F-4/A

As filed with the Securities and Exchange Commission on November 1, 2007

No. 333-145800

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 1 to

Form F-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

MAXCOM TELECOMUNICACIONES, S.A.B. DE C.V.*

(formerly Maxcom Telecomunicaciones, S.A. de C.V.)

(Exact name of Registrant as specified in its charter)

MAXCOM TELECOMMUNICATIONS, INC.

(Translation of Registrant’s name into English)


United Mexican States	4813	Not Applicable
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification No.)

Guillermo Gonzalez Camarena No. 2000

Colonia Centro de Ciudad Santa Fe

Mexico, D.F. 01210

+(52) 55-5147-1111

(Address, including zip code, and telephone number,

including area code, of Registrant’s principal executive offices)

CT Corporation System

111 Eighth Avenue

New York, NY 10011

(212) 894-8940

(Name, address, including zip code, and telephone number,

including area code, of agent for service)

Copies of all communications, including communications sent to agent for service, should be sent to:

Gerald T. Nowak, Esq.

Paul Zier, Esq.

Kirkland & Ellis LLP

200 East Randolph Drive

Chicago, Illinois 60601

* The Co-Registrants listed on the next page are also included in this Form F-4 Registration Statement as additional registrants.

Approximate date of commencement of proposed sale of the securities to the public: The exchange will occur as soon as practicable after the effective date of this Registration Statement.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. o

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

CALCULATION OF REGISTRATION FEE

Proposed Maximum

Amount of

Title of Each Class of Securities

Amount

Offering Price

Aggregate

Registration

to be Registered

per Unit

Offering Price(1)

Fee(4)

11% Senior Notes due 2014, Series B

$200,000,000

100%

$200,000,000

$6,140

Guarantees on 11% Senior Notes due 2014, Series B(2)

$200,000,000

—

(3)


(1)		Calculated in accordance with Rule 457(o) under the Securities Act of 1933, as amended.

(2)		The 11% Senior Notes dues 2014, Series B, will be issued by Maxcom Telecomunicaciones, S.A. de C.V. (the “Issuer”) and guaranteed by certain of the Issuer’s subsidiaries. No separate consideration will be received for the issuance of these guarantees.

(3)		Pursuant to Rule 457(n), no separate fee is payable with respect to the guarantees being registered hereby.


(4)		Of the total registration fee, U.S$5,373 was paid at the time of the initial filing of the registration statement and U.S.$767 is being paid herewith.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.


	Jurisdiction of		I.R.S. Employer
Exact Name of Additional Registrants*	Formation		Identification No.

Maxcom Servicios Administrativos, S.A. de C.V.		Mexico	None
Outsourcing Operadora de Personal, S.A. de C.V.		Mexico	None
TECBTC Estrategias de Promoción, S.A. de C.V. (formerly “Técnicos Especializados en Telecomunicaciones, S.A. de C.V.”)		Mexico	None
Corporativo en Telecommunications, S.A. de C.V.		Mexico	None
Maxcom SF, S.A. de C.V.		Mexico	None
Maxcom TV, S.A. de C.V.		Mexico	None
Maxcom USA, Inc.		Delaware	98-0419299

The address for each of the additional Registrants is c/o Maxcom Telecomunicaciones, S.A. de C.V., Guillermo Gonzalez Camarena No. 2000, Colonia Centro de Ciudad Santa Fe, Mexico, D.F. 01210, and the general phone number is (52) 55-1163-1005. The name, address, including zip code, of the agent for service for each of the Additional Registrants is CT Corporation System, 111 Eighth Avenue, New York, NY 10011. The primary standard industrial classification number for each of the additional Registrants is 4813.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. The prospectus is not an offer to sell these securities nor a solicitation of an offer to buy these securities in any jurisdiction where the offer and sale is not permitted.

SUBJECT TO COMPLETION: PRELIMINARY PROSPECTUS DATED NOVEMBER 1, 2007

Offer to Exchange

THE SECURITIES LISTED BELOW FOR SUBSTANTIALLY IDENTICAL SECURITIES THAT HAVE

BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933:

$200,000,000 11% Senior Notes due 2014

Material Terms of Exchange Offer


	•	We sold the outstanding senior notes on December 20, 2006, January 10, 2007 and September 5, 2007 to the initial purchasers who subsequently re-sold such securities to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S.


	•	The terms of the new senior notes to be issued in the exchange offer are substantially identical to the outstanding senior notes, except that the transfer restrictions and registration rights relating to the outstanding senior notes will not apply to the new senior notes.

	•	You may withdraw your tender of senior notes at any time before the expiration of the exchange offer. We will exchange all of the outstanding senior notes that are validly tendered and not withdrawn.

	•	Based upon interpretations by the Staff of the SEC, we believe that subject to some exceptions, the new senior notes may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery provisions of the Securities Act.

	•	The exchange offer will expire at 5:00 p.m., New York City time, on , 2007, unless we decide to extend it.

	•	The exchange of senior notes will not be a taxable event for U.S. federal income tax purposes.

	•	The exchange offer is not subject to any condition other than that it not violate applicable law or any applicable interpretation of the Staff of the SEC.

	•	We will not receive any proceeds from the exchange offer.

	•	The new senior notes will be guaranteed jointly and severally by certain our subsidiaries on a senior basis. The new senior notes and related guarantees will be secured by a first-priority lien on most of our telephone networks systems and equipment assets.

For a discussion of certain factors that you should consider before participating in this exchange offer, see “Risk Factors.”

Neither the SEC nor any state securities commission has approved the senior notes to be distributed in the exchange offer, nor have any of these organizations determined that this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

, 2007

TABLE OF CONTENTS


	Page

Prospectus Summary		1
Risk Factors		15
Special Note Regarding Forward-Looking Statements		34
Industry and Market Data		35
Exchange Rates		36
Exchange Offer		37
Use of Proceeds		46
Capitalization		47
Ratio of Earnings to Fixed Charges		48
Selected Consolidated Financial Information		49
Management’s Discussion and Analysis of Financial Condition and Results of Operations		52
Industry Overview		77
Business		81
Regulation		98
Management		108
Related Party Transactions		114
Description of Notes		116
Taxation		164
Plan of Distribution		171
Enforceability of Civil Liabilities		172
Legal Matters		171
Experts		173
Where You Can Find More Information		173
Index to Financial Statements		F-1
Annex I (Unaudited Financial Information for Nine Months Ended September 30, 2006 and 2007)		A-1
EX-4.2: FIRST SUPPLEMENTAL INDENTURE
EX-5.1: OPINION OF KIRKLAND & ELLIS LLP
EX-5.2: OPINION OF SOLERTIA ASESORES, S.C.
EX-23.1: CONSENT OF PRICEWATERHOUSECOOPERS S.C.
EX-25.1: STATEMENT OF ELIGIBILITY OF TRUSTEE ON FORM T-1
EX-99.1: FORM OF LETTER OF TRANSMITTAL
EX-99.2: FORM OF INSTRUCTIONS TO REGISTERED HOLDER
EX-99.3: FORM OF NOTICE OF GUARANTEED DELIVERY

We have not authorized anyone to give any information or represent anything to you other than the information contained in this prospectus. You must not rely on any unauthorized information or representations.

Until , 2007, all dealers that, buy, sell or trade the new senior notes, whether or not participating in the exchange offer, may be required to deliver a prospectus. This requirement is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments and subscriptions.

This prospectus incorporates business and financial information about the company that is not included in or delivered with this prospectus. This information is available free of charge to security holders upon written or oral request to: Maxcom Telecomunicaciones, S.A. de C.V., Guillermo Gonzalez Camarena No. 2000, Colonia Centro de Ciudad Santa Fe, Mexico, D.F. 01210, Attention: Director, Investor Relations (general phone number (52) 55-1163-1005).

PROSPECTUS SUMMARY

This summary highlights material information about our business and about participating in the exchange offer. This is a summary of material information contained elsewhere in this prospectus and is not complete and may not contain all of the information that may be important to you. For a more complete understanding of our business, you should read this entire prospectus, including the section entitled, “Risk Factors” and our audited and unaudited consolidated financial statements and related notes.

Our Company

We are an integrated telecommunication services operator providing widespread services to residential and small- and medium-sized business customers in four Mexican metropolitan markets, which consist of Mexico City, Puebla, Queretaro and Toluca and selected service in other markets. From December 31, 2002 to December 31, 2006, we achieved growth from 125,231 voice lines in service to 269,598 (a compound annual growth rate of 21.1%) while also reducing our churn level from 3.0% to 1.6% during this same period. We generated revenues of U.S.$155.4 million (Ps.1,678.6 million) and a net loss of U.S.$2.6 million (Ps.28.2 million) during 2006 and revenues of U.S.$99.7 million (Ps.1,075.5 million) and a net loss of U.S.$l.6 million (Ps.16.8 million) in the first six months of 2007. We provide a wide range of services including local and long-distance voice, data, high speed, dedicated and dial-up Internet access, public telephony and Voice over Internet Protocol telephony, and offer attractively priced service bundles. We also offer cable television and mobile voice service through resale and capacity leasing agreements with third parties. We recently launched multichannel television service over our own network, using Internet Protocol video transmission.

We operate our own telecommunications network and support infrastructure, including the critical “last mile,” or customers’ premise level infrastructure. As of June 30, 2007, our network encompasses 617 route kilometers of metropolitan fiber optic cable and over 3,177 kilometers of high-quality copper loops capable of high speed data transmission. We operate a 170-kilometer fiber optic link connecting the cities of Puebla and Mexico City and a 6,421-kilometer longhaul fiber optic backbone connecting Mexico City and Laredo, Texas. We also own microwave concessions for wireless transmission.

Competitive Strengths

We believe that the following strengths provide a basis upon which our business can continue to grow and achieve success in the highly competitive Mexican telecommunications market.

Wide Range of Service Offerings. We are an integrated telecommunication services provider, offering individually and in bundles, voice and data and, in some areas, cable television and mobile services. In August 2007, we launched multichannel Internet Protocol video service in Puebla, entirely on our own network. We have a history of being the first provider in Mexico to introduce new services including digital subscriber line, Internet Protocol telephony, “triple-play” services, unbundled “quadruple-play” services and Internet Protocol Television.

History of High Penetration Rates. Our business model is based on careful geographical targeting of certain underserved segments of the residential and business population in urban markets. As of June 30, 2007, in areas covered by our network where we own the last mile infrastructure, we have achieved residential penetration levels (measured by homes passed) of 37% in the city of Puebla, 35% in the city of Mexico City and 24% in the city of Queretaro. Since 2004, we have sold approximately 76% of built lines in our network clusters within 180 days after the completion of the buildout.

Cost Efficient, Flexible, Reliable Technology. We combine optical fiber, broadband capable copper lines and microwave technology, deployed based on customer requirements, deployment cost, time to market, time to revenue and profitability potential. Our network infrastructure, with copper loops generally no more than 3 kilometers in length, allows us to deliver broadband data at speeds up to 20 Mbps. The flexibility of our network allows us to provide value-added services such as video without major outside plant upgrades.

Valuable Last-Mile Ownership. Unlike many other markets worldwide, Mexican telecommunications regulations do not require the wireline incumbent, Telmex, to provide other telecommunication service providers

with access to its unbundled local loops. As a result, access to last mile infrastructure presents a significant barrier to entry. Our own broadband-capable last-mile infrastructure passes by approximately 526,000 homes allowing us to offer our services without depending on other telecommunications carriers to reach our customers.

Recognized Brand Name and Customer Perception for Quality Services. Because we control the entire process of network provisioning, service initiation and service quality, we are able to ensure the quality of our service and maintain customer loyalty. We monitor our customer satisfaction levels through surveys, commissioned by us, and utilize this information to enhance the quality of our services and the experience for our customers.

History of Developing Strategic Alliances. We have a track record of developing strategic alliances, through revenue sharing agreements, capacity leasing, resale arrangements and business relationships, with cable television and mobile wireless operators, technology suppliers and real estate developers that has allowed us to expand our product offerings, ensure compatible network technologies and gain access to new customers.

Strategy

Our growth strategy includes the following components:

Increase Penetration of Niche Markets with Unmet Demand for Telecommunication Services. We intend to continue to focus on residential customers and small- and medium-sized business customers in selected metropolitan areas that offer telecommunications growth potential due to a combination of a large population, low subscriber penetration and economic growth. We believe there is unmet demand for the services we offer among the lower and middle-low income socioeconomic classes and small- and medium-sized business customers.

Seize Wireline Opportunity Created by Highly Priced Wireless Offering. Mobile wireless penetration in Mexico is approximately 54%, nearly triple the penetration rate of wireline telephony, according to the Mexican Federal Telecommunications Commission (Comisión Federal de Telecomunicaciones). Based on an average call duration of five minutes, current per-minute pricing of prepaid wireless services (used by 92% of Mexican mobile users according to the Mexican Federal Telecommunications Commission) is over ten times that of wireline. We believe the high cost of wireless services combined with the socio-demographic characteristics of Mexico presents a significant opportunity for lower cost wireline services.

Expand our Network on a Disciplined Demand-Driven, Modular Basis. As part of our growth strategy, we intend to continue building our network on a carefully targeted, modular basis with a rigorous focus on return on investment. We will continue to invest network capital only when our planning process shows attractive expected returns.

Enhance Residential Penetration Rates and Average Revenue Per User Through Bundling. We expect that our bundled services will enhance residential penetration levels, increase customer use of multiple services, enhance margins, lower churn and increase average revenue per user. We plan to expand our multichannel Internet Protocol Television service over the rest of our network coverage area. We believe that this will allow us to sell video subscriptions to non-customers already passed by our networks and to sell video service bundles to a substantial percentage of our existing subscribers.

Maintain Our Service Quality Differentiation and Focus. We provide a differentiated customer experience based on high service quality and customer-focused product offerings. Key elements of our differentiation strategy include proactive marketing efforts with door-to-door personal sales and promotions, competitive pricing, fast and affordable installation and tailor made solutions for small- and medium-sized business customers. We also differentiate our services by providing accurate and timely billing, minimizing activation errors and delivering near real-time activations.

Risks Related to our Business

Our business involves various risks, including, amongst others, our ability to generate sufficient cash flows to meet our debt service obligations and implement our business plan, increasing competition in the Mexican telecommunications industry resulting in lower margins and/or our loss of market share, our ability to protect and

maintain our network infrastructure from service interruptions, loss of our concessions due to the failure to successfully renew them or comply with their conditions, political and economic conditions in Mexico and changes in Mexican laws, regulations and decrees applicable to us. Additionally, we have a substantial amount of indebtedness that may limit our ability to operate our business. We also have a history of net losses and cannot be certain that we will achieve profitability.

You should carefully consider the information in the “Risk Factors” section of this prospectus before participation in the exchange offer.

Corporate Information

Maxcom Telecomunicaciones, S.A. de C.V. is a variable capital corporation (sociedad anónima de capital variable), organized under the laws of Mexico and incorporated on February 28, 1996. We were originally organized under the name “Amaritel, S.A. de C.V.” We changed our corporate name to “Maxcom Telecomunicaciones, S.A. de C.V.” on February 9, 1999.

Our principal offices are located at Guillermo Gonzalez Camarena No. 2000, Colonia Centro de Ciudad Santa Fe, Mexico, D.F. 01210 and our general phone number is (52) 55-5147-1111. Our website address, the contents of which are not part of, or incorporated into, this prospectus or the registration statement of which this prospectus is a part, is www.maxcom.com. Our agent for service of process in the United States is CT Corporation System, 111 Eighth Avenue, New York, New York 10011.

The following chart summarizes our current corporate structure:

All of our subsidiaries are wholly-owned, directly or indirectly, by us.

Summary of the Exchange Offer


The Initial Offering of Outstanding Notes.		On December 20, 2006, the Company sold U.S.$150,000,000 of 11% Senior Notes due 2014 to Morgan Stanley & Co. Incorporated and Merrill Lynch, Fenner, Pierce & Smith Incorporated, as initial purchasers. On January 10, 2007, the Company sold U.S.$25,000,000 of 11% Senior Notes due 2014 to Morgan Stanley & Co. Incorporated, as the initial purchaser. On September 5, 2007, the Company sold U.S.$25,000,000 of 11% Senior Notes due 2014 to Morgan Stanley & Co. Incorporated, as the initial purchaser. These senior notes constitute a single class of notes under the indenture dated December 20, 2006. These senior notes were offered only to (1) qualified institutional buyers under Rule 144A and (2) outside the United States in compliance with Regulation S.


