EXHIBIT-10.8
SERIES C CONVERTIBLE PREFERRED STOCK
PURCHASE AGREEMENT
between
STARMEDIA NETWORK, INC.
and
THE SEVERAL PURCHASERS NAMED IN SCHEDULE I HERETO
Dated as of August 24, 1998
TABLE OF CONTENTS
Page
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ARTICLE I
THE PURCHASED SHARES
Section 1.1 Issuance, Sale and Delivery of the Purchased Shares ........1
Section 1.2 Closing ....................................................2
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 2.1 Organization, Qualifications and Corporate Power ...........2
Section 2.2 Authorization of Agreements, Etc ...........................3
Section 2.3 Validity ...................................................3
Section 2.4 Authorized Capital Stock ...................................4
Section 2.5 Financial Statements .......................................4
Section 2.6 Events Subsequent to the Date of the Balance Sheet .........5
Section 2.7 Litigation; Compliance with Law ............................5
Section 2.8 Proprietary Information ....................................6
Section 2.9 Proprietary Rights .........................................7
Section 2.10 Title to Properties ........................................7
Section 2.11 Leasehold Interests ........................................8
Section 2.12 Insurance ..................................................8
Section 2.13 Taxes ......................................................8
Section 2.14 Other Agreements ...........................................9
Section 2.15 Loans and Advances ........................................11
Section 2.16 Assumptions, Guaranties, Etc. of Indebtedness
of Other Persons ..........................................11
Section 2.17 Significant Customers and Suppliers .......................11
Section 2.18 Governmental Approvals ....................................11
Section 2.19 Disclosure ................................................11
Section 2.20 Offering of the Purchased Shares ..........................12
Section 2.21 Brokers ...................................................12
Section 2.22 Officers ..................................................12
Section 2.23 Transactions With Affiliates ..............................12
Section 2.24 Employees .................................................13
Section 2.25 U.S. Real Property Holding Corporation ....................13
Section 2.26 Environmental Protection ..................................13
Section 2.27 ERISA .....................................................14
Section 2.28 [Reserved] ................................................15
Section 2.29 Foreign Corrupt Practices Act .............................15
Section 2.30 Federal Reserve Regulation ................................15
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
AND ADDITIONAL PURCHASERS .......................15
ARTICLE IV
CONDITIONS TO THE OBLIGATIONS OF THE PURCHASERS
AND ADDITIONAL PURCHASERS
Section 4.1 Conditions to the Obligations of the Purchasers
on the First Closing Date .................................17
(a) Opinion of Company's Counsel .....................17
(b) Representations and Warranties to be
True and Correct .................................17
(c) Performance ......................................17
(d) All Proceedings to be Satisfactory ...............17
(e) Supporting Documents .............................17
(f) Charter ..........................................18
(g) Election of Directors ............................18
(h) [Reserved] .......................................18
(i) Key Person Insurance .............................18
(j) Preemptive Rights ................................18
(k) Fees of Purchasers' Counsel ......................18
Section 4.2 Condition to the Obligations of the Additional
Purchasers on each Additional Closing Date ................18
(a) Opinion of Company's Counsel .....................19
(b) Representations and Warranties to be
True and Correct .................................19
(c) Performance ......................................19
(d) No Adverse Change ................................19
(e) Supporting Documents .............................19
ARTICLE V
COVENANTS OF THE COMPANY
Section 5.1 Financial Statements, Reports, Etc. .......................19
Section 5.2 [Reserved] ................................................20
Section 5.3 Reserve for Conversion Shares .............................20
Section 5.4 Corporate Existence .......................................21
Section 5.5 Properties, Business, Insurance ...........................21
Section 5.6 Inspection, Consultation and Advice .......................21
Section 5.7 Restrictive Agreements Prohibited .........................21
Section 5.8 Transactions with Affiliates ..............................22
Section 5.9 Expenses of Directors .....................................22
Section 5.10 Use of Proceeds ...........................................22
Section 5.11 Compensation ..............................................22
Section 5.12 By-laws ...................................................22
Section 5.13 Employee Nondisclosure and Developments Agreements ........22
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Section 5.14 Activities of Subsidiaries ................................22
Section 5.15 Compliance with Laws ......................................23
Section 5.16 Keeping of Records and Books of Account ...................23
Section 5.17 Change in Nature of Business ..............................23
Section 5.18 Rule 144A Information .....................................23
Section 5.19 Compensation and Audit Committees .........................23
Section 5.20 Termination of Covenants ..................................24
ARTICLE VI
MISCELLANEOUS
Section 6.1 Expenses ..................................................24
Section 6.2 Survival of Representations; Termination of Agreements ....24
Section 6.3 Brokerage .................................................24
Section 6.4 Parties in Interest .......................................25
Section 6.5 Lock-Up Agreement .........................................25
Section 6.6 Notices ...................................................25
Section 6.7 Governing Law .............................................25
Section 6.8 Entire Agreement ..........................................25
Section 6.9 Counterparts ..............................................25
Section 6.10 Amendments ................................................26
Section 6.11 Severability ..............................................26
Section 6.12 Titles and Subtitles ......................................26
Section 6.13 Certain Defined Terms .....................................26
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SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT dated as of August
24, 1998, between StarMedia Network, Inc., a Delaware corporation (the
"Company"), and the several purchasers named in the attached Schedule I
(individually a "Purchaser" and collectively the "Purchasers").
