    Recent
    Accounting Pronouncements
   91




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         92




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 3.
    Financial
    Instruments  Short-Term
    Investments
    As of December 31, 2007Unrealized


UnrealizedCost


Gain


Loss


Fair ValueCommercial paper

$
69,333


$



$
(135
)

$
69,198Asset-backed commercial paper


26,962











26,962U.S. government or government agency securities


52,972



103



(2
)


53,073Auction rate securities


30,000











30,000$
179,267


$
103


$
(137
)

$
179,233   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      93




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 4.
    Supplementary
    Financial Information  Supplementary
    Balance Sheet Information (in thousands):
  As of December 31,2007


2006Other current assets:Accounts receivable, net(1)

$
21,158


$
38,257Prepaid expenses


16,076



11,808Other


865



2,916$
38,099


$
52,981Property and equipment, net:(2)Network equipment

$
1,421,648


$
1,128,127Computer equipment and other


184,224



100,496Construction-in-progress


341,742



238,5791,947,614



1,467,202Accumulated depreciation


(630,957
)


(388,681
)$
1,316,657


$
1,078,521Other intangible assets, net:Customer relationships

$
124,715


$
124,715Trademarks


37,000



37,000161,715



161,715Accumulated amortization customer relationships(3)


(106,583
)


(75,500
)Accumulated amortization trademarks(3)


(9,030
)


(6,387
)$
46,102


$
79,828Accounts payable and accrued liabilities:Trade accounts payable

$
109,781


$
218,020Accrued payroll and related benefits


41,048



29,450Other accrued liabilities


74,906



69,623$
225,735


$
317,093Other current liabilities:Deferred service revenue(4)

$
45,387


$
32,929Deferred equipment revenue(5)


14,615



16,589Accrued sales, telecommunications, property and other taxes
    payable


20,903



15,865Accrued interest


18,508



13,671Other


15,395



5,621$
114,808


$
84,675     (1)
    
    Accounts receivable consists primarily of amounts billed to
    third-party dealers for handsets and accessories. 94




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (2)
    
    As of December 31, 2007, approximately $49.5 million
    of gross assets were held by the Company under capital lease
    arrangements. Accumulated amortization relating to these assets
    totaled $5.6 million at December 31, 2007.(3)
    
    Amortization expense for other intangible assets for the years
    ended December 31, 2007, 2006 and 2005 was
    $33.7 million, $33.7 million and $34.5 million,
    respectively. Estimated amortization expense for intangible
    assets for 2008 is $20.8 million, from 2009 through 2012 is
    $2.6 million in each year and totals $14.8 million
    thereafter.(4)
    
    Deferred service revenue consists primarily of cash received
    from customers in advance of their service period.(5)
    
    Deferred equipment revenue relates to handsets and accessories
    sold to third-party dealers.  Supplementary
    Cash Flow Information (in thousands):
  December 31,2007

2006

2005Supplementary disclosure of cash flow information:Cash paid for interest

$
161,280


$
61,360


$
55,653Cash paid for income taxes

$
506


$
1,034


$
305Supplementary disclosure of non-cash investing activities:Contribution of wireless licenses

$
25,130


$
16,100


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

$
40,799


$



$
   Note 5.
    Basic and
    Diluted Earnings (Loss) Per Share    December 31,2007

2006

2005Basic weighted-average shares outstanding


67,100



61,645



60,135Effect of dilutive common share equivalents:Non-qualified stock options










130Restricted stock awards










472Warrants










266Diluted weighted-average shares outstanding


67,100



61,645



61,003    95




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 6.
    Long-Term
    Debt    As of December 31,2007


2006Term loans under senior secured credit facilities

$
926,500


$
935,500Unamortized deferred lender fees


(1,898
)


Senior notes


1,100,000



750,000Unamortized premium on senior notes


19,800



2,044,402



1,685,500Current maturities of long-term debt


(10,500
)


(9,000
)$
2,033,902


$
1,676,500   Senior
    Secured Credit Facilities
  Cricket
    Communications
      Form 10-Q
     96




---



##### Table of Contents



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




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Senior
    Notes
             98




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    90-day 90-day
  Note 7.
    Income
    Taxes    December 31,2007


2006


2005Current provision:Federal

$
(422
)

$
422


$
State


1,704



21



631,282



443



63Deferred provision:Federal


39,044



7,389



17,958State


(2,960
)


