Leap Wireless appeals Nasdaq delisting

Leap Wireless International said Nasdaq has delayed its delisting and granted the carrier’s request for a hearing to appeal the action.

Leap recently received notice from Nasdaq that it faced delisting on Oct. 11. The appeals hearing is set for Nov. 14.

An arbitration court ruling forced Leap to issue 21 million shares last month to MCG PCS, priced at $1.894, amounting to about $41 million, as an adjustment price for two New York PCS licenses Leap purchased from the company. Because Leap didn’t have time to obtain shareholder approval, it violated Nasdaq’s net tangible assets and stockholders’ equity requirements for listing.

Leap also has defaulted on its vendor loans. Last month, the carrier retained UBS Warburg to find new sources of financing and to restructure its debt. However, some of Leap’s lenders under its credit facilities have stopped funding new loan requests, including loan proceeds for interest that had previously been paid under these facilities. Leap has decided not to pay the interest on these loans.