WHEREAS, the Company wishes to issue and sell to the Purchasers up to an
aggregate of 16,666,667 shares (the "Purchased Shares") of the authorized but
unissued Series C Convertible Preferred Stock, $0.001 par value, of the Company
(the "Series C Convertible Preferred Stock"); and
WHEREAS, the Purchasers, severally but not jointly, wish to purchase the
number of Purchased Shares set forth below, on the terms and subject to the
conditions set forth 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
THE PURCHASED SHARES
Section 1.1 Issuance, Sale and Delivery of the Purchased Shares. (a) The
Company agrees to issue and sell to each Purchaser, and each Purchaser hereby
agrees to purchase from the Company, on the First Closing Date (as hereinafter
defined), the number of Purchased Shares set forth opposite the name of such
Purchaser under the heading "Number of Purchased Shares" on Schedule I (the
aggregate number of such Purchased Shares being hereinafter collectively
referred to at times as the "Initial Purchased Shares") in exchange for the
amount set forth opposite the name of such Purchaser under the heading
"Aggregate Purchase Price for Purchased Shares" (the "Initial Purchase Price").
(b) The Company may also issue and sell on each Additional Closing
Date (as hereinafter defined), on the terms and conditions of this Agreement, up
to a number of additional shares of Series C Convertible Preferred Stock equal
to (i) 16,666,667 minus (ii) the number of Initial Purchased Shares purchased at
the First Closing (the aggregate number of such Purchased Shares sold in
accordance with this subsection (b) being hereinafter collectively referred to
at times as the "Additional Purchased Shares"), at the price of $4.80 per share
(such amount in the aggregate referred to at times as the "Additional Purchase
Price"), to one or more additional purchasers (such additional purchasers being
hereinafter collectively referred to at times as the "Additional Purchasers").
Any Additional Purchaser who or which purchases any of the Additional Purchased
Shares shall, as a condition to his, her or its purchase of Additional Purchased
Shares, execute and deliver to the Company a written instrument, substantially
in the form attached as Exhibit A (each, a "Counterpart"), by which such
Additional Purchaser agrees to become a party hereto, and be bound by the
obligations of, and entitled to the benefits of, an Additional Purchaser under
this Agreement.
Section 1.2 Closing. Each of the closings of the purchase and sale of
Purchased Shares shall take place at the offices of Winthrop, Stimson, Xxxxxx
and Xxxxxxx, Xxx Xxxxxxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000. The closing for
the purchase and sale of the Initial Purchased Shares (the "First Closing")
shall be held on August 24, 1998, at 10:00 a.m., New York time, or at such other
date and time as may be agreed upon between the applicable Purchasers and the
Company (such date and time being called the "First Closing Date"). Each
additional closing, if any, for the purchase and sale of the Additional
Purchased Shares (each, an "Additional Closing"; each of the First Closing and
any Additional Closings being at times referred to herein as a "Closing") shall
be at such date and time as may be agreed upon between the Additional Purchasers
and the Company (each, an "Additional Closing Date;" each of the First Closing
Date and any Additional Closing Date being at times referred to herein as a
"Closing Date"), provided that no Additional Closing shall take place later than
October 15, 1998.
At each Closing, the Company shall issue and deliver to each Purchaser or
Additional Purchaser participating in such Closing a stock certificate or
certificates in definitive form, registered in the name of such Purchaser or
Additional Purchaser, representing the Purchased Shares being purchased by it at
such Closing. As payment in full for the Purchased Shares being purchased by it
on a Closing Date under this Agreement, and against delivery of the stock
certificate or certificates therefor as aforesaid, on such Closing Date, each
Purchaser and Additional Purchaser shall deliver to the Company the Initial
Purchase Price or the Additional Purchase Price, as the case may be, payable by
(i) delivery to the Company of a certified check payable to the order of the
Company, (ii) wire transfer to the account of the Company, (iii) delivery to the
Company for cancellation of promissory notes issued by the Company, or (iv) any
combination of the foregoing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Purchasers and any Additional
Purchasers that, except as set forth in the Disclosure Schedule attached as
Schedule II (which Disclosure Schedule makes explicit reference to the
particular representation or warranty as to which exception is taken, which in
each case shall constitute the sole representation and warranty as to which such
exception shall apply):
Section 2.1 Organization, Qualifications and Corporate Power. (a) The
Company and each of its subsidiaries is a corporation duly incorporated, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated and is duly licensed or qualified to transact business as a foreign
corporation and is in good standing 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 where the failure to be
so licensed or qualified would not have material and adverse effect on the
business, prospects, financial condition, operations, property or affairs of the
Company and its subsidiaries, taken as a whole ("Material Adverse Effect"). The
Company and each of its subsidiaries has the corporate power and authority to
own and hold its properties and to carry on its business as now conducted and as
proposed to be conducted in the Offering Memorandum of the Company dated June
1998 (the
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"Offering Memorandum"), and the Company has the corporate power and authority to
execute, deliver and perform this Agreement, to issue, sell and deliver the
Purchased Shares and to issue and deliver the shares of Common Stock, $0.001 par
value, of the Company ("Common Stock") issuable upon conversion of the Purchased
Shares (the "Conversion Shares").