1,445



3,59436,084



8,834



21,552$
37,366


$
9,277


$
21,615  99




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2007


2006


2005Amounts computed at statutory federal rate

$
(13,496
)

$
(5,335
)

$
18,305Non-deductible expenses


2,910



421



929State income tax expense (benefit), net of federal income tax
    impact


(816
)


(425
)


2,335Net tax expense related to joint venture


2,645



1,751



Other










46Change in valuation allowance


46,123



12,865



$
37,366


$
9,277


$
21,615     As of December 31,2007


2006Deferred tax assets:Net operating loss carryforwards

$
276,361


$
171,104Wireless licenses


17,950



41,854Capital loss carryforwards


4,200



29,592Reserves and allowances


16,024



12,446Share-based compensation


14,190



9,006Deferred charges


20,112



6,419Investments and deferred tax on unrealized losses


6,105



Other


8,560



3,834Gross deferred tax assets


363,502



274,255Deferred tax liabilities:Intangible assets


(17,727
)


(31,168
)Property and equipment


(58,967
)


(7,689
)Deferred revenues






(2,311
)Deferred tax on unrealized gains






(1,243
)Other






(390
)Net deferred tax assets


286,808



231,454Valuation allowance


(284,301
)


(231,454
)Other deferred tax liabilities:Wireless licenses


(172,492
)


(139,278
)Goodwill


(8,688
)


(6,169
)Investment in joint venture


(6,225
)


(3,367
)Net deferred tax liabilities

$
(184,898
)

$
(148,814
)  100




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of December 31,2007


2006Current deferred tax liabilities (included in other current
    liabilities)

$
(2,063
)

$
(479
)Long-term deferred tax liabilities


(182,835
)


(148,335
)$
(184,898
)

$
(148,814
)       SOP 90-7,
  Note 8.
    Stockholders
    Equity  Forward
    Sale Agreements
   101




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Warrants
    Note 9.
    Share-Based
    Compensation    Stock
    Options
    As of December 31,2007

2006Expected volatility


47
%


46
%Expected term (in years)


6.3



6.3Risk-free interest rate


4.30
%


4.72
%Expected dividend yield






    102




---



##### 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, 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


$
37.55Options exercisable at December 31, 2006






76


$
26.50Options granted






956


$
67.11Options forfeited






(374
)


51.08Options exercised






(278
)


29.33Options outstanding at December 31, 2007






3,374


$
45.12



8.28


$
28,419Options exercisable at December 31, 2007






270


$
38.71



7.85


$
3,370         Restricted
    Stock
   103




---



##### 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, 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



34.50Shares issued


529



56.86Shares forfeited


(74
)


50.48Shares vested


(168
)


29.24Restricted stock awards outstanding at December 31, 2007


1,405


$
42.70     Year Ended December 31,2007

2006

2005Fair value on vesting date of vested restricted stock awards

$
10,525


$
1,519


$
993       Employee
    Stock Purchase Plan
    Deferred
    Stock Units
   104




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Allocation
    of Share-Based Compensation Expense
    Year Ended December 31,2007


2006


2005Cost of service

$
2,156


$
1,245


$
1,204Selling and marketing expenses


3,330



1,970



1,021General and administrative expenses


23,853



16,510



10,254Share-based compensation expense before tax


29,339



19,725



12,479Related income tax benefit










Share-based compensation expense, net of tax

$
29,339


$
19,725


$
12,479Net share-based compensation expense per share:Basic

$
0.44


$
0.32


$
0.21Diluted

$
0.44


$
0.32


$
0.20   Effect
    of SFAS 123(R) Adoption
    Pro
    Forma Information under SFAS 123 for Periods Prior to
    Fiscal 2006
    Year EndedDecember 31,2005As reported net income

$
30,685Add: Share-based compensation expense included in net income


12,479Deduct: Net pro forma compensation expense


(20,085
)Pro forma net income

$
23,079Basic earnings per share:As reported

$
0.51Pro forma

$
0.38Diluted earnings per share:As reported

$
0.50Pro forma

$
0.38  105




---



##### 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  Patent
    Litigation
   106




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       107




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           108




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    American
    Wireless Group
  and/or
  and/or
    Securities
    Litigation
   109




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Form 10-K, and/or
  Rule 10b-5, Form 10-K,
  Other
    Litigation
    Spectrum
    Clearing Obligations
  and/or
 110




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    FCC
    Hurricane Katrina Order
  back-up
  System
    Equipment Purchase Agreements
  and/or
  Capital
    and Operating Leases
  five-year
 111




