##### Table of Contents



UNITED
    STATES
    SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C.
    20549
    FORM 10-Q/A
 (Amendment
    No. 1)
     (Mark One)þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) 
    OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended
    March 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)

33-0811062(I.R.S. Employer
    Identification No.)10307 Pacific Center Court, San Diego, CA(Address of principal executive
    offices)

92121(Zip Code)   (858) 882-6000
 (Registrants telephone
    number, including area code)
  Not applicable
 (Former name, former address and
    former fiscal year, if changed since last reported)
  þ o
  Rule 12b-2
 þ o o
  Rule 12b-2 o þ
  þ o




---



##### Table of Contents



EXPLANATORY
    NOTE
  Form 10-Q/A Form 10-Q Form 10-Q Form 10-Q).
    Form 10-Q Form 10-Q
  Rule 12b-15 Form 10-Q
  Form 8-K Form 10-Q




---



##### 



LEAP
    WIRELESS INTERNATIONAL, INC.
    QUARTERLY REPORT ON
    FORM 10-Q/A
    (Amendment No. 1)
    For the Quarter Ended March 31, 2007
    TABLE OF CONTENTS
  PagePART I   FINANCIAL
    INFORMATIONItem 1.

Financial Statements


1Item 2.

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


29Item 4.

Controls and Procedures


40PART II  OTHER INFORMATIONItem 1A.

Risk Factors


43Item 6.

Exhibits


59EXHIBIT 31EXHIBIT 32




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##### Table of Contents



PART I
    FINANCIAL INFORMATION
  Item 1.
    Financial
    Statements.  LEAP
    WIRELESS INTERNATIONAL, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (In thousands, except share amounts)
  March 31,


December 31,2007


2006(Unaudited)(As Restated)


(As Restated)(See Note 2)


(See Note 2)AssetsCash and cash equivalents

$
300,321


$
372,812Short-term investments


25,432



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


12,479



13,581Inventories


75,985



90,185Other current assets


55,222



52,981Total current assets


469,439



595,959Property and equipment, net


1,109,638



1,078,521Wireless licenses


1,564,381



1,563,958Assets held for sale






8,070Goodwill


425,782



425,782Other intangible assets, net


71,397



79,828Deposits for wireless licenses


274,084



274,084Other assets


39,054



58,745Total assets

$
3,953,775


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

$
175,306


$
317,093Current maturities of long-term debt


9,000



9,000Other current liabilities


112,294



84,675Total current liabilities


296,600



410,768Long-term debt


1,674,250



1,676,500Deferred tax liabilities


150,697



148,335Other long-term liabilities


49,038



47,608Total liabilities


2,170,585



2,283,211Minority interests


23,734



29,943Commitments and contingencies (Note 8)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, 68,051,029 and 67,892,512 shares
    issued and outstanding at March 31, 2007 and
    December 31, 2006, respectively


7



7Additional paid-in capital


1,782,880



1,769,772Retained earnings (accumulated deficit)


(23,996
)


228Accumulated other comprehensive income


565



1,786Total stockholders equity


1,759,456



1,771,793Total liabilities and stockholders equity

$
3,953,775


$
4,084,947    1




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONDENSED
    CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited
    and in thousands, except per share data)
  Three Months EndedMarch 31,2007


2006(As Restated)


(As Restated)(See Note 2)


(See Note 2)Revenues:Service revenues

$
321,691


$
218,085Equipment revenues


71,734



63,765Total revenues


393,425



281,850Operating expenses:Cost of service (exclusive of items shown separately below)


(90,440
)


(56,210
)Cost of equipment


(122,665
)


(71,977
)Selling and marketing


(48,769
)


(29,102
)General and administrative


(65,234
)


(49,090
)Depreciation and amortization


(68,800
)


(54,036
)Total operating expenses


(395,908
)


(260,415
)Net gain on sale of wireless licenses and disposal of operating
    assets


940



Operating income (loss)


(1,543
)


21,435Minority interests in consolidated subsidiaries


1,579



(75
)Interest income


5,285



4,194Interest expense


(26,496
)


(7,431
)Other income (expense), net


(637
)


535Income (loss) before income taxes and cumulative effect of
    change in accounting principle


(21,812
)


18,658Income tax expense


(2,412
)


Income (loss) before cumulative effect of change in accounting
    principle


(24,224
)


18,658Cumulative effect of change in accounting principle






623Net income (loss)

$
(24,224
)

$
19,281Basic earnings (loss) per share:Earnings (loss) before cumulative effect of change in accounting
    principle

$
(0.36
)

$
0.30Cumulative effect of change in accounting principle






0.01Basic earnings (loss) per share

$
(0.36
)

$
0.31Diluted earnings (loss) per share:Earnings (loss) before cumulative effect of change in accounting
    principle

$
(0.36
)

$
0.30Cumulative effect of change in accounting principle






0.01Diluted earnings (loss) per share

$
(0.36
)

$
0.31Shares used in per share calculations:Basic


66,870



61,203Diluted


66,870



61,961    2




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited
    and in thousands)
  Three Months EndedMarch 31,2007


2006(As Restated)


(As Restated)(See Note 2)


(See Note 2)Operating activities:Net cash provided by operating activities

$
5,122


$
37,909Investing activities:Purchases of property and equipment


(133,295
)


(60,894
)Change in prepayments for purchases of property and equipment


7,409



4,573Purchases of and deposits for wireless licenses


(423
)


(91
)Proceeds from sale of wireless licenses


9,500



Purchases of investments


(42,727
)


(46,865
)Sales and maturities of investments


84,293



72,657Purchase of minority interest


(4,706
)


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


1,102



(50
)Net cash used in investing activities


(78,847
)


(30,670
)Financing activities:Repayment of long-term debt


(2,250
)


(1,527
)Payment of debt issuance costs


(881
)


(91
)Minority interest contributions






668Proceeds from issuance of common stock, net


4,365



233Net cash provided by (used in) financing activities


1,234



(717
)Net increase (decrease) in cash and cash equivalents


(72,491
)