(b) Except as set forth in the attached Disclosure Schedule, the
Company does not (i) own of record or beneficially, directly or indirectly, (A)
any shares of capital stock or securities convertible into capital stock of any
other corporation or (B) any participating interest in any partnership, joint
venture or other non-corporate business enterprise or (ii) control, directly or
indirectly, any other entity.
Section 2.2 Authorization of Agreements, Etc. (a) The execution and
delivery by the Company of this Agreement; the performance by the Company of its
obligations hereunder, the issuance, sale and delivery of the Purchased Shares
and the issuance and delivery of the Conversion Shares have been duly authorized
by all requisite corporate action and will not violate any provision of law, any
order of any court or other agency of government, the Certificate of
Incorporation of the Company, as amended (the "Charter"), or the By-laws of the
Company, as amended, the organizational documents of any subsidiary or any
provision of any indenture, agreement or other instrument to which the Company
or any of its subsidiaries or any of their respective properties or assets is
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 upon 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 upon any of the properties or assets of the Company or any
subsidiary.
(b) The Purchased Shares have been duly authorized and, when issued
in accordance with this Agreement, will be validly issued, fully paid and
nonassessable shares of Series C Convertible Preferred Stock, with no personal
liability attaching to the ownership thereof, and will be free and clear of all
liens, charges, restrictions, claims and encumbrances imposed by or through the
Company. The Conversion Shares have been duly reserved for issuance upon
conversion of the Purchased Shares and, when so issued, will be duly authorized,
validly issued, fully paid and nonassessable shares of Common Stock, with no
personal liability attaching to the ownership thereof, and except as set forth
in the Disclosure Schedule will be free and clear of all liens, charges,
restrictions, claims and encumbrances imposed by or through the Company. Except
as set forth in the Disclosure Schedule, neither the issuance, sale or delivery
of the Purchased Shares nor the issuance or delivery of the Conversion Shares is
subject to any preemptive right to stockholders of the Company or to any right
of first refusal or other right in favor of any person, and all such rights have
been exercised or waived by all such persons with respect to the transactions
contemplated hereby.
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 in accordance with its terms.
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Section 2.4 Authorized Capital Stock. The authorized capital stock of the
Company consists of (i) 60,000,000 shares of Preferred Stock, $0.001 par value
(the "Preferred Stock"), of which 7,330,000 shares have been designated Series A
Convertible Preferred Stock, 8,000,000 shares have been designated Series B
Convertible Preferred Stock and 16,666,667 shares have been designated Series C
Convertible Preferred Stock, and (ii) 100,000,000 shares of Common Stock, $0.001
par value. Immediately prior to the First Closing, (A) 10,392,000 shares of
Common Stock will be validly issued and outstanding, fully paid and
nonassessable, with no personal liability attaching to the ownership thereof,
(B) 7,330,000 shares of Series A Convertible Preferred Stock will be validly
issued and outstanding, fully paid and nonassessable, with no personal liability
attached to the ownership thereof, and 8,000,000 shares of Series B Convertible
Preferred Stock will be validly issued and outstanding, fully paid and
non-assessable, with no personal liability attached to the ownership thereof. An
aggregate of 31,996,667 shares of Common Stock has been reserved for issuance
upon conversion of the Series A Convertible Preferred Stock, the Series B
Convertible Preferred Stock and the Series C Convertible Preferred Stock. An
aggregate of 8,000,000 shares of Common Stock (the "Reserved Employee Shares")
has been reserved for issuance pursuant to the Company's Stock Option Plan, of
which options to purchase 4,210,433 shares have been granted to date. The
designations, powers, preferences, rights, qualifications, limitation and
restrictions in respect of each class and series of authorized capital stock of
the Company are as set forth in the Charter, a copy of which is attached as
Exhibit B, and all such designations, powers, preferences, rights,
qualifications, limitations and restrictions are valid, binding and enforceable
and in accordance with all applicable laws. The equity interests in each of the
Company's subsidiaries is set forth in Section 2.1 of the Disclosure Schedule,
which interests are validly issued and outstanding and free of all liens,
charges, restrictions, claims and encumbrances. Except as set forth in the
attached Disclosure Schedule, (i) no person owns of record or is known to the
Company to own beneficially any share of Common Stock or Preferred Stock or any
equity securities of any of the Company's subsidiaries, (ii) no subscription,
warrant, option, convertible security, or other right (contingent or other) to
purchase or otherwise acquire equity securities of the Company or any of its
subsidiaries is authorized or outstanding and (iii) there is no commitment by
the Company or any of its subsidiaries to issue shares, subscriptions, warrants,
options, convertible securities, or other such rights or to distribute to
holders of any of its equity securities any evidence of indebtedness or asset.
