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Put And Call Agreement - CYCLELOGIC, INC. - 4-2-2001

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Put And Call Agreement - CYCLELOGIC, INC. - 4-2-2001 Powered By Docstoc
					Exhibit 10.33 PUT AND CALL AGREEMENT among STARMEDIA NETWORK, INC. and THE SEVERAL NOTEHOLDERS NAMED IN SCHEDULE I HERETO Dated as of September 28, 2000 THIS AGREEMENT AND THE RIGHTS TO ACQUIRE (THE "RIGHTS") THE SHARES OF COMMON STOCK, PAR VALUE, $0.001 PER SHARE, OF STARMEDIA NETWORK, INC. PURSUANT TO THIS AGREEMENT (OR ANY OTHER SECURITY ISSUED IN SUBSTITUTION OF SUCH SHARES) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATES, AND THESE RIGHTS MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND LAWS, IF APPLICABLE. THE COMPANY, PRIOR TO PERMITTING A TRANSFER OF THESE RIGHTS MAY REQUIRE AN OPINION OF COUNSEL OR OTHER ASSURANCE IN FORM AND SUBSTANCE SATISFACTORY TO IT AS TO COMPLIANCE WITH, OR EXEMPTION FROM, SUCH ACT AND LAWS.

TABLE OF CONTENTS

ARTICLE I PUT AND CALL OF GRATIS1 NOTES AND GRATIS1 WARRANTS Section Section Section Section Section 1.1. 1.2. 1.3. 1.4. 1.5 Put and Call of the Gratis1 Notes Upon a Negotiated Change of Control.......... Put and Call of the Gratis1 Notes Upon a Hostile Change of Control............. Put or Call of Portion of Gratis1 Note......................................... Closing........................................................................ Non-Discriminatory Treatment................................................... ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY Section Section Section Section 2.1. 2.2. 2.3. 2.4. Organization, Qualifications and Corporate Power............................... Authorization of Agreements, Etc............................................... Validity....................................................................... SEC Reports.................................................................... ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS Section Section Section Section Section Section 3.1. 3.2. 3.3. 3.4. 3.5. 3.6. Corporate Power, Authorization, Validity....................................... Accredited Investor............................................................ Experience..................................................................... Access to Data................................................................. Investment..................................................................... Restricted Securities.......................................................... ARTICLE IV MISCELLANEOUS Section 4.1. Expenses.......................................................................

TABLE OF CONTENTS

ARTICLE I PUT AND CALL OF GRATIS1 NOTES AND GRATIS1 WARRANTS Section Section Section Section Section 1.1. 1.2. 1.3. 1.4. 1.5 Put and Call of the Gratis1 Notes Upon a Negotiated Change of Control.......... Put and Call of the Gratis1 Notes Upon a Hostile Change of Control............. Put or Call of Portion of Gratis1 Note......................................... Closing........................................................................ Non-Discriminatory Treatment................................................... ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY Section Section Section Section 2.1. 2.2. 2.3. 2.4. Organization, Qualifications and Corporate Power............................... Authorization of Agreements, Etc............................................... Validity....................................................................... SEC Reports.................................................................... ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS Section Section Section Section Section Section 3.1. 3.2. 3.3. 3.4. 3.5. 3.6. Corporate Power, Authorization, Validity....................................... Accredited Investor............................................................ Experience..................................................................... Access to Data................................................................. Investment..................................................................... Restricted Securities.......................................................... ARTICLE IV MISCELLANEOUS Section Section Section Section Section Section Section Section 4.1. 4.2. 4.3. 4.4. 4.5. 4.6. 4.7. 4.8. Expenses....................................................................... Survival of Agreements......................................................... Successors and Assigns......................................................... Notices........................................................................ Governing Law; Jurisdiction.................................................... Entire Agreement............................................................... Counterparts................................................................... Amendments.....................................................................

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TABLE OF CONTENTS (continued)

Section Section Section Section Section Section

4.9. 4.10. 4.11. 4.12. 4.13. 4.14.

Severability................................................................... Titles and Subtitles........................................................... Certain Defined Terms.......................................................... Legends........................................................................ WAIVER OF JURY TRIAL........................................................... Expiration of Options..........................................................

1 1 1

SCHEDULE I

Noteholders

ii

PUT AND CALL AGREEMENT, dated as of September 26, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware corporation (the "COMPANY"), and the several noteholders

TABLE OF CONTENTS (continued)

Section Section Section Section Section Section

4.9. 4.10. 4.11. 4.12. 4.13. 4.14.

Severability................................................................... Titles and Subtitles........................................................... Certain Defined Terms.......................................................... Legends........................................................................ WAIVER OF JURY TRIAL........................................................... Expiration of Options..........................................................

1 1 1

SCHEDULE I

Noteholders

ii

PUT AND CALL AGREEMENT, dated as of September 26, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware corporation (the "COMPANY"), and the several noteholders named in the attached Schedule I (individually a "NOTEHOLDER" and collectively the "Noteholders"). Unless otherwise defined herein, capitalized terms used herein shall have the meaning set forth in Section 4.11 of this Agreement. WHEREAS, pursuant to [the Note and Warrant Purchase Agreement, dated as of July 18, 2000 (as amended or modified from time to time, the "NOTE PURCHASE AGREEMENT"), among Gratis1, Inc., a Delaware corporation ("Gratis1"), and the Purchasers listed in Annex I thereto,] the Noteholders, along with the other Purchasers, have agreed to purchase from Gratis1 from time to time those certain 12% Convertible Promissory Notes in the aggregate principal amount of up to $16,000,000 (collectively, the "12% NOTES") on the terms and conditions contained therein; WHEREAS, the Company owns a majority of the outstanding capital stock of Gratis1 and will derive substantial direct and indirect benefits from the transactions contemplated by the Note Purchase Agreement; and WHEREAS, in order to induce the Noteholders to purchase from Gratis1 from time to time, on or after the date of this Agreement, 12% Notes in the aggregate principal amount of up to $7,000,000 (collectively, the "GRATIS1 NOTES"), the Company has agreed, on the terms and conditions contained herein, to purchase the Gratis1 Notes from the Noteholders in consideration for a certain number of shares of the Company's Common Stock, $0.001 par value per share, to be issued by the Company to the Noteholders (the "COMMON SHARES") or such other assets or property in lieu of such Common Shares as provided in this Agreement; NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this Agreement, the parties agree as follows: ARTICLE I PUT AND CALL OF GRATIS1 NOTES AND GRATIS1 WARRANTS Section 1.1. PUT AND CALL OF THE GRATIS1 NOTES UPON A NEGOTIATED CHANGE OF CONTROL. (a) Not less than 12 Business Days prior to the proposed date for the consummation of a Negotiated Change in Control, the Company shall send a written notice (the "NOTICE OF NEGOTIATED CHANGE IN CONTROL") to each of the Noteholders stating that a Negotiated Change of Control is scheduled to occur and setting forth the proposed date of such Negotiated Change of Control and the terms of any agreements with respect to such Negotiated Change of Control. Each Noteholder may, by written notice to the Company on or before the date that is 5 Business Days after its receipt of the Notice of Negotiated Change in Control (the "NEGOTIATED CHANGE IN CONTROL PUT NOTICE"), require the Company to purchase all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder the Note Purchase Price for each such Gratis1 Note designated by such Noteholder in