Registration Rights Agreement		Simultaneously with each initial sale of the outstanding senior notes, we entered into registration rights agreements for the exchange offer. In the registration rights agreements, we agreed, among other things, to cause a registration statement under the Securities Act to be declared effective for:

		• an offer to exchange the senior notes for a new issue of registered senior notes, or

		• registration of the senior notes for resale.

		The exchange offer is intended to satisfy your rights under the registration rights agreement. After the exchange offer is complete, you will no longer be entitled to any exchange or registration rights with respect to your outstanding senior notes.


The Exchange Offer		We are offering to exchange the new senior notes, which have been registered under the Securities Act of 1933, as amended (the “Securities Act”), for your outstanding senior notes, which were issued on December 20, 2006, January 10, 2007 or September 5, 2007, in the initial offerings. In order to be exchanged, an outstanding senior secured note must be properly tendered and accepted. All outstanding senior notes that are validly tendered and not validly withdrawn will be exchanged. We will issue new senior notes promptly after the expiration of the exchange offer. The outstanding senior notes may be tendered only in integral multiples of $1,000.


Resales		Based on interpretations by the staff of the SEC set forth in no-action letters issued to unrelated parties, we believe that the new senior notes issued in the exchange offer may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery requirements of the Securities Act provided that:

		• the new senior notes are being acquired in the ordinary course of your business;

		• you are not participating, do not intend to participate, and have no arrangement or understanding with any person to participate, in the distribution of the new senior notes issued to you in the exchange offer; and

		• you are not an affiliate of ours.


		If any of these conditions are not satisfied and you transfer any new senior notes issued to you in the exchange offer without delivering a prospectus meeting the requirements of the Securities Act or without an exemption from registration of your new senior notes from these requirements, you may incur liability under the Securities Act. We will not assume, nor will we indemnify you against, any such liability.

		Each broker-dealer that is issued new senior notes in the exchange offer for its own account in exchange for outstanding senior notes that were acquired by that broker-dealer as a result of market-marking or other trading activities, must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of the new senior notes. A broker-dealer may use this prospectus for an offer to resell, resale or other retransfer of the new senior notes issued to it in the exchange offer.

Record Date		We mailed this prospectus and the related exchange offer documents to registered holders of outstanding senior notes on , 2007.

Expiration Date		The exchange offer will expire at 5:00 p.m., New York City time, on , 2007, unless we decide to extend it.

Conditions to the Exchange Offer		The exchange offer is subject to customary conditions, including that the exchange offer does not violate applicable law or any applicable interpretation of the staff of the SEC.

Procedures for Tendering Outstanding Notes		We issued the outstanding senior notes as global securities. When the outstanding senior notes were issued, we deposited the Global Notes with the custodians for the book-entry depositary. The book-entry depositary issued depositary interests in respect of each Global Note to DTC and then recorded such interests in their respective books and records in the name of DTC’s nominee.

		If you wish to tender your outstanding senior notes for exchange in this exchange offer, you must transmit to the exchange agent on or before the expiration date either:

		• an original or a facsimile of a properly completed and duly executed copy of the letter of transmittal, which accompanies this prospectus, together with your outstanding senior notes and any other documentation required by the letter of transmittal, at the address provided on the cover page of the letter of transmittal; or

		• if the notes you own are held of record by The Depository Trust Company, or “DTC,” in book-entry form and you are making delivery by book-entry transfer, a computer-generated message transmitted by means of the Automated Tender Offer Program System of DTC, or “ATOP,” in which you acknowledge and agree to be bound by the terms of the letter of transmittal and which, when received by the exchange agent, forms a part of a confirmation of book-entry transfer. As part of the book-entry transfer, DTC will facilitate the exchange of your outstanding senior notes and update your account to reflect the issuance of the new senior notes to you. ATOP allows you to electronically transmit your acceptance of the exchange offer to DTC instead of physically completing and


		delivering a letter of transmittal to the outstanding senior notes exchange agent.

		In addition, you must deliver to the exchange agent on or before the expiration date:

		• a timely confirmation of book-entry transfer of your outstanding senior notes into the account of the notes exchange agent at DTC if you are effecting delivery of book-entry transfer, or

		• if necessary, the documents required for compliance with the guaranteed delivery procedures. Do not send letters of transmittal and certificates representing outstanding senior notes to us. Send these documents only to an exchange agent. See “Exchange Offer — Exchange Agent” for more information.

Special Procedures for Beneficial Owners		If you are the beneficial owner of book-entry interests and your name does not appear on a security position listing of DTC as the holder of the book-entry interests or if you are a beneficial owner of outstanding senior notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender the book-entry interest or outstanding senior notes in the exchange offer, you should contact the person in whose name your book-entry interests or outstanding senior notes are registered promptly and instruct that person to tender on your behalf.

Guaranteed Delivery Procedures		If you wish to tender your outstanding senior notes and you cannot get your required documents to the exchange agent on time, you may tender your outstanding senior notes by completing a notice of guaranteed delivery and complying with the guaranteed delivery procedures.

Withdrawal Rights		You may withdraw the tender of your outstanding senior notes at any time prior to 5:00 p.m., New York City time, on , 2007.

Acceptance of Outstanding Notes and Delivery of New Notes		If you fulfill all conditions required for proper acceptance of outstanding senior notes, we will accept any and all outstanding senior notes that you properly tender in the exchange offer on or before 5:00 p.m., New York City time, on the expiration date. We will return any outstanding senior notes that we do not accept for exchange to you without expense as promptly as practicable after the expiration date. We will deliver the new senior notes as promptly as practicable after the expiration date and acceptance of the outstanding senior notes for exchange. See “Exchange Offer — Terms of Exchange Offer.”

Federal Income Tax Considerations		We believe that the exchange of outstanding senior notes will not be a taxable event for United States federal income tax purposes.

Use of Proceeds; Fees and Expenses		We will not receive any proceeds from the issuance of new senior notes pursuant to the exchange offer. We will pay all of our expenses incident to the exchange offer.

Exchange Agent		Deutsche Bank Trust Company Americas is serving as the exchange agent in connection with the exchange offer.

Summary of Terms of the New Notes

The form and terms of the new senior notes are the same as the form and terms of the outstanding senior notes, except that the new senior notes will be registered under the Securities Act. As a result, the new senior notes will not bear legends restricting their transfer and will not contain the registration rights and liquidated damage provisions contained in the outstanding senior notes. The new senior notes represent the same debt as the outstanding senior notes. Both the outstanding senior notes and the new senior notes are governed by the same indenture. Unless the context otherwise requires, we use the term “senior notes” in this prospectus to collectively refer to the outstanding senior notes and the new senior notes.


Issuer		Maxcom Telecomunicaciones, S.A. de C.V.


Guarantors		Maxcom Servicios Administrativos, S.A. de C.V., Outsourcing Operadora de Personal, S.A. de C.V., TECBTC Estrategias de Promoción, S.A. de C.V. (formerly “Técnicos Especializados en Telecomunicaciones, S.A. de C.V.,”) Corporativo en Telecomunicaciones, S.A. de C.V., Maxcom SF, S.A. de C.V., Maxcom TV, S.A. de C.V. and Maxcom USA, Inc.


New Notes Offered		U.S.$200,000,000 aggregate principal amount of 11% senior senior notes due 2014, Series B.


Issue Price		100%

Maturity Date		December 15, 2014.

Interest		The new senior notes will bear interest at the annual rate of 11%, payable in arrears on each interest payment date.

Interest Payment Dates		June 15 and December 15 of each year, commencing on December 15, 2007.

Optional Redemption		The Issuer may redeem some or all of the senior notes prior to December 15, 2010 by paying a “make-whole” premium and at any time thereafter at the redemption prices listed in the section under the heading “Optional Redemption,” plus accrued and unpaid interest and additional interest, if any. See “Description of Notes — Optional Redemption.”

Optional Redemption After Public Equity Offerings		At any time (which may be more than once) before December 15, 2009, the Issuer can choose to redeem up to 35% of the aggregate principal amount of the senior notes originally issued with money that the Issuer raises in one or more public equity offerings, as long as:

		• the Issuer pays 111% of the face amount of the senior notes, plus accrued and unpaid interest, if any;

		• the Issuer redeems the senior notes within 90 days of completing the public equity offering; and

		• at least 65% of the aggregate principal amount of senior notes originally issued remains outstanding afterwards. See “Description of Notes — Optional Redemption.”

Redemption for Tax Reasons		Under certain circumstances, we may redeem the senior notes in whole but not in part upon not less than 30 and no more than 60 days prior notice at a price equal to 100% of the principal amount thereof, together with accrued and unpaid interest to the date fixed for redemption plus any additional amounts. See “Description of Notes — Optional Tax Redemption.”


Change of Control		Upon a change of control, as defined under the section entitled “Description of the Notes — Certain Definitions,” we will be required to make an offer to purchase the senior notes then outstanding at a purchase price equal to 101% of their principal amount, plus accrued interest to the date of repurchase. We may not have sufficient funds available at the time of any change of control to make any required debt repayment (including repurchases of the senior notes). See “Description of Notes — Repurchase at the Option of Holders — Change of Control.”

Asset Sale Offer		If we or our Restricted Subsidiaries engage in asset sales and we do not apply the proceeds as required under the indenture, we may be required to make an offer to repurchase the new senior notes. See “Description of Notes — Repurchase at the Option of Holders — Asset Sales.”

Guarantees		Guarantors will unconditionally guarantee, jointly and severally, on a senior unsecured basis, all of the Issuer’s obligations under the senior notes. See “Description of Notes — Note Guarantees.”

Security		The new senior notes will be secured by first-priority liens on most of our telephone network systems and equipment assets. See “Description of Notes — Security.”

Ranking		The new senior notes will be secured senior obligations of the Issuer and will rank:

		• senior in right of payment to all of our existing and future subordinated indebtedness;

		• equally in right of payment with any of our existing and future senior indebtedness;

		• effectively junior in right of payment to all of our secured indebtedness, to the extent of the value of the assets securing such indebtedness; and

		• structurally junior to all of the obligations, including trade payables, of any subsidiaries that do not guarantee the senior notes.

		Similarly, the guarantee of each guarantor of the new senior notes will rank:

		• senior in right of payment to all of such guarantor’s existing and future subordinated indebtedness;

		• equally in right of payment with any existing and future senior unsecured indebtedness of such guarantor;

		• effectively junior in right of payment to all of such guarantor’s secured indebtedness, to the extent of the value of the assets securing such indebtedness; and

		• structurally junior to all of the obligations, including trade payables, of any subsidiaries that do not guarantee the senior notes.

		As of June 30, 2007:

		• the Issuer and the Guarantors had approximately U.S.$177.8 million in senior unsecured indebtedness outstanding, including approximately


		U.S.$1.9 million of indebtedness under various vendor financing facilities;

		• the Issuer and the Guarantors had no subordinated indebtedness and no secured indebtedness; and

		• subsidiaries of ours that do not guarantee the senior notes had U.S.$4.8 million of liabilities, including trade payables, but excluding intercompany liabilities.

		Under Mexican law, holders of the senior notes will not have any claim whatsoever against the Issuer’s or the Guarantors’ non-guarantor subsidiaries.

Certain Indenture Provisions		The indenture governing the new senior notes contains covenants that, among other things, limit our ability and the ability of our Restricted Subsidiaries to:

		• incur additional debt;

		• pay dividends on, redeem or repurchase our capital stock;

		• issue or sell stock of certain subsidiaries;

		• make investments;

		• create certain liens;

		• transfer and sell assets;

		• enter into sale and leaseback transactions;

		• enter into transactions with affiliates;

		• create unrestricted subsidiaries;

		• guarantee other debt; and

		• merge or consolidate with another company.

		See “Description of Notes — Certain Covenants.”

Risk Factors

Before making an investment decision, you should carefully consider all of the information in this prospectus, including the discussion under the caption “Risk Factors,” for a discussion of certain risks of participating in the exchange offer.

Recent Developments

On October 24, 2007, we completed an initial public offering of shares of our Series A common stock in the form of Ordinary Participation Certificates (Certificados de Participación Ordinarios), or CPOs, including American Depositary Shares, or ADSs, comprised of CPOs. In connection with the initial public offering, each issued and outstanding share of our Series A, Series B and Series N common stock was converted into one new share of Series A common stock. We issued a total of 304,608,201 shares of Series A common stock in the initial public offering and, immediately following the closing of our initial public offering, our outstanding capital stock consisted of788,965,237 shares of Series A common stock, 1,528,827 shares of which represent the fixed portion of our capital stock and 787,436,410 shares of which represent the variable portion of our capital stock. We received U.S.$240.9 million in net proceeds from the initial public offering. The principal purpose of the initial public offering was to raise capital resources which we currently intend to use for capital expenditures to further expand our network. However, we currently have no commitments or agreements to use the net proceeds of this offering for capital expenditures, and we may use net proceeds of the offering for general corporate purposes, including

repayment of debt, investment in our subsidiaries, working capital, repurchases of stock or the financing of possible acquisitions or business opportunities. We have not determined the amounts we plan to spend on any of the uses described above or the timing of these expenditures. The net proceeds may be invested temporarily or applied to repay short-term debt until they are used for other purposes.

In January 2006, the Mexican tax authorities commenced tax audits of our subsidiary, Telereunión, S.A. de C.V., for tax payments corresponding to the fiscal year of 2004. These audits were completed on September 6, 2007. On September 11, 2007, the Mexican tax authorities assessed Telereunión, S.A. de C.V. a Ps.59,375,541.25 (approximately U.S.$5.5 million) debt (credito fiscal) for differences and omissions in the Telereunión, S.A. de C.V. tax returns for fiscal year 2004. Also as part of this audit, the Mexican tax authorities determined that Telereunión, S.A. de C.V. was liable for paying Ps.8,239,605.09 (U.S.$750,000) to former employees in connection with employees’ statutory profit sharing laws. We are currently assessing the validity of these claims and, to the extent any of them lack merit, intend to vigorously defend against such claim. In connection with the share purchase agreement related to the Grupo Telereunión acquisition, the Grupo VAC Investors agreed to indemnify us for any out-of-pocket costs and expenses incurred in connection with the negotiation, settlement and/or resolution of these tax claims. To the extent we are ultimately found to have liability following our appeal with respect to the matters described above, we expect to obtain full indemnity from the Grupo VAC Investors.

PRESENTATION OF FINANCIAL INFORMATION

This prospectus includes our audited consolidated financial statements as of December 31, 2006 and 2005 and for each of the three years in the period ended December 31, 2006 and also includes our unaudited consolidated financial statements as of June 30, 2007 and for the six months ended June 30, 2007 and 2006, which have been prepared in accordance with Mexican Financial Reporting Standards, which we refer to as MFRS, NIF, or Mexican GAAP, which differs in certain significant respects from generally accepted accounting principles in the United States, or U.S. GAAP. Pursuant to Mexican GAAP, we have prepared the financial statements and certain financial data in accordance with Bulletin B-10 “Recognition of Effects of Inflation on Financial Information,” of the Mexican Institute of Public Accountants, or MIPA, which requires a restatement of all full year comparative financial statements to constant Mexican pesos as of the date of the balance sheet for the most recently completed fiscal year. We publish our financial statements in pesos that are adjusted to reflect changes in purchasing power due to inflation. Pursuant to Mexican GAAP, except for the financial data as of and for the six months ended June 30, 2007 and 2006, which has been restated in constant pesos as of June 30, 2007, and except as otherwise indicated, the financial data for all other periods throughout this section have been restated in constant pesos as of December 31, 2006. According to the Central Bank of Mexico (Banco de México), the inflation rate from December 31, 2006 to June 30, 2007 was 0.6%. See note 22 to our full-year audited consolidated financial statements for a description of the principal differences, other than inflation accounting, between Mexican GAAP and U.S. GAAP applicable to us and for a reconciliation of our net income and stockholders’ equity to U.S. GAAP as of December 31, 2006 and 2005 and for the years ended December 31, 2006, 2005 and 2004 and note 12 to our interim unaudited consolidated financial statements for a description of the principal differences, other than inflation accounting, between Mexican GAAP and U.S. GAAP applicable to us and for a reconciliation of our net income and stockholders’ equity to U.S. GAAP as of June 30, 2007 and 2006 and for the six months ended June 30, 2007 and 2006.