Except as provided for in the Charter or as set forth in the attached Disclosure
Schedule, neither the Company nor any of its subsidiaries has any obligation
(contingent or other) to purchase, redeem or otherwise acquire any of its equity
securities or any interest therein or to pay any dividend or make any other
distribution in respect thereof. Except as set forth in the Disclosure Schedule,
neither the Company or any of its subsidiaries nor, to the Company's knowledge,
without having investigated such matter, any other person is party to any voting
trusts or agreements, stockholders' agreements, pledge agreements, buy-sell
agreements, rights of first refusal, preemptive rights or proxies relating to
any securities of the Company or any of its subsidiaries (whether or not the
Company or any of its subsidiaries is a party thereto), and all such rights
under any such agreement have been waived or exercised by all such persons with
respect to the transactions contemplated hereby. All of the outstanding
securities of the Company and its subsidiaries were issued in compliance with
all applicable Federal, foreign and state securities laws.
Section 2.5 Financial Statements. The Company has furnished to the
Purchasers and the Additional Purchasers (i) the audited balance sheet of the
Company as of December 31,
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1997, and the related audited statements of income and stockholders' equity for
the year then ended and (ii) the unaudited consolidated balance sheet of the
Company as of June 30, 1998 (the "Balance Sheet"), and the related unaudited
consolidated statements of income and stockholders' equity for the six months
then ended. All such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied (except, in the
case of the unaudited financial statements, for the absence of footnotes) and
fairly present the financial position of the Company and results of operation
for and as of the dates set forth therein. Since the date of the Balance Sheet,
except as set forth in the attached Disclosure Schedule, (x) there has been no
change in the assets, liabilities or financial condition of the Company and its
subsidiaries, taken as a whole, from that reflected in the Balance Sheet except
for changes in the ordinary course of business which in the aggregate have not
been materially adverse and (y) none of the business, prospects, financial
condition, operations, property or affairs of the Company and its subsidiaries,
taken as a whole, has been materially adversely affected by any occurrence or
development, individually or in the aggregate, whether or not insured against.
Section 2.6 Events Subsequent to the Date of the Balance Sheet. Since the
date of the Balance Sheet, except as set forth in the attached Disclosure
Schedule, neither the Company nor any of its subsidiaries has (i) issued any
stock, bond or other corporate security, (ii) borrowed any amount or incurred or
become subject to any liability (absolute, accrued or contingent), except
current liabilities incurred and liabilities under contracts entered into in the
ordinary course of business, (iii) discharged or satisfied any lien or
encumbrance or incurred or paid any obligation or liability (absolute, accrued
or contingent) other than current liabilities shown on the Balance Sheet and
current liabilities incurred since the date of the Balance Sheet in the ordinary
course of business, (iv) declared or made any payment or distribution to
stockholders or purchased or redeemed any share of its capital stock or other
security, (v) mortgaged, pledged, encumbered or subjected to lien any of its
assets, tangible or intangible, other than liens of current real property taxes
not yet due and payable, (vi) sold, assigned or transferred any of its tangible
assets except in the ordinary course of business, or canceled any debt or claim,
(vii) sold, assigned, transferred or granted any exclusive license with respect
to any patent, trademark, trade name, service xxxx, copyright, trade secret or
other intangible asset, (viii) suffered any loss of property or waived any right
of substantial value whether or not in the ordinary course of business, (ix)
made any change in officer compensation except in the ordinary course of
business and consistent with past practice, (x) made any material change in the
manner of business or operations of the Company and its subsidiaries, taken as a
whole,, (xi) entered into any transaction except in the ordinary course of
business or as otherwise contemplated hereby or (xii) entered into any
commitment (contingent or otherwise) to do any of the foregoing.
Section 2.7 Litigation; Compliance with Law. Except as set forth on the
attached Disclosure Schedule, there is no (i) action, suit, claim, proceeding or
investigation pending or, to the best of the Company's knowledge, threatened
against or affecting the Company or any of its subsidiaries, at law or in
equity, or before or by any foreign or domestic Federal, state, municipal or
other governmental department, commission, board, bureau agency or
instrumentality, except to the extent that any of the foregoing, if determined
adversely to the Company or any of its subsidiaries, would not have a Material
Adverse Effect, (ii) arbitration proceeding relating to the Company or any of
its subsidiaries pending under collective bargaining agreements or otherwise or
(iii) foreign or domestic governmental inquiry pending or, to the best of the
Company's
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knowledge, threatened against or affecting the Company or any of its
subsidiaries (including without limitation any inquiry as to the qualification
of the Company or any of its subsidiaries to hold or receive any license or
permit), and there is no basis for any of the foregoing. Neither the Company nor
any of its subsidiaries has received any opinion or memorandum or legal advice
from foreign or domestic legal counsel to the effect that it is exposed, from a
legal standpoint, to any liability or disadvantage which may be material to its
business, prospects, financial condition, operations, property or affairs.
Neither the Company nor any of its subsidiaries is in default with respect to
any order, writ, injunction or decree known to or served upon the Company or any
of its subsidiaries of any court or of any foreign or domestic Federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign. There is no action or suit by the Company
or any of its subsidiaries pending, threatened or contemplated against others.