PUT AND CALL AGREEMENT, dated as of September 26, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware corporation (the "COMPANY"), and the several noteholders named in the attached Schedule I (individually a "NOTEHOLDER" and collectively the "Noteholders"). Unless otherwise defined herein, capitalized terms used herein shall have the meaning set forth in Section 4.11 of this Agreement. WHEREAS, pursuant to [the Note and Warrant Purchase Agreement, dated as of July 18, 2000 (as amended or modified from time to time, the "NOTE PURCHASE AGREEMENT"), among Gratis1, Inc., a Delaware corporation ("Gratis1"), and the Purchasers listed in Annex I thereto,] the Noteholders, along with the other Purchasers, have agreed to purchase from Gratis1 from time to time those certain 12% Convertible Promissory Notes in the aggregate principal amount of up to $16,000,000 (collectively, the "12% NOTES") on the terms and conditions contained therein; WHEREAS, the Company owns a majority of the outstanding capital stock of Gratis1 and will derive substantial direct and indirect benefits from the transactions contemplated by the Note Purchase Agreement; and WHEREAS, in order to induce the Noteholders to purchase from Gratis1 from time to time, on or after the date of this Agreement, 12% Notes in the aggregate principal amount of up to $7,000,000 (collectively, the "GRATIS1 NOTES"), the Company has agreed, on the terms and conditions contained herein, to purchase the Gratis1 Notes from the Noteholders in consideration for a certain number of shares of the Company's Common Stock, $0.001 par value per share, to be issued by the Company to the Noteholders (the "COMMON SHARES") or such other assets or property in lieu of such Common Shares as provided in this Agreement; NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this Agreement, the parties agree as follows: ARTICLE I PUT AND CALL OF GRATIS1 NOTES AND GRATIS1 WARRANTS Section 1.1. PUT AND CALL OF THE GRATIS1 NOTES UPON A NEGOTIATED CHANGE OF CONTROL. (a) Not less than 12 Business Days prior to the proposed date for the consummation of a Negotiated Change in Control, the Company shall send a written notice (the "NOTICE OF NEGOTIATED CHANGE IN CONTROL") to each of the Noteholders stating that a Negotiated Change of Control is scheduled to occur and setting forth the proposed date of such Negotiated Change of Control and the terms of any agreements with respect to such Negotiated Change of Control. Each Noteholder may, by written notice to the Company on or before the date that is 5 Business Days after its receipt of the Notice of Negotiated Change in Control (the "NEGOTIATED CHANGE IN CONTROL PUT NOTICE"), require the Company to purchase all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder the Note Purchase Price for each such Gratis1 Note designated by such Noteholder in

2 the Negotiated Change of Control Put Notice, on the date on which such Negotiated Change in Control shall be consummated (the "NEGOTIATED CHANGE OF CONTROL CLOSING DATE"). (b) If any Noteholder fails to deliver a Negotiated Change in Control Put Notice with respect to any Gratis1 Note pursuant to Section 1.1(a) above, then the Company may, by written notice to such Noteholder not less than 5 Business Days prior to the proposed date for such Negotiated Change of Control (the "NEGOTIATED CHANGE IN CONTROL CALL NOTICE"), require such Noteholder to sell to the Company all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder the Note Purchase Price for each such Gratis1 Note on the Negotiated Change of Control Closing Date. (c) In the event that the terms of the Negotiated Change in Control set forth in the Notice of Negotiated Change of Control change in any material respect, the Company shall send out a new notice and the Noteholders shall

2 the Negotiated Change of Control Put Notice, on the date on which such Negotiated Change in Control shall be consummated (the "NEGOTIATED CHANGE OF CONTROL CLOSING DATE"). (b) If any Noteholder fails to deliver a Negotiated Change in Control Put Notice with respect to any Gratis1 Note pursuant to Section 1.1(a) above, then the Company may, by written notice to such Noteholder not less than 5 Business Days prior to the proposed date for such Negotiated Change of Control (the "NEGOTIATED CHANGE IN CONTROL CALL NOTICE"), require such Noteholder to sell to the Company all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder the Note Purchase Price for each such Gratis1 Note on the Negotiated Change of Control Closing Date. (c) In the event that the terms of the Negotiated Change in Control set forth in the Notice of Negotiated Change of Control change in any material respect, the Company shall send out a new notice and the Noteholders shall have a period equal to the greater of 5 days or 3 Business Days from the date of such new Notice of Negotiated Change in Control (i) to exercise their option to cause the Company to purchase their Gratis1 Notes or (ii) in the event any such Noteholder has previously elected to exercise its option, to rescind such election, provided, however, that if such period expires other than on a Business Day, the period shall be extended to the next occurring Business Day. Section 1.2. PUT AND CALL OF THE GRATIS1 NOTES UPON A HOSTILE CHANGE OF CONTROL. (a) Upon the occurrence of a Hostile Change in Control, the Company shall promptly upon obtaining actual knowledge of such Change in Control, send a written notice (the "NOTICE OF A HOSTILE CHANGE OF CONTROL") to each of the Noteholders stating that a Hostile Change in Control has occurred. Each Noteholder may, by written notice (the "HOSTILE CHANGE IN CONTROL PUT NOTICE") to the Company on or before the date that is 5 Business Days after its receipt of the Notice of a Hostile Change in Control, require the Company to purchase all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder, the Note Purchase Price for each such Gratis1 Note, on the date which is the 5th day following the date of the Hostile Change in Control Put Notice, or, if such day is not a Business Day, on the next following Business Day (the "PUT CLOSING DATE"). (b) If any Noteholder fails to deliver a Hostile Change in Control Put Notice with respect to any Gratis1 Note pursuant to Section 1.2(a) above, then the Company may, by written notice (the "HOSTILE CHANGE IN CONTROL CALL NOTICE") to such Noteholder within 10 Business Days after the date of the Notice of a Hostile Change in Control, require such Noteholder to sell to the Company all or any portion of the Gratis1 Notes held by such Noteholder. Any such purchase shall be effected by the Company paying to such Noteholder the Note Purchase Price for each such Gratis1 Note, on the date which is the 5th day following the date of the Hostile Change in Control Call Notice, or, if such day is not a Business Day, on the next following Business Day (the "CALL CLOSING DATE"). Section 1.3. PUT OR CALL OF PORTION OF GRATIS1 NOTE. In the event a Noteholder or the Company desires to sell or purchase pursuant to Sections 1.1 and 1.2, as the case may be, only a