Unless otherwise specified, all references to “U.S. dollars,” “dollars,” “U.S.$” or “$” are to United States dollars, the legal currency of the United States, and references to “pesos” or “Ps.” are to Mexican pesos, the legal currency of Mexico. Except as otherwise indicated, peso amounts as of and for the six months ended June 30, 2007 and 2006 have been converted to U.S. dollars at the exchange rate of Ps.10.79 per U.S.$1.00, as reported by the Federal Reserve Bank of New York as its noon buying rate on June 29, 2007, the business day immediately preceding June 30, 2007. Except as otherwise indicated, peso amounts as of December 31, 2005 and 2006 and for the years ended December 31, 2004, 2005 and 2006 have been converted to U.S. dollars at the exchange rate of Ps.10.80 per U.S.$1.00, as reported by the Federal Reserve Bank of New York as its noon buying rate for pesos on December 29, 2006, the business day immediately preceding December 31, 2006. Such conversions are for the convenience of the reader and should not be construed as representations that the peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated, or at all. For more information on exchange rates, see “Exchange Rates.” Amounts presented in this prospectus may not add up due to rounding.

SUMMARY CONSOLIDATED FINANCIAL INFORMATION

The following tables present our summary consolidated financial information as of and for the periods indicated. This information should be read in conjunction with, and is qualified in its entirety by reference to, our consolidated financial statements, including the notes thereto, and the information contained under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus. Our financial statements are prepared in accordance with Mexican GAAP, which differs in certain significant respects from U.S. GAAP. See note 22 to our full-year audited consolidated financial statements, which have been audited by PricewaterhouseCoopers, S.C., registered public accounting firm, as stated in their report included in this prospectus, and note 12 to our interim unaudited consolidated financial statements for a discussion of the significant differences between Mexican GAAP and U.S. GAAP as they relate to our business. Results of the interim periods are not necessarily indicative of results that may be expected for a full fiscal year or any other future period.

We have derived this summary consolidated financial information for the years ended December 31, 2004, 2005 and 2006 and as of December 31, 2005 and 2006 from our audited consolidated financial statements and accompanying notes included elsewhere in this prospectus. The summary consolidated financial information as of June 30, 2007 and for the six months ended June 30, 2006 and 2007 has been derived from our unaudited interim consolidated financial statements included elsewhere in this prospectus.

As reported by the Banco de México, the rate of inflation was 0.6% for the period from December 31, 2006 to June 30, 2007 and 3.9% for the period from June 30, 2006 to June 30, 2007.


	Year Ended December 31,												Six Months Ended June 30,
	2004			2005			2006			2006⁽²⁾			2006			2007			2007⁽³⁾
										(unaudited)
	(thousands of constant December 31,												(unaudited, thousands of constant June 30,
	2006 pesos and thousands of U.S. dollars,												2007 pesos and thousands of U.S. dollars,
	except per share and share amounts)⁽¹⁾												except per share and share amounts)⁽¹⁾

Statement of Operations Data:
Mexican GAAP
Net revenues	Ps.	933,513		Ps.	1,197,104		Ps.	1,678,593		U.S.$	155,432		Ps.	739,408		Ps.	1,075,507		U.S.$	99,676
Operating costs and expenses:
Network operating costs		(329,439	)		(399,320	)		(652,452	)		(60,415	)		(265,676	)		(456,471	)		(42,305	)
Selling, general and administrative expenses		(402,551	)		(487,250	)		(585,496	)		(54,215	)		(273,001	)		(320,310	)		(29,686	)
Depreciation and amortization		(360,071	)		(293,051	)		(289,582	)		(26,814	)		(130,908	)		(190,345	)		(17,641	)

Total operating costs and expenses		(1,092,061	)		(1,179,621	)		(1,527,530	)		(141,445	)		(669,585	)		(967,126	)		(89,632	)

Operating (loss) income		(158,548	)		17,483			151,063			13,988			69,823			108,381			10,045
Integral cost (income) of financing:
Interest expense, net		(40,303	)		(101,058	)		(130,534	)		(12,087	)		(46,858	)		(90,111	)		(8,351	)
Exchange (loss) gain, net		(1,510	)		20,783			6,511			603			(30,781	)		18,430			1,708
Gain on net monetary position		92,649			22,985			20,724			1,919			3,966			5,330			494

Total integral cost of financing		50,836			(57,290	)		(103,299	)		(9,565	)		(73,673	)		(66,351	)		(6,149	)
Other income (expense), net		(852	)		9,354			(1,065	)		(99	)		666			(2,777	)		(257	)
Special item⁽⁴⁾		—			(15,988	)		(17,031	)		(1,577	)		—			—			—
Tax		(30,144	)		(27,685	)		(57,875	)		(5,359	)		(3,710	)		(56,054	)		(5,195	)

Net income (loss) for the period	Ps.	(138,708	)	Ps.	(74,126	)	Ps.	(28,207	)	U.S.$	(2,612	)	Ps.	(6,894	)	Ps.	(16,801	)	U.S.$	(1,557	)

Basic earnings (loss) per share⁽⁵⁾	Ps.	(0.47	)	Ps.	(0.18	)	Ps	.(0.06	)	U.S.$	(0.006	)	Ps.	(0.017	)	Ps.	(0.035	)	U.S.$	(0.003	)
Diluted earnings (loss) per share⁽⁵⁾		(0.47	)		(0.18	)		(0.06	)		(0.006	)		(0.017	)		(0.032	)		(0.003	)
Weighted average number of shares outstanding (thousands of shares)⁽⁵⁾
Basic		293,032			403,521			442,928			442,928			403,521			482,934			482,934
Diluted		293,032			403,521			467,628			467,628			403,521			529,016			529,016


	Year Ended December 31,												Six Months Ended June 30,
	2004			2005			2006			2006⁽²⁾			2006			2007			2007⁽³⁾
										(unaudited)
	(thousands of constant December 31,												(unaudited, thousands of constant June 30,
	2006 pesos and thousands of U.S. dollars,												2007 pesos and thousands of U.S. dollars,
	except per share and share amounts)⁽¹⁾												except per share and share amounts)⁽¹⁾

U.S. GAAP
Operating (loss) gain	Ps.	(207,965	)	Ps.	(5,678	)	Ps.	(48,775	)	U.S.$	(4,516	)	Ps.	(69,602	)	Ps.	98,046		U.S.$	9,087
Net (loss) gain		1,271,427			178,890			12,009			1,112			(22,771	)		(38,729	)		(3,589	)
Basic earnings (loss) per share⁽⁵⁾		4.34			0.44			0.03			0.003			(0.06	)		(0.08	)		(0.007	)
Diluted earnings (loss) per share⁽⁵⁾		4.34			0.44			0.03			0.003			—			—			—
Ratio of earnings to fixed charges under U.S. GAAP⁽⁸⁾		—			2.92			1.55			1.55			—			1.42			1.42
Other Financial Data:
Mexican GAAP
EBITDA⁽⁶⁾		201,523			310,534			440,645			40,802			200,731			298,726			27,685
Capital expenditures⁽⁷⁾		373,926			465,183			1,004,131			92,979			440,932			652,583			60,480
Ratio of earnings to fixed charges⁽⁸⁾		—			—			1.05			1.05			—			1.06			1.06
Total debt⁽⁹⁾		866,574			1,174,735			1,993,541			184,587			1,433,006			1,918,620			177,815
Total interest expense		40,303			105,389			138,814			12,853			43,692			111,939			10,374


	As of June 30, 2007
	Actual		Pro Forma⁽¹¹⁾		Actual⁽³⁾		Pro Forma^(3)(11)
	(unaudited, thousands of constant June 30, 2007
	pesos and thousands of U.S. dollars)⁽¹⁾

Balance Sheet Data
Mexican GAAP
Cash and temporary investments	Ps.	152,832	Ps.	3,019,406	U.S.$	14,164	U.S.$	279,823
Working capital⁽¹⁰⁾		83,971		83,971		7,782		7,782
Total assets		4,986,151		7,852,907		462,108		727,767
Total liabilities		2,789,239		3,059,104		258,502		283,502
Total shareholders’ equity		2,196,912		4,793,803		203,606		444,265


(1)		Pursuant to Mexican GAAP, except for the financial data as of June 30, 2007 and for the six month periods ended June 30, 2006 and 2007, which have been restated in constant pesos as of June 30, 2007, and except as otherwise indicated, the financial data for all other periods throughout this section have been restated in constant pesos as of December 31, 2006. Since financial data as of June 30, 2007 and for the six month periods ended June 30, 2006 and 2007 is presented in constant pesos in purchasing power as of June 30, 2007, it is not directly comparable to our audited consolidated year-end financial information included elsewhere in this prospectus. Restatement into December 31, 2006 pesos is made by multiplying the relevant nominal peso amount by the accumulated inflation index for the period between the end of the period to which such nominal peso amount relates and December 31, 2006. We use the inflation index 1.0519 for December 31, 2004 figures, 1.0333 for December 31, 2005 figures, 1.0405 for December 31, 2006 figures, 1.039 for June 30, 2006 and 1.000 for June 30, 2007 figures. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”


(2)		Peso amounts were converted to U.S. dollars at the exchange rate of Ps.10.80 per U.S.$1.00, as reported by the Federal Reserve Bank of New York as its noon buying rate for pesos on December 29, 2006, the business day immediately preceding December 31, 2006. Such conversions are for the convenience of the reader and should not be construed as representations that the peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated, or at all.


(3)		Peso amounts were converted to U.S. dollars at the exchange rate of Ps.10.79 per U.S.$1.00, as reported by the Federal Reserve Bank of New York as its noon buying rate on June 29, 2007, the business day immediately preceding June 30, 2007. Such conversions are for the convenience of the reader and should not be construed as representations that the peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated, or at all.


(4)		Special item refers to (a) expenses we incurred in connection with the sale of our subsidiary, Mijolife, S.A. de C.V., on November 22, 2005 and (b) the recognition of Ps.17.0 million, derived from the total amortization of the debt issuance costs related to the repayment of the 133/4% series bonds, the 2009 senior step-up notes and the 2007 senior notes. As of January 1, 2007, we adopted Mexican FRS NIF B-3, “Statement of Income,” which incorporates, among other things, a new approach to classifying income and expenses as ordinary and non-ordinary, eliminates special and extraordinary items and eliminates the cumulative effect of accounting changes. The adoption of this


		standard will affect our year end 2007 financial statements through the reclassification into general expenses of the special items that were previously presented in a separated line in the income statement. Our unaudited interim financial statements as of June 30, 2007 and for the six months ended June 30, 2006 and 2007 already reflect the application of this standard.
(5)		Earnings per share data give effect to the reclassification of all classes and series of outstanding stock into a single class of Series A common stock immediately prior to the completion of this offering.


(6)		EBITDA for any period is defined as consolidated net income (loss) excluding depreciation and amortization, total integral cost of financing, other (income) expenses, special items and tax. EBITDA is not a recognized financial measure under Mexican GAAP or U.S. GAAP and does not purport to be, and should not be considered to be, an alternative to net income as a measure of operating performance or to cash flows from operating activity as a measure of liquidity. The following table sets forth a reconciliation of EBITDA to net income (loss) under Mexican GAAP for each of the periods presented above.


	Year Ended December 31,												Six Months Ended June 30,
	2004			2005			2006			2006			2006			2007			2007
										(unaudited)
	(thousands of constant December 31,												(unaudited, thousands of constant
	2006 pesos and thousands of U.S. dollars)												June 30, 2007 pesos and thousands
													of U.S. dollars)

Net income (loss)	Ps.	(138,708	)	Ps.	(74,126	)	Ps.	(28,207	)	U.S.$	(2,612	)	Ps.	(6,894	)	Ps.	(16,801	)	U.S.$	(1,557	)
Depreciation and amortization		360,071			293,051			289,582			26,814			130,908			190,345			17,641
Total integral cost of financing		(50,836	)		57,290			103,299			9,565			73,673			66,351			6,149
Other income (expense) net		852			(9,354	)		1,065			99			(666	)		2,777			257
Special item⁽⁴⁾		—			15,988			17,031			1,577			—			—			—
Tax		30,144			27,685			57,875			5,359			3,710			56,054			5,195

EBITDA	Ps.	201,523		Ps.	310,534		Ps.	440,645		U.S.$	40,802		Ps.	200,731		Ps.	298,726		U.S.$	27,685


		EBITDA has been included solely because we believe it is a meaningful indication of our operating performance. We believe that EBITDA can be useful to facilitate comparisons of operating performance between periods and with other companies because it excludes the effect of (i) depreciation and amortization, which represents a non-cash charge to earnings, (ii) certain financing costs, which are significantly affected by external factors, including interest rates, foreign currency exchange rates and inflation rates, which have little or no bearing on our operating performance, (iii) income tax and tax on assets and statutory employee profit sharing, which is similar to a tax on income and (iv) other expenses or income not related to the operation of the business. EBITDA is also a useful basis of comparing our results with those of other companies because it presents operating results on a basis unaffected by capital structure and taxes. You should review EBITDA, along with consolidated net income (loss) and resources arising from (used in) operating activities, investing activities and financing activities, when trying to understand our operating performance. However, companies define EBITDA in different ways and caution must be used in comparing this measurement to EBITDA of other companies.


(7)		Capital expenditures include frequency rights, telephone network systems and equipment, intangible assets and other assets. Investing activities in the consolidated statements of changes in financial position are net of dispositions. In accordance with our capital expenditures policy, any acquisition of a subsidiary will be considered a capital expenditure since our investment in subsidiaries is part of our strategy to incorporate new network systems.


(8)		Our earnings were insufficient to cover fixed charges for the periods 1998 through 2005 and the six month period ended June 30, 2006. Fixed charges include interest expense, capitalized interest and the portion of operating lease rental expense that represents the interest factor. The fixed charge coverage deficiency under Mexican GAAP was Ps.108.0 million in 2004, Ps.46.0 million in 2005 and Ps.31.9 million for the six-month period ended June 30, 2006. Under U.S. GAAP, the fixed charge deficiency was Ps.1,301 million in 2004 and Ps.58.8 million in the six-month period ended June 30, 2006.


(9)		Total debt is as of the end of the period indicated.


(10)		Working capital is defined as current assets (excluding cash and temporary investments and restricted cash) less current liabilities (excluding current maturities of long-term debt, which includes interest payable).


(11)		Pro forma amounts as of June 30, 2007 give effect to the private placement of U.S.$25 million aggregate principal amount of our senior notes completed on September 5, 2007 and the initial public offering of our Series A common stock in the form of CPOs, including ADSs comprised of CPOs, which was completed on October 24, 2007.

RISK FACTORS

You should carefully consider the following risks, as well as other information contained in this prospectus when deciding whether to participate in the exchange offer. Any of the following risks could materially adversely affect our business, financial condition or results of operations.

The risks described below are not the only ones that may affect us or the senior notes. In general, investing in the securities of issuers in emerging market countries such as Mexico involves risks not typically associated with investing in the securities of U.S. companies.

Risk Factors Associated with the Exchange Offer

Because there is no public market for the senior notes, you may not be able to resell your senior notes.

The new senior notes will be registered under the Securities Act, but will constitute a new issue of securities with no established trading market, and there can be no assurance as to:


	•	the liquidity of any trading market that may develop;

	•	the ability of holders to sell their new senior notes; or

	•	the price at which the holders would be able to sell their new senior notes.

If a trading market were to develop, the new senior notes might trade at higher or lower prices than their principal amount or purchase price, depending on many factors, including prevailing interest rates, the market for similar securities and our financial performance.

