American TeleSource Signs $15 Million Financing for Mexico Network Buildout; Credit Suisse First Boston Affiliate to Lead Funding.

Business Editors and High-Tech/Telecommunications Writers

SAN ANTONIO--(BUSINESS WIRE)--July 17, 2000

American TeleSource International, Inc. ("ATSI") (AMEX:AI) today announced that it has signed an agreement to receive $15 million in private equity funding from Marshall Capital Management, Inc., an affiliate of Credit Suisse First Boston. This financing follows ATSI's announcement that it has secured its Mexican Long Distance Concession License.

In addition to Marshall Capital Management, BayStar Capital and Heights Capital Management will participate in the investment. Funding is expected to occur on or before August 31, 2000. Proceeds from the investment are expected to be used for the initial buildout of ATSI's network in Mexico. Gerard Klauer Mattison & Co., Inc. served as the advisor to ATSI on the agreement.

H. Douglas Saathoff, ATSI's Chief Financial Officer, commented, "This funding should serve as the financial cornerstone for the buildout of our network under our Long Distance Concession in Mexico and the enhancement of our operations over the coming months. We are committed to building long term, strategic value by enhancing our physical presence in Mexico under the Concession. It is important for us to extend our network in Mexico in order to limit our reliance on third party networks in that country, giving us greater ability to control costs. We are excited to have these groups share in our vision through their financial commitments."

ATSI's network plan includes an OC-192 fiber optic network, which would be the first of its kind built in Mexico by a competitive carrier. The highly scalable, state-of-the-art network, equipped with Internet telephony technology, will allow for integration of voice, data, Internet, and video services on a single network. ATSI's network architecture plan incorporates a broadband fiber network that will interconnect to a satellite network equipped with Voice over Internet Protocol (VoIP) gateways to serve as many as 115 Mexican cities, many of which are already served by ATSI communications centers. By using digital rather than analog signals, VoIP is a leading-edge technology that provides numerous advantages over the traditional method for transporting voice traffic. This next generation, cross-border network would interconnect to a U.S. network that extends into key markets that generate a majority of the communications traffic destined for Mexico, many of which are currently served by Genesis Communications.

Arthur L. Smith, ATSI's Chairman and CEO, stated, "In recent weeks we have delivered on some of the most important strategic objectives in the history of ATSI, including securing the Mexican Long Distance Concession, signing a definitive agreement to acquire Genesis Communications, setting the record date for the distribution of GlobalSCAPE shares to ATSI stockholders, and securing initial research coverage. In addition, ATSI has now been added to the Russell 3000(R) and 2000(R) Indexes. The signing of this financing arrangement is the catalyst to initiate the network expansion process in Mexico, the quality and uniqueness of which we believe will set us apart from the competition and other companies in our sector of the industry."

American TeleSource International, Inc. is an emerging international carrier serving the rapidly expanding niche markets in and between Latin America and the United States. The Company's borderless strategy includes the deployment of a "next generation" network for more efficient and cost effective service offerings of domestic and international voice and data. ATSI has clear advantages over the competition through its corporate framework consisting of unique licenses, interconnection and service agreements, network footprint, and extensive retail distribution. ATSI's wholly owned e-commerce subsidiary, GlobalSCAPE, Inc. (www.globalscape.com) is a leader in the development, marketing, distribution and support of award winning Internet-based software in a broad array of categories including file management, multimedia utilities and Web site development tools.

This news release contains forward looking statements, such as "This funding should serve as the financial cornerstone for the buildout of our network under our Long Distance Concession in Mexico and the enhancement of our operations over the coming months. The signing of this financing arrangement is the catalyst to initiate the network expansion process in Mexico, the quality and uniqueness of which we believe will set us apart from the competition and other companies in our sector of the industry." These statements describe management's beliefs and expectations about the future. We have identified forward looking statements by using words such as "expect," "believe," and "should." Although we believe our expectations are reasonable, our operations involve a number of risks and uncertainties, and these statements may turn out not to be true. Risks that could cause these statements not to be true include loss of key customers, inability to obtain additional capital, inability to make payments to suppliers and lenders on time, dilution of our common stock, equipment failures leading to service interruptions, failure to achieve profitability, and other Risk Factors discussed in filings made by the Company with the SEC.