3 portion of the Gratis1 Notes of such Noteholder, Noteholder hereby agrees, that prior to any such sale or purchase, such Noteholder shall exchange its Gratis1 Note with Gratis1, for a Gratis1 Note in the principal amount (the "Purchased Portion") being sold or purchased pursuant to Sections 1.1 and 1.2 and a Gratis1 Note in the principal amount equal to the excess of the original Gratis1 Note over the Purchased Portion with respect to such Gratis1 Note. Section 1.4. CLOSING. (a) If a Put Notice or Call Notice is delivered, as the case may be, then the Company and the Noteholders shall proceed with the closings of the purchase of the Gratis1 Notes on the applicable Negotiated Change of Control Closing Date, Put Closing Date or Call Closing Date, as the case may be (individually, a "CLOSING" and collectively the "CLOSINGS"). Each Closing shall take place at the offices of Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, New York 10004, at 10:00 a.m., New York time, on the applicable Negotiated Change of Control Closing Date, Put Closing Date or Call Closing

3 portion of the Gratis1 Notes of such Noteholder, Noteholder hereby agrees, that prior to any such sale or purchase, such Noteholder shall exchange its Gratis1 Note with Gratis1, for a Gratis1 Note in the principal amount (the "Purchased Portion") being sold or purchased pursuant to Sections 1.1 and 1.2 and a Gratis1 Note in the principal amount equal to the excess of the original Gratis1 Note over the Purchased Portion with respect to such Gratis1 Note. Section 1.4. CLOSING. (a) If a Put Notice or Call Notice is delivered, as the case may be, then the Company and the Noteholders shall proceed with the closings of the purchase of the Gratis1 Notes on the applicable Negotiated Change of Control Closing Date, Put Closing Date or Call Closing Date, as the case may be (individually, a "CLOSING" and collectively the "CLOSINGS"). Each Closing shall take place at the offices of Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, New York 10004, at 10:00 a.m., New York time, on the applicable Negotiated Change of Control Closing Date, Put Closing Date or Call Closing Date, as the case may be, or at such other date and time as may be agreed upon between the applicable Noteholder and the Company (each such date of a Closing being referred to herein as a "CLOSING DATE"). (b) At each Closing, the applicable Noteholder shall deliver to the Company the original Gratis1 Notes held by such Noteholder, free and clear of all liens and encumbrances, duly endorsed to the Company or accompanied by a duly executed instrument of transfer, together with the Noteholder Payment Amount applicable to such Noteholder. As payment in full for such Gratis1 Notes being purchased by it on a Closing Date under this Agreement, and against delivery of the original Gratis1 Notes as aforesaid and Noteholder Payment Amount on such Closing Date, the Company shall pay to such Noteholder the Note Purchase Price. To the extent the Note Purchase Price includes securities, such securities will contain an applicable securities law legend substantially similar to the one set forth in Section 4.12. (c) (i) The obligation of the Company to purchase and pay for any Gratis1 Notes of any Noteholder on a Closing Date is, at its option, subject to the satisfaction, on or before such Closing Date, of the following conditions: (A) The offer and sale of the Exchange Shares (or any other securities issued in substitution thereof) to such Noteholder at such Closing pursuant to this Agreement shall be exempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all other applicable state securities laws. (B) Such Noteholder shall have delivered to the Company the original Gratis1 Note, in each case free and clear of all liens and encumbrances, duly endorsed to the Company or accompanied by a duly executed instrument of transfer and the Noteholder Payment Amount. (ii) The obligation of each Noteholder to deliver its Gratis1 Note to the Company is, at its option, subject to the satisfaction, on or before the appropriate Closing Date, of the following conditions:

4 (A) The Company shall have delivered to such Noteholder the Note Purchase Price specified for such Gratis1 Note. (B) The offer and sale of the Gratis1 Notes to the Company at such Closing pursuant to this Agreement shall be exempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all other applicable state securities Laws. (d) The Company shall not be obligated to purchase, and the Noteholders shall not be obligated to sell, any Gratis1 Notes to the extent that such purchase or sale would violate any law, rule or regulation applicable to the Company or the Noteholders or their respective businesses or assets, or subject any of the foregoing to any injunction or other equitable remedy of any court or government entity, PROVIDED, HOWEVER, that the Company or any Noteholder, as applicable, shall have used its commercially reasonable efforts to prevent the entry of any such injunction or other order and to appeal as promptly as possible any such injunction or other order that may be entered; PROVIDED FURTHER, HOWEVER, that if the Company or the Noteholder, as the case may be, shall be legally prevented from making such purchase or sale at any time, then the Company and the Noteholders, shall consummate the transactions contemplated hereby within 10 days of being legally

4 (A) The Company shall have delivered to such Noteholder the Note Purchase Price specified for such Gratis1 Note. (B) The offer and sale of the Gratis1 Notes to the Company at such Closing pursuant to this Agreement shall be exempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all other applicable state securities Laws. (d) The Company shall not be obligated to purchase, and the Noteholders shall not be obligated to sell, any Gratis1 Notes to the extent that such purchase or sale would violate any law, rule or regulation applicable to the Company or the Noteholders or their respective businesses or assets, or subject any of the foregoing to any injunction or other equitable remedy of any court or government entity, PROVIDED, HOWEVER, that the Company or any Noteholder, as applicable, shall have used its commercially reasonable efforts to prevent the entry of any such injunction or other order and to appeal as promptly as possible any such injunction or other order that may be entered; PROVIDED FURTHER, HOWEVER, that if the Company or the Noteholder, as the case may be, shall be legally prevented from making such purchase or sale at any time, then the Company and the Noteholders, shall consummate the transactions contemplated hereby within 10 days of being legally permitted to do so. The Company and the Noteholders shall each use all reasonable efforts in cooperation with each other to make promptly all filings, give all notices and secure all consents, approvals and waivers that may be required in connection with the purchase and sale of the Gratis1 Notes. Section 1.5. NON-DISCRIMINATORY TREATMENT. With respect to any Gratis1 Notes subject to a Call Notice or Put Notice, in connection with any Change in Control, the Company shall use its commercially reasonable efforts to cause the Noteholders to receive the same consideration (whether cash, securities or other rights and privileges) from such Change of Control as the other stockholders of the Company. ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY The Company represents and warrants to the Noteholders that: Section 2.1. ORGANIZATION, QUALIFICATIONS AND CORPORATE POWER. The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware and is duly licensed or qualified to transact business as a foreign corporation and is in good standing as a foreign corporation in each jurisdiction in which the nature of the business transacted by it or the character of the properties owned or leased by it requires such licensing or qualification, except for such failures to be so qualified and in good standing which would not have a Material Adverse Effect. The Company has the requisite corporate power and authority to own, lease and operate its assets and properties and to carry on its business as now conducted and to execute, deliver and perform this Agreement.

5 Section 2.2. AUTHORIZATION OF AGREEMENTS, ETC. The execution and delivery by the Company of this Agreement, the performance by the Company of its obligations hereunder and the purchase of the Gratis1 Notes pursuant to this Agreement have been duly authorized by all requisite corporate action on the part of the Company, and do not violate (i) any provision of existing law (assuming that the representations and warranties of the Noteholders contained in Sections 3.2, 3.3, 3.4, 3.5 and 3.6 are true and correct), (ii) any existing order of any court or other agency of government, (iii) the certificate of incorporation or by-laws of the Company, or (iv) any provision of any indenture, agreement or other instrument to which the Company or any of its properties or assets is currently bound, or conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any lien, charge, restriction, claim or encumbrance of any nature whatsoever (each a "LIEN") upon any of the Company's assets under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any of the properties or assets of the Company, except, with respect to the foregoing clause (iv) only, for such violations, conflicts, breaches, defaults, or Liens which do not and could not reasonably be expected to have a Material Adverse Effect.