---



##### Table of Contents



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


OperatingYears Ended December 31:

Leases


Leases2008

$
16,716


$
121,7122009


16,716



121,5192010


16,716



121,1392011


2,466



115,6762012


2,466



114,530Thereafter


6,458



461,518Total minimum lease payments

$
61,538


$
1,056,094Less amount representing interest


(10,848
)Present value of minimum lease payments

$
50,690   Outstanding
    Letters of Credit and Surety Bonds
      Note 14.
    Guarantor
    Financial Information       112




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Balance Sheet as of December 31, 2007 (in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
62


$
399,153


$



$
34,122


$



$
433,337Short-term investments






163,258







15,975







179,233Restricted cash, cash equivalents and
    short-term
    investments


7,671



7,504







375







15,550Inventories






64,583







625







65,208Other current assets


102



37,201







796







38,099Total current assets


7,835



671,699







51,893







731,427Property and equipment, net


30



1,254,856







66,901



(5,130
)


1,316,657Investments in and advances to affiliates and consolidated
    subsidiaries


1,728,602



1,903,009



173,922



5,325



(3,810,858
)


Wireless licenses






18,533



1,519,638



328,182







1,866,353Goodwill






425,782















425,782Other intangible assets, net






45,948







154







46,102Deposits for wireless licenses






















Other assets


41



44,464







2,172







46,677Total assets

$
1,736,508


$
4,364,291


$
1,693,560


$
454,627


$
(3,815,988
)

$
4,432,998Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
6,459


$
210,707


$
7


$
8,562


$



$
225,735Current maturities of long-term debt






9,000







1,500







10,500Intercompany payables


5,727



179,248



726



2,986



(188,687
)


Other current liabilities






112,626







2,182







114,808Total current liabilities


12,186



511,581



733



15,230



(188,687
)


351,043Long-term debt






1,995,402







311,052



(272,552
)


2,033,902Deferred tax liabilities






19,606



163,229











182,835Other long-term liabilities






88,570







1,602







90,172Total liabilities


12,186



2,615,159



163,962



327,884



(461,239
)


2,657,952Minority interests






20,530











30,194



50,724Membership units subject to repurchase














37,879



(37,879
)


Stockholders equity


1,724,322



1,728,602



1,529,598



88,864



(3,347,064
)


1,724,322Total liabilities and stockholders equity

$
1,736,508


$
4,364,291


$
1,693,560


$
454,627


$
(3,815,988
)

$
4,432,998  113




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Balance Sheet as of December 31, 2006 (in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
206


$
329,240


$



$
43,366


$



$
372,812Short-term
    investments






66,400















66,400Restricted cash, cash equivalents and
    short-term
    investments


8,093



4,753







735







13,581Inventories






89,383







802







90,185Other current assets


105



52,404







472







52,981Total current assets


8,404



542,180







45,375







595,959Property and equipment, net


117



1,040,380







38,024







1,078,521Investments in and advances to affiliates and consolidated
    subsidiaries


1,779,514



1,867,876



142,072







(3,789,462
)


Wireless licenses










1,527,574



36,384







1,563,958Assets held for sale










8,070











8,070Goodwill






425,782















425,782Other intangible assets, net






79,409







419







79,828Deposits for wireless licenses














274,084







274,084Other assets


815



56,875







1,827



(772
)


58,745Total assets

$
1,788,850


$
4,012,502


$
1,677,716


$
396,113


$
(3,790,234
)

$
4,084,947Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
6,792


$
300,070


$



$
10,231


$



$
317,093Current maturities of
    long-term
    debt






9,000















9,000Intercompany payables


10,265



142,072







9,893



(162,230
)


Other current liabilities






84,844







604



(773
)


84,675Total current liabilities


17,057



535,986







20,728



(163,003
)


410,768Long-term
    debt






1,636,500







271,443



(231,443
)


1,676,500Deferred tax liabilities






9,057



139,278











148,335Other
    long-term
    liabilities






46,622







986







47,608Total liabilities


17,057



2,228,165



139,278



293,157



(394,446
)


2,283,211Minority interests






4,821











25,122



29,943Stockholders equity


1,771,793



1,779,516



1,538,438



102,956



(3,420,910
)


1,771,793Total liabilities and stockholders equity

$
1,788,850


$
4,012,502


$
1,677,716


$
396,113


$
(3,790,234
)