We understand that the initial purchasers presently intend to make a market in the senior notes. However, they are not obligated to do so, and any market-making activity with respect to the senior notes may be discontinued at any time without notice. In addition, any market-making activity will be subject to the limits imposed by the Securities Act and the Securities Exchange Act of 1934, and may be limited during the exchange offer or the pendency of an applicable shelf registration statement. We currently intend to list the new senior notes on the PORTAL market, Luxembourg Stock Exchange, however, we cannot assure you that a PORTAL, Luxembourg Stock Exchange listing will be obtained. There can be no assurance that an active trading market will exist for the senior notes or that any trading market that does develop will be liquid.

In addition, any holder of outstanding senior notes who tenders in the exchange offer for the purpose of participating in a distribution of the new senior notes may be deemed to have received restricted securities, and if so, will be required to comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. For a description of these requirements, see “Exchange Offer.”

Your outstanding senior notes will not be accepted for exchange if you fail to follow the exchange offer procedures and, as a result, your senior notes will continue to be subject to existing transfer restrictions and you may not be able to sell your outstanding senior notes.

We will not accept your senior notes for exchange if you do not follow the exchange offer procedures. We will issue new senior notes as part of this exchange offer only after a timely receipt of your outstanding senior notes, a properly completed and duly executed letter of transmittal and all other required documents. Therefore, if you want to tender your outstanding senior notes, please allow sufficient time to ensure timely delivery. If we do not receive your senior notes, letter of transmittal and other required documents by the expiration date of the exchange offer, we will not accept your senior notes for exchange. We are under no duty to give notification of defects or irregularities with respect to the tenders of outstanding senior notes for exchange. If there are defects or irregularities with respect to your tender of outstanding senior notes, we may not accept your outstanding senior notes for exchange. For more information, see “Exchange Offer.”

If you do not exchange your outstanding senior notes, your outstanding senior notes will continue to be subject to the existing transfer restrictions and you may not be able to sell your outstanding senior notes.

We did not register the outstanding senior notes, nor do we intend to do so following the exchange offer. Outstanding senior notes that are not tendered will therefore continue to be subject to the existing transfer restrictions and may be transferred only in limited circumstances under the securities laws. If you do not exchange your outstanding senior notes, you will lose your right to have your outstanding senior notes registered under the federal securities laws. As a result, if you hold outstanding senior notes after the exchange offer, you may not be able to sell your outstanding senior notes.

Risks Relating to the Notes and the Guarantees

We may not be able to generate sufficient cash flows to meet our debt service obligations.

Our ability to make payments on and to refinance our indebtedness, including the senior notes, and to fund planned capital expenditures will depend on our ability to generate cash from our future operations. This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control, including those described in this prospectus.

Our business plan, including the expansion of our network and services, requires significant capital expenditures. In turn, our ability to fund these planned capital expenditures as well as our operating expenses and our debt service obligations will depend on our ability to develop a significantly larger customer base and increase our operating cash flows. However, we may not succeed in attracting more customers and as a result our business may not generate sufficient operating cash flows to implement our business plan or even meet our existing debt service obligations. For example, from our incorporation in 1996 through 2003 we generated negative cash flows from operating activities. We may need to refinance or restructure all or a portion of our indebtedness, including the senior notes, on or before maturity. We may not be able to refinance any of our indebtedness, including the senior notes, on commercially reasonable terms, or at all. If we cannot service our indebtedness, we may have to take actions such as selling assets, seeking additional equity investments or reducing or delaying capital expenditures, strategic acquisitions, investments and alliances, any of which could inhibit the implementation of our business plan and materially harm our operating results and financial condition. We may not be able to effect such actions, if necessary, on commercially reasonable terms, or at all. Under such circumstances, our ability to generate sufficient cash flow could adversely effect our ability to continue as a going concern.

Our substantial indebtedness could have a material adverse effect on our financial condition, including our ability to fulfill our obligations under the senior notes and our ability to operate our business and implement our business plan.

We are highly leveraged. As of June 30, 2007, we had total indebtedness in the amount of Ps.1,918.6 million (U.S.$177.8 million), which consists primarily of U.S.$175 million aggregate principal of senior notes. In addition, on September 5, 2007, we issued an additional U.S.$25 million aggregate principal amount of our senior notes. We will use approximately U.S.$23.1 million annually from our cash flows to service our senior notes. For the six months ended June 30, 2007, our ratio of earnings to fixed charges was 1.06. Despite our current level of indebtedness, we may be able to incur substantial additional indebtedness, including secured indebtedness. Although the terms of the indenture governing the senior notes restrict us and our restricted subsidiaries from incurring additional indebtedness, these restrictions are subject to important exceptions and qualifications including with respect to our ability to incur additional senior secured indebtedness. If we or our subsidiaries incur additional indebtedness to finance working capital, capital expenditures, investments or acquisitions or for other purposes, the risks related to our business associated with our high level of indebtedness could be intensified. Specifically, our high level of indebtedness could have important consequences to our business, including the following:


	•	making it more difficult for us to satisfy our obligations with respect to our indebtedness;

	•	requiring us to dedicate a substantial portion of our cash flow from operations to debt service payments, reducing the funds available for working capital, capital expenditures, acquisitions and other general corporate purposes;


	•	limiting our flexibility in planning for, or reacting to, changes in the telecommunications industry;

	•	limiting our ability to take advantage of opportunities for acquisitions and other business combinations;

	•	placing us at a competitive disadvantage compared to our less leveraged competitors;

	•	increasing our vulnerability to both general and industry-specific adverse economic conditions; and

	•	limiting our ability to obtain additional financing or obtain it on commercially reasonable terms, to fund future working capital, capital expenditures, acquisitions or other general corporate requirements and increasing our cost of borrowing.

If we and our subsidiaries incur substantial additional indebtedness in the future, the leverage-related risks that we now face could intensify and have a material adverse effect on business, results of operation and financial condition.

The indenture governing the senior notes contains restrictions on our ability to operate our business and to pursue our business strategies. Our failure to comply with these covenants could result in an acceleration of our indebtedness.

The indenture governing the senior notes contains covenants that may restrict our ability to finance future operations or capital needs, to respond to changing business and economic conditions or to engage in certain transactions or business activities that may be important to our growth strategy, necessary to remain competitive or otherwise important to us. The indenture restricts, among others, our ability to:


	•	incur additional indebtedness;

	•	pay dividends or make other distributions on our capital stock or repurchase our capital stock or subordinated indebtedness;

	•	make investments or other specified restricted payments;

	•	create liens;

	•	enter into mergers, consolidations, sales of substantially all of our assets and other forms of business combinations;

	•	enter into change of control transactions;

	•	sell assets and subsidiary stock; and

	•	enter into transactions with affiliates.

If we do not comply with these restrictions, we could be in default despite our ability to service our indebtedness. If there were an event of default under the indenture for the senior notes, holders of the senior notes could demand immediate payment of the aggregate principal amount and accrued interest on the senior notes outstanding which, as of August 31, 2007, was an amount equal to U.S.$179.1 million, not including the U.S.$25 million aggregate principal amount of senior notes issued on September 5, 2007. This could lead to our inability to pay our obligations or to our bankruptcy or reorganization for the benefit of our creditors. Any additional financings we obtain in the future would most likely contain similar or more restrictive covenants.

The terms of the indenture governing our senior notes restricting us and our restricted subsidiaries from incurring additional indebtedness are subject to certain exceptions and qualifications including exceptions allowing us to incur capital lease, financing and purchase money obligations not exceeding U.S.$10 million and additional indebtedness not exceeding U.S.$10 million. If we or our subsidiaries incur additional indebtedness to finance working capital, capital expenditures, investments or acquisitions or for other purposes, the risks related to our business associated with our high level of indebtedness could be intensified.

You may not be able to enforce the guarantees of our subsidiaries under the senior notes.

The subsidiary guarantees provide a basis for a direct claim against the subsidiary guarantors; however, it is possible that the subsidiary guarantees will not be enforceable. The laws of Mexico do not prevent the subsidiary guarantees from being valid, binding and enforceable against the subsidiary guarantors in accordance with their terms, provided they are in compliance with certain requirements under Mexican law. However, the obligation of each subsidiary guarantor may be subject to review under Mexican or U.S. state or federal fraudulent transfer laws. Under such laws, in a lawsuit by an unpaid creditor or representative of creditors of one of our subsidiaries such as a trustee in bankruptcy or the subsidiary guarantor as debtor-in-possession, if a court were to find that at the time such obligation was incurred, the subsidiary guarantor, among other things:


	•	did not receive fair consideration or reasonably equivalent value, and

	•	(1) was insolvent, (2) was rendered insolvent, (3) was engaged in a business or transaction for which its remaining unencumbered assets constituted unreasonably small capital or (4) intended to incur or believed that it would incur debts beyond its ability to pay such debts as they matured,

the court could void the subsidiary guarantor’s obligation and direct the return of any payments made to the subsidiary guarantor or to a fund for the benefit of its creditors. Moreover, regardless of the factors identified in the prior clauses (1) through (4), the court could void such obligation and direct repayment if it found that the obligation was incurred with an intent to hinder, delay or defraud the creditors.

In addition, under Mexican Bankruptcy Law (Ley de Concursos Mercantiles), if any of the Guarantors that are located in Mexico are judicially declared bankrupt, such Guarantors’ obligations under its note guarantee will be subordinated to secured creditors and certain statutorily preferred creditors, such as those holding labor, tax and social security related claims, which will have preference over any other claims, including claims related to the senior notes described in this prospectus.

The senior notes may be effectively subordinated to our obligations under other secured indebtedness to the extent that these obligations are secured by collateral that does not secure the senior notes.

To the extent that our assets secure other indebtedness, but do not secure the senior notes, the senior notes will be effectively subordinated to such other obligations. In the event of a bankruptcy, liquidation, reorganization or the winding up of our business, assets securing other indebtedness would not be available to pay obligations under the senior notes unless and until payment in full of the obligations under such other secured indebtedness. Likewise, if the lenders under such other indebtedness accelerate such obligations, then those creditors would be entitled to exercise the remedies to secured creditors under applicable law.

Payments on the senior notes and the guarantees will be effectively junior to the liabilities of any non-guarantor subsidiaries.

The senior notes and the guarantees will constitute secured unsubordinated obligations of the Issuer and the Guarantors and will rank equal in right of payment with all of the other existing and future unsubordinated indebtedness of the Issuer and the Guarantors. Payment on the senior notes will be effectively subordinated to the payment of secured and unsecured debt and other creditors of our and the Guarantors’ non-guarantor subsidiaries. In addition, under Mexican law, the obligations of the Guarantors under the guarantees are subordinated to certain statutory preferences, including claims for salaries, wages, secured obligations, social security, taxes, court fees, expenses and costs. In the event of the Guarantors’ liquidation, such statutory preferences will have preference over any other claims, including claims by any holder of the senior notes.

As of June 30, 2007, the Issuer had Ps.1,918.6 million indebtedness and the Guarantors had no consolidated indebtedness. As of June 30, 2007, Ps.2.7 million of our cash was held in reserve pursuant to a trust arrangement in connection with our IXE Banco and Banco Mercantil del Norte loan facilities (this amount equals approximately one month’s interest under such credit facilities).

Not all of our subsidiaries are guarantors of the senior notes. However, our financial information (including our financial statements included herein) is presented on a consolidated basis. For the six month period ended June 30,

2007, our non-guarantor subsidiaries accounted for approximately 5.8% of our net revenue. As of June 30, 2007, our non-guarantor subsidiaries had liabilities in the amount of U.S.$4.8 million.

The provisions of the indenture governing the senior notes generally do not apply to our Unrestricted Subsidiaries and therefore their ability to incur debt, encumber their assets and make payments and distributions, among other matters, is not limited thereby.

Generally, the covenants and events of default included in the indenture do not apply to the Unrestricted Subsidiaries. See “Description of Notes.” As a result, the indenture imposes no limitations on the ability of the Unrestricted Subsidiaries to incur debt, make restricted payments, pledge their assets, make assets sales, and permit restrictions on their ability to pay dividends or make other distributions to us or issue their stock to third parties. Moreover, our Unrestricted Subsidiaries will not guarantee the senior notes. Thus, the senior notes will be effectively subordinated to all obligations, including indebtedness and trade payables, of our Unrestricted Subsidiaries. As a result, when evaluating our credit risk and making an investment decision with respect to the senior notes, you should not expect that the assets or cash flow of, if any, or our equity interest in, the Unrestricted Subsidiaries or those Restricted Subsidiaries will be available to repay the principal of, or pay interest on, the senior notes. As of June 30, 2007, we currently do not have any Unrestricted Subsidiaries. Subject to the limitations described under “Description of Notes — Certain Covenants — Restricted Payments,” however, we will be permitted to designate new or existing subsidiaries as Unrestricted Subsidiaries.

Laws affecting creditors’ rights and contractual restrictions of the subsidiary guarantors may limit the remedies of holders of the senior notes.

Under Mexican law, there are provisions that affect or may affect creditors’ rights generally or the rights of some creditors in particular. Those provisions include, among other things:


	•	a creditor’s right to request the nullification of an action taken by a debtor to the prejudice of such creditor; and

	•	priority given to preferred creditors, pursuant to which labor claims, claims of tax authorities for unpaid taxes and claims of secured creditors or creditors with a special privilege under the law will have priority over claims of unsecured creditors.

The measure of insolvency will vary depending upon the law of the jurisdiction being applied. Generally, however, an entity would be considered insolvent if the sum of its debts is greater than all of its property (including collection rights) at a fair valuation or if the present fair salable value of its assets is less than the amount that will be required to pay its probable liability on its existing debts as they become absolute and matured.

In addition, the subsidiary guarantors may be or become subject to contractual restrictions on their ability to make payments on the subsidiary guarantees. If a subsidiary guarantor is sold, merged or consolidated in a transaction in which it is not the surviving entity, it will be released from all obligations under its subsidiary guarantee. See “Description of Notes — Note Guarantees” and “Description of Notes — Limitation on the Sale or Issuance of Capital Stock of Restricted Securities.”

If the subsidiary guarantees are held not to be enforceable, the senior notes would effectively be subordinated to all liabilities of the subsidiary guarantors, including trade payables and accrued liabilities.

You may be unable to recover in civil proceedings for U.S. securities laws violations.

In connection with the transaction described in this prospectus, we have consented to the jurisdiction of the courts of the State of New York in the Borough of Manhattan and the United States Federal District Courts in the Southern District of New York. We are organized under the laws of Mexico as a sociedad anónima de capital variable. Some of our directors and officers named herein reside outside of the United States and some or a significant portion of the assets of such persons may be, and substantially all of our assets are, located outside of the United States. As a result, it may not be possible for investors to effect service of process upon such persons or entities outside of Mexico or to enforce judgments against us or them in the courts of jurisdictions other than Mexico or enforce any judgments obtained in such courts that are predicated upon the laws of such other jurisdictions. There

is doubt as to the enforceability against such persons in Mexico, whether in original actions or in actions to enforce judgments of U.S. courts, of liabilities predicated solely on U.S. federal securities laws because Mexican courts may determine that the obligations for which enforcement is sought contravenes or goes beyond Mexican law (and public policy (órden público) thereunder).

We may not be able to finance the repurchase of all of the senior notes should there be a change of control offer.

If there is a change of control, as defined under “Description of Notes — Change of Control,” for any reason, we would have the obligation to offer to repurchase the senior notes at 101% of their principal amount, plus accrued and unpaid interest, if any. The source of funds for any repurchase of the senior notes and any such other payments due upon the occurrence of a change of control will be our available cash or cash equivalents, if any. We cannot assure you, however, that we will have access to sufficient funds to purchase all of the senior notes that might be delivered by holders of the senior notes seeking to accept the offer to purchase, as well as such other amounts that may be due and payable at such time.