5 Section 2.2. AUTHORIZATION OF AGREEMENTS, ETC. The execution and delivery by the Company of this Agreement, the performance by the Company of its obligations hereunder and the purchase of the Gratis1 Notes pursuant to this Agreement have been duly authorized by all requisite corporate action on the part of the Company, and do not violate (i) any provision of existing law (assuming that the representations and warranties of the Noteholders contained in Sections 3.2, 3.3, 3.4, 3.5 and 3.6 are true and correct), (ii) any existing order of any court or other agency of government, (iii) the certificate of incorporation or by-laws of the Company, or (iv) any provision of any indenture, agreement or other instrument to which the Company or any of its properties or assets is currently bound, or conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any lien, charge, restriction, claim or encumbrance of any nature whatsoever (each a "LIEN") upon any of the Company's assets under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any of the properties or assets of the Company, except, with respect to the foregoing clause (iv) only, for such violations, conflicts, breaches, defaults, or Liens which do not and could not reasonably be expected to have a Material Adverse Effect. Section 2.3. VALIDITY. This Agreement has been duly executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, fraudulent transfer or other similar laws affecting creditors' rights generally and subject to general principles of equity (including possible unavailability of specific performance or injunctive relief and the general discretion of the court considering the matter), regardless of whether enforceability is considered in a proceeding in equity or at law. Section 2.4. SEC REPORTS. The Company has made available to the Noteholders the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1999 and Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2000 and June 30, 2000 (collectively, the "SEC REPORTS"). The SEC Reports, as of the date of filing thereof with the Securities and Exchange Commission (or if amended or superseded by a filing prior to the date of this Agreement, on the date of such filing), did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Since June 30, 2000, there has been no material adverse change in the business, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS Each Noteholder, severally and not jointly, represents and warrants to the Company that: Section 3.1. CORPORATE POWER, AUTHORIZATION, VALIDITY. Such Noteholder has the requisite power and authority to execute, deliver and perform this Agreement. The execution and delivery by such Noteholder of this Agreement, the performance by such Noteholder of its

6 obligations hereunder, and the sale of the Gratis1 Notes held by such Noteholder pursuant to the terms of this Agreement, have been duly authorized by all requisite action (corporate or otherwise) on the part of such Noteholder and do not violate (i) any provision of existing law, (ii) any existing order of any court or other agency of government, (iii) the certificate of incorporation or by-laws (or similar governing instruments with different names) of such Noteholder, or (iv) any provision of any indenture, agreement or other instrument to which such Noteholder or any of its properties or assets is currently bound, or conflict with, result in a breach of, or constitute (with due notice or lapse of time or both), a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any such Noteholder's assets under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any of the properties or assets of such Noteholder except, with respect to the foregoing clause (iv) only, for such violations, conflicts, breaches, defaults or Liens which do not and could not reasonably be expected to have a material adverse effect on the ability of such Noteholder to perform its obligations hereunder. This Agreement has been

6 obligations hereunder, and the sale of the Gratis1 Notes held by such Noteholder pursuant to the terms of this Agreement, have been duly authorized by all requisite action (corporate or otherwise) on the part of such Noteholder and do not violate (i) any provision of existing law, (ii) any existing order of any court or other agency of government, (iii) the certificate of incorporation or by-laws (or similar governing instruments with different names) of such Noteholder, or (iv) any provision of any indenture, agreement or other instrument to which such Noteholder or any of its properties or assets is currently bound, or conflict with, result in a breach of, or constitute (with due notice or lapse of time or both), a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any such Noteholder's assets under any such indenture, agreement or other instrument, or result in the creation or imposition of any Lien upon any of the properties or assets of such Noteholder except, with respect to the foregoing clause (iv) only, for such violations, conflicts, breaches, defaults or Liens which do not and could not reasonably be expected to have a material adverse effect on the ability of such Noteholder to perform its obligations hereunder. This Agreement has been duly executed and delivered by such Noteholder and constitutes the legal, valid and binding obligation of such Noteholder, enforceable against such Noteholder in accordance with its terms, except as may be limited by bankruptcy, insolvency, fraudulent transfer or other similar laws affecting creditors' rights generally and subject to general principles of equity (including possible unavailability of specific performance or injunctive relief and the general discretion of the court considering the matter), regardless of whether enforceability is considered in a proceeding in equity or at law. Section 3.2. ACCREDITED INVESTOR. Such Noteholder is an "ACCREDITED INVESTOR" within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as amended (the "SECURITIES ACT"), and was not organized for the specific purpose of acquiring the Exchange Shares (or any other securities issued in substitution thereof). Section 3.3. EXPERIENCE. Such Noteholder has sufficient knowledge and experience in investing in companies similar to the Company in terms of the Company's stage of development so as to be able to evaluate the risks and merits of its investment in the Company and it is able financially to bear the risks thereof. Section 3.4. ACCESS TO DATA. Such Noteholder has had an opportunity to discuss the Company's business, management and financial affairs with the Company's management. Section 3.5. INVESTMENT. Any securities that are issued to such Noteholder pursuant to this Agreement will be acquired for its own account, not as a nominee or agent, for the purpose of investment and not with a view to or for sale in connection with any distribution thereof in violation of any federal or state securities laws. Such Noteholder understands that (i) any such securities may not have been registered under the Securities Act by reason of their issuance in a transaction exempt from the registration requirements of the Securities Act pursuant to Section 4(2) thereof or Rule 505 or 506 promulgated under the Securities Act, (ii) such securities may have to be held indefinitely unless a subsequent disposition thereof is registered under the Securities Act or is exempt from such registration, (iii) such securities shall bear the legend to

7 this effect as such legend is set forth in Section 4.12 hereof, and (iv) the Company will make a notation on its transfer books to that effect. Section 3.6. RESTRICTED SECURITIES. Such Noteholder understands that the Exchange Shares (or any other securities issued in substitution thereof) may be characterized as "restricted securities" under the Securities Act inasmuch as they are being acquired from the Company or other applicable person in a transaction not involving a public offering and that under the Securities Act and applicable regulations thereunder, such securities may be resold without registration under the Securities Act only in certain limited circumstances. In this connection, such Noteholder represents that such Noteholder is familiar with Rules 144 and 144A of the Securities and Exchange Commission, as presently in effect, and understands that the Company is under no obligation to register any of the securities issued hereunder. ARTICLE IV