6,522Cash and cash equivalents at beginning of period


372,812



293,073Cash and cash equivalents at end of period

$
300,321


$
299,595Supplementary cash flow information:Cash paid for interest

$
18,373


$
11,098Cash paid for income taxes

$
332


$
168    3




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##### Table of Contents



LEAP
    WIRELESS INTERNATIONAL, INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
    (UNAUDITED)
  Note 1.
    The
    Company  ® tm
      Note 2.
    Restatement
    of Previously Reported Consolidated Financial
    Statements      
    Errors in the Timing of Recognition of Service Revenues
    (Revenue  Timing Adjustments) The Company identified several timing errors in
    the recognition of service revenues that generally resulted from
    errors in the processes that the Company used to ensure that
    revenues were not recognized until service had been provided to
    customers and cash had been received from them. The nature of
    these timing errors generally was that revenue that was
    recognized in a particular month should have been recognized in
    either the preceding or the following month. These errors
    resulted in an overstatement of service revenues of
    $2.8 million in the quarter ended March 31, 2007 and
    an understatement of service revenues of $1.3 million in
    the quarter ended March 31, 2006.
    Other Errors in the Recognition of Service Revenues
    (Other  Revenue Adjustments) The Company incorrectly recognized revenue for a
    group of customers who voluntarily disconnected their service.
    For these customers, approximately one month of deferred revenue
    that was recorded when the customers monthly bills were
    generated was mistakenly recognized as revenue after their
    service was disconnected, 4




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##### Table of Contents



due to the fact that one of the key reports used to validate
    that revenue is not recognized for customers who have not yet
    paid erroneously excluded this subset of disconnected customer
    balances. These customers comprised a small percentage of the
    Companys disconnected customers, and the error arose in
    connection with the Companys re-implementation of the
    pay-in-advance
    billing method for new and reactivating customers in May 2006.
    This error resulted in an overstatement of service revenues of
    $2.0 million in the quarter ended March 31, 2007. In
    addition, certain other errors were made in the recognition of
    revenue and revenue-related accounts, resulting in an
    overstatement of service revenues of $1.8 million and
    $0.1 million in the quarters ended March 31, 2007 and
    2006, respectively.  
    Errors in the Classification of Certain Components of Service
    Revenues, Equipment Revenues and Operating Expenses
    (Reclassification Adjustments) The
    Company identified errors relating to the classification of
    certain components of service revenues, equipment revenues and
    operating expenses. The Company incorrectly classified certain
    customer service fees as equipment revenue rather than service
    revenue. The Company incorrectly classified certain costs
    related to handset insurance purchased by some
    pay-in-arrears
    customers as a reduction of service revenues rather than as a
    cost of service. The Company incorrectly classified certain
    revenues received by the Company in connection with handsets
    sold to Company customers under insurance or other handset
    replacement programs as a reduction in handset costs rather than
    as equipment revenues. These classification errors resulted from
    deficiencies in certain account analyses that resulted in the
    Company incorrectly analyzing certain types of transactions for
    their classification impacts. The errors resulted in a net
    understatement of total revenues and understatement of operating
    expenses of $10.5 million and $14.1 million in the
    quarters ended March 31, 2007 and 2006, respectively. These
    errors had no impact on operating income or net income.
    Other Non-Material Items (Other Adjustments) The Company identified other errors that were
    not material, individually or in the aggregate, to its financial
    statements taken as a whole. However, because the Company is
    restating its financial statements for the effects of the items
    noted above, the Company revised its previously reported
    financial statements to correct all identified errors, including
    those that were not material. These items resulted in a net
    overstatement of operating expenses of $0.5 million and
    $0.4 million in the quarters ended March 31, 2007 and
    2006, respectively.   5




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##### Table of Contents



March 31, 2007PreviouslyReported


Adjustments


As Restated(Unaudited)AssetsCash and cash equivalents

$
303,784


$
(3,463
)

$
300,321Short-term investments


25,432







25,432Restricted cash, cash equivalents and short-term investments


12,479







12,479Inventories


75,985







75,985Other current assets


55,038



184



55,222Total current assets


472,718



(3,279
)


469,439Property and equipment, net


1,107,314



2,324



1,109,638Wireless licenses


1,564,381







1,564,381Goodwill


431,896



(6,114
)


425,782Other intangible assets, net


71,397







71,397Deposits for wireless licenses


274,084







274,084Other assets


39,054







39,054Total assets

$
3,960,844


$
(7,069
)

$
3,953,775Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
173,606


$
1,700


$
175,306Current maturities of long-term debt


9,000







9,000Other current liabilities


96,897



15,397



112,294Total current liabilities


279,503



17,097



296,600Long-term debt


1,674,250







1,674,250Deferred tax liabilities


141,439



9,258



150,697Other long-term liabilities


49,038







49,038Total liabilities


2,144,230



26,355



2,170,585Minority interests


23,849



(115
)


23,734Stockholders equity:Preferred stock










Common stock


7







7Additional paid-in capital


1,782,880







1,782,880Retained earnings (accumulated deficit)


9,313



(33,309
)


(23,996
)Accumulated other comprehensive income


565







565Total stockholders equity


1,792,765



(33,309
)


1,759,456Total liabilities and stockholders equity

$
3,960,844


$
(7,069
)

$
3,953,775  6




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##### Table of Contents



Three Months Ended March 31, 2007Revenue 


Other 








IncomePreviously


Timing


Revenue


Reclassification


Other


Tax


AsReported


Adjustments


Adjustments


Adjustments


Adjustments


Adjustments


Restated(Unaudited)Revenues:Service revenues

$
326,809


$
(2,805
)

$
(3,765
)

$
1,452


$



$



$
321,691Equipment revenues


62,613



123







8,998











71,734Total revenues


389,422



(2,682
)


(3,765
)


10,450











393,425Operating expenses:Cost of service (exclusive of items shown separately below)


(90,949
)










(313
)


822







(90,440
)Cost of equipment


(112,482
)










(10,137
)


(46
)






(122,665
)Selling and marketing


(48,560
)














(209
)






(48,769
)General and administrative


(65,199
)














(35
)






(65,234
)Depreciation and amortization


(68,800
)






















(68,800
)Total operating expenses


(385,990
)










(10,450
)


532







(395,908
)Net gain on sale of wireless licenses and disposal of operating
    assets


940























940Operating income (loss)


4,372



(2,682
)


(3,765
)






532







(1,543
)Minority interests in consolidated subsidiaries


1,520















59







1,579Interest income


5,285























5,285Interest expense


(26,496
)






















(26,496
)Other expense, net


(637
)






















(637
)Loss before income taxes


(15,956
)


(2,682
)


(3,765
)






591







(21,812
)Income tax benefit (expense)


7,833



















(10,245
)


(2,412
)Net loss

$
(8,123
)

$
(2,682
)

$
(3,765
)

$



$
591


$
(10,245
)

$
(24,224
)Basic and diluted loss per share:Basic loss per share

$
(0.12
)

$
(0.04
)

$
(0.06
)

$



$
0.01


$
(0.15
)