Some events involving a change of control may also cause an event of default under our other existing indebtedness or indebtedness that we may incur in the future. If a change of control occurs at a time when we are prohibited from purchasing the senior notes under other debt agreements, we could seek the consent of our lenders to purchase the senior notes or could attempt to refinance the borrowings that prohibit our repurchase of the senior notes. If we do not obtain that consent or repay those borrowings, we would remain prohibited from purchasing the senior notes. In that case, our failure to purchase any of the tendered senior notes would constitute an event of default under the indenture governing the senior notes, which would likely cause a default under other indebtedness. In that event, we would be required to repay all senior debt, including any secured debt, before we could repurchase the senior notes.

You may not be able to receive your payments on the senior notes in U.S. dollars in certain circumstances.

We are required to make payments of amounts owed under the senior notes in U.S. dollars. However, in the event that proceedings are brought against us or the subsidiary guarantors in Mexico, either to enforce a judgment or as a result of an action brought in Mexico, neither we nor the subsidiary guarantors would be required to discharge our obligations in a currency other than Mexican currency. Under the Mexican Monetary Law (Ley Monetaria de los Estados Unidos Mexicanos), obligations to make payments in Mexico in foreign currency may be discharged in pesos at the rate of exchange for pesos prevailing at the time and place of payment. Although we are contractually required, and intend, to make all payments of amounts owed under the senior notes in U.S. dollars, we are legally entitled to pay in pesos if payment of the senior notes is sought in Mexico (through the enforcement of a non-Mexican judgment or otherwise). In the event that we make payment in pesos, you may experience a U.S. dollar shortfall when converting the pesos into U.S. dollars.

You may suffer a U.S. dollar shortfall if you obtain a judgment against us.

In the event you are awarded a judgment from a Mexican court enforcing our U.S. dollar-denominated obligations under our senior notes, we will have the right to discharge our obligations by paying you in pesos at the exchange rate in effect on the date of payment of such judgment. The exchange rate is currently determined by the Central Bank of Mexico (Banco de México) every banking day in Mexico and published the following banking day in the Official Gazette of the Federation (Diario Oficial de la Federación). As a result of such currency conversion, you could face a shortfall in U.S. dollars. No separate actions exist or are enforceable in Mexico for compensation for any such shortfall.

If we were to be declared in bankrupt, holders of senior notes may find it difficult to collect payment on the senior notes.

Under the Mexican Bankruptcy Law (Ley de Concursos Mercantiles), if we or any of the guarantors of the senior notes were declared bankrupt (en quiebra) by a Mexican court, or were to become subject to reorganization

proceeding (concurso mercantil), our obligations under the senior notes and the applicable guarantor’s obligations under the guarantee of the senior notes: (i) would be converted into pesos at the exchange rate published by the Central Bank of Mexico prevailing at the time of the declaration of reorganization proceeding and then from pesos into a Unidades de Inversión, or UDIs, inflation indexed units, and would not be adjusted to take into account any devaluation of the peso relative to the U.S. dollar occurring after such conversion, (ii) would be subject to the outcome of, and priorities recognized in, the relevant proceedings, (iii) would be satisfied at the time claims of all of our creditors are satisfied after the relevant proceedings have been substantially advanced, (iv) would cease to accrue interest from the date a reorganization proceeding or bankruptcy is declared and, (v) would be subject to certain statutory preferences including tax, social security and labor claims and claims of secured creditors.

We cannot assure you that an active trading market for the exchange senior notes will develop.

The new senior notes constitute a new issue of securities, for which there is no existing market. We have agreed to file an application to admit the new senior notes to listing on the Official List of the Luxembourg Stock Exchange and to trading on the EuroMTF market, the alternative market of the Luxembourg Stock Exchange. We cannot provide you with any assurances that the application will be accepted. Further, no assurance can be provided regarding the development of a market for the new senior notes, the ability of holders of the new senior notes to sell their new senior notes, or the price at which such holders may be able to sell their new senior notes.

The initial purchasers are not obligated to facilitate trading in the new senior notes and any such activities, if commenced, may be discontinued at any time, for any reason, without notice. If the initial purchasers do not facilitate trading in the senior notes for any reason, there can be no assurance that another firm or person will do so. In addition, trading or resale of the new senior notes may be negatively affected by others factors described in this prospectus or the market for securities of Mexican issuers generally.

Accordingly, we cannot assure you that an active trading market for the new senior notes will develop or, if a trading market develops, that it will continue. The lack of an active trading market for the new senior notes would have a material adverse effect on the market price and liquidity of the new senior notes. Even if a market for the new senior notes develops, the new senior notes may trade at a discount from their initial offering price.

We may not be able to make payments in U.S. dollars as a result of restrictions and limitations imposed by the Mexican government.

In the past, the Mexican economy has experienced balance of payments deficits, shortages in foreign exchange reserves and other events that have resulted in restrictions on obtaining foreign currencies in exchange for pesos. While the Mexican government does not currently restrict the ability of Mexican or foreign persons to convert pesos to foreign currencies, or to U.S. dollars in particular, it has done so in the past and could do so again in the future. We cannot assure you that the Mexican government will not implement a restrictive exchange control policy in the future. Any such restrictive exchange control policy could prevent or restrict our access to U.S. dollars to meet our U.S. dollar obligations.

Risks Relating to the Collateral

The value of the Collateral securing the senior notes may not be sufficient to satisfy our obligations under the senior notes.

The Collateral subject to liens perfected after the date of issuance of the outstanding senior notes constitutes most of the Company’s telephone network systems and equipment assets. In the event of a foreclosure on the Collateral, we would be required to pay certain fees and other amounts prior to distribution of any amount in respect of the senior notes, which amounts would then be shared on an equal and ratable basis among the senior notes. We can provide no assurance as to the amount that would be distributed in respect of the senior notes upon any foreclosure or otherwise, or that the proceeds from the sale of the Collateral would be sufficient to satisfy our obligations under the senior notes.

The value of the Collateral and any amount to be received at foreclosure will depend upon many factors including, among others, the condition of the Collateral, changes in our industry, the ability to sell the Collateral in

an orderly sale, the availability of buyers, the condition of the Mexican economy and exchange rates. No appraisal of any of the Collateral has been prepared by us or on our behalf in connection with the offering and sale of the senior notes. Given the limited number of participants in the Mexican telecommunications market, and because a telecommunications concession title is required to operate some of the assets that comprise the Collateral, there may not be any buyer willing and able to purchase a significant portion of our assets or the Collateral in the event of foreclosure. In addition, since we are not pledging all of our assets, it will not be possible to sell our business as a going concern upon foreclosure. Each of these factors could reduce the likelihood of a foreclosure as well as reduce the amount of any proceeds in the event of foreclosure.

Rights of holders of senior notes in the Collateral may be adversely affected by the failure to perfect security interests in certain Collateral acquired in the future.

The security interest in the Collateral securing the senior notes includes specified classes of assets whether now owned or acquired or arising in the future. Applicable law requires that certain property and rights acquired after the grant of a general security interest can only be perfected at the time such property and rights are acquired and identified. There can be no assurance that the Trustee or the Collateral Agent will monitor, or that we will inform the Trustee or the Collateral Agent of, the future acquisition of property and rights that constitute Collateral, and that the necessary action will be taken to properly perfect the security interest in such after-acquired Collateral. Such failure may result in the loss of the security interest therein or the priority of the security interest in favor of the senior notes against third parties.

We will in most cases have control over the Collateral securing the senior notes, and the sale of particular assets by us or the guarantors could reduce the pool of assets securing the senior notes and the guarantees.

The Collateral Documents allow us and the guarantors to remain in possession of, retain exclusive control over, to freely operate and to collect, invest and dispose of any income from, the Collateral securing the senior notes. To the extent we sell any assets that constitute such Collateral, the proceeds from such sale will be subject to the liens securing the senior notes only to the extent such proceeds would otherwise constitute “Collateral” securing the senior notes and the guarantees under the security documents. To the extent the proceeds from any such sale of Collateral do not constitute “Collateral” under the security documents, the pool of assets securing the senior notes and the guarantees would be reduced and the senior notes and the guarantees would not be secured by such proceeds.

Impediments exist to any foreclosure on the Collateral, which may adversely affect the proceeds of any foreclosure.

Substantially all of the documents that create liens on the Collateral for the benefit of the senior notes, which we refer to as the Collateral Documents, are governed by the laws of Mexico, and substantially all of the Collateral is located in Mexico. Any foreclosure would therefore be required to comply with Mexican legal and procedural requirements, which differ substantially from those in the United States. In particular, Mexican law does not allow for self-executing liens or expedited foreclosure proceedings. Any proceeding against the Collateral in Mexico would be required to be initiated in a Mexican court, and could involve significant delays. A Mexican court would require a judgment regarding the existence of an event of default under the indenture governing the senior notes from a U.S. court prior to any foreclosure. We may also have available to us defenses under Mexican law not available under U.S. law to any foreclosure proceeding. In addition, foreclosure proceedings would need to be brought under the laws of the United States, which govern the remainder of the Collateral. These delays could result in a deterioration of the Collateral and a decrease in the value that would otherwise be realizable upon foreclosure.

Third parties’ rights may affect the ability of the Collateral Agent to foreclose on the Collateral and the priority of the senior notes with respect to the Collateral.

Third parties may have rights and be entitled to remedies that diminish the ability of the Collateral Agent to foreclose upon the Collateral or that affect the priority of the senior notes with respect to the Collateral. Under Mexican law, amounts owed to employees or, with some limited exceptions, to tax authorities, must be paid by a

debtor prior to the satisfaction of any other claims, including secured claims. In addition, under the terms of the senior notes, certain third-party Collateral Permitted Liens may be senior to the liens securing the senior notes. See “Description of Notes — Certain Definitions — Collateral Permitted Liens.” The rights and remedies to which these and other third party creditors are entitled may limit the ability of foreclosure on the Collateral or may otherwise reduce the proceeds available to satisfy our obligations under the senior notes.

We may incur additional secured indebtedness, which would dilute the value of the Collateral securing the senior notes.

Under the indenture governing the terms of the senior notes, we are permitted in the future to incur specified additional obligations that may share in the liens on the Collateral securing the senior notes. If we incur any additional debt that is secured on an equal and ratable basis with the senior notes, the holders of that debt will be entitled to share ratably with the holders of the senior notes and the value of the Collateral securing the senior notes will be diluted. Any such dilution will increase the risk of the proceeds from the sale of the Collateral not being sufficient to satisfy the amounts outstanding under the senior notes and all other obligations secured by such Collateral. If such proceeds were not sufficient to repay amounts due on the senior notes, then holders of the senior notes (to the extent the senior notes are not repaid from the proceeds of the sale of the Collateral) would only have an unsecured claim against our remaining assets.

Since not all of our assets are included in the Collateral, the ability to sell the Collateral as a going concern may be limited.

The Collateral pledged as security for our obligations under the senior notes is limited. The Collateral consists of a significant portion, but not all, of our tangible assets. The Collateral subject to liens constitutes most of the Company’s telephone network systems and equipment assets. In light of the fact that the Collateral is closely related to assets that are not pledged as Collateral, the ability of the Collateral Agent to sell the Collateral as a going concern may be limited.

A Mexican or U.S. bankruptcy may limit the ability to realize value from the Collateral.

The rights of the Collateral Agent upon a foreclosure on the Collateral upon the occurrence of an event of default under the indenture is likely to be significantly impaired by applicable bankruptcy law if a bankruptcy proceeding were to be commenced by or against us before the foreclosure on the Collateral.

The Mexican bankruptcy law, which we refer to as the Ley de Concursos Mercantiles, may prevent the foreclosure or selling all or any part of the Collateral prior to our liquidation. In addition, during the pendency of insolvency proceedings, Mexican law does not require the debtor to provide adequate protection or assurances to secured creditors, although the bankruptcy court could adopt precautionary measures to such effect. A proceeding under Mexican bankruptcy law is divided into stages: an initial mediation stage and a second bankruptcy stage. The initial stage cannot last more than one year, and during this stage, a mediator (conciliador) is to be appointed within five days of the initial court ruling initiating a concurso mercantil. The mediator has certain powers to protect the enterprise as a going concern and initiate bankruptcy proceedings. During the second bankruptcy stage, a receiver (síndico) is appointed to proceed with the sale of assets. The receiver has additional powers to protect the enterprise. Neither the mediator nor the receiver, however, is specifically required to protect the rights of secured creditors. No proceeds would be distributed in respect of the senior notes prior to this sale of assets, and any amounts owed to our employees would be paid prior to the distribution of any amounts in respect of the senior notes. Generally, claims for taxes would also rank senior to the senior notes, other than with respect to certain portions of the Collateral to the extent perfected and recorded prior to notification of a federal tax claim.

In addition, significant uncertainties are inherent in Mexican bankruptcy proceedings that may result in further delays that could adversely impact the value of the Collateral. The Ley de Concursos Mercantiles was recently enacted, and only a few companies have completed a concurso mercantil under the amended law. There have been a limited number of final judicial decisions under the new law relating to critical bankruptcy issues such as the relative treatment and priority of debts, criteria for recognition of claims, the filing of the petition for reorganization, the role of the creditors in overseeing business operations during insolvency proceedings, criteria for court approval of a

reorganization plan and the effect of the process on subsidiaries. Creditors’ rights in a bankruptcy proceeding are therefore not well-established in Mexico, and this may result in substantial delays beyond those contemplated by the Ley de Concursos Mercantiles as well as the inability of the mediator and the receiver to exercise the remedies and powers granted to them. Delays in proceedings, the inadequacy of available remedies and the inability of the mediator or receiver to exercise available remedies could result in a substantial deterioration of the Collateral during the pendency of any such proceeding.

Under applicable U.S. federal bankruptcy law, a secured creditor is prohibited from repossessing its security from a debtor in a bankruptcy case, or from disposing of security repossessed from such debtor, without bankruptcy court approval. Applicable U.S. federal bankruptcy law also permits the debtor to continue to retain and to use Collateral even though the debtor is in default under the applicable debt instruments, provided that the secured creditor is given “adequate protection.” The meaning of the term “adequate protection” may vary according to circumstances, but is intended in general to protect the value of the secured creditor’s interest in the Collateral and may include cash payments or the granting of additional security, if and at such times as the court in its discretion determines, for any diminution in the value of the Collateral as a result of the stay of repossession or disposition or any use of the Collateral by the debtor during the pendency of the bankruptcy case. Generally, adequate protection payments, in the form of interest or otherwise, are not required to be paid by a debtor to a secured creditor unless the bankruptcy court determines that the value of the secured creditor’s interest in the Collateral is declining during the pendency of the bankruptcy case. Given the lack of a precise definition of the term “adequate protection” and the broad discretionary powers of a bankruptcy court, it is impossible to predict:


	•	how long payments under the senior notes could be delayed following commencement of a bankruptcy case;

	•	whether or when the Collateral Agent could repossess or dispose of the Collateral; or

	•	whether or to what extent holders of the senior notes would be compensated for any delay in the payment or loss of value of the Collateral through the requirement of “adequate protection.”

Furthermore, in the event the bankruptcy court determines that the value of the Collateral is not sufficient to repay all amounts due on the senior notes, the holders of the senior notes would hold “undersecured claims.” Applicable U.S. federal bankruptcy law does not permit the payment or accrual of interests, costs and attorney’s fees for “undersecured claims” during the debtor’s bankruptcy case.

The value of the Collateral may decrease because of obsolescence, impairment or certain casualty events.

We can provide no assurances that the value of the Collateral will not be adversely affected by obsolescence, changes in the technology in our industry, other changes in equipment or certain casualty events.

The Collateral Documents do not require us to improve the Collateral. In addition, our existing equipment may become obsolete or be replaced by new equipment that may not be part of the Collateral. Although we are obligated under the Collateral Documents to maintain insurance with respect to the Collateral, we can provide no assurances that the proceeds of such insurance will be sufficient to repurchase adequate replacement Collateral or will equal the fair market value of the damaged Collateral. Our insurance policies also do not cover all events that may result in damage to the Collateral. Additionally, a loss arising from a title defect with respect to the Collateral may adversely affect the value of the Collateral.

The guarantees granted by and the pledges of assets of our subsidiaries may be held to be unenforceable under fraudulent conveyance laws.