7 this effect as such legend is set forth in Section 4.12 hereof, and (iv) the Company will make a notation on its transfer books to that effect. Section 3.6. RESTRICTED SECURITIES. Such Noteholder understands that the Exchange Shares (or any other securities issued in substitution thereof) may be characterized as "restricted securities" under the Securities Act inasmuch as they are being acquired from the Company or other applicable person in a transaction not involving a public offering and that under the Securities Act and applicable regulations thereunder, such securities may be resold without registration under the Securities Act only in certain limited circumstances. In this connection, such Noteholder represents that such Noteholder is familiar with Rules 144 and 144A of the Securities and Exchange Commission, as presently in effect, and understands that the Company is under no obligation to register any of the securities issued hereunder. ARTICLE IV MISCELLANEOUS Section 4.1. EXPENSES. Each party hereto will pay its own expenses in connection with the transactions contemplated hereby, whether or not such transactions shall be consummated. Section 4.2. SURVIVAL OF AGREEMENTS. All covenants, agreements, representations and warranties made in this Agreement shall survive (and not be affected by) any Closing. Section 4.3. SUCCESSORS AND ASSIGNS. All representations, covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not; PROVIDED, HOWEVER, that no Noteholder may transfer or assign any of its rights or obligations under this Agreement in violation of applicable securities law and unless the Company is given written notice by such Noteholder and its assignee of such transfer or assignment and any such assignee shall, as a condition to such transfer or assignment, execute and deliver to the Company a written instrument, in form and substance acceptable to the Company, by which such assignee (i) represents that such transfer or assignment is exempt from the registration requirements of the Securities Act, (ii) agrees to become, and be bound by the obligations of, and entitled to the benefits of, a Noteholder under this Agreement; and (iii) such assignee shall make representations and warranties comparable to those contained in Article III hereof; and PROVIDED FURTHER, HOWEVER, that the Company may not assign its rights or obligations hereunder without the prior written consent of the Noteholders. Section 4.4. NOTICES. All notices, requests, consents and other communications hereunder shall be in writing and shall be delivered in person, mailed by certified or registered mail, return receipt requested, or sent by telecopier or telex, addressed as follows: (a) if to the Company, to it at StarMedia Network, Inc. 75 Varick Street, New York, New York 10013, Attention: General Counsel, with a copy to Kenneth

8 Lefkowitz, Esq., Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, New York 10004; and (b) if to any Noteholder, at the address of such Noteholder set forth in Schedule I, with a copy to Michael J. O'Brien, Esq., O'Sullivan Graev & Karabell, LLP, 30 Rockefeller Plaza, New York, New York 10112; or, in any such case, at such other address or addresses as shall have been furnished in writing by such party to the others. Section 4.5. GOVERNING LAW; JURISDICTION. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. Each of the Company and the Noteholders irrevocably submits to the exclusive jurisdiction of (a) the Supreme Court of the State of New York, New York County, and (b) the United States District Court for the Southern District of New York, and the appellate courts therefrom,

8 Lefkowitz, Esq., Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, New York 10004; and (b) if to any Noteholder, at the address of such Noteholder set forth in Schedule I, with a copy to Michael J. O'Brien, Esq., O'Sullivan Graev & Karabell, LLP, 30 Rockefeller Plaza, New York, New York 10112; or, in any such case, at such other address or addresses as shall have been furnished in writing by such party to the others. Section 4.5. GOVERNING LAW; JURISDICTION. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. Each of the Company and the Noteholders irrevocably submits to the exclusive jurisdiction of (a) the Supreme Court of the State of New York, New York County, and (b) the United States District Court for the Southern District of New York, and the appellate courts therefrom, for the purposes of any suit, action or other proceeding arising out of this Agreement or any transaction contemplated hereby. Each of the Company and the Noteholders further agrees that service of any process, summons, notice or document by U.S. registered mail to such party's respective address set forth in Section 4.4 shall be effective service of process for any action, suit or proceeding in New York with respect to any matters to which it has submitted to jurisdiction in this Section 4.5. Each of the Company and the Noteholders agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. Section 4.6. ENTIRE AGREEMENT. This Agreement, including the Schedule hereto, constitutes the sole and entire agreement of the parties with respect to the subject matter hereof and supersedes all prior agreements or understandings between the parties, except any prior agreements relating to confidentiality of disclosed information. The Schedule hereto is hereby incorporated herein by reference. Section 4.7. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Section 4.8. AMENDMENTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Noteholders. Section 4.9. SEVERABILITY. If any provision of this Agreement shall be declared void or unenforceable by any judicial or administrative authority, the validity of any other provision and of the entire Agreement shall not be affected thereby. Section 4.10. TITLES AND SUBTITLES. The titles and subtitles used in this Agreement are for convenience only and are not to be considered in construing or interpreting any term or provision of this Agreement.

9 Section 4.11. CERTAIN DEFINED TERMS. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined). (a) "ACCRUED INTEREST" shall mean, on any Closing Date with respect to a Gratis1 Note, the accrued and unpaid interest on such Gratis1 Note as of such Closing Date. (b) "BUSINESS DAY" shall mean any day that is not a Saturday, Sunday, or legal holiday in the State of New York. (c) "CALL NOTICE" shall mean either a Hostile Change in Control Call Notice or a Negotiated Change in Control Call Notice (d) A "CHANGE IN CONTROL" shall be deemed to occur on: (1) the date that any person or group deemed a person under Sections 3(a)(9) and 13(d)(3) of the Securities

9 Section 4.11. CERTAIN DEFINED TERMS. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined). (a) "ACCRUED INTEREST" shall mean, on any Closing Date with respect to a Gratis1 Note, the accrued and unpaid interest on such Gratis1 Note as of such Closing Date. (b) "BUSINESS DAY" shall mean any day that is not a Saturday, Sunday, or legal holiday in the State of New York. (c) "CALL NOTICE" shall mean either a Hostile Change in Control Call Notice or a Negotiated Change in Control Call Notice (d) A "CHANGE IN CONTROL" shall be deemed to occur on: (1) the date that any person or group deemed a person under Sections 3(a)(9) and 13(d)(3) of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), other than the Company and its Subsidiaries as determined immediately prior to that date or an employee benefit plan of the Company or its Subsidiaries, has become the beneficial owner, directly or indirectly (with beneficial ownership determined as provided in Rule 13d-3, or any successor rule, under the Exchange Act) of securities of the Company representing more than 50% of the total combined voting power of all classes of stock of the Company having the right under ordinary circumstances to vote at an election of the Board of Directors of the Company (the "BOARD"); (2) the date on which any person or group deemed a person under Sections 3(a)(9) and 13(d)(3) of the Exchange Act (provided that neither the Company nor any of its Subsidiaries as determined immediately prior to that date, nor an employee benefit plan of the Company or its Subsidiaries shall be deemed such a person or group), elects a majority of the members of the Board of Directors of the Company; (3) the date of consummation of the merger or consolidation of the Company with another corporation where (i) the stockholders of the Company, immediately prior to the merger or consolidation, would not beneficially own, immediately after the merger or consolidation, shares entitling such stockholders to more than 50% of all votes (without consideration of the rights of any class of stock to elect directors by a separate class vote) to which all stockholders of the surviving corporation would be entitled in the election of directors, or (ii) the members of the Board, immediately prior to the merger or consolidation, would not, immediately after the merger or consolidation, constitute a majority of the board of directors of the surviving corporation; or (4) the date on which the Company consummates a sale of all or substantially all of its assets determined on a consolidated basis.