The Company and each of its subsidiaries has complied with all foreign and
domestic laws, rules, regulations and orders applicable to its business,
operations, properties, assets, products and services, the Company and each of
its subsidiaries has all necessary permits, licenses and other authorizations
required to conduct its business as conducted and as proposed to be conducted,
and the Company and each of its subsidiaries has been operating its business
pursuant to and in compliance with the terms of all such permits, licenses and
other authorizations, except to the extent that the failure to do any of the
foregoing would not have a Material Adverse Effect. There is no existing law,
rule, regulation or order, and the Company is not aware of any proposed law,
rule, regulation or order, whether foreign or domestic, Federal, state, county
or local, which would prohibit or restrict the Company or any of its
subsidiaries from, or otherwise materially adversely affect the Company or any
of its subsidiaries in, conducting its business in any jurisdiction in which it
is now conducting business or in which it proposes to conduct business.
Section 2.8 Proprietary Information. (a) To the best of the Company's
knowledge, no third party has claimed or has reason to claim that any officer or
director or other person employed by or engaged by the Company or any of its
subsidiaries has (i) violated or may be violating any of the terms or conditions
of his employment, non-competition or non-disclosure agreement with such third
party, (ii) disclosed or may be disclosing or utilized or may be utilizing any
trade secret or proprietary information or documentation of such third party or
(iii) interfered or may be interfering in the employment relationship between
such third party and any of its present or former employees. No third party has
requested information from the Company or any of its subsidiaries which suggests
that such a claim might be contemplated. To the best of the Company's knowledge,
no officer or director or other person employed by or engaged by the Company or
any of its subsidiaries has employed or proposes to employ any trade secret or
any information or documentation proprietary to any former employer, and to the
best of the Company's knowledge, no officer or director or other person employed
by or engaged by the Company or any of its subsidiaries has violated any
confidential relationship which such person may have had with any third party,
in connection with the development, manufacture or sale of any product or
proposed product or the development or sale of any service or proposed service
of the Company or any of its subsidiaries, and the Company has no reason to
believe there will be any such employment or violation. To the best of the
Company's knowledge, none of the execution or delivery of this Agreement, or the
carrying on of the business of the Company or any of its subsidiaries as
officers, employees or agents by any officer, director or key employee of the
Company or any of its subsidiaries, or the conduct or proposed conduct of the
business of the Company or any of its subsidiaries, will conflict with or result
in a breach of the terms,
6
conditions or provisions of or constitute a default under any contract, covenant
or instrument under which any such person is obligated.
Section 2.9 Proprietary Rights. Set forth in the Disclosure Schedule is a
list of (i) all domestic and foreign patents, patent rights, patent
applications, trademarks, trademark applications, service marks, service xxxx
applications, trade names and copyrights, and all applications for such which
have been filed, owned by or registered in the name of the Company or any of its
subsidiaries, or of which the Company or any of its subsidiaries is a licensor
or licensee or in which the Company or any of its subsidiaries has any right,
and (ii) all licenses and other agreements with third parties (the "Third Party
Licenses") relating to any software, copyrights, technology, know-how or
processes that the Company or any of its subsidiaries has licensed or is
otherwise authorized by such third parties to use, market, distribute or
incorporate into products distributed or services provided by the Company or any
of its subsidiaries (such software, technology, know-how and processes being
collectively referred to as "Third Party Technology"). The Company owns or
possesses adequate licenses or other rights to use all patents, patent
applications, trademarks, trademark applications, service marks, service xxxx
applications, trade names, copyrights, manufacturing processes, formulae, trade
secrets, customer lists and know-how, including without limitation the Third
Party Technology (collectively, "Intellectual Property") necessary or desirable
to the conduct of its business as conducted and as proposed to be conducted,
free and clear of all liabilities, charges, liens, pledges, mortgages,
restrictions, adverse claims, security interests, rights of others and
encumbrances (including, without limitation, distribution rights). The foregoing
representation as it relates to Third Party Technology is limited to the
Company's interest pursuant to the Third Party Licenses, all of which are valid
and enforceable and in full force and effect and which grant the Company such
rights to Third Party Technology as are employed in or necessary to the business
of the Company as conducted or proposed to be conducted. All of the Company's
registered patents, trademarks and copyrights in any of the Company's products
and applications therefor, if any, are valid and in full force and effect, and
consummation of the transactions contemplated hereby will not alter or impair
any such rights. Except as set forth in the attached disclosure schedule, no
claim is pending or, to the best of the Company's knowledge, threatened to the
effect that the operations of the Company or any of its subsidiaries infringe
upon or conflict with, constitute misappropriation of or in any way involve
unfair competition with respect to, the asserted rights of any other person
under any Intellectual Property, and there is no basis for any such claim
(whether or not pending or threatened). Except as set forth in the attached
disclosure schedule, no claim is pending or, to the best of the Company's
knowledge, threatened to the effect that any such Intellectual Property owned or
licensed by the Company or any of its subsidiaries or which the Company or any
of its subsidiaries otherwise has the right to use, is invalid or unenforceable
by the Company or any such subsidiary, and there is no basis for any such claim
(whether or not pending or threatened). To the best of the Company's knowledge,
all trade secrets developed by and belonging to the Company or any of its
subsidiaries which have not been patented have been kept confidential.
