Leap Wireless International, Inc.

October 11, 2005 16:59 ET

Leap, ANB Select Nortel to Provide US$130 Million in 3G Network Gear; CDMA 2000 1X, EV-DO Technology to Expand Capacity, Deliver High-Speed Services

TORONTO--(CCNMatthews - Oct 11, 2005) -

Leap Wireless International, Inc. (Nasdaq:LEAP) and Alaska Native Broadband 1 License, LLC (ANB), a Leap joint venture, today announced the signing of three-year agreements collectively estimated at US$130 million with Nortel (NYSE:NT)(TSX:NT) for 3G wireless network equipment.

The agreements include Nortel CDMA2000 1X and 1xEV-DO wireless technology, which are expected to help enhance the experience of Leap and ANB subscribers by supporting delivery of feature-rich services like Web browsing, streaming audio and video, multimedia messaging, wireless gaming, and VPNs.

Under terms of the agreements, Leap's operating subsidiary, Cricket Communications, Inc., has committed to purchase US$90.5 million of equipment, while ANB has committed to US$39.5 million.

"As we progress into the future, we expect to maintain our focus on operating efficient networks while we introduce new, customer-driven products and services that will enhance the value of our wireless service," said Glenn Umetsu, chief technical officer for Leap. "Nortel has been a reliable network supplier and its proven CDMA wireless broadband technology and vast experience in evolving wireless networks will allow us to roll out new features our customers desire while improving our efficiency as we increase the coverage and capacity of our networks."

"This is new footprint for Nortel and celebrates our long-standing relationship with Leap, one of the industry's most innovative wireless providers," said Richard Lowe, president, Mobility and Converged Core Networks, Nortel. "We look forward to supporting them in their efforts to expand service into new areas and to deliver compelling voice and data services that their subscribers desire."

The agreements with Leap and ANB call for Nortel to deploy CDMA2000 1X and EV-DO radio base stations, base station controllers, CDMA Packet MSC switching and other related equipment in various Leap markets and in additional markets that Leap and ANB obtained through the FCC's Auction 58 earlier in 2005. These markets include: San Diego, Houston and Temple/Killeen, Texas for Leap; and San Antonio, Austin, Cincinnati, Lexington, Louisville and Bryan/College Station, Texas for ANB.

Nortel recently replaced existing Leap infrastructure equipment in Modesto, Merced and Visalia, Calif., and was selected as the CDMA infrastructure supplier for Leap's new market build in Fresno, Calif.

Leap and ANB plan to begin the launch of their commercial EV-DO networks in 2006, enabling subscribers to download data on their mobile devices at speeds up to 2.4 megabits per second, which is approximately up to 10 times faster than today's 1X network.

Nortel has supplied wireless infrastructure to Leap since 2000. With these new agreements, Nortel will expand its coverage from five million Leap PoPs (points of presence) to approximately 11 million Leap and 10 million ANB PoPs.

Nortel supplies EV-DO equipment to 13 of the 22 operators across the globe currently offering commercial EV-DO service. Nortel CDMA equipment is designed to support EV-DO through simple upgrades to existing hardware. Nortel's CDMA Packet MSC is a proven, turnkey, packet-based wireless switching solution that allows operators to gracefully transition operations to an all IP network capable of offering simultaneous voice, video and data 'anytime, anywhere.'

Nortel has designed, installed and launched more than 300 wireless networks in over 70 countries. Nortel was the industry's first supplier with wireless networks operating in all advanced radio technologies and is the only end-to-end provider of all next generation wireless solutions.

About Leap

Leap (Nasdaq:LEAP), headquartered in San Diego, Calif., is a customer-focused company providing innovative mobile wireless services targeted to meet the needs of customers under-served by traditional communications companies. With the value of unlimited wireless services as the foundation of its business, Leap pioneered both Cricket and Jump™ Mobile. Cricket® service offers customers unlimited anytime minutes for a flat-rate within a Cricket calling area over a high-quality, all-digital CDMA network. Designed for the urban youth market, Jump Mobile is a unique prepaid wireless service offering customers free unlimited incoming calls from anywhere with outgoing calls at an affordable 10 cents per minute and free incoming and outgoing text messaging. Both Cricket and Jump Mobile are offered without long-term commitments or credit checks. For more information, please visit

Leap Safe Harbor Statement

Except for the historical information contained herein, this news release contains "forward-looking statements" reflecting management's current forecast of certain aspects of Leap's future. Some forward-looking statements can be identified by forward-looking words such as "believe," "think," "may," "could," "will," "estimate," "continue," "anticipate," "intend," "seek," "plan," "expect," "should," "would" and similar expressions. This news release is based on current information, which we have assessed but which by its nature is dynamic and subject to rapid and even abrupt changes. Our actual results could differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with our business. Factors that could cause actual results to differ include, but are not limited to:

-- 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;

-- our ability to comply with the covenants in our senior secured credit facilities;

-- our ability to attract, motivate and retain an experienced workforce;

-- failure of network systems to perform according to expectations;

-- global political unrest, including the threat or occurrence of war or acts of terrorism; and

-- other factors detailed in the section entitled "Risk Factors" included in our Form 10-Q for the fiscal quarter ended June 30, 2005 and in our other SEC filings.