$
(0.36
)Diluted loss per share

$
(0.12
)

$
(0.04
)

$
(0.06
)

$



$
0.01


$
(0.15
)

$
(0.36
)Shares used in per share calculations:Basic


66,870























66,870Diluted


66,870























66,870  7




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##### Table of Contents



March 31, 2007PreviouslyReported


Adjustments


As Restated(Unaudited)Operating activities:Net cash provided by operating activities

$
4,900


$
222


$
5,122Investing activities:Purchases of property and equipment


(131,737
)


(1,558
)


(133,295
)Change in prepayments for purchases of property and equipment


7,409







7,409Purchases of and deposits for wireless licenses


(423
)






(423
)Proceeds from sale of wireless licenses


9,500







9,500Purchases of investments


(42,727
)






(42,727
)Sales and maturities of investments


84,293







84,293Purchase of minority interest


(4,706
)






(4,706
)Changes in restricted cash, cash equivalents and short-term
    investments, net


1,102







1,102Net cash used in investing activities


(77,289
)


(1,558
)


(78,847
)Financing activities:Repayment of long-term debt


(2,250
)






(2,250
)Payment of debt issuance costs


(881
)






(881
)Proceeds from issuance of common stock, net


4,365







4,365Net cash provided by financing activities


1,234







1,234Net decrease in cash and cash equivalents


(71,155
)


(1,336
)


(72,491
)Cash and cash equivalents at beginning of period


374,939



(2,127
)


372,812Cash and cash equivalents at end of period

$
303,784


$
(3,463
)

$
300,321Supplementary cash flow information:Cash paid for interest

$
18,373


$



$
18,373Cash paid for income taxes

$
332


$



$
332  8




---



##### Table of Contents



December 31, 2006PreviouslyReported


Adjustments


As RestatedAssetsCash and cash equivalents

$
374,939


$
(2,127
)

$
372,812Short-term investments


66,400







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


13,581







13,581Inventories


90,185







90,185Other current assets


53,527



(546
)


52,981Total current assets


598,632



(2,673
)


595,959Property and equipment, net


1,077,755



766



1,078,521Wireless licenses


1,563,958







1,563,958Assets held for sale


8,070







8,070Goodwill


431,896



(6,114
)


425,782Other intangible assets, net


79,828







79,828Deposits for wireless licenses


274,084







274,084Other assets


58,745







58,745Total assets

$
4,092,968


$
(8,021
)

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

$
316,494


$
599


$
317,093Current maturities of long-term debt


9,000







9,000Other current liabilities


74,637



10,038



84,675Total current liabilities


400,131



10,637



410,768Long-term debt


1,676,500







1,676,500Deferred tax liabilities


149,728



(1,393
)


148,335Other long-term liabilities


47,608







47,608Total liabilities


2,273,967



9,244



2,283,211Minority interests


30,000



(57
)


29,943Stockholders equity:Preferred stock










Common stock


7







7Additional paid-in capital


1,769,772







1,769,772Retained earnings


17,436



(17,208
)


228Accumulated other comprehensive income


1,786







1,786Total stockholders equity


1,789,001



(17,208
)


1,771,793Total liabilities and stockholders equity

$
4,092,968


$
(8,021
)

$
4,084,947  9




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##### Table of Contents



Three Months Ended March 31, 2006Revenue 


Other Previously


Timing


Revenue


Reclassification


Other


Income Tax


AsReported


Adjustments


Adjustments


Adjustments


Adjustments


Adjustments


Restated(Unaudited)Revenues:Service revenues

$
215,840


$
1,255


$
(143
)

$
1,133


$



$



$
218,085Equipment revenues


50,848











12,917











63,765Total revenues


266,688



1,255



(143
)


14,050











281,850Operating expenses:Cost of service (exclusive of items shown separately below)


(55,204
)










(959
)


(47
)






(56,210
)Cost of equipment


(58,886
)










(13,091
)










(71,977
)Selling and marketing


(29,102
)






















(29,102
)General and administrative


(49,582
)














492







(49,090
)Depreciation and amortization


(54,036
)






















(54,036
)Total operating expenses


(246,810
)










(14,050
)


445







(260,415
)Operating income


19,878



1,255



(143
)






445







21,435Minority interests in consolidated subsidiaries


(75
)






















(75
)Interest income


4,194























4,194Interest expense


(7,431
)






















(7,431
)Other income, net


535























535Income before income taxes and cumulative effect of change in
    accounting principle


17,101



1,255



(143
)






445







18,658Income tax expense


























Income before cumulative effect of change in accounting principle


17,101



1,255



(143
)






445







18,658Cumulative effect of change in accounting principle


623























623Net income

$
17,724


$
1,255


$
(143
)

$



$
445


$



$
19,281Basic earnings per share:Income before cumulative effect of change in accounting principle

$
0.28


$
0.01


$



$



$
0.01


$



$
0.30Cumulative effect of change in accounting principle


0.01























0.01Basic earnings per share

$
0.29


$
0.01


$



$



$
0.01


$



$
0.31Diluted earnings per share:Income before cumulative effect of change in accounting principle

$
0.28


$
0.01


$



$



$
0.01


$



$
0.30Cumulative effect of change in accounting principle


0.01























0.01Diluted earnings per share

$
0.29


$
0.01


$



$



$
0.01


$



$
0.31Shares used in per share calculations:Basic


61,203























61,203Diluted


61,961























61,961  10




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##### Table of Contents



March 31, 2006PreviouslyReported


Adjustments


As Restated(Unaudited)Operating activities:Net cash provided by operating activities

$
38,290


$
(381
)

$
37,909Investing activities:Purchases of property and equipment


(60,894
)






(60,894
)Change in prepayments for purchases of property and equipment


4,573







4,573Purchases of and deposits for wireless licenses


(91
)






(91
)Purchases of investments


(46,865
)






(46,865
)Sales and maturities of investments


72,657







72,657Changes in restricted cash, cash equivalents and short-term
    investments, net


(50
)






(50
)Net cash used in investing activities


(30,670
)






(30,670
)Financing activities:Repayment of long-term debt


(1,527
)






(1,527
)Payment of debt issuance costs


(91
)






(91
)Minority interest contributions


668







668Proceeds from issuance of common stock, net


233







233Net cash used in financing activities


(717
)






(717
)Net increase in cash and cash equivalents


6,903



(381
)


6,522Cash and cash equivalents at beginning of period


293,073







293,073Cash and cash equivalents at end of period

$
299,976


$
(381
)