$
4,084,947  114




---



##### Table of Contents



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











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
1,360,801


$



$
34,866


$



$
1,395,667Equipment revenues






230,457







4,679







235,136Other revenues






38



54,424







(54,462
)


Total revenues






1,591,296



54,424



39,545



(54,462
)


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






(424,022
)






(14,494
)


54,388



(384,128
)Cost of equipment






(392,062
)






(13,935
)






(405,997
)Selling and marketing


(8
)


(196,803
)






(9,402
)






(206,213
)General and administrative


(4,979
)


(259,325
)


(132
)


(7,174
)


74



(271,536
)Depreciation and amortization


(65
)


(293,621
)






(8,515
)






(302,201
)Impairment of assets






(383
)


(985
)










(1,368
)Total operating expenses


(5,052
)


(1,566,216
)


(1,117
)


(53,520
)


54,462



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






(349
)


1,251











902Operating income (loss)


(5,052
)


24,731



54,558



(13,975
)






60,262Minority interests in consolidated subsidiaries






(2,067
)










3,884



1,817Equity in net loss of consolidated subsidiaries


(70,838
)


(7,708
)










78,546



Equity in net loss of investee






(2,309
)














(2,309
)Interest income


38



63,024







985



(35,108
)


28,939Interest expense






(119,734
)






(34,296
)


32,799



(121,231
)Other expense, net


(75
)


(5,933
)






(31
)






(6,039
)Income (loss) before income taxes


(75,927
)


(49,996
)


54,558



(47,317
)


80,121



(38,561
)Income tax expense






(20,842
)


(16,524
)










(37,366
)Net income (loss)

$
(75,927
)

$
(70,838
)

$
38,034


$
(47,317
)

$
80,121


$
(75,927
)  115




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Operations for the Year Ended December 31,
    2006 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
952,921


$



$
3,444


$



$
956,365Equipment revenues






210,123







1,474



(775
)


210,822Other revenues






364



39,943







(40,307
)


Total revenues






1,163,408



39,943



4,918



(41,082
)


1,167,187Operating expenses:Cost of service (exclusive of items shown separately below)






(300,949
)






(3,156
)


39,943



(264,162
)Cost of equipment






(309,223
)






(2,386
)


775



(310,834
)Selling and marketing






(155,615
)






(3,642
)






(159,257
)General and administrative


(7,178
)


(186,931
)


(937
)


(1,922
)


364



(196,604
)Depreciation and amortization


(100
)


(223,576
)






(3,071
)






(226,747
)Impairment of assets










(7,912
)










(7,912
)Total operating expenses


(7,278
)


(1,176,294
)


(8,849
)


(14,177
)


41,082



(1,165,516
)Gain on sale or disposal of assets






21,300



754











22,054Operating income (loss)


(7,278
)


8,414



31,848



(9,259
)






23,725Minority interests in consolidated subsidiaries






(695
)










2,188



1,493Equity in net income (loss) of consolidated subsidiaries


(19,116
)


4,869











14,247



Interest income


37



30,317







664



(7,955
)


23,063Interest expense






(61,219
)






(8,070
)


7,955



(61,334
)Other income (expense), net


2,000



(4,650
)














(2,650
)Income (loss) before income taxes and cumulative effect of
    change in accounting principle


(24,357
)


(22,964
)


31,848



(16,665
)


16,435



(15,703
)Income tax (expense) benefit






3,225



(12,502
)










(9,277
)Income (loss) before cumulative effect of change in accounting
    principle


(24,357
)


(19,739
)


19,346



(16,665
)


16,435



(24,980
)Cumulative effect of change in accounting principle






623















623Net income (loss)

$
(24,357
)

$
(19,116
)

$
19,346


$
(16,665
)

$
16,435


$
(24,357
)  116




---



##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Operations for the Year Ended December 31,
    2005 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
768,916


$



$



$



$
768,916Equipment revenues






188,855















188,855Other revenues


625







31,165







(31,790
)


Total revenues


625



957,771



31,165







(31,790
)


957,771Operating expenses:Cost of service (exclusive of items shown separately below)






(234,713
)










31,165



(203,548
)Cost of equipment






(230,520
)














(230,520
)Selling and marketing






(100,042
)














(100,042
)General and administrative


(3,345
)


(156,396
)


(625
)






625



(159,741
)Depreciation and amortization


(643
)


(194,819
)














(195,462
)Impairment of assets










(12,043
)