Our obligations under the senior notes are guaranteed by certain of our subsidiaries and are secured by the pledge of certain of our and our subsidiaries’ assets. The guarantees and the pledges may be subject to review under various laws for the protection of creditors. It is possible that the creditors of a guarantor or a grantor may challenge a guarantee or a pledge as a fraudulent transfer under relevant U.S. federal and state laws by claiming, for example, that, since the guarantee or pledge was incurred for our benefit (and only indirectly, if at all, for the benefit of the guarantor or a grantor), the obligations of the guarantor or a grantor were incurred for less than reasonable equivalent value or fair consideration. A similar doctrine could apply under Mexican law if the guarantee or pledge is granted within 270 days of the commencement of insolvency proceedings, which period may be extended upon

the reasonable request of the mediator or any creditor. Moreover, laws for the protection of creditors of other jurisdictions also provide similar remedies to creditors of a guarantor or a grantor. Under certain circumstances, including a finding that a guarantor or a grantor was insolvent at the time its guarantee or pledge was issued or granted, a court could hold that the obligations of the guarantor or a grantor under the guarantee or the pledge may be voided or are subordinate to other obligations of the guarantor or a grantor or that the amount for which a guarantor or a grantor is liable under a guarantee or for a debt secured by a pledge may be limited. Different jurisdictions define “insolvency” differently. However, a guarantor or a grantor generally would be considered insolvent at the time it guaranteed the senior notes or secured the senior notes with a pledge of its assets if:


	•	the fair market value (or fair saleable value) of its assets is less than the amount required to pay its total existing debts and liabilities (including the probable liability of contingent liabilities) as they become absolute or mature; or

	•	the guarantor or a grantor were incurring debts beyond its ability to pay as such debts mature.

We cannot assure you what standard a court would apply to determine whether a guarantor or a grantor was “insolvent” as of the date the senior notes were guaranteed or secured by a pledge of assets. Irrespective of the method of valuation, a court may determine that the guarantees or the pledges constituted fraudulent transfers on another ground whether or not the guarantor or a grantor was insolvent on the date the guarantee was issued or the pledge was granted. In addition, although the indenture will limit the amount of the senior secured note guarantees to the amount that will result in the guarantees not constituting fraudulent transfers or improper corporate distributions, we cannot be certain which standard a court would apply in determining the maximum liability of the guarantors or the grantors.

Risks Relating to Mexico

Political conditions in Mexico may significantly affect our business, results of operations and financial condition.

We are incorporated in Mexico and substantially all of our assets and operations are located in Mexico. As a result, we are subject to political, legal and regulatory risks specific to Mexico which can have a significant impact on our business, results of operations and financial condition.

Political situation

The Mexican federal elections were held on July 2, 2006. The Federal Electoral Court of the Federal Judicial Power (Tribunal Federal Electoral del Poder Judicial de la Federación) determined on September 5, 2006 that Felipe de Jesús Calderón Hinojosa of the Partido Acción Nacional won the presidential elections and formally declared him to be president elect, with a very narrow margin over Andrés Manuel López Obrador of the Partido de la Revolución Democrática. Citing electoral fraud, Mr. López Obrador refused to concede the election. On December 1, 2006, Felipe Calderón officially became President of Mexico. Although the Partido Acción Nacional won a plurality of the seats in the Mexican Congress after the election, no party succeeded in securing a majority in either chamber of the Mexican Congress. We believe that the absence of a clear majority by a single party and the lack of alignment between the president and the legislature is likely to continue. This situation may result in government gridlock and political uncertainty, which could result in changes to existing laws and regulations relating to, among other areas, taxation, labor and the telecommunications industry. Any of these changes could have a significant impact on the telecommunications industry and harm our business.

Legal and regulatory situation

Effective April 11, 2006, the Mexican Congress enacted amendments to the Federal Law on Radio and Television (Ley Federal de Radio y Televisión) and to the Federal Telecommunications Law. Pursuant to these amendments, which were highly controversial, the Mexican Federal Telecommunications Commission now also has the ability to regulate broadcasting (radio and television). We cannot predict how the Mexican Ministry of Communications and Transportation (Secretaria de Comunicaciones y Transportes) or the Mexican Federal Telecommunications Commission will interpret and implement the amendments to the Federal Law on Radio

and Television and the Federal Telecommunications Law and thus how these new rules could affect our business. This uncertainty could adversely affect our business and subject us to additional legal liabilities or obligations. Furthermore, the Mexican Supreme Court recently resolved that several articles of the Federal Law on Radio and Television and to the Federal Telecommunications Law are unconstitutional. Although we believe that this Supreme Court ruling does not directly affect us, we cannot predict the impact that the future interpretation and implementation by the Mexican Ministry of Communications and Transportation or the Mexican Federal Telecommunications Commission of this ruling, or the amendment by the Mexican Congress of these laws as a result of the Mexican Supreme Court ruling could have on the regulation of the telecommunications industry and on our business, results of operations and financial condition.

If Mexico experiences future economic crises, our business could be affected negatively.

We are a Mexican company with all of our operations in Mexico. Accordingly, the economic environment within Mexico can have a significant impact on our business, results of operations and financial condition.

The Mexican government has exercised, and continues to exercise, significant influence over the Mexican economy. Accordingly, Mexican federal governmental actions and policies concerning the economy could have a significant impact on private sector entities in general and on us in particular and on market conditions, prices and returns on Mexican securities, including our securities.

In the past, Mexico has experienced economic crises caused by internal and external factors, characterized by exchange rate instability, high inflation, high domestic interest rates, economic contraction, a reduction of international capital flows, a reduction of liquidity in the banking sector and high unemployment. These economic conditions could substantially reduce the purchasing power of the Mexican population and, as a result, the demand for telecommunications services that we offer.

Changes to Mexican laws, regulations and decrees applicable to us could have a material adverse effect on our business, results of operations and financial condition.

The telecommunications sector in Mexico is subject to numerous laws and extensive regulations by a number of governmental authorities, including the Mexican Ministry of Communications and Transportation and the Mexican Federal Telecommunications Commission, which are responsible for, among others, formulating policy, granting licenses, setting tariff schemes, regulating interconnection among providers, levying taxes on services and supervising the provision of services. Laws applicable to our business may be enacted, amended or repealed and governmental agencies may make regulatory interpretations or take regulatory actions that could damage our business, increase competition, increase our costs of operation, decrease our revenues, limit our ability to grow our operations, or otherwise adversely impact our business.

Peso devaluation relative to the U.S. dollar could make it more difficult for us to service our indebtedness and could decrease the value of our securities.

While our revenues are almost entirely denominated in pesos, the majority of our obligations and all of our long-term indebtedness are denominated in U.S. dollars. In addition, substantially all of our capital expenditures are denominated in U.S. dollars. We are, and will be, exposed to peso devaluation risk. The peso has devalued substantially against the U.S. dollar in the past and may devalue significantly in the future. For example, the noon buying rate rose from Ps.3.45 per U.S.$1.00 on December 19, 1994 to Ps.5.00 per U.S.$1.00 on December 31, 1994 and Ps.7.74 per U.S.$1.00 on December 31, 1995, representing a 124.6% devaluation of the peso relative to the U.S. dollar from December 19, 1994 to December 31, 1995. In 2003, the peso depreciated 9.0% relative to the U.S. dollar. The peso depreciated relative to the U.S. dollar 0.3% in 2004, appreciated 4.9% in 2005 and depreciated 1.5% in 2006.

The peso-to-dollar exchange rate may experience significant devaluations in the future. Further declines in the value of the peso relative to the U.S. dollar could adversely affect our ability to meet our U.S. dollar-denominated obligations, including our senior secured notes. In addition, any further decrease in the value of the peso may negatively affect the value of Mexican securities such as ours.

Exchange rate control rules enacted in the future could make it more difficult for us to service our U.S. dollar-denominated debt, raise capital outside of Mexico and make capital expenditures.

In the past, the Mexican government has issued exchange control rules that, although not in effect today, may be enacted in the future. If so enacted, exchange control rules could make it more difficult to service our U.S. dollar-denominated debt, raise capital outside of Mexico and make capital expenditures.

The price of our securities could decrease due to events in other countries, especially the United States and emerging market countries.

We cannot assure you that the price of our securities will not be adversely affected by events elsewhere, especially in the United States and in emerging market countries. Mexican financial and securities markets are, to varying degrees, influenced by economic and market conditions in other countries. Although economic conditions are different in each country, investor reaction to developments in one country has had and can have significant effects on the prices of securities of issuers in other countries, including Mexico. For example, each of the 1997 Asian economic crisis, the 1998 Russian debt moratorium and currency devaluation, the 1999 Brazilian currency devaluation and the 2001 Argentine debt default and currency devaluation triggered market volatility in Latin America. The economic slowdown in the United States, the military conflict in Iraq, the threat of terrorism and political and financial crises in certain emerging markets have had a significant negative impact on the financial and securities markets in many emerging market countries, including Mexico.

Less information about our company may be publicly available because we are subject to different corporate disclosure and accounting standards than U.S. companies.

A principal objective of the securities laws of the United States and Mexico is to promote full and fair disclosure of all material corporate information. However, there may be less publicly available information about foreign issuers of securities listed in the United States and of Mexican issuers in Mexico than is regularly published by or about U.S. issuers of listed securities. In addition, we prepare our consolidated financial statements in accordance with Mexican GAAP. Mexican GAAP differs in significant respects from U.S. GAAP, including in the treatment of deferred income taxes, employees’ profit sharing accounting for retirement obligations, the capitalization of preoperating expenses and interest, the restructuring of troubled debt and the presentation of cash flow information. In particular, all Mexican companies must incorporate the effects of inflation directly in their accounting records and in published financial statements. We cannot assure you that these will be the only differences in the future. See note 22 to the consolidated financial statements for a description of the principal differences between Mexican GAAP and U.S. GAAP applicable to us.

You may suffer a U.S. dollar shortfall if you obtain a judgment against us.

If we were to be declared bankrupt, holders of the senior notes may find it difficult to collect payment on the notes.

Under the Mexican Bankruptcy Law (Ley de Concursos Mercantiles), if we or any of the guarantors of our senior notes were declared bankrupt (en quiebra) by a Mexican Court, or were to become subject to reorganization proceeding (concurso mercantil), our obligations under the notes and the applicable guarantor’s obligations under the guarantee of the senior notes: (i) would be converted into pesos at the exchange rate published by the Central Bank of Mexico prevailing at the time of the declaration of reorganization proceeding and then from pesos into Unidades de Inversión, or UDIs, inflation indexed units and would not be adjusted to take into account any

devaluation of the peso relative to the U.S. dollar occurring after such conversion, (ii) would be subject to the outcome of, and priorities recognized in, the relevant proceedings, (iii) would be satisfied at the time claims of all of our creditors are satisfied after the relevant proceedings have been substantially advanced, (iv) would cease to accrue interest from the date a reorganization proceeding or bankruptcy is declared and, (v) would be subject to certain statutory preferences including tax, social security and labor claims and claims of secured creditors.

High inflation rates in Mexico may decrease demand for our services while increasing our costs.

In recent years, Mexico has experienced high levels of inflation relative to the United States, its main commercial partner. Mexico’s annual rate of inflation was 5.7% in 2002, 4.0% in 2003, 5.2% in 2004, 3.3% in 2005 and 4.1% in 2006. High inflation rates can adversely affect us as follows:


	•	inflation can adversely affect consumer purchasing power, thereby adversely affecting consumer demand for our services and products; and

	•	to the extent inflation exceeds our price increases, our prices and revenues will be adversely affected in real terms.

High interest rates in Mexico could increase our financing costs.

Mexico has, and is expected to continue to have, high real and nominal interest rates, relative to the United States, its main commercial partner. The interest rates on 28-day Mexican government treasury securities averaged, 7.1% in 2002, 6.2% in 2003, 6.8% in 2004, 9.2% in 2005 and 7.2% in 2006. Although we do not currently have any peso-denominated indebtedness, if we need to incur such indebtedness in the future, it will likely be at high interest rates.

As a result of a recently enacted alternative minimum tax, our tax expenses could increase and our net income could decrease.

On September 14, 2007, the Mexican Congress approved a new federal tax applicable to all Mexican corporations, including us, known as the Single Rate Corporate Tax (Impuesto Empresarial a Tasa Única), which is a form of alternative minimum tax and replaces the asset tax that has applied to corporations and other taxpayers in Mexico for several years. This tax will be imposed at a rate of 16.5% for calendar year 2008, 17% for calendar year 2009 and 17.5% for calendar year 2010 and thereafter. A Mexican corporation is required to pay the tax if the amount payable under the alternative minimum tax exceeds the income tax payable by the corporation under the Mexican income tax law. In general terms, the alternative minimum tax is determined by applying the rates specified above to the amount resulting from deducting from a company’s taxable income, among other items, goods acquired (consisting of raw materials and capital investments), services provided by independent contractors and lease payments required for the performance of the activities taxable under the alternative minimum tax. Salaries and interest payments arising from financing transactions are not deductible for purposes of determining the alternative minimum tax. However, salaries subject to income tax and social security contributions paid to employees are creditable for purposes of determining the alternative minimum tax. If the amount of alternative minimum tax payable by us significantly exceeds the income tax we would have paid, our tax expenses will increase and we could suffer a material decrease in net income.

Risks Relating to the Mexican Telecommunications Industry

The telecommunications industry in Mexico is increasingly competitive, which may result in lower prices for telecommunications services, lower margins and/or a loss of market share.

The Mexican telecommunications industry is increasingly competitive and rapidly changing. We face significant competition from Telmex (the incumbent wireline telecommunications provider in Mexico) as well as other telecommunications providers and new market entrants such as cable operators. The Mexican government has been taking action to increase competition by, among other things, enacting regulations allowing certain concessionaries of media (including cable operators) and telecommunication services to provide services not included in their original concessions. In particular, cable operators who have substantial coverage of cities we currently serve may offer the same voice and data services we provide at lower prices since telephony income

represents incremental revenue to cable operators. See “Industry Overview — Market Liberalization.” Many of our current and potential competitors have significantly more employees and greater financial, technical, marketing and other resources than we do. Increased competition could result in fewer customers, reduced pricing, reduced gross and operating margins and loss of market share, any of which could harm our business.

If the Mexican government grants more concessions, the value of our concessions could be severely impaired.

The telecommunications industry is regulated by the Mexican government. Our concessions are not exclusive and the Mexican government is granting concessions covering the same geographic regions and frequency bands to other entrants. We cannot assure you that additional concessions to provide similar services to those we provide or plan to provide will not be granted to other competitors and that the value of our concessions will not be adversely affected.

We could lose our concessions if we do not fully comply with their terms or if we are not able to renew our existing concessions.

We hold concessions that enable us to provide telecommunications services. Under the terms of our concessions, we are required to meet a number of technical, buildout and financial conditions and in the past, we have failed to meet some of these conditions. We subsequently obtained a modification from the Mexican Federal Telecommunications Commission to the concessions and are now in compliance with all material aspects. However, we cannot assure you that we will not be fined for our past failure to comply with the terms of our concessions. In addition, any failure to comply with any of the terms of our concessions or to obtain a waiver or modification could result in the termination of those concessions, the imposition of fines or the loss of performance bonds that we have issued to the Mexican Ministry of Communications and Transportation. The Mexican government is not required to compensate us in the event of such termination. See “Regulation — Concessions and Permits — Termination.”

Furthermore, all of our concessions have a specified duration and are scheduled to expire between 2016 and 2028. Mexican law provides that concessions, except for the microwave transmission concessions which will be re-auctioned, may be renewed for a period equal to the duration of the original concession if certain requirements are met and at the discretion of the Mexican Ministry of Communications and Transportation. There can be no assurances that any of our concessions will be renewed or under what terms they would be renewed or that we will successfully bid for and retain the microwave transmission concessions.

If any of our key concessions, including our local and long distance telephony concession, were terminated or not renewed, we would be unable to engage in our business.

Fraudulent use of telecommunications networks increases our expenses.

