Cricket Wireless 2010 Annual Report Download - page 45

• entry of new competitors into our markets, changes in product and service offerings by us or our competitors,
changes in the prices charged for product and service offerings by us or our competitors, or changes or
upgrades in the network technologies used by us or our competitors;
• significant developments with respect to intellectual property or other litigation;
• announcements of and bidding in 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 any of the indentures governing our secured or unsecured senior notes or convertible senior
notes because of a covenant breach or otherwise;
• rumors or speculation in the marketplace regarding acquisitions or consolidation in our industry, including
regarding transactions involving Leap; and
• market conditions in our industry and the economy as a whole.
In addition, we have registered all shares of common stock that we may issue under our 2004 Stock Option,
Restricted Stock and Deferred Stock Unit Plan, under our 2009 Employment Inducement Equity Incentive Plan and
under our Employee Stock Purchase Plan. When we issue shares under these stock plans, they can be freely sold in
the public market. If any of Leap’s stockholders causes a large number of securities to be sold in the public market,
these sales could reduce the trading price of Leap common stock. These sales also could impede our ability to raise
future capital.
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.
Our directors and entities affiliated with them beneficially owned in the aggregate approximately 20.9% of
Leap common stock as of February 18, 2011. Moreover, our four largest stockholders and entities affiliated with
them beneficially owned in the aggregate approximately 47.5% of Leap common stock as of February 18, 2011.
These stockholders have the ability to exert substantial influence over all matters requiring approval by our
stockholders. These stockholders will be able to influence the election and removal of directors and any merger,
consolidation or sale of all or substantially all of Leap’s assets and other matters. This concentration of ownership
could have the effect of delaying, deferring or preventing a change in control or impeding a merger or consolidation,
takeover or other business combination.
Our resale shelf registration statements register for resale 15,537,869 shares of Leap common stock held by
entities affiliated with one of our directors, or approximately 20.0% of Leap’s outstanding common stock as of
February 18, 2011. In addition, in connection with our offering of 7,000,000 shares of Leap common stock in the
second quarter of 2009, we agreed to register for resale any additional shares of common stock that these entities or
their affiliates may acquire in the future. We are unable to predict the potential effect that sales into the market of any
material portion of such shares, or any of the other shares held by our other large stockholders and entities affiliated
with them, may have on the then-prevailing market price of Leap common stock. If any of Leap’s stockholders
cause a large number of securities to be sold in the public market, these sales could reduce the trading price of Leap
common stock. These sales could also impede our ability to raise future capital.
We Could Elect to Raise Additional Equity Capital Which Could Dilute Existing Stockholders.
During the second quarter of 2009 we sold 7,000,000 shares of Leap common stock in an underwritten public
offering. We could raise additional capital in the future, as market conditions permit, to enhance our liquidity and to
provide us with additional flexibility to pursue business expansion efforts. Any additional capital we could raise
could be significant and could consist of debt, convertible debt or equity financing from the public and/or private
capital markets. To provide flexibility with respect to any future capital raising alternatives, we have filed a
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