American TeleSource and Genesis Communications Announce Termination of Agreement.

Business Editors & High-Tech Writers

SAN ANTONIO--(BUSINESS WIRE)--Feb. 26, 2001

American TeleSource International Inc. ("ATSI") (AMEX:AI) and Genesis Communications International Inc. ("Genesis") announced today that they have mutually agreed to terminate the previously announced definitive agreement to combine the two companies.

The parties have agreed to continue their existing business relationship.

Citing the fact that certain conditions required to close the transaction have not been met and the significant changes that have occurred in the telecommunications marketplace since the original agreement and subsequent amendment were executed, the companies concluded that it would be in the mutual best interest of the shareholders of both companies to terminate the current agreement.

An important condition necessary to close on or before Feb. 28, 2001, was the successful completion of the fairness hearing process with the California Department of Corporations ("DOC"). The DOC has not determined a date for the fairness hearing, therefore the Company has not received the fairness permit necessary for the Genesis shareholders to vote on the acquisition. Furthermore, ATSI's stock price is below the minimum levels set by the current amendment to the agreement.

Arthur L. Smith, ATSI's chairman and CEO, stated, "Both companies remain convinced that the synergies continue to exist. However, the current market conditions and regulatory process will prevent the companies from closing the transaction in the required time frame. We believe that this is in the best interest of all parties involved."

Derek M. Gietzen, president and CEO of Genesis, commented, "We are disappointed that we were not able to consummate this deal considering all the time and effort invested. The changes on Wall Street in recent months as it relates to the telecom market have completely changed the parameters under which deals can get done. Deals that made sense six months ago no loner make sense in today's market. However, both sides have decided to remain open to a possible future combination of the companies."

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, data and Internet. 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 Internet software 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.

Founded in March of 1995, Genesis Communications International Inc. is a facilities-based carrier that provides local and long-distance services to more than 55,000 Spanish-speaking customers in selected markets nationwide. Genesis also provides carrier-to-carrier, switchless reseller and prepaid long distance calling card services to wholesale customers throughout the United States. With roots in the residential marketplace, the San Diego-based company employs more than 200 people and specializes in delivering competitive telecommunications services to a growing base of Spanish-speaking residential and small business customers. For more information visit the company's Web site at www.genesisld.com.

This news release contains forward-looking statements. 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. More detailed information about American TeleSource International Inc. is available in the Company's public filings with the Security and Exchange Commission.