All forward-looking statements included in this news release should be considered in the context of these risk factors. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Investors and prospective investors are cautioned not to place undue reliance on such forward-looking statements.

Leap and the Leap logo design are registered trademarks of Leap Wireless International, Inc. Cricket is a registered trademark of Cricket Communications, Inc. Jump Mobile is a trademark of Cricket Communications, Inc.

About Nortel

Nortel is a recognized leader in delivering communications capabilities that enhance the human experience, ignite and power global commerce, and secure and protect the world's most critical information. Serving both service provider and enterprise customers, Nortel delivers innovative technology solutions encompassing end-to-end broadband, Voice over IP, multimedia services and applications, and wireless broadband designed to help people solve the world's greatest challenges. Nortel does business in more than 150 countries. For more information, visit Nortel on the Web at For the latest Nortel news, visit

Nortel Safe Harbor Statement

Certain information included in this press release is forward-looking and is subject to important risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events.

Factors which could cause results or events to differ from current expectations include, among other things: the outcome of regulatory and criminal investigations and civil litigation actions related to Nortel's restatements and the impact any resulting legal judgments, settlements, penalties and expenses could have on Nortel's results of operations, financial condition and liquidity, and any related potential dilution of Nortel's common shares; the findings of Nortel's independent review and implementation of recommended remedial measures; the outcome of the independent review with respect to revenues for specific identified transactions, which review will have a particular emphasis on the underlying conduct that led to the initial recognition of these revenues; the restatement or revisions of Nortel's previously announced or filed financial results and resulting negative publicity; the existence of material weaknesses in Nortel's internal control over financial reporting and the conclusion of Nortel's management and independent auditor that Nortel's internal control over financial reporting is ineffective, which could continue to impact Nortel's ability to report its results of operations and financial condition accurately and in a timely manner; the impact of Nortel's and NNL's failure to timely file their financial statements and related periodic reports, including Nortel's inability to access its shelf registration statement filed with the United States Securities and Exchange Commission (SEC); ongoing SEC reviews, which may result in changes to Nortel's and NNL's public filings; the impact of management changes, including the termination for cause of Nortel's former CEO, CFO and Controller in April 2004; the sufficiency of Nortel's restructuring activities, including the work plan announced on August 19, 2004 as updated on September 30, 2004 and December 14, 2004, including the potential for higher actual costs to be incurred in connection with restructuring actions compared to the estimated costs of such actions;

cautious or reduced spending by Nortel's customers; increased consolidation among Nortel's customers and the loss of customers in certain markets; fluctuations in Nortel's operating results and general industry, economic and market conditions and growth rates; fluctuations in Nortel's cash flow, level of outstanding debt and current debt ratings; Nortel's monitoring of the capital markets for opportunities to improve its capital structure and financial flexibility; Nortel's ability to recruit and retain qualified employees; the use of cash collateral to support Nortel's normal course business activities; the dependence on Nortel's subsidiaries for funding; the impact of Nortel's defined benefit plans and deferred tax assets on results of operations and Nortel's cash flow; the adverse resolution of class actions, litigation in the ordinary course of business, intellectual property disputes and similar matters; Nortel's dependence on new product development and its ability to predict market demand for particular products; Nortel's ability to integrate the operations and technologies of acquired businesses in an effective manner; the impact of rapid technological and market change; the impact of price and product competition; barriers to international growth and global economic conditions, particularly in emerging markets and including interest rate and currency exchange rate fluctuations; the impact of rationalization and consolidation in the telecommunications industry; changes in regulation of the Internet; the impact of the credit risks of Nortel's customers and the impact of customer financing and commitments; general stock market volatility; negative developments associated with Nortel's supply contracts and contract manufacturing agreements, including as a result of using a sole supplier for a key component of certain optical networks solutions; the impact of Nortel's supply and outsourcing contracts that contain delivery and installation provisions, which, if not met, could result in the payment of substantial penalties or liquidated damages; any undetected product defects, errors or failures; and the future success of Nortel's strategic alliances.

For additional information with respect to certain of these and other factors, see the most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed by Nortel with the SEC. Unless otherwise required by applicable securities laws, Nortel disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks. CDMA2000 is a trademark of the Telecommunications Industry Association (TIA).

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