10 (e) "CURRENT MARKET PRICE" shall mean the average of the reported last sales prices of a Common Share for the five consecutive Trading Days before the date of the applicable Put Notice or Call Notice, as the case may be. The reported last sales price of a Common Share for each Trading Day shall be: (i) the reported last sales price as reported on the National Market tier of The Nasdaq Stock Market; or (ii) if the Common Shares are not listed or admitted to trading on the National Market tier of the Nasdaq Stock Market at such time, in the principal consolidated or composite transaction reporting system on the principal national securities exchange on which the Common Shares are listed or admitted to trading; or (iii) if the Common Shares are not quoted on such National Market tier or any national securities exchange, the average of the highest bid and lowest asked prices on such day as reported on The Nasdaq Stock Market. Notwithstanding anything to the contrary contained herein, the "Current Market Price" for purposes of this Agreement shall in no event be less than $7.00 per Common Share (subject to any adjustment for any stocksplits, dividends, combination and similar events). (f) "EXCHANGE SHARES" shall mean the Common Shares (or other securities issued in substitution thereof) issued to the Noteholders pursuant to Section 1.1(a) or 1.1(b) hereof.

10 (e) "CURRENT MARKET PRICE" shall mean the average of the reported last sales prices of a Common Share for the five consecutive Trading Days before the date of the applicable Put Notice or Call Notice, as the case may be. The reported last sales price of a Common Share for each Trading Day shall be: (i) the reported last sales price as reported on the National Market tier of The Nasdaq Stock Market; or (ii) if the Common Shares are not listed or admitted to trading on the National Market tier of the Nasdaq Stock Market at such time, in the principal consolidated or composite transaction reporting system on the principal national securities exchange on which the Common Shares are listed or admitted to trading; or (iii) if the Common Shares are not quoted on such National Market tier or any national securities exchange, the average of the highest bid and lowest asked prices on such day as reported on The Nasdaq Stock Market. Notwithstanding anything to the contrary contained herein, the "Current Market Price" for purposes of this Agreement shall in no event be less than $7.00 per Common Share (subject to any adjustment for any stocksplits, dividends, combination and similar events). (f) "EXCHANGE SHARES" shall mean the Common Shares (or other securities issued in substitution thereof) issued to the Noteholders pursuant to Section 1.1(a) or 1.1(b) hereof. (g) "HOSTILE CHANGE IN CONTROL" shall mean a Change in Control resulting from any transaction, event or agreement to which the Company has not consented and which has not been approved by the Board of Directors of the Company as constituted immediately prior to that Change of Control. (h) "MATERIAL ADVERSE EFFECT" shall mean, when used with respect to any representation, an occurrence, event or condition that individually or in the aggregate is reasonably likely to be materially adverse to the business, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. (i) "NEGOTIATED CHANGE IN CONTROL" shall mean a Change in Control resulting from a transaction, event or agreement negotiated by the Company with any person and approved by the Board of Directors of the Company. (j) "NOTE PURCHASE PRICE" shall mean, on any Closing Date with respect to a Gratis1 Note held by any Noteholder (i) in the event of a Change in Control pursuant to clause (3) of the definition of "Change in Control", the Post-Merger Consideration with respect to such Gratis1 Note or (ii) in all other circumstances, such number of Common Shares equal to the quotient of (x) the sum of (A) the outstanding principal amount of such Gratis1 Note, (B) Accrued Interest with respect to such Gratis1 Note and (C) the Premium due with respect to such Gratis1 Note DIVIDED BY (y) the Current Market Price, in each case as of such Closing Date. (k) "NOTEHOLDER PAYMENT AMOUNT" shall mean, on any Closing Date with respect to any Gratis1 Note, an amount equal to the product of (x) the par value of any Exchange Shares (or any other securities issued in substitution of such shares) received

11 by such Noteholder multiplied by (y) the number of Exchange Shares (or other securities issued in substitution of such shares) to be issued to such Noteholder hereunder on such Closing Date with respect to such Gratis1 Note. (l) "PERSON" shall mean an individual, corporation, trust, partnership, limited liability company, joint venture, unincorporated organization, government agency or any agency or political subdivision thereof, or other entity. (m) "POST-MERGER CONSIDERATION" shall mean, with respect to a Gratis1 Note held by any Noteholder, in the event of a Change in Control under clause (3) of such definition (A) relating to any sale or purchase pursuant to Section 1.1 in which the consideration to be received by the holders of Common Stock in connection with such Change in Control consists solely of cash, the outstanding principal amount of such Gratis1 Note, plus the Accrued Interest with respect to such Gratis 1 Note, plus the Premium with respect to such Gratis1 Note and (B) in all other cases, such securities of the surviving entity (and/or, if applicable, cash or other property) that such Noteholder would have received if, immediately prior to such Change in Control, such Noteholder held the number of Common Shares attributable to the Note Purchase Price as determined in accordance with clause (ii) of the definition of "Note Purchase Price".

11 by such Noteholder multiplied by (y) the number of Exchange Shares (or other securities issued in substitution of such shares) to be issued to such Noteholder hereunder on such Closing Date with respect to such Gratis1 Note. (l) "PERSON" shall mean an individual, corporation, trust, partnership, limited liability company, joint venture, unincorporated organization, government agency or any agency or political subdivision thereof, or other entity. (m) "POST-MERGER CONSIDERATION" shall mean, with respect to a Gratis1 Note held by any Noteholder, in the event of a Change in Control under clause (3) of such definition (A) relating to any sale or purchase pursuant to Section 1.1 in which the consideration to be received by the holders of Common Stock in connection with such Change in Control consists solely of cash, the outstanding principal amount of such Gratis1 Note, plus the Accrued Interest with respect to such Gratis 1 Note, plus the Premium with respect to such Gratis1 Note and (B) in all other cases, such securities of the surviving entity (and/or, if applicable, cash or other property) that such Noteholder would have received if, immediately prior to such Change in Control, such Noteholder held the number of Common Shares attributable to the Note Purchase Price as determined in accordance with clause (ii) of the definition of "Note Purchase Price". (n) "PREMIUM" shall mean, on any Closing Date with respect to any Gratis1 Note, the excess of (x) the amount of interest that such Gratis1 Note would have accrued from the date of issuance thereof to such Closing Date if the interest rate on such Gratis1 Note was 25% per annum over (y) the amount of interest actually accrued on such Gratis1 Note from the date of issuance thereof to such Closing Date. (o) "PUT NOTICE" shall mean either a Hostile Change in Control Put Notice or a Negotiated Change in Control Put Notice. (p) "TRADING DAY" shall mean a day on which each national securities exchange on which the Common Shares are listed and The Nasdaq Stock Market are open for business, PROVIDED that if no sales of Common Shares take place on such day on the relevant exchange or stock market determined hereunder, such day shall not be a Trading Day. Section 4.12. LEGENDS. It is understood that the certificates evidencing the Exchange Shares will the legends set forth below: THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATES, AND THESE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND LAWS, IF APPLICABLE. THE COMPANY, PRIOR TO PERMITTING A TRANSFER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL OR OTHER ASSURANCE IN FORM AND SUBSTANCE