The fraudulent use of telecommunications networks imposes a significant cost upon service providers, who must bear the cost of services provided to fraudulent users. We suffer a loss of revenue as a result of fraudulent use and a cash cost due to our obligation to reimburse carriers for the cost of services provided to fraudulent users. Although we have installed technology to combat fraudulent use and will continue to evaluate and select amongst new fraud detection technologies as they become available, technology does not eliminate fraud entirely. In addition, since we rely on other long-distance carriers for interconnection, some of which do not have anti-fraud technology in their networks, we are particularly exposed to this risk in our long-distance service and in traffic originating in our network to mobile users under the mode of “calling party pays.” In 2006, our expenses for the prevention and detection of fraud were not significant. Due to cost reduction measures, we may elect not to upgrade our licenses relating to anti-fraud software or to cover maintenance fees.

Rapid technological advances may require us to make significant capital expenditures to maintain and improve the competitiveness of our service offerings.

The telecommunications industry is subject to rapid and significant changes in technology and requires the introduction of new products and services. Like other operators, we cannot predict the effect of technological changes on our business. New services and technological advances may offer additional opportunities for

competitors to compete against us on the basis of cost, quality or functionality. While we have been installing what we believe to be a technologically advanced fiber optic network with a microwave overlay, we cannot assure you that this technology will not be challenged by competition from new or improved digital or other technologies in the near future. Our future success depends, in part, on our ability to anticipate and respond in a timely manner to technological changes. This may require us to devote significant capital to the development, procurement or implementation of new technologies. Additionally, our adoption of new imported technology may be dependent upon the final cost and our ability to obtain additional financing. There can be no assurance as to the nature and extent of the impact of technological change on our viability or competitiveness. If any future technological change places at risk our viability or competitiveness, the cost of upgrading our products and technology to remain competitive could be significant and our ability to fund this upgrading may depend on our ability to obtain additional financing on terms acceptable to us.

Under Mexican law, our concessions could be expropriated or temporarily seized.

Pursuant to the Mexican law, the public telecommunications networks are considered public domain. Holders of concessions to install, operate and develop public telecommunications networks are subject to the provisions of the Mexican Federal Telecommunications Law (Ley Federal de Telecomunicaciones) and any other provision contained in the concession title. The Mexican Federal Telecommunications Law and other applicable laws provide, among other things, the following:


	•	rights and obligations granted under the concessions to install, operate and develop public telecommunications networks may only be assigned with the prior authorization of the Mexican Ministry of Communications and Transportation;


	•	neither the concession nor the rights thereunder or the related assets may be assigned, pledged, mortgaged or sold to any government or country; and


	•	the Mexican government (through the Mexican Ministry of Communications and Transportation) may permanently expropriate any telecommunications concession and claim any related asset for reason of public interest or may temporarily seize the assets related to the concessions in the event of natural disasters, war, significant public disturbance or threats to internal peace or for other reasons relating to economic or public order.

Mexican law sets forth the process for indemnification for direct damages arising out of the expropriation or temporary seizure of the assets related to the concessions, except in the event of war. However, in the event of expropriation, we cannot assure you that the indemnification will equal the market value of the concessions and related assets or that we will receive such indemnification in a timely manner.

Mexican law does not prohibit a grant of a security interest in the concessions and the assets by the concessionaire to its creditors (except for security granted to a foreign government or country), provided, however, that all applicable procedural laws are followed. In the event such security interest is enforced, the assignee must comply with the Mexican Federal Telecommunications Law’s provisions related to concessionaires, including, among others, the requirement to receive the authorization of the Mexican Ministry of Communications and Transportation to be a holder of the concession.

“Long-distance Calling Party Pays” system could result in a loss of customer traffic and revenue.

On December 18, 2006, the Mexican Federal Telecommunications Commission implemented the “Long-distance Calling Party Pays” system, whereby the customer originating the domestic or international call, from either a fixed line or mobile phone to a mobile phone, pays the entire fee for placing the call rather than the mobile telephone subscriber who receives such call. Even though the mobile telephone subscriber receiving the call does not pay to receive the call, the network from which the call originates must still compensate the terminating mobile network. Maxcom has negotiated with mobile carriers the “Long-distance Calling Party Pays” interconnection tariff for local and long-distance calls to be terminated in such mobile operators’ network, achieving a significant reduction of the original tariff contemplated by the agreements implementing this system issued by the Mexican Federal Telecommunications Commission. The per minute tariffs will be Ps.1.34 in 2007, Ps.1.21 in 2008, Ps.1.09

in 2009 and Ps.1.00 in 2010. Even though we have negotiated better interconnection tariffs than those proposed by the Mexican Federal Telecommunications Commission, we believe that the expense associated with the interconnection tariff could result in loss of customer traffic and revenue.

Foreign ownership restrictions may limit our ability to raise equity capital.

Mexican law currently provides that no more than 49% of the full voting stock of a Mexican corporation holding a concession to provide telecommunications services, other than mobile services, may be held by non-Mexicans. In addition, Mexican authorities have mandated that our shares held by the CPO trustee, which are also referred to as neutral investment shares, may not represent more than 95% of our total capital stock. Because of such restrictions, we have limited flexibility to raise equity capital from non-Mexican investors. As a result, any future sales of equity securities may require substantial participation by Mexicans, the issuance of non-voting securities to foreign investors or a modification of Mexican foreign investment laws and regulations. We cannot assure you that such a modification would be passed.

Risks Relating to Maxcom

We may not be able to generate sufficient cash flows to meet our debt service obligations and implement our business plan.

Our business plan, including the expansion of our network and services, requires significant capital expenditures. In turn, our ability to fund these planned capital expenditures as well our operating expenses and our debt service obligations will depend on our ability to develop a significantly larger customer base and increase our operating cash flows. However, we may not succeed in attracting more customers and as a result our business may not generate sufficient operating cash flows to implement our business plan or even meet our existing debt service obligations. For example, from our incorporation in 1996 through 2003 we generated negative operating cash flows. If we cannot service our debt obligations, we may have to take actions such as selling assets, seeking additional equity investments, reducing or delaying capital expenditures, strategic acquisitions, investments and alliances, or restructuring our indebtedness pursuant to in court or out of court procedures, any of which could inhibit the implementation of our business plan and materially harm our operating results and financial condition.

Because we have a history of losses and may continue to incur significant expenses, we cannot be certain that we will achieve profitability.

We incurred net losses of U.S.$2.6 million (Ps.28.2 million) for the year ended December 31, 2006 and U.S.$1.6 million (Ps.16.8 million) for the six months ended June 30, 2007. Our losses may continue, and possibly increase, as we invest in the expansion of our network and the implementation of our business strategy. Because we expect to continue to incur significant expenses in connection with the expansion of our network, we will need to generate significant revenues to achieve and maintain profitability. We cannot be certain that we will ever achieve profitability and, if we do achieve profitability, we cannot be certain that we can sustain or increase profitability on a quarterly or annual basis in the future. If we fail to achieve profitability within the time frame expected by our investors, the market price of our securities will be adversely affected.

We may be unable to build out our network in a timely manner or without undue cost.

Our ability to achieve our strategic objectives will depend in large part upon the successful, timely and cost-effective buildout of our network. Factors that could affect such buildout include:


	•	municipal or regional political events or local rulings;


	•	our ability to obtain permits to use public rights of way;


	•	our ability to generate cash flow or to obtain future financing necessary for such buildout;


	•	unforeseen delays, costs or impediments relating to the granting of municipal and state permits for our buildout;

	•	delays or disruptions resulting from physical damage, power loss, defective equipment or the failure of third-party suppliers or contractors to meet their obligations in a timely and cost-effective manner; and

	•	regulatory and political risks relating to Mexico, such as the revocation or termination of our concessions, the temporary seizure or permanent expropriation of assets, import and export controls, political instability,


		changes in the regulation of telecommunications and any future restrictions or easing of restrictions on the repatriation of profits or on foreign investment.

Although we believe that our cost estimates and buildout schedule are reasonable, we cannot assure you that the actual construction costs or time required to complete the buildout will not substantially exceed our current estimates. Any significant cost overrun or delay could hinder or prevent the successful implementation of our business plan, including the development of a significantly larger customer base, and result in revenues and net income being less than expected.

The loss of key personnel could harm our business, results of operations and financial condition.

Our operations are managed by a small number of executive officers and key management personnel. Our continued success, including our ability to effectively expand our network, provide existing services and develop and introduce new services, largely depends on the efforts and abilities of our executive officers and other key management employees, as well as our ability to hire and retain highly skilled and qualified management personnel. Between 2000 and 2004, we experienced significant turnover in our executive ranks, including in the positions of chief executive officer, chief marketing officer and chief financial officer, which adversely affected our ability to develop and execute our business strategies during such period. The competition for highly qualified management personnel in the telecommunications industry is intense and, accordingly, we cannot assure you that we will be able to hire or retain the necessary management personnel. Our business could be materially and adversely affected if, for any reason, a number of our officers including our Chief Executive Officer, René Sagastuy, our Chief Financial Officer, José Antonio Solbes, our Chief Operating and Technology Officer, Ricardo Arévalo Ruiz and our Vice President of Sales and Marketing, Alejandro Díaz y Díaz, or key employees do not remain with us and we were unable to promptly replace them with qualified personnel.

We may not have sufficient personnel to grow as rapidly as we would like.

Our expected rate of growth will place a significant strain on our administrative, operational and financial personnel. We anticipate that continued growth will require us to recruit and hire a significant number of new non-executive managerial, finance, sales and marketing, accounting and support personnel. If we are unable to attract and retain qualified personnel who can support the implementation of our business plan, our growth may be limited and the quality of our services may be impaired.

If we have to pay Telmex local interconnection fees, we may not be able to provide services at competitive rates.

Teléfonos de México, S.A.B. de C.V., or Telmex, and its affiliates exert significant influence on all aspects of the telecommunications market in Mexico, including interconnection agreements for local and long-distance services. We use Telmex’s network for call termination to service virtually all of our customers’ calls to Telmex’s customers. Our current local interconnection agreement with Telmex incorporates a “bill and keep” procedure under which we do not pay Telmex an interconnection fee unless we exceed a certain level of traffic imbalance. Under the “bill and keep” arrangement, if the imbalance between calls originated by Telmex and terminated by Maxcom and calls originated by Maxcom and terminated by Telmex during a month does not exceed 5%, excluding commercial traffic and customers who have had contracts for less than 180 days, then no interconnection fee amounts are payable by the net carrier of interconnection services. The interconnection rate is currently Ps.0.1052 (U.S.$0.00975) per minute. If the allowed percentage for imbalance of traffic for the “bill and keep” procedure is exceeded and/or if the “bill and keep” procedure is eliminated and we have to pay Telmex for local interconnection, our operating costs may increase and we may not be able to offer services at competitive rates.

Our inability to successfully upgrade our accounting, billing, customer service and management information systems as new technology becomes available could increase our churn rates, inhibit our ability to attract new customers and result in decreased revenue and increased costs.

Sophisticated information and processing systems are important to our existing operations and future growth and our ability to monitor costs, deliver invoices, process customer orders, provide customer service and achieve operating efficiencies. While we have installed systems we deem necessary to conduct our operations efficiently, we intend to upgrade our accounting, information and processing systems as new and more cost efficient technology becomes available. We believe we have budgeted for the applicable expenditures and will have sufficient resources

to make such investments. However, we cannot assure you that we will be able to successfully upgrade such systems as technology advances and any inability to do so could increase our churn rates, inhibit our ability to attract new customers and result in decreased revenue and increased costs.

Service interruptions due to natural disasters or unanticipated problems with our network infrastructure could result in customer loss.

Natural disasters or unanticipated problems with our network infrastructure could cause interruptions in the services we provide. The failure of a switch would result in the interruption of service to the customers served by that switch until necessary repairs are completed or replacement equipment is installed. The successful operation of our network and its components is highly dependent upon our ability to maintain the network and its components in reliable enough working order to provide sufficient quality of service to attract and maintain customers. Any damage or failure that causes interruptions in our operations or lack of adequate maintenance of our network could result in the loss of customers and increased maintenance costs that would adversely impact our results of operations and financial condition.

We could be negatively affected by “by-pass” international traffic.

Pursuant to Mexican Federal Telecommunications Commission regulations, international long-distance traffic in Mexico must be routed and terminated through authorized international gateways at established international settlement rates. However, less expensive alternatives which by-pass authorized gateways exist, particularly in the case of countries with whom Mexico exchanges a significant amount of traffic. Given the disparity between the government-authorized and alternative long-distance interconnection and termination rates through local service routes and/or Internet Protocol services, an increasing portion of the long-distance market between Mexico and the United States is served by entities that circumvent or “by-pass” the international long-distance interconnection system. This practice is illegal under applicable law.

Maxcom cannot confirm whether any of its high-volume customers are engaging in “by-pass” activities because it is not required to make such a determination under Mexican regulations and therefore has not implemented a system to detect such activity. Maxcom is required, however, to comply with any Mexican Federal Telecommunications Commission order to disconnect a customer deemed to be engaged in “by-pass” activities by the Mexican Federal Telecommunications Commission. In 2000, Mexican regulatory authorities announced their intention to conduct more rigorous audits of persons or companies believed to be engaged in “by-pass” activities. In December 2000, some of the major Mexican long-distance carriers, including Maxcom, signed a cooperation agreement to combat “by-pass” activities. If, as a consequence of such actions, the regulatory authorities determine that any of our high-volume customers are engaged in “by-pass” activity, Maxcom would be required to disconnect their service and our revenues could be negatively affected.

Our telecommunications network infrastructure has several vulnerabilities and limitations.

Our telecommunications network is the source of all our revenues. Any problem with or limitation of our network may result in a reduction in the number of our customers or usage level by our customers, our inability to attract new customers or increased maintenance costs, all of which would have a negative impact on our revenues and net income. The development and operation of our network is subject to problems and technological risks, including:


	•	physical damage;

	•	power loss;

	•	capacity limitations;

	•	software defects as well as hardware and software obsolescence;

	•	breaches of security, whether by computer virus, break-in or otherwise;

	•	failure to interconnect with carriers linking us with our customers;

	•	denial of access to our sites for failure to obtain required municipal or other regulatory approvals; and


	•	other factors which may cause interruptions in service or reduced capacity for our customers.

Our results may be negatively impacted by high levels of churn.

A high rate of residential or business customer lines attrition, or “churn,” decreases revenue, reduces our ability to recoup installation costs and increases our operating costs. Churn may be impacted by:


	•	customer delinquency;

	•	our limited coverage area that restricts our ability to continue providing service when a customer moves;

	•	our failure to meet service levels required by our customers;

	•	our failure to provide, efficiently or on competitive terms, other services demanded by our customers;

	•	promotional and pricing strategies of our competitors; and

	•	macroeconomic conditions in Mexico.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements. Statements that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. The words “anticipates,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “targets,” “will” and similar words are intended to identify these statements, which necessarily involve known and unknown risks and uncertainties. Accordingly, our actual results of operations may be different from our current expectations, and prospective investors should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments.

These statements are based on management’s current expectations, assumptions and beliefs in light of the information currently available to us. These expectations, assumptions and beliefs also involve risks and uncertainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Potential risks and uncertainties include, without limitation:


	•	competition in local services, data, Internet, Voice over Internet Protocol and Internet Protocol Television services;


	•	our ability to service our debt;

	•	limitations on our access to sources of financing on competitive terms;

	•	significant economic or political developments in Mexico and the United States;

	•	changes in our regulatory environment, particularly developments affecting the regulation of the telecommunications industry;

	•	our need for substantial capital;

	•	general economic conditions, including the economic slow-down in Mexico and the United States;

	•	the global telecommunications downturn;

	•	performance of financial markets and thus our ability to refinance our financial obligations when they come due;

	•	our history of operating losses;

	•	the risks associated with our ability to implement our growth strategy;

	•	customer attrition;


	•	technological innovations;

	•	currency fluctuations and inflation in Mexico;

	•	changes in the policies of central banks and/or foreign governments; and

	•	the risks factors discussed under “Risk Factors.”