Section 2.10 Title to Properties. Either the Company or its subsidiaries
has good, clear and valid title to its properties and assets reflected on the
Balance Sheet or acquired by it since the date of the Balance Sheet (other than
properties and assets disposed of in the ordinary course of business since the
date of the Balance Sheet), and all such properties and assets are free and
clear of mortgages, pledges, security interests, liens, charges, claims,
restrictions and other
7
encumbrances (including without limitation, easements and licenses), except for
liens for or current taxes not yet due and payable and minor imperfections of
title, if any, not material in nature or amount and not materially detracting
from the value or impairing the use of the property subject thereto or impairing
the operations or proposed operations of the Company and its subsidiaries, taken
as a whole, including, without limitation, the ability of the Company to secure
financing using such properties and assets as collateral. To the best of the
Company's knowledge, there are no condemnation, environmental, zoning or other
land use regulation proceedings, either instituted or planned to be instituted,
which would adversely affect the use or operation of the Company's or any of its
subsidiaries' properties and assets for their respective intended uses and
purposes, or the value of such properties, and the Company has not received
notice of any special assessment proceedings which would affect such properties
and assets.
Section 2.11 Leasehold Interests. Each lease or agreement to which the
Company or any of its subsidiaries is a party under which it is a lessee of any
property, real or personal, is a valid and subsisting agreement, duly authorized
and entered into, without any default of the Company or any of its subsidiaries
thereunder and, to the best of the Company's knowledge, without any default
thereunder of any other party thereto. No event has occurred and is continuing
which, with due notice or lapse of time or both, would constitute a default or
event of default by the Company or any of its subsidiaries under any such lease
or agreement or, to the best of the Company's knowledge, by any other party
thereto. The Company's or any of its subsidiaries' possession of such property
has not been disturbed and, to the best of the Company's knowledge, no claim has
been asserted against the Company or any of its subsidiaries adverse to its
rights in such leasehold interests.
Section 2.12 Insurance. The Company and its subsidiaries hold valid
policies covering all of the insurance required to be maintained by it under
Section 5.5.
Section 2.13 Taxes. The Company and each of its subsidiaries has filed all
tax returns, Federal, state, foreign, county and local, required to be filed by
it, and the Company and each of its subsidiaries has paid all taxes shown to be
due by such returns as well as all other taxes, assessments and governmental
charges which have become due or payable, including without limitation all taxes
which the Company and each of its subsidiaries is obligated to withhold from
amounts owing to employees, creditors and third parties. The Company and each of
its subsidiaries has established adequate reserves for all taxes accrued but not
yet payable. All material tax elections of any type which the Company has made
as of the date hereof are set forth in the financial statements referred to in
Section 2.5. The Federal income tax returns of the Company have never been
audited by the Internal Revenue Service, and the Company's and its subsidiaries'
foreign income tax returns have neither been audited or challenged by any
foreign tax authority. No deficiency assessment with respect to or proposed
adjustment of the Company's or any of its subsidiaries' Federal, state, foreign,
county or local taxes is pending or, to the best of the Company's knowledge,
threatened. There is no tax lien (other than for current taxes not yet due and
payable), whether imposed by any Federal, state, foreign, county or local taxing
authority, outstanding against the assets, properties or business of the
Company. Neither the Company nor any of its present or former stockholders has
ever filed an election pursuant to Section 1362 of the Internal Revenue Code of
1986, as amended (the "Code") that the Company be taxed as an S corporation. The
Company's net operating losses for Federal income tax purposes, as set forth in
the financial statements referred to in Section 2.5, are not subject to any
8
limitations imposed by Section 382 of the Code and the full amount of such net
operating losses are available to offset the taxable income of the Company for
the current fiscal year and, to the extent not so used, succeeding fiscal years.
Consummation of the transactions contemplated by this Agreement or by any other
agreement, understanding or commitment (contingent or otherwise) to which the
Company is a party or by which it is otherwise bound will not have the effect of
limiting the Company's ability to use such net operating losses in full to
offset such taxable income.
