FCC Clears Way for Leap Wireless International to Rollout Cricket
Concept Leap to Acquire Over 20 Million POPs
SAN DIEGO, July 22 /PRNewswire/ -- Wireless communications carrier Leap Wireless International, Inc. (Nasdaq: LWIN - news) today announced that the
Federal Communications Commission (FCC) has issued a Memorandum Opinion and Order, which conditionally grants Leap's applications to transfer four F-Block
PCS licenses from AirGate Wireless, L.L.C., in North and South Carolina to Cricket Holdings, a wholly owned subsidiary of Leap. The Memorandum Opinion and
Order also grants Leap's application to acquire '36 C-Block PCS licenses on which the company was the successful bidder in the U.S. government's recent
reauction of PCS spectrum. The auctioned licenses will be formally granted after remaining payment obligations have been met. The license grants affected by the
Memorandum Opinion and Order are subject to certain conditions and are effective on issuance by the FCC. Leap believes it will meet all the conditions and has
initiated the required payments.
The Memorandum Opinion and Order, which has the effect of granting Leap ''Designated Entity'' status, allows Leap, or its wholly owned subsidiary, Cricket
Holdings, to acquire wireless spectrum in the C and F blocks. It therefore allows Leap to proceed with the application for FCC consent to Leap's acquisition of
certain Chase Telecommunications Holdings, Inc. assets. Access to the C- and F-Blocks of the PCS frequency is expected to assist Leap in the rollout of its unique
Cricket concept in select markets across the United States.
''We are excited about moving ahead with our plans to revolutionize telecommunications by bringing wireless competition to local phone service with mobility, to the
people who live, work, and play in a local area,'' said Harvey P. White, chairman and CEO for Leap. ''The unique Cricket service has already shown the need for
this service and the public's overwhelming acceptance of this advanced local loop offering. Now we can move on to other markets immediately.''
The ''conditions imposed by the Memorandum Opinion & Order include the closing of Ericsson's acquisition of Qualcomm's infrastructure division (which has
already occurred), adjusting Qualcomm's potential equity holdings in Leap, reducing the level of reliance on its Qualcomm credit line within 18 months, removing
certain Leap commitments to use cdmaOne technology in the United States market, and altering the equipment procurement agreement between Leap and
Qualcomm.
''We are confident that all conditions required will be met,'' said Sue Swenson, president of Leap and CEO for Cricket. ''The FCC's decision will allow us to
execute a strategy that makes wireless communications comfortable and predictable for consumers.''
In October 1998 Leap filed an assignment application with the FCC to acquire four 10-MHz F Block PCS licenses in North and South Carolina from AirGate
Wireless, L.L.C. The pending acquisition will give Leap the ability to offer service in markets including Charlotte and Greensboro-Highpoint, N.C. Those who
previously opposed Leap's application have rights to appeal the Order.
In January 1999 Leap announced its planned acquisition of substantially all of the assets of Chase Telecommunications Holdings, Inc. (ChaseTel), the owner of a
wireless service provider and eleven related 15-MHz C-Block licenses covering potential customers in Tennessee markets including Chattanooga, Nashville,
Knoxville, and Memphis. The FCC's 'order allowing Leap ''Designated Entity'' status should facilitate the completion of this proposed acquisition. Leap's request to
transfer ChaseTel's FCC licenses is expected to be filed shortly.
About Cricket Communications, Inc.
Cricket Communications, a subsidiary of Leap Wireless International, plans to change the way people communicate by bringing wireless communications to the U.S.
mass consumer market. Called ''Comfortable Wireless(SM)'' and ''Around Town Phone(SM),'' Cricket's new service lets customers make and receive all the calls
they want within their local service area for one low, flat rate. While roaming is not available, full mobility exists within the local area in which people live, work and
play.
About Leap Wireless International, Inc.
Leap Wireless International, Inc., headquartered in San Diego, Calif., is a wireless communications carrier that deploys, owns and operates wireless networks in
domestic and international markets with strong growth potential. In conjunction with its strategic partners, Leap has launched all-digital wireless service in the United
States, Mexico, Chile and Russia, and plans to offer service in Australia through its operating companies. Leap is dedicated to bringing the benefits of reliable,
cost-effective and high-quality voice and data services to domestic and emerging markets. For more information, please visit www.leapwireless.com.
This news release contains certain ''forward-looking statements,'' including statements regarding the future scope of Cricket's network. Forward-looking statements,
which are based upon certain assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words
''believe,'' ''expect,'' ''intend,'' ''plan,'' ''anticipate,'' ''estimate,'' ''project'' or similar expressions. The ability of the Company to predict actual results and other
future events is inherently uncertain. Important factors which may cause actual results to differ materially from the forward-looking statements contained herein or in
other public statements by the Company are described in the section entitled ''Risk Factors'' in the Company's 1998 10-K, most recent 10-Q and other documents
on file with the Securities and Exchange Commission. Those factors most likely to cause actual results to differ include but are not limited to: uncertainties regarding
Leap's ability to access capital markets, the delayed build-out of the system in Tennessee, failure of the system to perform according to expectations, increased
competitive pressures that could affect market demand for the new Cricket service, uncertainties relating to costs and profitability of development stage companies,
and the substantial leverage of Leap Wireless and its operating companies.
SOURCE: Leap Wireless International, Inc.
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