INDUSTRY AND MARKET DATA

We obtained the industry and market data used in this prospectus from research, surveys or studies conducted by third parties on our behalf, information contained in third-party publications, such as Pyramid Research (an Economist Intelligence Unit subsidiary), and other publicly available sources. Additionally, certain market share data for the Mexican states is based on published information available. There is no comparable data available relating to the particular cities we serve. In presenting market share estimates for these cities, we have estimated the size of the market on the basis of the published information for the state in which the particular city is located. We believe this method is reasonable, but the results have not been verified by any independent source.

EXCHANGE RATES

The following table sets forth, for the periods indicated, the period-end, average, high and low noon buying rates, in each case for the purchase of U.S. dollars, all expressed in nominal pesos per U.S. dollar. The noon buying rate on October 25, 2007 was Ps.10.84 per U.S.$1.00.


	Noon Buying Rate⁽¹⁾
	Period End		Average⁽²⁾		High		Low

2002		10.43		9.75		10.43		9.00
2003		11.24		10.85		11.41		10.11
2004		11.15		11.31		11.64		10.81
2005		10.63		10.87		11.41		10.41
2006		10.80		10.90		11.46		10.43
January 2007		11.04		10.96		11.09		10.77
February 2007		11.16		11.00		11.16		10.92
March 2007		11.04		11.11		11.18		11.01
April 2007		10.93		10.98		11.03		10.92
May 2007		10.74		10.82		10.93		10.74
June 2007		10.79		10.83		10.98		10.71
July 2007		10.93		10.81		11.01		10.73
August 2007		11.03		11.04		11.27		10.93
September 2007		10.93		11.04		11.15		10.93
October 2007 (through October 25th)		10.84		10.84		10.91		10.79


(1)		Source: Federal Reserve Bank of New York.
(2)		Represents the average rates for each period indicated, calculated by using the average of the exchange rates on the last day of each month during the years presented and by using the daily average of the exchange rates during the months presented.

Our inclusion of these exchange ratios is not meant to suggest that the peso amounts actually represent such U.S. dollars or that such amounts could have been converted into U.S. dollars at such rate or any other rate.

Except for the period from September through December 1982, during a liquidity crisis, the Mexican Central Bank has consistently made foreign currency available to Mexican private-sector entities (such as us) to meet their foreign currency obligations. Nevertheless, in the event of renewed shortages of foreign currency, there can be no assurance that foreign currency would continue to be available to private-sector companies or that foreign currency needed by us to service foreign currency obligations or to import goods could be purchased in the open market without substantial additional cost.

EXCHANGE OFFER

All acceptances of the exchange offer and withdrawals of tendered outstanding senior notes must be made as set forth in this prospectus.

Purpose and Effect of the Exchange Offer

The Issuer and the Guarantors entered into a registration rights agreement with Morgan Stanley & Co. Incorporated, as representative of the initial purchasers, on each of the original issue dates of the outstanding senior notes. In that agreement, the Issuer and the Guarantors agreed for the benefit of the holders of the outstanding senior notes that the Issuer and the Guarantors will file with the SEC and use their reasonable best efforts to cause to become effective a registration statement relating to an offer to exchange the outstanding senior notes for an issue of SEC-registered senior notes with terms identical to the outstanding senior notes (except that the new senior notes will not be subject to restrictions on transfer or to any increase in annual interest rate as described below).

If the exchange offer is not completed on or before September 30, 2007, the annual interest rate borne by the outstanding senior notes will be increased by 0.50% per annum. This increase in the interest rate will end upon the earlier of (i) completion of the exchange offer, (ii) the effectiveness of the shelf registration or (iii) the outstanding senior notes being freely tradable under the Securities Act.

Following the consummation of the exchange offer, holders of the outstanding senior notes who were eligible to participate in the exchange offer but who did not tender their outstanding senior notes will not have any further registration rights and their outstanding senior notes will continue to be subject to certain restrictions on transfer. Accordingly, the liquidity of the market for the outstanding senior notes could be adversely affected.

Terms of the Exchange Offer

Upon the terms and subject to the conditions set forth in this prospectus and in the applicable letter of transmittal, we will accept any and all outstanding senior notes validly tendered and not withdrawn prior to 5:00 p.m. New York City time, on the expiration date of the exchange offer. We will issue $1,000 principal amount of exchange senior notes in exchange for each $1,000 principal amount of outstanding senior notes accepted in the exchange offer. Any holder may tender some or all of its outstanding senior notes pursuant to the exchange offer. However, outstanding senior notes may be tendered only in integral multiples of $1,000.

The form and terms of the new senior notes are the same as the form and terms of the outstanding senior notes except that:


	•	the new senior notes bear a Series B designation and different ISIN, CUSIP and Common Code numbers, as the case may be, from the outstanding senior notes;

	•	the new senior notes have been registered under the Securities Act and hence will not bear legends restricting their transfer; and

	•	the holders of the new senior notes will not be entitled to certain rights under the registration rights agreements, all of which rights will terminate when such exchange offer is completed.

The new senior notes will evidence the same debt as the outstanding senior notes and will be entitled to the benefits of the applicable indenture. The exchange offer is not conditioned upon any minimum aggregate principal amount of outstanding senior notes being tendered for exchange.

$200.0 million in aggregate principal amount of the outstanding senior notes are subject to the exchange offer. We have fixed close of business on , 2007 as the record date for the exchange offer for purposes of determining the persons to whom this prospectus and the letters of transmittal will be mailed initially.

Holders of outstanding senior notes do not have any appraisal or dissenters’ rights under Mexican law or the indentures relating to the senior notes in connection with the exchange offer. We intend to conduct the exchange offer in accordance with the applicable requirements of the Exchange Act and the rules and regulations of the SEC.

We will be deemed to have accepted validly tendered outstanding senior notes when, as and if we have given oral or written notice of our acceptance to the exchange agent. The exchange agent will act as agent for the tendering holders for the purposes of receiving the new senior notes from us.

If any tendered outstanding senior notes are not accepted for exchange because of an invalid tender, the occurrence of specified other events set forth in this prospectus or otherwise, the certificates for any unaccepted outstanding senior notes will be returned, without expense, to the tendering holder thereof as promptly as practicable after the expiration date of the exchange offer.

Holders who tender outstanding senior notes in the exchange offer will not be required to pay brokerage commissions or fees or, subject to the instructions in the applicable letter of transmittal, transfer taxes with respect to the exchange of outstanding senior notes pursuant to the exchange offer. We will pay all charges and expenses, other than transfer taxes in certain circumstances, in connection with the exchange offer. See “— Fees and Expenses.”

Expiration Date; Extensions; Amendments

The term “expiration date” will mean 5:00 p.m., New York City time, on , 2007, unless we, in our sole discretion, extend the exchange offer, in which case the term “expiration date” will mean the latest date and time to which the exchange offer is extended.

In order to extend the exchange offer, we will notify the exchange agent of any extension by oral or written notice and by mailing to the registered holders an announcement thereof or by means of a press release or other public announcement, each prior to 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.

We reserve the right, in our sole discretion, (1) to delay accepting any outstanding senior notes, to extend the exchange offer or to terminate the exchange offer if any of the conditions set forth below under “— Conditions” have not been satisfied, by giving oral or written notice of any delay, extension or termination to the exchange agent or (2) to amend the terms of the exchange offer in any manner. Any delay in acceptance, extension, termination or amendment will be followed as promptly as practicable by oral or written notice thereof to the registered holders.

Interest on the New Notes

For each of the outstanding senior notes surrendered in the exchange offer, the holder who surrendered the senior secured note will receive a new senior secured note, having a principal amount equal to that of the surrendered senior secured note. Interest on each new senior secured note will accrue from the later of:


	•	the last interest payment date on which interest was paid on the outstanding senior secured note surrendered; and

	•	if no interest has been paid on the outstanding senior secured note, from the date on which the outstanding senior notes were issued.

If the outstanding senior secured note is surrendered for exchange on a date after the record date for an interest payment date to occur on or after the date of the exchange offer expiration date, interest on the new senior secured note will accrue from that interest payment date.

Interest on the new senior notes is payable semi-annually on each June 15 and December 15. For more information regarding the terms of the new senior notes, see “Description of the Notes.”

Procedures for Tendering

Only a holder of outstanding senior notes may tender the outstanding senior notes in the exchange offer.

In all cases, issuance of new senior notes for outstanding senior notes that are accepted for exchange pursuant to the exchange offer will be made only after timely, prior to the expiration date, receipt by an exchange agent of:


	•	certificates for such outstanding senior notes or a timely confirmation (a “Book-Entry Confirmation”) of a book-entry transfer of such outstanding senior notes into the exchange agent’s account at DTC (the “book-entry transfer facility”), as the case may be;

	•	a duly executed letter of transmittal (with the signature thereon guaranteed if required by the terms fo the letter of transmittal) or a properly transmitted agent’s message, as defined below, as applicable; and

	•	all other required documents.

To be tendered effectively, the outstanding senior notes, letter of transmittal or an agent’s message and other required documents must be completed and received by the exchange agent at the address set forth below under “— Exchange Agent” prior to 5:00 p.m., New York City time, on the expiration date. Delivery of the outstanding senior notes may be made by book-entry transfer in accordance with the procedures described below. Confirmation of the book-entry transfer must be received by the exchange agent prior to the expiration date. If any tendered outstanding senior notes are not accepted for any reason set forth in the terms and conditions of the exchange offer or if outstanding senior notes are submitted for a greater principal amount than the holder desires to exchange, such unaccepted or non-exchanged outstanding senior notes will be credited to an account maintained with DTC as promptly as practicable after the expiration of the exchange offer.

If you hold outstanding senior notes through DTC and wish to accept the exchange offer, you must do so through DTC’s Automated Tender Offer Program, or ATOP, pursuant to which you will agree to be bound by the terms of the applicable letter of transmittal. See “— Book-Entry Transfer.” If you wish to tender such senior notes and cannot complete the procedures for book-entry transfer prior to the expiration date, you may tender such senior notes according to the guaranteed delivery procedures set forth below under “— Guaranteed Delivery Procedures.”

To participate in the exchange offer, each holder will be required to make the following representations to us:


	•	Any new senior notes to be received by the holder and, if applicable, each beneficial owner of senior notes held by such holder, will be acquired in the ordinary course of the holder’s, and, if applicable, each beneficial owner’s business;

	•	The holder is not participating or engaging in, does not intend to participate in or engage in and has no arrangement or understanding with any person to participate or engage in the distribution, within the meaning of Securities Act, of the new senior notes in violation of the Securities Act;

	•	Neither the holder nor any beneficial owner of senior notes held by such holder is our affiliate as defined in Rule 405 promulgated under the Securities Act;

	•	The holder is not a broker-dealer tendering outstanding senior notes directly acquired from us for its own account;

	•	If the holder is not a broker-dealer, it is not engaged in, and does not intend to engage in, the distribution of new senior notes;

	•	If the holder or, if applicable, any beneficial owner of senior notes held by such holder is a broker-dealer that will receive new senior notes for its own account in exchange for outstanding senior notes that were acquired as a result of market-making or other trading activities, such broker dealer will deliver a prospectus in connection with any resale of the new senior notes (in this prospectus, we refer to these broker-dealers as participating broker-dealers); and

	•	The holder is not acting on behalf of any person or entity that could not truthfully make these representations.

The tender by a holder and our acceptance thereof will constitute an agreement between the holder and us in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal or agent’s message.

The delivery of outstanding senior notes and delivery of all other required documents is at the election and sole risk of the holder. As an alternative to delivery by mail, holders may wish to consider facsimile, overnight courier or hand delivery service. In all cases, sufficient time should be allowed to assure delivery of the letter of transmittal or agent’s message to an exchange agent before the required time on the expiration date. No letter of transmittal or agent’s message should be sent to issuer or any book-entry transfer facility. If applicable, holders should request their respective brokers, dealers, commercial banks, trust companies or nominees to effect the above transactions for such holders. A holder that tenders outstanding senior notes by use of the guaranteed delivery procedures, however, must provide to an eligible institution (as defined below) the information required on page 2 of the notice of guaranteed delivery. See “— Guaranteed Delivery Procedures.”

Any beneficial owner whose outstanding senior notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and who wishes to tender should contact the registered holder promptly and instruct such registered holder to tender on such beneficial owner’s behalf. See “Instructions to Registered Holder and/or Book-Entry Transfer Facility Participant from Beneficial Owner” included with the letter of transmittal.

Signatures on a letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed by an Eligibile Institute (as defined below) unless the outstanding senior notes tendered pursuant to the letter of transmittal are tendered (1) by a registered holder who has not completed the box entitled “Special Registration Instructions” or “Special Delivery Instructions” on the letter of transmittal or (2) for the account of an Eligible Institution. In the event that signatures on a letter of transmittal or a notice of withdrawal, as the case may be, are required to be guaranteed, the guarantee must be by an Eligible Institution.

If the letter of transmittal is signed by a person other than the registered holder of any outstanding senior notes listed in this prospectus, the outstanding senior notes must be endorsed or accompanied by a properly completed bond power, signed by the registered holder as the registered holder’s name appears on the outstanding senior notes with the signature thereon guaranteed by an Eligible Institution.

If a letter of transmittal is signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and evidence satisfactory to us of their authority to so act must be submitted with such letter of transmittal.

All questions as to the validity, form, eligibility (including time of receipt), acceptance, and withdrawal of tendered outstanding senior notes will be determined by us in our sole discretion, subject to compliance with the applicable rules of the SEC, which determination will be final and binding. We reserve the absolute right to reject any and all outstanding senior notes not properly tendered or any outstanding senior notes the acceptance of which would, in the opinion of our counsel, be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to particular outstanding senior notes. Our interpretation of the terms and conditions of the exchange offer (including the instructions in the letters of transmittal) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of outstanding senior notes must be cured within such time as we shall determine, in our sole discretion and subject to compliance with the applicable rules of the SEC. Although we intend to notify holders of defects or irregularities with respect to tenders of outstanding senior notes, neither we, the exchange agent nor any other person shall incur any liability for failure to give such notification. Tenders of outstanding senior notes will not be deemed to have been made until such defects or irregularities have been cured or waived. Any outstanding senior notes received by the exchange agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned by the exchange agent to the tendering holder, unless otherwise provided in the letter of transmittal, as soon as practicable following the expiration date.

Book-Entry Transfer

We understand that the exchange agent will make a request promptly after the date of this prospectus to establish accounts with respect to the outstanding senior notes at DTC for the purpose of facilitating the exchange offer, and subject to the establishment thereof, any financial institution that is a participant in DTC’s system may

make book-entry delivery of outstanding senior notes by causing DTC to transfer the outstanding senior notes into the exchange agent’s account with respect to the outstanding senior notes in accordance with DTC’s procedures for the transfer. Although delivery of the outstanding senior notes may be effected through book-entry transfer into the exchange agent’s account at DTC, unless an agent’s message is received by the exchange agent in compliance with ATOP, an appropriate letter of transmittal properly completed and duly executed with any required signature guarantee and all other required documents must in each case be transmitted to and received or confirmed by the exchange agent at its address set forth below on or prior to the expiration date, or, if the guaranteed delivery procedures described below are complied with, within the time period provided under the procedures. Delivery of documents or instructions to DTC does not constitute delivery to the exchange agent.

DTC’s ATOP program is the only method of processing the exchange offer through DTC. To accept the exchange offer through ATOP, participants in DTC must send electronic instructions to DTC through DTC’s communication system. In addition, such tendering participants should deliver a copy of the applicable letter of transmittal to the applicable exchange agent unless an agent’s message is transmitted in lieu thereof. DTC is obligated to communicate those electronic instructions to the exchange agent through an agent’s message. To tender outstanding senior notes through ATOP, the electronic instructions sent to DTC and transmitted by DTC to the exchange agent must contain the character by which the participant acknowledges its receipt of and agrees to be bound by a letter of transmittal. Any instruction through ATOP is at your risk and such instruction will be deemed made only when actually received by the exchange agent. In order for an acceptance of the exchange offer through ATOP to be valid, an agent’s message must be transmitted to and received by the exchange agent prior to the expiration date, or the guaranteed delivery procedures described below must be complied with. Delivery of documents or instructions to DTC does not constitute delivery to the exchange agent.

The term “agent’s message” means a message, transmitted by the book-entry transfer facility to, and received