Section 2.14 Other Agreements. Except as set forth in the attached
Disclosure Schedule, neither the Company nor any of its subsidiaries is a party
to or otherwise bound by any written or oral agreement, instrument, commitment
or restriction which individually or in the aggregate could materially adversely
affect the business, prospects, financial condition, operations, property or
affairs of the Company and its subsidiaries, taken as a whole. Except as set
forth in the attached Disclosure Schedule, neither the Company nor any of its
subsidiaries is a party to or otherwise bound by any written or oral:
(a) distributor, dealer, manufacturer's representative or sales
agency agreement which is not terminable on less than ninety (90) days'
notice without cost or other liability to the Company or its subsidiaries
(except for agreements which, in the aggregate, are not material to the
business of the Company or its subsidiaries);
(b) sales agreement which entitles any customer to a rebate or right
of set-off, to return any product to the Company or its subsidiaries after
acceptance thereof or to delay the acceptance thereof, or which varies in
any material respect from the Company's or its subsidiaries' standard form
agreements;
(c) agreement with any labor union (and, to the knowledge of the
Company, no organizational effort is being made with respect to any of its
employees);
(d) agreement with any supplier containing any provision permitting
any party other than the Company or its subsidiaries to renegotiate the
price or other terms, or containing any pay-back or other similar
provision, upon the occurrence of a failure by the Company or its
subsidiaries to meet its obligations under the agreement when due or the
occurrence of any other event;
(e) agreement for the future purchase of fixed assets or for the
future purchase of materials, supplies or equipment in excess of its
normal operating requirements;
(f) agreement for the employment of any officer, employee or other
person (whether of a legally binding nature or in the nature of informal
understandings) on a full-time or consulting basis which is not terminable
on notice without cost or other liability to the Company or its
subsidiaries, except normal severance arrangements and accrued vacation
pay;
(g) bonus, pension, profit-sharing, retirement, hospitalization,
insurance, stock purchase, stock option or other plan, agreement or
understanding pursuant to which benefits are provided to any employee of
the Company or its subsidiaries (other than
9
group insurance plans which are not self-insured and are applicable to
employees generally);
(h) agreement relating to the borrowing of money or to the
mortgaging or pledging of, or otherwise placing a lien or security
interest on, any asset of the Company or its subsidiaries;
(i) guaranty of any obligation for borrowed money or otherwise;
(j) voting trust or agreement, stockholders' agreement, pledge
agreement, buy-sell agreement or first refusal or preemptive rights
agreement relating to any securities of the Company or its subsidiaries;
(k) agreement, or group of related agreements with the same party or
any group of affiliated parties, under which the Company or its
subsidiaries has advanced or agreed to advance money or has agreed to
lease any property as lessee or lessor;
(l) agreement or obligation (contingent or otherwise) to issue, sell
or otherwise distribute or to repurchase or otherwise acquire or retire
any share of its capital stock or any of its other equity securities;
(m) assignment, license or other agreement with respect to any form
of intangible property;
(n) agreement under which it has granted any person any registration
rights;
(o) agreement under which it has limited or restricted its right to
compete with any person in any respect;
(p) other agreement or group of related agreements with the same
party involving more than $250,000 or continuing over a period of more
than six months from the date or dates thereof (including renewals or
extensions optional with another party), which agreement or group of
agreements is not terminable by the Company or its subsidiaries without
penalty upon notice of thirty (30) days or less, but excluding any
agreement or group of agreements entered into by the Company or its
subsidiaries in the ordinary course of business; or
(q) other agreement, instrument, commitment, plan or arrangement, a
copy of which would be required to be filed with the Securities and
Exchange Commission (the "Commission") as an exhibit to a registration
statement on Form S-1 if the Company were registering securities under the
Securities Act of 1933, as amended (the "Securities Act").
Any agreement specified in the Disclosure Schedule pursuant to this Section 2.14
is hereinafter referred to as a "Material Agreement". The Company and its
subsidiaries, and to the best of the Company's knowledge after due inquiry, each
other party thereto have in all material respects performed all the obligations
required to be performed by them to date (or such non-performing party has
received a valid, enforceable and irrevocable written waiver with respect to its
non-
10
performance), have received no notice of default and are not in default (with
due notice or lapse of time or both) under any Material Agreement. The Company
has no present expectation or intention of not fully performing, or causing any
of its subsidiaries to not fully perform, all its obligations under each such
Material Agreement, and the Company has no knowledge of any breach or
anticipated breach by the other party to any Material Agreement. The Company and
its subsidiaries are in full compliance with all of the terms and provisions of
their respective organizational documents, as amended.
Section 2.15 Loans and Advances. Neither the Company nor any of its
subsidiaries has any outstanding loans or advances to any person and is not
obligated to make any such loans or advances, except, in each case, for advances
to employees of the Company or any of its subsidiaries in respect of
reimbursable business expenses anticipated to be incurred by them in connection
with their performance of services for the Company or any of its subsidiaries.
Section 2.16 Assumptions, Guaranties, Etc. of Indebtedness of Other
Persons. Neither the Company nor any of its subsidiaries has assumed,
guaranteed, endorsed or otherwise become directly or continently liable on any
indebtedness of any other person (including, without limitation, liability by
way of agreement, contingent or otherwise, to purchase, to provide funds for
payment, to supply funds to or otherwise invest in the debtor, or otherwise to
assure the creditor against loss), except for guaranties by endorsement of
negotiable instruments for deposit in collection in the ordinary course of
business.
Section 2.17 Significant Customers and Suppliers. Except as set forth in
the Disclosure Schedule, no customer or supplier which was significant to the
Company and its subsidiaries, taken as a whole, during the period covered by the
financial statements referred to in Section 2.5 or which has been significant to
the Company and its subsidiaries, taken as a whole, thereafter has terminated,
materially reduced or threatened to terminate or materially reduce its purchases
from or provision of products or services to the Company or its subsidiaries, as
the case may be.