(12,043
)Total operating expenses


(3,988
)


(916,490
)


(12,668
)






31,790



(901,356
)Gain on sale or disposal of assets










14,587











14,587Operating income (loss)


(3,363
)


41,281



33,084











71,002Minority interests in consolidated subsidiaries






(31
)














(31
)Equity in net income of consolidated subsidiaries


32,361



18,962











(51,323
)


Interest income






9,957















9,957Interest expense






(30,051
)














(30,051
)Other income (expense), net


1,687



(264
)














1,423Income before income taxes


30,685



39,854



33,084







(51,323
)


52,300Income tax expense






(7,493
)


(14,122
)










(21,615
)Net income

$
30,685


$
32,361


$
18,962


$



$
(51,323
)

$
30,685  117




---



##### Table of Contents



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











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


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

$
(1,166
)

$
316,746


$
(3,756
)

$
(16,168
)

$
20,525


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






(463,389
)






(28,550
)






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










(5,744
)


452







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










9,500











9,500Purchases of investments






(642,513
)














(642,513
)Sales and maturities of investments






530,956















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


(9,690
)


(4,706
)










9,690



(4,706
)Purchase of membership units






(18,955
)














(18,955
)Other


1,022



(426
)






(375
)






221Net cash provided by (used in) investing activities


(8,668
)


(599,033
)


3,756



(28,473
)


9,690



(622,728
)Financing activities:Principal payments on capital lease obligation






(5,213
)














(5,213
)Proceeds from long-term debt






370,480







6,000



(6,000
)


370,480Issuance of related party debt






(6,000
)










6,000



Repayment of long-term debt






(9,000
)














(9,000
)Payment of debt issuance costs






(7,757
)






(8
)






(7,765
)Capital contributions, net


9,690



9,690







29,405



(30,215
)


18,570Proceeds from issuance of common stock, net






















Net cash provided by financing activities


9,690



352,200







35,397



(30,215
)


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


(144
)


69,913







(9,244
)






60,525Cash and cash equivalents at beginning of period


206



329,240







43,366







372,812Cash and cash equivalents at end of period

$
62


$
399,153


$



$
34,122


$



$
433,337  118




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Cash Flows for the Year Ended December 31,
    2006 (in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by operating activities

$
6,933


$
269,947


$



$
12,991


$



$
289,871Investing activities:Purchases of and changes in prepayments for property and
    equipment






(567,518
)






(27,623
)






(595,141
)Purchases of and deposits for wireless licenses










(743,688
)


(275,144
)






(1,018,832
)Proceeds from sale of wireless licenses and operating assets






6,887



33,485











40,372Purchases of investments






(150,488
)














(150,488
)Sales and maturities of investments






177,932















177,932Investments in and advances to affiliates and consolidated
    subsidiaries


(259,898
)


(777,291
)










1,037,189



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


(6,773
)


1,571







735







(4,467
)Net cash used in investing activities


(266,671
)


(1,308,907
)


(710,203
)


(302,032
)


1,037,189



(1,550,624
)Financing activities:Proceeds from long-term debt






2,220,000







263,378



(223,378
)


2,260,000Issuance of related party debt






(223,378
)










223,378



Repayment of long-term debt






(1,168,944
)














(1,168,944
)Capital contributions, net


259,898



268,783



710,203



70,605



(1,037,189
)


272,300Payment of debt issuance costs






(21,288
)






(1,576
)






(22,864
)Net cash provided by financing activities


259,898



1,075,173



710,203



332,407



(1,037,189
)


1,340,492Net increase in cash and cash equivalents


160



36,213







43,366







79,739Cash and cash equivalents at beginning of period


46



293,027















293,073Cash and cash equivalents at end of period

$
206


$
329,240


$



$
43,366


$



$
372,812  119




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Consolidating
    Statement of Cash Flows for the Year Ended December 31,
    2005 (in thousands):
  Guarantor











ConsolidatingParent


Issuing


Guarantor


Non-Guarantor


and EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by operating activities

$
364


$
307,916


$



$



$



$
308,280Investing activities:Purchases of and changes in prepayments for property and
    equipment






(218,636
)














(218,636
)Purchases of and deposits for wireless licenses










(243,960
)










(243,960
)Proceeds from sale of wireless licenses and operating assets






20,300



88,500











108,800Purchases of investments






(307,021
)














(307,021
)Sales and maturities of investments






329,043















329,043Investments in and advances to affiliates and consolidated
    subsidiaries






