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Maxcom Announces Increase In Coupon Rate And Extension Of The Exchange Offer



 Maxcom Announces Increase In Coupon Rate And Extension Of The Exchange Offer

PR Newswire

MEXICO CITY, April 11, 2013

MEXICO CITY, April 11, 2013 /PRNewswire/ -- (NYSE: MXT, BMV: MAXCOM.CPO) –
Maxcom Telecomunicaciones, S.A.B. de C.V. ("Maxcom" or the "Company")
announced today that it has extended, amended and supplemented the pending
exchange offer (the "Exchange Offer") for any and all of its outstanding 11%
Senior Notes due 2014 (the "Old Notes") for its Step‐Up Senior Notes due 2020
(the "New Notes").

The exchange agent for the Exchange Offer has advised the Company that as of
5:00 p.m., New York City time, on April 10, 2013, approximately US$84,268,000,
or 42.13%, of the Old Notes had been validly tendered and not withdrawn in the
Exchange Offer.

The Exchange Offer has been extended three times and as a result has remained
open longer than anticipated.  Since the Exchange Offer and the concurrent
equity tender offer for Maxcom's Series A Common Stock and related CPOs and
ADSs (the "Equity Tender Offer") have not been consummated, the Company has
not yet received the capital contribution the purchaser in connection with the
Equity Tender Offer agreed to make.  During the period that the Exchange Offer
has remained open, the Company's operational and financial viability has
further deteriorated in light of not having received the capital contribution
from such purchaser.  As of March 31, 2013, the Company's cash and temporary
investment balance was Ps. 102.9 million (US$8.3 million). 

If the Exchange Offer is not consummated and the Company does not receive the
capital contribution from the purchaser in connection with the Equity Tender
Offer, the Company does not expect to be able to make the coupon payment due
on June 15, 2013 with respect to the Old Notes and the Company may not be able
to meet other financial obligations as they come due.  If this occurs, holders
of the Old Notes and other creditors could commence involuntary bankruptcy
proceedings against the Company in Mexico or in the United States.

Our ability to continue as a going concern depends upon our consummation of
our recapitalization transactions, including the consummation of the exchange
offer and the receipt of the capital contribution from the Purchaser, or on
our ability to otherwise raise additional capital or restructure our capital
structure.  We may not be able to satisfy our liquidity and working capital
requirements or restructure our capital structure.  Although our consolidated
financial statements do not currently include any adjustments that might
result from the outcome of this uncertainty, our auditors may conclude there
is substantial doubt as to our ability to continue as a going concern.

If the Exchange Offer is not consummated, the Company currently intends to
implement a restructuring by (i) commencing voluntary cases under Chapter 11
of the United States Bankruptcy Code through a plan of reorganization; (ii)
seeking expedited confirmation of a plan of reorganization; or (iii) seeking
other forms of bankruptcy relief, all of which involve uncertainties,
potential delays, reduced payments to all creditors (including holders of the
Old Notes) and litigation risks. Such a restructuring may be protracted and
contentious and disruptive to the Company's business and could materially
adversely affect its relationships with its customers, suppliers and employees
who may terminate their relationships with the Company.  A restructuring would
also cause the Company to incur significant legal, administrative and other
professional expenses. Moreover, no assurances can be given that any such
restructuring will be successful or that holders of the Company's debt
obligations will not have their claims significantly reduced, converted into
equity or eliminated.  If a restructuring is not successful, the Company may
be forced to liquidate its business and assets.

The board of directors of the Company has approved the engagement of, and the
Company has engaged, counsel to advise it on a Chapter 11 reorganization and
authorized preparatory activities related to a restructuring, including the
negotiating of a plan support agreement and a Chapter 11 plan term sheet with
certain of the holders of the Old Notes during the pendency of the Exchange
Offer. In the event the Company implements a restructuring through Chapter 11,
holders of the Old Notes may receive New Notes with terms less favorable than
those offered pursuant to the Exchange Offer.