$
299,595Supplementary cash flow information:Cash paid for interest

$
11,098


$



$
11,098Cash paid for income taxes

$
168


$



$
168   Note 3.
    Basis of
    Presentation and Significant Accounting Policies  Basis
    of Presentation
  Form 10-Q Form 10-K/A
  FIN 46-R,
 11




---



##### Table of Contents



Revenues
    No. 00-21, No. 00-21, No. 00-21
      and/or
    Costs
    and Expenses
    Cost of Service.
 12




---



##### Table of Contents



Cost of Equipment.
  Selling and Marketing.
  General and Administrative.
  Property
    and Equipment
      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
    Wireless
    Licenses
   13




---



##### Table of Contents



Concentrations
    Share-Based
    Compensation
      Three MonthsEnded March 31,2007


2006(As Restated)


(As Restated)Cost of service

$
679


$
258Selling and marketing expenses


1,001



327General and administrative expenses


7,063



3,907Share-based compensation expense before tax


8,743



4,492Related income tax benefit






Share-based compensation expense, net of tax

$
8,743


$
4,492Net share-based compensation expense per share:Basic

$
0.13


$
0.07Diluted

$
0.13


$
0.07   Income
    Taxes
     14




---



##### Table of Contents



90-7,
    Comprehensive
    Income (Loss)
    Three MonthsEnded March 31,2007


2006(As Restated)


(As Restated)Net income (loss)

$
(24,224
)

$
19,281Other comprehensive income (loss):Net unrealized holding losses on investments


(27
)


(17
)Unrealized gains (losses) on interest rate swaps


(1,194
)


2,149Comprehensive income (loss)

$
(25,445
)

$
21,413     March 31,


December 31,2007


2006Net unrealized holding losses on investments, net of tax

$
(1,416
)

$
(1,389
)Unrealized gains on interest rate swaps


1,981



3,175Accumulated other comprehensive income

$
565


$
1,786   Recent
    Accounting Pronouncements
   15




---



##### Table of Contents



Note 4.
    Supplementary
    Balance Sheet Information (in thousands):  March 31,


December 31,2007


2006(As Restated)


(As Restated)Other current assets:Accounts receivable, net(1)

$
29,497


$
38,257Prepaid expenses


22,622



11,808Other


3,103



2,916$
55,222


$
52,981Property and equipment, net:Network equipment

$
1,189,575


$
1,128,127Computer equipment and other


109,601



100,496Construction- in-progress


258,067



238,5791,557,243



1,467,202Accumulated depreciation


(447,605
)


(388,681
)$
1,109,638


$
1,078,521Accounts payable and accrued liabilities:Trade accounts payable

$
87,693


$
218,020Accrued payroll and related benefits


24,557



29,450Other accrued liabilities


63,056



69,623$
175,306


$
317,093Other current liabilities:Deferred service revenue(2)

$
42,431


$
32,929Deferred equipment revenue(3)


17,826



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


15,093



15,865Accrued interest


31,060



13,671Other


5,884



5,621$
112,294


$
84,675     (1)
    
    Accounts receivable consists primarily of amounts billed to
    third-party dealers for handsets and accessories.(2)
    
    Deferred service revenue consists primarily of cash received
    from customers in advance of their service period.(3)
    
    Deferred equipment revenue relates to handsets and accessories
    sold to third-party dealers. 16




---



##### Table of Contents



Note 5.
    Basic and
    Diluted Earnings (Loss) Per Share      Three Months Ended March 31,2007


2006Basic weighted-average shares outstanding


66,870



61,203Effect of dilutive securities:Stock options






31Restricted stock awards






381Warrants






346Diluted weighted-average shares outstanding


66,870



61,961     Note 6.
    Long-Term
    Debt    March 31,


December 31,2007


2006Term loans under senior secured credit facilities

$
933,250


$
935,500Senior notes


750,000



750,0001,683,250



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


(9,000
)


(9,000
)$
1,674,250


$
1,676,500   Senior
    Secured Credit Facilities
     17




---



##### Table of Contents



Form 10-Q
    Form 10-Q Form 10-K Form 10-Q/A Form 10-K/A Form 10-Q/A
   18




---



##### Table of Contents



Senior
    Notes
     19




---



##### Table of Contents



Note 7.
    Significant
    Acquisitions and Dispositions    Note 8.
    Commitments
    and Contingencies  Outstanding
    Bankruptcy Claims
  03-03470-All 03-035335-All
  Patent
    Litigation
  Method for
    Providing Wireless Communication Services and Network and System
    for Delivering Same,
 20




---



##### Table of Contents



Other
  and/or
  and/or
   21




---



##### Table of Contents



Note 9.
    Guarantor
    Financial Information       22




---



##### Table of Contents



Condensed
    Consolidating Balance Sheet as of March 31, 2007 (as
    restated; unaudited and in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
134


$
255,378


$
23,814


$
20,995


$



$
300,321Short-term investments






25,432















25,432Restricted cash, cash equivalents and short-term investments


7,578



4,260



641











12,479Inventories






73,571



1,858



556







75,985Other current assets


42



43,212



11,288



680







55,222Total current assets


7,754



401,853



37,601



22,231







469,439Property and equipment, net


96



918,609



144,803



46,130







1,109,638Investments in and advances to affiliates and consolidated
    subsidiaries


1,763,131



2,022,574



152,392







(3,938,097
)


Wireless licenses






183



1,527,829



36,369







1,564,381Goodwill






425,782















425,782Other intangible assets, net






71,044







353







71,397Deposits for wireless licenses














274,084







274,084Other assets


1,090



34,093



2,305



2,614



(1,048
)


39,054Total assets

$
1,772,071


$
3,874,138


$
1,864,930


$
381,781


$
(3,939,145
)

$
3,953,775Liabilities and Stockholders EquityAccounts payable and accrued liabilities

$
6,243


$
156,707


$
7,650


$
4,705


$
1


$
175,306Current maturities of long-term debt






9,000















9,000Intercompany payables


6,372



152,393



31,753



4,699



(195,217
)


Other current liabilities






104,908



6,805



1,630



(1,049
)


112,294Total current liabilities


12,615



423,008



46,208



11,034



(196,265
)


296,600Long-term debt






1,634,250



301,288



281,569



(542,857
)


1,674,250Deferred tax liabilities






10,404



140,293











150,697Other long-term liabilities






43,051



4,839



1,148







49,038Total liabilities


12,615



2,110,713



492,628



293,751



(739,122
)


2,170,585Minority interests






294











23,440



23,734Stockholders equity


1,759,456



1,763,131



1,372,302



88,030



(3,223,463
)