(191,408
)










191,408



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


(338
)


















(338
)Net cash used in investing activities


(338
)


(367,722
)


(155,460
)






191,408



(332,112
)Financing activities:Proceeds from long-term debt






600,000















600,000Repayment of long-term debt






(377,912
)


(40,373
)










(418,285
)Capital contributions, net






1,000



191,408







(191,408
)


1,000Payment of debt issuance costs






(6,951
)














(6,951
)Net cash provided by financing activities






216,137



151,035







(191,408
)


175,764Net increase (decrease) in cash and cash equivalents


26



156,331



(4,425
)










151,932Cash and cash equivalents at beginning of period


20



136,696



4,425











141,141Cash and cash equivalents at end of period

$
46


$
293,027


$



$



$



$
293,073  120




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  (a)
    Evaluation
    of Disclosure Controls and Procedures    Form 10-K, Rule 13a-15(b), Form 10-K, Rule 13a-15(e)
    (b)
    Managements
    Report on Internal Control over Financial Reporting  Rule 13a-15(f).
    Internal Control 
    Integrated Framework
 121




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##### Table of Contents




    There were deficiencies in our internal controls over the
    existence, completeness and accuracy of revenues, cost of
    revenues and deferred revenues. Specifically, the design of
    controls over the preparation and review of the account
    reconciliations and analysis of revenues, cost of revenues and
    deferred revenues did not detect the errors in revenues, cost of
    revenues and deferred revenues. A contributing factor was the
    ineffective operation of our user acceptance testing (i.e.,
    ineffective testing) of changes made to our revenue and billing
    systems in connection with the introduction or modification of
    service offerings. This material weakness resulted in the
    accounting errors which caused us to restate our consolidated
    financial statements as of and for the years ended
    December 31, 2006 and 2005 (including interim periods
    therein), for the period from August 1, 2004 to
    December 31, 2004 and for the period from January 1,
    2004 to July 31, 2004, and our condensed consolidated
    financial statements as of and for the quarterly periods ended
    June 30, 2007 and March 31, 2007. In addition, this
    material weakness resulted in an adjustment recorded in the
    three months ended December 31, 2007, which we determined
    was not material to our previously reported 2006 annual or 2007
    interim periods. The material weakness described above could
    result in a misstatement of revenues, cost of revenues and
    deferred revenues that would result in a material misstatement
    to the Companys interim or annual consolidated financial
    statements that would not be prevented or detected on a timely
    basis.  Internal Control 
    Integrated Framework
    (c)
    Managements
    Remediation Initiatives    
    During the fiscal quarter ended December 31, 2007, we
    performed a detailed review of our billing and revenue systems,
    and processes for recording revenue. We also began and continue
    to implement stronger account reconciliations and analyses
    surrounding our revenue recording processes which are designed
    to detect any material errors in the completeness and accuracy
    of the underlying data.
    We intend to design and implement automated enhancements to our
    billing and revenue systems to reduce the need for manual
    processes and estimates and thereby streamline the processes for
    ensuring revenue is recorded only when payment is received and
    services are provided.
    We intend to further improve our user acceptance testing related
    to system changes by ensuring the user acceptance testing
    encompasses a complete population of scenarios of possible
    customer activity.
    We intend to hire additional personnel with the appropriate
    skills, training and experience in the areas of revenue
    accounting and assurance. We have conducted and will conduct
    further training of our accounting and finance personnel with
    respect to our significant accounting policies and procedures.   122




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##### Table of Contents



(d)
    Changes
    in Internal Control over Financial Reporting    Item 9A(T).
    Controls
    and Procedures    Item 9B.
    Other
    Information   123




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##### 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   124




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##### Table of Contents



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:
                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).4.3.2(8)

Third Supplemental Indenture, dated as of April 30, 2007,
    among Cricket Communications, Inc., Wells Fargo Bank, N.A., as
    trustee, Leap Wireless International, Inc. and the other
    guarantors under the Indenture. 125




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##### Table of Contents



ExhibitNumber

Description4.4(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(9)

Registration Rights Agreement, dated as of June 6, 2007, 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.10.1(10)

System Equipment Purchase Agreement, dated as of June 11,
    2007, by and among Cricket Communications, Inc., Alaska Native
    Broadband 1 License LLC and Nortel Networks Inc.10.2(10)