As a result, the Company is amending and supplementing the Exchange Offer to
(i) reflect that the Company has increased the minimum tender condition in the
Exchange Offer from 61.44% to 80%, subject to the Company's right, in its sole
discretion, to decrease the minimum tender condition to 75.1% without
extending the Exchange Offer or granting any withdrawal rights, (ii) reflect
that the Company has increased the rate at which the New Notes will accrue
interest as follows: (x) from the date of issuance of the New Notes until June
14, 2016 by 100 basis points, from 6% per annum to 7% per annum, (y) from June
15, 2016 until June 14, 2018 by 100 basis points, from 7% per annum to 8% per
annum and (z) from June 15, 2018 until the date of maturity by 200 basis
points, from 8% per annum to 10% per annum and (iii) inform holders of the Old
Notes that if the 80% minimum tender condition (or 75.1% if decreased by the
Company) is not met on the expiration date, the Company will terminate the
Exchange Offer and does not expect to be able to make the coupon payment due
on June 15, 2013 on the Old Notes.

The Company is also extending the early participation date, the withdrawal
date and the expiration date to 5:00 p.m. New York City time on April 24,
2013. The expiration date of the Equity Tender Offer is also being extended by
ten business days to April 24, 2013.

The complete terms and conditions of the Exchange Offer and consent
solicitation are described in the Offering Memorandum and Consent Solicitation
Statement, copies of which may be obtained by eligible holders of the Old
Notes by contacting D.F. King & Co., Inc., the information agent for the
Exchange Offer and consent solicitation, at (800) 967-4607 (toll free).

The New Notes have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), or any state securities laws, and may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements, and will therefore be subject to
substantial restrictions on transfer.

The Exchange Offer is being made, and the New Notes are being offered and
issued, only to registered holders of Old Notes (i) in the United States who
are "qualified institutional buyers," as that term is defined in Rule 144A
under the Securities Act and (ii) outside the United States and are persons
who are not "U.S. persons," as that term is defined in Rule 902 under the
Securities Act.

This announcement is for informational purposes only and does not constitute
an offer to sell or a solicitation of an offer to buy the New Notes nor an
offer to purchase Old Notes nor a solicitation of consents.  The Exchange
Offer and consent solicitation is being made solely by means of the Offering
Memorandum and Consent Solicitation Statement and Letter of Transmittal.

About Maxcom

Maxcom Telecomunicaciones, S.A.B. de C.V., headquartered in Mexico City,
Mexico, is a facilities-based telecommunications provider using a
"smart-build" approach to deliver last-mile connectivity to micro, small and
medium-sized businesses and residential customers in the Mexican territory.
Maxcom launched commercial operations in May 1999 and is currently offering
local, long distance, data, value-added, paid TV and IP-based services on a
full basis in greater metropolitan Mexico City, Puebla, Tehuacan, San Luis,
and Queretaro, and on a selected basis in several cities in Mexico. The
information contained in this press release is the exclusive responsibility of
Maxcom and has not been reviewed by the Mexican National Banking and
Securities Commission (the "CNBV") or any other authority. The registration of
the securities described in this press release before the National Registry of
Securities (Registro Nacional de Valores) held by the CNBV, shall it be the
case, does not imply a certification of the investment quality of the
securities or of Maxcom's solvency. The trading of these securities by an
investor will be made under such investor's own responsibility.

This document may include forward-looking statements that involve risks and
uncertainties that are detailed from time to time in the U.S. Securities and
Exchange Commission filings of the Company. Words such as "estimate,"
"project," "plan," "believe," "expect," "anticipate," "intend," and similar
expressions may identify such forward-looking statements. The Company wants to
caution readers that any forward-looking statement in this document or made by
the company's management involves risks and uncertainties that may change
based on various important factors not under the Company's control. These
forward-looking statements represent the Company's judgment as of the date of
this document. The Company disclaims, however, any intent or obligation to
update these forward-looking statements.

SOURCE Maxcom Telecomunicaciones, S.A.B. de C.V.

Contact: Manuel S. Perez, Mexico City, Mexico, (52 55) 4770-1170,
manuel.perez@maxcom.com
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