12 SATISFACTORY TO IT AS TO COMPLIANCE WITH, OR EXEMPTION FROM, SUCH ACT AND LAWS. The legend set forth in the immediately preceding paragraph above shall be removed by the Company or other applicable person from any certificate evidencing Exchange Shares upon delivery to the Company or other applicable person of an opinion by counsel, reasonably satisfactory to the Company or other applicable person, that a registration statement under the Securities Act is at that time in effect with respect to the legended security or that such security can be freely transferred in a public sale without such a registration statement being in effect and that such transfer will not jeopardize the exemption or exemptions from registration pursuant to which the Company or other applicable person issued the Exchange Shares. Section 4.13. WAIVER OF JURY TRIAL. Each of the Company and the Noteholders hereby waives all right to trial by jury in any action, proceeding or counterclaim with respect to, in connection with, or arising out of the transactions contemplated by this Agreement or any document or instrument delivered hereunder. ANY SUCH

12 SATISFACTORY TO IT AS TO COMPLIANCE WITH, OR EXEMPTION FROM, SUCH ACT AND LAWS. The legend set forth in the immediately preceding paragraph above shall be removed by the Company or other applicable person from any certificate evidencing Exchange Shares upon delivery to the Company or other applicable person of an opinion by counsel, reasonably satisfactory to the Company or other applicable person, that a registration statement under the Securities Act is at that time in effect with respect to the legended security or that such security can be freely transferred in a public sale without such a registration statement being in effect and that such transfer will not jeopardize the exemption or exemptions from registration pursuant to which the Company or other applicable person issued the Exchange Shares. Section 4.13. WAIVER OF JURY TRIAL. Each of the Company and the Noteholders hereby waives all right to trial by jury in any action, proceeding or counterclaim with respect to, in connection with, or arising out of the transactions contemplated by this Agreement or any document or instrument delivered hereunder. ANY SUCH PERSON MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. Section 4.14. EXPIRATION OF OPTIONS. The rights of a Noteholder to cause the Company to purchase, and the right of the Company to cause the Noteholders to sell, such Noteholder's Gratis1 Note, shall expire on September 26, 2002. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

13 IN WITNESS WHEREOF, the Company and the Noteholders have executed this Agreement as of the day and year first above written. STARMEDIA NETWORK, INC. By: Name:

Title: CHASE EQUITY ASSOCIATES, LP By: CHASE CAPITAL PARTNERS, as Investment Manager By: Name:

Title: THE FLATIRON FUND 2000 LLC By: Name:

13 IN WITNESS WHEREOF, the Company and the Noteholders have executed this Agreement as of the day and year first above written. STARMEDIA NETWORK, INC. By: Name:

Title: CHASE EQUITY ASSOCIATES, LP By: CHASE CAPITAL PARTNERS, as Investment Manager By: Name:

Title: THE FLATIRON FUND 2000 LLC By: Name:

Title: FLATIRON ASSOCIATES II LLC By: Name:

Title:

SCHEDULE I NOTEHOLDERS NAME AND ADDRESS: Chase Equity Associates, LP c/o Chase Capital Partners 1221 Avenue of the Americas 40th Floor New York, New York 10022 Telephone: (212) 899-3470

SCHEDULE I NOTEHOLDERS NAME AND ADDRESS: Chase Equity Associates, LP c/o Chase Capital Partners 1221 Avenue of the Americas 40th Floor New York, New York 10022 Telephone: (212) 899-3470 Telecopy: (212) 899-3528 Attention: Susan Segal The Flatiron Fund 2000 LLC c/o Flatiron Partners LLC 257 Park Avenue South 12th Floor New York, New York 10010 Telephone: (212) 228-3800 Telecopy: (212) 228-0552 Attention: Fred Wilson Flatiron Associates II LLC c/o Flatiron Partners LLC 257 Park Avenue South 12th Floor New York, New York 10010 Telephone: (212) 228-3800 Telecopy: (212) 228-0552 Attention: Fred Wilson

EXHIBIT 10.34 AMENDMENT NO. 1, dated as of December 29, 2000 (the "AMENDMENT"), to the Put and Call Agreement, dated as of September 26, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware corporation (the "COMPANY"), and the several noteholders named in the attached Schedule I (individually a "NOTEHOLDER" and collectively the "NOTEHOLDERS"). Unless otherwise defined herein, capitalized terms used herein shall have the meaning set forth in the Agreement. WHEREAS, the Noteholders have purchased from Gratis1, Inc., a Delaware corporation ("GRATIS1"), those certain 12% Convertible Promissory Notes in the aggregate principal amount of up to $16,000,000 (collectively, the "12% NOTES"); WHEREAS, pursuant to the Agreement the Company has agreed to purchase 12% Notes in the aggregate principal amount of up to $7,000,000 (collectively, the "GRATIS1 NOTES") in consideration for a certain number of shares of the Company's Common Stock, $0.001 par value per share, to be issued by the Company to the Noteholders (the "COMMON SHARES") or such other assets or property in lieu of such Common Shares as provided in this Agreement; WHEREAS, the Noteholers desire to be able to convert Gratis1 Notes to shares of Gratis1 capital stock pursuant to and in accordance with the terms and conditions set forth in such Notes (such shares acquired upon conversion of 12% Notes being referred to herein as the "CONVERSION SHARES") and to be able to

EXHIBIT 10.34 AMENDMENT NO. 1, dated as of December 29, 2000 (the "AMENDMENT"), to the Put and Call Agreement, dated as of September 26, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware corporation (the "COMPANY"), and the several noteholders named in the attached Schedule I (individually a "NOTEHOLDER" and collectively the "NOTEHOLDERS"). Unless otherwise defined herein, capitalized terms used herein shall have the meaning set forth in the Agreement. WHEREAS, the Noteholders have purchased from Gratis1, Inc., a Delaware corporation ("GRATIS1"), those certain 12% Convertible Promissory Notes in the aggregate principal amount of up to $16,000,000 (collectively, the "12% NOTES"); WHEREAS, pursuant to the Agreement the Company has agreed to purchase 12% Notes in the aggregate principal amount of up to $7,000,000 (collectively, the "GRATIS1 NOTES") in consideration for a certain number of shares of the Company's Common Stock, $0.001 par value per share, to be issued by the Company to the Noteholders (the "COMMON SHARES") or such other assets or property in lieu of such Common Shares as provided in this Agreement; WHEREAS, the Noteholers desire to be able to convert Gratis1 Notes to shares of Gratis1 capital stock pursuant to and in accordance with the terms and conditions set forth in such Notes (such shares acquired upon conversion of 12% Notes being referred to herein as the "CONVERSION SHARES") and to be able to purchase Common Shares with such Conversion Shares as though the Gratis1 Notes with which they were acquired had not been converted; WHEREAS, the Company will derive substantial direct and indirect benefits from the conversion of Gratis1 Notes into Conversion Shares; WHEREAS, in order to induce the Noteholders to convert Gratis1 Notes into Conversion Shares, the Company desires to amend the Agreement to permit the Company to purchase Conversion Shares from the Noteholders in consideration for the issuance of Common Shares substantially on the terms and conditions set forth in the Agreement; NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this Amendment, the parties hereby agree to amend the Agreement as follows: Section 1. AMENDMENT. Effective as of the date of the Agreement, (i) the definition of "Gratis1 Notes" shall be deemed to include all Conversion Shares acquired by any Noteholder pursuant to the terms and conditions of the Gratis1 Notes and (ii) all terms and conditions relating the purchase and sale of Gratis1 Notes in consideration for Common Shares shall apply, MUTATIS MUTANDIS, to the purchase and sale of Conversion Shares except that: (a) "NOTE PURCHASE PRICE" shall mean, on any Closing Date with respect to a Conversion Share held by any Noteholder, (i) in the event of a Change in Control pursuant to clause (3) of the definition of "Change in Control", the Post-Merger