System Equipment Purchase Agreement, dated as of June 14,
    2007, by and among Cricket Communications, Inc., Alaska Native
    Broadband 1 License LLC and Lucent Technologies, Inc.10.3(11)

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(12)

Amendment No. 1 to Amended and Restated Credit Agreement,
    dated March 15, 2007, by and among Cricket Communications,
    Inc., Leap Wireless International, Inc., the lenders party
    thereto and Bank of America, N.A., as administrative agent.10.3.2(12)

Consent dated March 15, 2007 by Leap Wireless
    International, Inc. and the subsidiary guarantors party thereto.10.3.3(13)

Amendment No. 2 to Amended and Restated Credit Agreement,
    dated November 20, 2007, by and among Cricket
    Communications, Inc., Leap Wireless International, Inc., the
    lenders party thereto and Bank of America, N.A., as
    administrative agent.10.3.4(13)

Consent dated November 20, 2007 by Leap Wireless
    International, Inc. and the subsidiary guarantors party thereto.10.3.5(11)

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.10.3.6(14)

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, 2006.10.3.7(11)

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.10.3.8(11)

Amended and Restated Subsidiary Guaranty, dated June 16,
    2006, made by the Subsidiary Guarantors of the secured parties
    under the Credit Agreement.10.4(15)

Credit Agreement, dated as of July 13, 2006, by and among
    Cricket Communications, Inc., Denali Spectrum License, LLC and
    Denali Spectrum, LLC.10.4.1(14)

Amendment No. 1 to Credit Agreement by and among Cricket
    Communications, Inc., Denali Spectrum License, LLC and Denali
    Spectrum, LLC, dated as of September 28, 2006, between
    Cricket Communications, Inc., Denali Spectrum License, LLC and
    Denali Spectrum, LLC.10.4.2(16)

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

Letter of Credit and Reimbursement Agreement by and between
    Cricket Communications, Inc. and Denali Spectrum Operations,
    LLC, dated as of February 21, 2008.10.5(17)#

Form of Indemnity Agreement to be entered into by and between
    Leap Wireless International, Inc. and its directors and
    officers. 126




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##### Table of Contents



ExhibitNumber

Description10.6(5)#

Amended and Restated Executive Employment Agreement among Leap
    Wireless International, Inc., Cricket Communications, Inc., and
    S. Douglas Hutcheson, dated as of January 10, 2005.10.6.1(18)#

First Amendment to Amended and Restated Executive Employment
    Agreement among Leap Wireless International, Inc., Cricket
    Communications, Inc., and S. Douglas Hutcheson, effective as of
    June 17, 2005.10.6.2(19)#

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, 2006.10.7*#

Form of Executive Vice President and Senior Vice President
    Amended and Restated Severance Benefits Agreement.10.8(5)#

Employment Offer Letter dated January 31, 2005, between
    Cricket Communications, Inc. and Albin F. Moschner.10.9(20)#

Employment Offer Letter, dated March 24, 2005, between
    Cricket Communications, Inc., and Grant Burton.10.9.1(19)#

Retention Agreement, dated December 5, 2005, between
    Cricket Communications, Inc., and Grant Burton.10.10(21)#

Leap Wireless International, Inc. 2004 Stock Option Restricted
    Stock and Deferred Stock Unit Plan.10.10.1(16)#

First Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.10.2(10)#

Second Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.10.3(18)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (February 2008 Vesting).10.10.4(18)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Five-Year Vesting) entered into prior to
    October 26, 2005.10.10.5(19)#

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, 2005.10.10.6(19)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Five-Year Vesting) entered into on or after
    October 26, 2005.10.10.7(19)#

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.10.10.8(22)#

Form of Stock Option Grant Notice and Non-Qualified Stock Option
    Agreement (Four-Year Time Based Vesting).10.10.9(18)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (February 2008 Vesting).10.10.10(18)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Five-Year Vesting) entered into prior to
    October 26, 2005.10.10.11(19)#

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, 2005.10.10.12(19)#

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.10.10.13(19)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Five-Year Vesting) entered into on or after
    October 26, 2005.10.10.14(22)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (Four-Year Time Based Vesting).10.10.15(21)#

Form of Deferred Stock Unit Award Grant Notice and Deferred
    Stock Unit Award Agreement. 127




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##### Table of Contents



ExhibitNumber

Description10.10.16(5)#

Form of Non-Employee Director Stock Option Grant Notice and
    Non-Qualified Stock Option Agreement.10.10.17(23)#