1,759,456Total liabilities and stockholders equity

$
1,772,071


$
3,874,138


$
1,864,930


$
381,781


$
(3,939,145
)

$
3,953,775  23




---



##### Table of Contents



Condensed
    Consolidating Balance Sheet as of December 31, 2006 (as
    restated, in thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedAssetsCash and cash equivalents

$
206


$
316,398


$
12,842


$
43,366


$



$
372,812Short-term investments






66,400















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


8,093



4,258



495



735







13,581Inventories






87,303



2,080



802







90,185Other current assets


105



50,307



2,097



472







52,981Total current assets


8,404



524,666



17,514



45,375







595,959Property and equipment, net


117



892,859



147,521



38,024







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


1,779,514



2,013,023



144,966







(3,937,503
)


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



45,616



11,259



1,827



(772
)


58,745Total assets

$
1,788,850


$
3,981,355


$
1,856,904


$
396,113


$
(3,938,275
)

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

$
6,792


$
274,764


$
25,306


$
10,231


$



$
317,093Current maturities of long-term debt






9,000















9,000Intercompany payables


10,265



144,965



11,844



9,893



(176,967
)


Other current liabilities






80,265



4,579



604



(773
)


84,675Total current liabilities


17,057



508,994



41,729



20,728



(177,740
)


410,768Long-term debt






1,636,500



277,955



271,443



(509,398
)


1,676,500Deferred tax liabilities






9,057



139,278











148,335Other long-term liabilities






42,467



4,155



986







47,608Total liabilities


17,057



2,197,018



463,117



293,157



(687,138
)


2,283,211Minority interests






4,821











25,122



29,943Stockholders equity


1,771,793



1,779,516



1,393,787



102,956



(3,276,259
)


1,771,793Total liabilities and stockholders equity

$
1,788,850


$
3,981,355


$
1,856,904


$
396,113


$
(3,938,275
)

$
4,084,947  24




---



##### Table of Contents



Condensed
    Consolidating Statement of Operations for the Three Months Ended
    March 31, 2007 (as restated; unaudited and in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
287,945


$
28,186


$
5,560


$



$
321,691Equipment revenues






79,447



4,512



1,496



(13,721
)


71,734Other revenues






13



13,028







(13,041
)


Total revenues






367,405



45,726



7,056



(26,762
)


393,425Operating expenses:Cost of service (exclusive of items shown separately below)






(88,049
)


(12,346
)


(3,073
)


13,028



(90,440
)Cost of equipment






(120,627
)


(10,897
)


(4,862
)


13,721



(122,665
)Selling and marketing


(8
)


(39,762
)


(6,597
)


(2,402
)






(48,769
)General and administrative


(321
)


(55,029
)


(8,714
)


(1,183
)


13



(65,234
)Depreciation and amortization






(60,887
)


(6,006
)


(1,907
)






(68,800
)Total operating expenses


(329
)


(364,354
)


(44,560
)


(13,427
)


26,762



(395,908
)Net gain (loss) on sale of wireless licenses and disposal of
    operating assets






(311
)


1,251











940Operating income (loss)


(329
)


2,740



2,417



(6,371
)






(1,543
)Minority interests in consolidated subsidiaries






(180
)










1,759



1,579Equity in net loss of consolidated subsidiaries


(23,905
)


(24,797
)










48,702



Interest income


10



21,179



176



376



(16,456
)


5,285Interest expense






(25,410
)


(8,331
)


(9,211
)


16,456



(26,496
)Other expense, net






(625
)


(12
)










(637
)Loss before income taxes


(24,224
)


(27,093
)


(5,750
)


(15,206
)


50,461



(21,812
)Income tax (expense) benefit






3,188



(5,600
)










(2,412
)Net loss

$
(24,224
)

$
(23,905
)

$
(11,350
)

$
(15,206
)

$
50,461


$
(24,224
)  25




---



##### Table of Contents



Condensed
    Consolidating Statement of Operations for the Three Months Ended
    March 31, 2006 (as restated; unaudited and in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedRevenues:Service revenues

$



$
216,541


$
1,544


$



$



$
218,085Equipment revenues






63,220



1,349







(804
)


63,765Other revenues






52



9,557







(9,609
)


Total revenues






279,813



12,450







(10,413
)


281,850Operating expenses:Cost of service (exclusive of items shown separately below)






(63,677
)


(2,090
)






9,557



(56,210
)Cost of equipment






(69,630
)


(3,151
)






804



(71,977
)Selling and marketing






(26,159
)


(2,943
)










(29,102
)General and administrative


(1,010
)


(43,165
)


(4,967
)






52



(49,090
)Depreciation and amortization


(30
)


(53,350
)


(656
)










(54,036
)Total operating expenses


(1,040
)


(255,981
)


(13,807
)






10,413



(260,415
)Operating income (loss)


(1,040
)


23,832



(1,357
)










21,435Minority interests in consolidated subsidiaries






(75
)














(75
)Equity in net income (loss) of consolidated subsidiaries


20,313



(6,154
)










(14,159
)


Interest income


8



5,250



38







(1,102
)


4,194Interest expense






(7,431
)


(1,102
)






1,102



(7,431
)Other income (expense), net






537



(2
)










535Income (loss) before income taxes and cumulative effect of
    change in accounting principle


19,281



15,959



(2,423
)






(14,159
)


18,658Income tax (expense) benefit






3,731



(3,731
)










Income (loss) before cumulative effect of change in accounting
    principle


19,281



19,690



(6,154
)






(14,159
)


18,658Cumulative effect of change in accounting principle






623















623Net income (loss)

$
19,281


$
20,313


$
(6,154
)

$



$
(14,159
)

$
19,281  26




---



##### Table of Contents



Condensed
    Consolidating Statement of Cash Flows for the Three Months Ended
    March 31, 2007 (as restated; unaudited and in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


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

$
(1,322
)

$
33,316


$
(9,840
)

$
(17,032
)

$



$
5,122Investing activities:Purchases of and changes in prepayments for property and
    equipment






(115,436
)


(3,288
)


(7,162
)






(125,886
)Purchases of and deposits for wireless licenses










(254
)


(169
)






(423
)Proceeds from sale of wireless licenses










9,500











9,500Purchases of investments






(42,727
)














(42,727
)Sales and maturities of investments






84,293















84,293Investments in and advances to affiliates and consolidated
    subsidiaries


(4,365
)


(4,706
)










4,365



(4,706
)Other


1,250



(2
)


(146
)










1,102Net cash provided by (used in) investing activities


(3,115
)