2 Consideration with respect to such Conversion Share or (ii) in all other circumstances, such number of Common Shares equal to the quotient of (x) the sum of (A) the US1.00 and (B) the Premium due with respect to such Conversion Share DIVIDED BY (y) the Current Market Price, in each case as of such Closing Date; (b) "NOTEHOLDER PAYMENT AMOUNT" shall mean, on any Closing Date with respect to any Conversion Share held by a Noteholder, an amount equal to the product of (x) the par value of any Exchange Shares (or any other securities issued in substitution of such shares) received by such Noteholder multiplied by (y) the number of Exchange Shares (or other securities issued in substitution of such shares) to be issued to such Noteholder under the Agreement on such Closing Date with respect to such Conversion Share.

2 Consideration with respect to such Conversion Share or (ii) in all other circumstances, such number of Common Shares equal to the quotient of (x) the sum of (A) the US1.00 and (B) the Premium due with respect to such Conversion Share DIVIDED BY (y) the Current Market Price, in each case as of such Closing Date; (b) "NOTEHOLDER PAYMENT AMOUNT" shall mean, on any Closing Date with respect to any Conversion Share held by a Noteholder, an amount equal to the product of (x) the par value of any Exchange Shares (or any other securities issued in substitution of such shares) received by such Noteholder multiplied by (y) the number of Exchange Shares (or other securities issued in substitution of such shares) to be issued to such Noteholder under the Agreement on such Closing Date with respect to such Conversion Share. (b) "PREMIUM" on any Closing Date with respect to any Conversion Share shall be the sum of (x) US$1.00 multiplied by .13 per annum for the period extending from Applicable Issuance Date to the Applicable Conversion Date and (y) US$1.00 multiplied by .25 per annum for the period extending from the Conversion Date until the Closing Date. For purposes of the foregoing "APPLICABLE CONVERSION DATE" shall mean the date on which the Conversion Share in question was purchased through the conversion of a Gratis1 Note and the "APPLICABLE ISSUANCE DATE" shall mean the date that such Gratis1 Note was issued. Section 2. GOVERNING LAW . This Agreement shall be governed by and construed in accordance with the laws of the State of New York. Section 3. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile counterpart signatures to this Amendment shall be acceptable. Section 4. EFFECTIVENESS OF AGREEMENT. Except as amended hereby, the Agreement shall remain in full force and effect. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

3 IN WITNESS WHEREOF, the Company and the Noteholders have executed this Amendment to the Agreement as of the day and year first above written. STARMEDIA NETWORK, INC. By: Name:

Title: CHASE EQUITY ASSOCIATES, LP By: CHASE CAPITAL PARTNERS, as Investment Manager By: Name:

Title: THE FLATIRON FUND 2000 LLC

3 IN WITNESS WHEREOF, the Company and the Noteholders have executed this Amendment to the Agreement as of the day and year first above written. STARMEDIA NETWORK, INC. By: Name:

Title: CHASE EQUITY ASSOCIATES, LP By: CHASE CAPITAL PARTNERS, as Investment Manager By: Name:

Title: THE FLATIRON FUND 2000 LLC By: Name:

Title: FLATIRON ASSOCIATES II LLC By: Name:

Title:

SCHEDULE I NOTEHOLDERS NAME AND ADDRESS: Chase Equity Associates, LP c/o Chase Capital Partners 1221 Avenue of the Americas 40th Floor New York, New York 10022 Telephone: (212) 899-3470

SCHEDULE I NOTEHOLDERS NAME AND ADDRESS: Chase Equity Associates, LP c/o Chase Capital Partners 1221 Avenue of the Americas 40th Floor New York, New York 10022 Telephone: (212) 899-3470 Telecopy: (212) 899-3528 Attention: Susan Segal The Flatiron Fund 2000 LLC c/o Flatiron Partners LLC 257 Park Avenue South 12th Floor New York, New York 10010 Telephone: (212) 228-3800 Telecopy: (212) 228-0552 Attention: Fred Wilson Flatiron Associates II LLC c/o Flatiron Partners LLC 257 Park Avenue South 12th Floor New York, New York 10010 Telephone: (212) 228-3800 Telecopy: (212) 228-0552 Attention: Fred Wilson

Exhibit 21.1 STARMEDIA NETWORK, INC. State of Delaware LIST OF SUBSIDIARIES StarMedia Argentina Sociedad de Responsabilidad Limitada (SRL) Buenos Aires, Argentina StarMedia do Brasil LTDA. Sao Paulo, Brazil Servicios Interactivos Limitada, Santiago, Chile StarMedia Chile Limitada Santiago, Chile StarMedia Colombia Ltda., Sociedad de

Exhibit 21.1 STARMEDIA NETWORK, INC. State of Delaware LIST OF SUBSIDIARIES StarMedia Argentina Sociedad de Responsabilidad Limitada (SRL) Buenos Aires, Argentina StarMedia do Brasil LTDA. Sao Paulo, Brazil Servicios Interactivos Limitada, Santiago, Chile StarMedia Chile Limitada Santiago, Chile StarMedia Colombia Ltda., Sociedad de Responsabilidad Limitada Bogota, Colombia SMN de Mexico, Sociedad de Responsabilidad Limitada (S. de R.L.) Mexico City, Mexico AdNet S.A. de C.V. Mexico City, Mexico Latin Red, S.L. (formerly Wass Net, S.L.) Barcelona, Spain StarMedia Network Americas, Sociedad Anonima (S.A.) Montevideo, Uruguay StarMedia S.R.L. Caracas, Venezuela StarMedia Mobile (USA), Inc. Delaware StarMedia Mobile (BVI), Inc. British Virgin Islands

EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-41962) pertaining to the StarMedia Network, Inc. 2000 Stock Incentive Plan and (Form S-8 No. 333-79255) pertaining to the 1997 Stock Option Plan, 1998 Stock Option Plan and 1999 Employee Stock Purchase Plan of StarMedia Network, Inc. of our reports dated February 16, 2001, with respect to the consolidated financial statements and schedule of StarMedia Network, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2000.

EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-41962) pertaining to the StarMedia Network, Inc. 2000 Stock Incentive Plan and (Form S-8 No. 333-79255) pertaining to the 1997 Stock Option Plan, 1998 Stock Option Plan and 1999 Employee Stock Purchase Plan of StarMedia Network, Inc. of our reports dated February 16, 2001, with respect to the consolidated financial statements and schedule of StarMedia Network, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2000.
/s/ ERNST & YOUNG LLP New York, New York

March 28, 2001