Form of Restricted Stock Award Grant Notice and Restricted Stock
    Award Agreement (for Non-Employee Directors).10.10.18*#

Consulting Agreement  2008, dated as of
    January 5, 2008, between Leap Wireless International, Inc.
    and Steven R. Martin.10.11(24)#

Resignation Agreement, dated September 6, 2007, by and
    between Leap Wireless International, Inc., Cricket
    Communications, Inc. and Amin Khalifa.10.12(25)#

Leap Wireless International, Inc. Executive Incentive Bonus Plan.10.13(16)#

2007 Cricket Non-Sales Bonus Plan.21*

Subsidiaries of Leap Wireless International, Inc.23*

Consent of Independent Registered Public Accounting Firm.31*

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

Certification of the Chief Executive Officer and Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.     *
    
    Filed herewith.**
    
    This certification is being furnished solely to accompany this
    report pursuant to U.S.C. § 1350, and is not being filed
    for purposes of Section 18 of the Securities Exchange Act
    of 1934, as amended, and is not to be incorporated by reference
    into any filing of Leap Wireless International, Inc. whether
    made before or after the date hereof, regardless of any general
    incorporation language in such filing.
    
    Portions of this exhibit (indicated by asterisks) have been
    omitted pursuant to a request for confidential treatment
    pursuant to
    Rule 24b-2
    under the Securities Exchange Act of 1934.#
    
    Management contract or compensatory plan or arrangement in which
    one or more executive officers or directors participates.(1)
    
    Filed as an exhibit to Leaps 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 fiscal year ended December 31, 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),
    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 April 30, 2007, filed with the SEC on May 4,
    2007, and incorporated herein by reference.(9)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 1, 2007, filed with the SEC on June 6,
    2007, and incorporated herein by reference.(10)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2007, filed with the
    SEC on August 9, 2007, and incorporated herein by reference. 128




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##### Table of Contents



(11)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated June 16, 2006, filed with the SEC on June 19,
    2006, and incorporated herein by reference.(12)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated March 15, 2007, filed with the SEC on March 21,
    2007, and incorporated herein by reference.(13)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated November 20, 2007, filed with the SEC on
    November 23, 2007, and incorporated herein by reference.(14)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2006, filed with
    the SEC on November 9, 2006, and incorporated herein by
    reference.(15)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended June 30, 2006, filed with the
    SEC on August 8, 2006, and incorporated herein by reference.(16)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2007, filed with the
    SEC on May 10, 2007, and incorporated herein by reference.(17)
    
    Filed as an exhibit to Leaps Registration Statement on
    Form 10, as amended (File
    No. 0-29752),
    filed with the SEC on August 21, 1998 and incorporated
    herein by reference.(18)
    
    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.(19)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2005, filed with the
    SEC on March 27, 2006, and incorporated herein by reference.(20)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended March 31, 2005, filed with the
    SEC on June 15, 2005, and incorporated herein by reference.(21)
    
    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.(22)
    
    Filed as an exhibit to Leaps Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2006, filed with the
    SEC on March 1, 2007, and incorporated herein by reference.(23)
    
    Filed as an exhibit to Leaps Current Report on
    Form 8-K,
    dated May 18, 2006, filed with the SEC on June 6,
    2006, and incorporated herein by reference.(24)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2007, filed with
    the SEC on December 14, 2007, and incorporated herein by
    reference.(25)
    
    Filed as Appendix B to Leaps Definitive Proxy
    Statement filed with the SEC on April 6, 2007, and
    incorporated herein by reference. 129




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##### Table of Contents



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

Title

Date/s/  S.
    Douglas HutchesonS.
    Douglas Hutcheson

Chief Executive Officer, President, Acting Chief Financial
    Officer and Director
    (Principal Executive Officer and
    Principal Financial Officer)

February 29, 2008/s/  Steven
    R. MartinSteven
    R. Martin

Acting Chief Accounting Officer
    (Principal Accounting Officer)

February 29, 2008/s/  John
    D. Harkey, Jr.John
    D. Harkey, Jr.

Director

February 29, 2008/s/  Robert
    V. LaPentaRobert
    V. LaPenta

Director

February 29, 2008/s/  Mark
    H. Rachesky, M.D.Mark
    H. Rachesky, M.D.

Chairman of the Board and Director

February 29, 2008/s/  Michael
    B. TargoffMichael
    B. Targoff

Director

February 29, 2008  130