(78,578
)


5,812



(7,331
)


4,365



(78,847
)Financing activities:Issuance of related party debt






(17,000
)










17,000



Proceeds from related party debt










15,000



2,000



(17,000
)


Repayment of long-term debt






(2,250
)














(2,250
)Payment of debt issuance costs






(873
)






(8
)






(881
)Capital contributions, net






4,365











(4,365
)


Proceeds from issuance of common stock, net


4,365



















4,365Net cash provided by (used in) financing activities


4,365



(15,758
)


15,000



1,992



(4,365
)


1,234Net increase (decrease) in cash and cash equivalents


(72
)


(61,020
)


10,972



(22,371
)






(72,491
)Cash and cash equivalents at beginning of period


206



316,398



12,842



43,366







372,812Cash and cash equivalents at end of period

$
134


$
255,378


$
23,814


$
20,995


$



$
300,321  27




---



##### Table of Contents



Condensed
    Consolidating Statement of Cash Flows for the Three Months Ended
    March 31, 2006 (as restated; unaudited and in
    thousands):
  ConsolidatingGuarantor











andParent


Issuing


Guarantor


Non-Guarantor


EliminatingCompany


Subsidiary


Subsidiaries


Subsidiaries


Adjustments


ConsolidatedOperating activities:Net cash provided by operating activities

$
270


$
34,373


$
3,266


$



$



$
37,909Investing activities:Purchases of and changes in prepayments for property and
    equipment






(28,328
)


(27,993
)










(56,321
)Purchases of and deposits for wireless licenses










(91
)










(91
)Purchases of investments






(46,865
)














(46,865
)Sales and maturities of investments






72,657















72,657Investments in and advances to affiliates and consolidated
    subsidiaries


(233
)


(2,002
)










2,235



Other


(299
)


(1
)


250











(50
)Net cash used in investing activities


(532
)


(4,539
)


(27,834
)






2,235



(30,670
)Financing activities:Issuance of related party debt






(34,750
)










34,750



Proceeds from related party debt










34,750







(34,750
)


Repayment of long-term debt






(1,527
)














(1,527
)Payment of debt issuance costs






(91
)














(91
)Capital contributions, net






233



2,670







(2,235
)


668Proceeds from issuance of common stock, net


233



















233Net cash provided by (used in) financing activities


233



(36,135
)


37,420







(2,235
)


(717
)Net increase (decrease) in cash and cash equivalents


(29
)


(6,301
)


12,852











6,522Cash and cash equivalents at beginning of period


46



291,456



1,571











293,073Cash and cash equivalents at end of period

$
17


$
285,155


$
14,423


$



$



$
299,595  28




---



##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  As used in this report, unless the context suggests
    otherwise, the terms we, our,
    ours, and us refer to Leap Wireless
    International, Inc., or Leap, and its subsidiaries, including
    Cricket Communications, Inc., or Cricket, and Alaska Native
    Broadband 1 License, LLC, or ANB 1 License. Leap, Cricket
    and ANB 1 License and their subsidiaries are sometimes
    collectively referred to herein as the Company.
    Unless otherwise specified, information relating to population
    and potential customers, or POPs, is based on 2007 population
    estimates provided by Claritas Inc.
  Form 10-K
  Cautionary
    Statement Regarding Forward-Looking Statements
    
    our ability to attract and retain customers in an extremely
    competitive marketplace;
    changes in economic conditions that could adversely affect the
    market for wireless services;
    the impact of competitors initiatives;
    our ability to successfully implement product offerings and
    execute market expansion plans;
    delays in our market expansion plans resulting from any
    difficulties in funding such expansion through cash from
    operations, our revolving credit facility or additional capital,
    delays in the availability of network equipment and handsets for
    the 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 Part II 
    Item 1A. Risk Factors below.   29




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##### Table of Contents



Overview
  Restatement
    of Previously Reported Consolidated Financial
    Information
    Company
    Overview
  ® tm
               30




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##### Table of Contents



31




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##### Table of Contents



Results
    of Operations
  Operating
    Items
    Three Months Ended March 31,% of 2007





% of 2006


Change fromService





Service


Prior Year2007


Revenues


2006


Revenues


Dollars


Percent(As Restated)





(As Restated)Revenues:Service revenues

$
321,691






$
218,085






$
103,606



47.5
%Equipment revenues


71,734







63,765







7,969



12.5
%Total revenues


393,425







281,850







111,575



39.6
%Operating expenses:Cost of service (exclusive of items shown separately below)


90,440



28.1
%


56,210



25.8
%


34,230



60.9
%Cost of equipment


122,665



38.1
%


71,977



33.0
%


50,688



70.4
%Selling and marketing


48,769



15.2
%


29,102



13.3
%


19,667



67.6
%General and administrative


65,234



20.3
%


49,090



22.5
%


16,144



32.9
%Depreciation and amortization


68,800



21.4
%


54,036



24.8
%


14,764



27.3
%Total operating expenses


395,908



123.1
%


260,415



119.4
%


135,493



52.0
%Net gain on sale of wireless licenses and disposal of operating
    assets


940



0.3
%










940



100.0
%Operating income

$
(1,543
)


(0.5
)%

$
21,435



9.8
%

$
(22,978
)


(107.2
)%     Change2007


2006


Amount


PercentFor the Three Months Ended
    March 31:Gross customer additions


565,055



278,370



286,685



103.0
%Net customer additions


318,346



110,409



207,937



188.3
%Weighted-average number of customers


2,393,161



1,718,349



674,812



39.3
%As of March
    31:Total customers


2,548,172



1,778,704



769,468



43.3
%   Three
    Months Ended March 31, 2007 Compared to Three Months Ended
    March 31, 2006
       32




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##### Table of Contents



Non-Operating
    Items
    Three Months Ended March 31,2007


2006(As Restated)


(As Restated)


ChangeMinority interests in consolidated subsidiaries

$
1,579


$
(75
)

$
1,654Interest income


5,285



4,194



1,091Interest expense


(26,496
)


(7,431
)


(19,065
)Other income (expense), net


(637
)


535



(1,172
)Income tax expense


(2,412
)






(2,412
)   Three
    Months Ended March 31, 2007 Compared to Three Months Ended
    March 31, 2006
       33




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Performance
    Measures
  Regulation S-K
 34




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35




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##### Table of Contents



Three Months EndedMarch 31,2007


2006(As Restated)


(As Restated)ARPU

$
44.81


$
42.31CPGA

$
166


$
128CCU

$
21.27


$
19.86Churn


3.4
%


3.3
%   Reconciliation
    of Non-GAAP Financial Measures
  Regulation S-K
    Three Months EndedMarch 31,2007


