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Technology Stocks : Leap Wireless International (LWIN)
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To: pcstel who wrote (1756)3/14/2002 2:44:13 PM
From: Robert J. Irvin  Read Replies (1) of 2737
 
You're right, I used the three vendor limit of $1,845,000,000, not the current amount outstanding. If I were running Leap, I would be tempted to get my borrowings as high as possible before funding stopped. Each dollar spent on better call quality and fewer dropped calls probably is well spent as a down payment on reduced churn. Not to mention marketing dollars (operating costs) to build subs as fast as possible. Plus expanding covered POPs within the 40 market plan. Plus getting my protective builds covered as far ahead as possible.

Each vendor financing facility permits borrowing to pay its own interest, until the music stops at the end of three years. Each facility also permits borrowing for capital expenditures and operating costs. So, an EBITDA analysis doesn't get you to the total borrowings outstanding.

I look forward to your input on total vendor financing outstanding at the end of 2002, or whenever the music stops. It may be shy of $1.85 billion, but I hope not by much.
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