2006(As Restated)


(As Restated)Selling and marketing expense

$
48,769


$
29,102Less share-based compensation expense included in selling and
    marketing expense


(1,001
)


(327
)Plus cost of equipment


122,665



71,977Less equipment revenue


(71,734
)


(63,765
)Less net loss on equipment transactions unrelated to initial
    customer acquisition


(4,762
)


(1,247
)Total costs used in the calculation of CPGA

$
93,937


$
35,740Gross customer additions


565,055



278,370CPGA

$
166


$
128     Three Months EndedMarch 31,2007


2006(As Restated)


(As Restated)Cost of service

$
90,440


$
56,210Plus general and administrative expense


65,234



49,090Less share-based compensation expense included in cost of
    service and general and administrative expense


(7,742
)


(4,165
)Plus net loss on equipment transactions unrelated to initial
    customer acquisition


4,762



1,247Total costs used in the calculation of CCU

$
152,694


$
102,382Weighted-average number of customers


2,393,161



1,718,349CCU

$
21.27


$
19.86  36




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Liquidity
    and Capital Resources
  Overview
           37




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##### Table of Contents



Cash
    Flows
      
    During the three months ended March 31, 2007, we and LCW
    Operations purchased $133.3 million of property and
    equipment for the build-out of our new markets and the expansion
    and improvement of our existing markets.
    During the three months ended March 31, 2007, we made
    investment purchases of $42.7 million from proceeds
    received from the issuances of our unsecured senior notes due
    2014, offset by sales or maturities of investments of
    $84.3 million.
    During March 2007, Cricket acquired the remaining 25% of the
    membership interests in ANB 1, following Alaska Native
    Broadband, LLCs exercise of its option to sell its entire
    25% controlling interest in ANB 1 to Cricket, for
    $4.7 million.
    During January 2007, we completed the sale of three wireless
    licenses that we were not using to offer commercial service for
    an aggregate sales price of $9.5 million.    
    During the three months ended March 31, 2007, we issued
    common stock resulting in net proceeds of $4.4 million.
    During March 2007, we made a payment of $2.3 million on our
    $895.5 million term loan.  Senior
    Secured Credit Facilities
     38




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##### Table of Contents



Form 10-Q
  Form 10-Q Form 10-K Form 10-Q/A Form 10-K/A Form 10-Q/A
    Senior
    Notes
   39




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##### Table of Contents



Capital
    Expenditures and Other Asset Acquisitions and
    Dispositions
  Capital
    Expenditures
        Other
    Acquisitions and Dispositions
    Off-Balance
    Sheet Arrangements
    Recent
    Accounting Pronouncements
      Item 4.
    Controls
    and Procedures  (a)
    Evaluation
    of Disclosure Controls and Procedures   40




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##### Table of Contents



Form 10-Q/A, Rule 13a-15(b), Form 10-Q/A, Rule 13a-15(e)
    Form 10-Q/A
      (b)
    Managements
    Remediation Initiatives    
    We performed a detailed review of our billing and revenue
    systems, and processes for recording revenue. We are
    implementing 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. 41




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##### Table of Contents




    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.    (c)
    Changes
    in Internal Control over Financial Reporting   42




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##### Table of Contents



PART II
  OTHER
    INFORMATION
  Item 1A.
    Risk
    Factors.  Form 10-K
  
    the Risk Factor below entitled We Face Increasing
    Competition Which Could Have a Material Adverse Effect on Demand
    for the Cricket Service, which has been updated to reflect
    additional risks related to the competitive landscape for our
    services;
    the Risk Factor entitled We Have Restated Our Prior
    Consolidated Financial Statements, Which May Lead to Additional
    Risks and Uncertainties, Including Shareholder Litigation,
    which has been added to describe certain risks related to the
    restatement of our financial statements;
    the Risk Factor entitled Our Business and Stock Price May
    Be Adversely Affected If Our Internal Controls Are Not
    Effective, which was been updated to reflect the
    identification of a material weakness in connection with our
    restatement of our financial statements;
    the Risk Factor entitled Covenants in Our Existing
    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, which has been updated to
    reflect risks related to the waiver we received from our lenders;
    the Risk Factor below entitled 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, which
    has been updated to reflect additional risks related to our
    plans to build out additional markets;
    the Risk Factor below entitled Despite Current
    Indebtedness Levels, We May Incur Substantially More
    Indebtedness. This Could Further Increase the Risks Associated
    With Our Leverage, which has been updated to reflect
    additional risks related to our plans to raise additional
    indebtedness, including our near term plans to raise additional
    debt financing for general corporate purposes and the build-out
    of new markets;
    the Risk Factor entitled We and Our Suppliers May Be
    Subject to Claims of Infringement Regarding Telecommunications
    Technologies That Are Protected By Patents and Other
    Intellectual Property Rights, which has been updated to
    reflect additional risks related to potential infringement
    claims that could be made against our suppliers; and
    the Risk Factor below entitled We May Be Unable to Acquire
    Additional Spectrum in the Future at a Reasonable Cost or on a
    Timely Basis, which has been updated to reflect the
    decision by the FCC to approve the award to Denali License of
    the license that it won in Auction #66.  Risks
    Related to Our Business and Industry
  We Have
    Experienced Net Losses, and We May Not Be Profitable in the
    Future.
   43




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##### Table of Contents



We May
    Not Be Successful in Increasing Our Customer Base Which Would
    Negatively Affect Our Business Plans and Financial
    Outlook.
  quarter-by-quarter
  If We
    Experience High Rates of Customer Turnover, Our Ability to
    Become Profitable Will Decrease.
    We Have
    Made Significant Investment, and Will Continue to Invest, in
    Joint Ventures That We Do Not Control.
     44




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##### Table of Contents



We Face
    Increasing Competition Which Could Have a Material Adverse
    Effect on Demand for the Cricket Service.
  and/or
         45




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##### Table of Contents



We May Be
    Unable to Obtain the Roaming Services We Need From Other
    Carriers to Remain Competitive.
    We Have
    Restated Our Prior Consolidated Financial Statements, Which May
    Lead to Additional Risks and Uncertainties, Including
    Shareholder Litigation.
    and/or
  Our
    Business and Stock Price May Be Adversely Affected If Our
    Internal Controls Are Not Effective.
       46




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##### Table of Contents



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
 47




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##### Table of Contents



If We Are
    Unable to Manage Our Planned Growth, Our Operations Could Be
    Adversely Impacted.
    Our
    Significant Indebtedness Could Adversely Affect Our Financial
    Health and Prevent Us From Fulfilling Our Obligations.
    
    make it more difficult for us to satisfy our debt obligations;
    increase our vulnerability to general adverse economic and
    industry conditions; 48




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##### Table of Contents




    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.    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.
   49




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##### Table of Contents



Covenants
    in Our Existing 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;
    enter into transactions with affiliates; and
    make acquisitions or merge or consolidate with another entity.    Form 10-Q Form 10-Q Form 10-K
   50




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##### Table of Contents



Form 10-Q/A Form 10-K/A Form 10-Q/A
    Rises in
    Interest Rates Could Adversely Affect Our Financial
    Condition.
    The
    Wireless Industry is Experiencing Rapid Technological Change,
    and We May Lose Customers If We Fail to Keep Up With These
    Changes.
       51




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##### Table of Contents



The Loss
    of Key Personnel and Difficulty Attracting and Retaining
    Qualified Personnel Could Harm Our Business.
      Risks
    Associated With Wireless Handsets Could Pose Product Liability,
    Health and Safety Risks That Could Adversely Affect Our
    Business.
          We Rely
    Heavily on Third Parties to Provide Specialized Services; a
    Failure by Such Parties to Provide the Agreed Upon Services
    Could Materially Adversely Affect Our Business, Results of
    Operations and Financial Condition.
   52




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##### Table of Contents



System
    Failures Could Result in Higher Churn, Reduced Revenue and
    Increased Costs, and Could Harm Our Reputation.
      We May
    Not Be Successful in Protecting and Enforcing Our Intellectual
    Property Rights.
    No. 2-06-CV-00240-TJW, Method for Providing Wireless Communication Services
    and Network and System for Delivering Same,
 53




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##### Table of Contents



No. 8:06-CV-01754-T-23TBM, Method for
    Providing Wireless Communication Services and Network and System
    for Delivering Same
  No. 3-06CV1399-D, Operations Method for Providing
    Wireless Communication Services and Network and System for
    Delivering Same
    We and
    Our Suppliers May Be Subject to Claims of Infringement Regarding
    Telecommunications Technologies That Are Protected By Patents
    and Other Intellectual Property Rights.
     54




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##### Table of Contents



Regulation
    by Government Agencies May Increase Our Costs of Providing
    Service or Require Us to Change Our Services.
        If Call
    Volume Under Our Cricket and Jump Mobile Services Exceeds Our
    Expectations, Our Costs of Providing Service Could Increase,
    Which Could Have a Material Adverse Effect on Our Competitive
    Position.
   55




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##### Table of Contents



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 Potential
    Revocation in the Event that We Violate Applicable
    Laws.
  15-year
  Future
    Declines in the Fair Value of Our Wireless Licenses Could Result
    in Future Impairment Charges.
  90-7, SOP 90-7,
    
    consolidation in the wireless industry allows or requires
    carriers to sell significant portions of their wireless spectrum
    holdings;
    a sudden large sale of spectrum by one or more wireless
    providers occurs; or
    market prices decline as a result of the sale prices in FCC
    auctions.     56




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##### Table of Contents



Declines
    in Our Operating Performance Could Ultimately Result in an
    Impairment of Our Indefinite-Lived Assets, Including Goodwill,
    or Our Long-Lived Assets, Including Property and
    Equipment.
  and/or and/or
  We May
    Incur Higher Than Anticipated Intercarrier Compensation
    Costs.
      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;
    announcements of technological innovations, new services or
    service enhancements, strategic alliances or significant
    agreements by us or by our competitors;
    recruitment or departure of key personnel; 57




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##### Table of Contents




    changes in the estimates of our operating results or changes in
    recommendations by any securities analysts that elect to follow
    Leap common stock; and
    market conditions in our industry and the economy as a whole.  The
    16,460,077 Shares of Leap Common Stock Registered for
    Resale By Our Shelf Registration Statement May Adversely Affect
    The Market Price of Leaps Common Stock.
    Your
    Ownership Interest in Leap Will Be Diluted Upon Issuance of
    Shares We Have Reserved for Future Issuances, and Future
    Issuances or Sales of Such Shares May Adversely Affect The
    Market Price of Leaps Common Stock.
        Our
    Directors and Affiliated Entities Have Substantial Influence
    over Our Affairs.
   58




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##### Table of Contents



Provisions
    in Our Amended and Restated Certificate of Incorporation and
    Bylaws or Delaware Law Might Discourage, Delay or Prevent a
    Change in Control of Our Company or Changes in Our Management
    and, Therefore, Depress The Trading Price of Our Common
    Stock.
    
    require super-majority voting to amend some provisions in our
    amended and restated certificate of incorporation and bylaws;
    authorize the issuance of blank check preferred
    stock that our board of directors could issue to increase the
    number of outstanding shares to discourage a takeover attempt;
    prohibit stockholder action by written consent, and require that
    all stockholder actions be taken at a meeting of our
    stockholders;
    provide that the board of directors is expressly authorized to
    make, alter or repeal our bylaws; and
    establish advance notice requirements for nominations for
    elections to our board or for proposing matters that can be
    acted upon by stockholders at stockholder meetings.    Item 6.
    Exhibits.  Index to Exhibits:
  ExhibitNumber

Description of Exhibit4.3.2(1)

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.10.3.5(2)

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.10.3.6(2)

Consent dated March 15, 2007 by Leap Wireless
    International, Inc. and the subsidiary guarantors party thereto10.4.6(3)

Letter Agreement, dated as of March 5, 2007, regarding
    termination of Credit Agreement, dated as of December 22,
    2004, among Cricket Communications, Inc., Alaska Native
    Broadband 1 License, LLC, and Alaska Native Broadband I,
    LLC.10.5.2(3)

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.10.11.19(3)

First Amendment to the Leap Wireless International, Inc. 2004
    Stock Option, Restricted Stock and Deferred Stock Unit Plan.10.13(3)

2007 Cricket Non-Sales Bonus Plan.31*

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

Certification of Chief Executive Officer and Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.     *
    
    Filed herewith. 59




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##### Table of Contents



**
    
    This certification is being furnished solely to accompany this
    report pursuant to 18 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.(1)
    
    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.(2)
    
    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.(3)
    
    Filed as an exhibit to Leaps Quarterly Report on
    Form 10-Q,
    dated May 10, 2007, filed with the SEC on May 10, 2007
    and incorporated herein by reference. 60




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SIGNATURES
       By:
    /s/  S.
    Douglas Hutcheson     61