Section 2.18 Governmental Approvals. Subject to the accuracy of the
representations and warranties of the Purchasers and the Additional Purchasers
set forth in Article III, no registration or filing with, or consent or approval
of or other action by, any foreign or domestic Federal, state or other
governmental agency or instrumentality is or will be necessary for the valid
execution, delivery and performance by the Company of this Agreement, the
issuance, sale and delivery of the Purchased Shares or the issuance and delivery
of the Conversion Shares, other than (i) filings pursuant to Federal and state
securities laws (all of which filings have been made by the Company, other than
those which are required to be made after any Closing and which will be duly
made on a timely basis) in connection with the sale of the Purchased Shares.
Section 2.19 Disclosure. Neither this Agreement, nor any Schedule or
Exhibit to this Agreement, nor the Offering Memorandum, contains an untrue
statement of a material fact or omits a material fact necessary to make the
statements contained herein or therein not misleading. None of the statements,
documents, certificates or other items prepared or supplied by the Company with
respect to the transactions contemplated hereby contains an untrue statement of
a material fact or omits a material fact necessary to make the statements
contained therein not misleading. There is no fact which the Company has not
disclosed to the Purchasers
11
and Additional Purchasers and their counsel in writing and of which the Company
is aware which materially and adversely affects or is reasonably likely to
materially and adversely affect the business, prospects, financial condition,
operations, property or affairs of the Company and its subsidiaries, taken as a
whole. The financial projections and other estimates contained in the Offering
Memorandum were prepared by the Company based on the Company's experience in the
industry and on assumptions of fact and opinion as to future events which the
Company, at the date of the issuance of the Offering Memorandum, believed to be
reasonable, but which the Company cannot and does not assure or guarantee the
attainment of in any manner. Except as set forth in the Disclosure Schedule, as
of the date hereof no facts have come to the attention of the Company which
would, in its opinion, require the Company to revise or amplify the assumptions
underlying such projections and other estimates or the conclusions derived
therefrom.
Section 2.20 Offering of the Purchased Shares. Neither the Company nor any
person authorized or employed by the Company as agent, broker, dealer or
otherwise in connection with the offering or sale of the Purchased Shares or any
security of the Company similar to the Purchased Shares has offered the
Purchased Shares or any such similar security for sale to, or solicited any
offer to buy the Purchased Shares or any such similar security from, or
otherwise approached or negotiated with respect thereto with, any person or
persons, and neither the Company nor any person acting on its behalf has taken
or will take any other action (including, without limitation, any offer,
issuance or sale of any security of the Company under circumstances which might
require the integration of such security with the Purchased Shares under the
Securities Act or the rules and regulations of the Commission thereunder), in
either case so as to subject the offering, issuance or sale of the Purchased
Shares or the Conversion Shares to the registration provisions of the Securities
Act.
Section 2.21 Brokers. Except as set forth on the Disclosure Schedule, the
Company has no contract, arrangement or understanding with any broker, finder or
similar agent with respect to the transactions contemplated by this Agreement.
Section 2.22 Officers. Set forth in the Disclosure Schedule is a list of
the names of the officers of the Company and each of its subsidiaries, together
with the title or job classification of each such person and the total
compensation anticipated to be paid to each such person by the Company in 1998.
Except as set forth in the Disclosure Schedule, none of such persons has an
employment agreement or understanding, whether oral or written, with the Company
which is not terminable on notice by the Company without cost or other liability
to the Company.
Section 2.23 Transactions With Affiliates. Except as set forth in the
Disclosure Schedule, no director, officer, employee or stockholder of the
Company or any of its subsidiaries, or member of the family of any such person,
or any corporation, partnership, trust or other entity in which any such person,
or any member of the family of any such person, has a substantial interest or is
an officer, director, trustee, partner or holder of more than 5% of the
outstanding capital stock thereof, is a party to any transaction with the
Company or any of its subsidiaries, including any contract, agreement or other
arrangement providing for the employment of, furnishing of services by rental of
real or personal property from or otherwise requiring payments to any such
person or firm, other than employment-at-will arrangements in the ordinary
course of business.
12
Section 2.24 Employees. Except as set forth on the Disclosure Schedule,
each of the officers of the Company and each of its subsidiaries, each key
employee and each other employee now employed by the Company and each of its
subsidiaries or any consultant retained by the Company or any of its
subsidiaries who has access to confidential information of the Company or any of
its subsidiaries has executed a nondisclosure agreement substantially in a form
previously approved by the counsel to the Purchasers and Additional Purchasers
described in Section 6.1 hereof (the "Nondisclosure and Developments
Agreement"), and such agreements are in full force and effect. To the best
knowledge of the Company, no employee or former employee of the Company or any
of its subsidiaries is in violation of any term of any employment contract,
patent disclosure agreement, confidentiality agreement or any other contract or
agreement relating to the relationship of any such employee with the Company or
any of its subsidiaries. No officer or key employee of the Company or any of its
subsidiaries has advised the Company or any of its subsidiaries (orally or in
writing) that he intends to terminate employment with the Company or any of its
subsidiaries. The Company and each of its subsidiaries has complied in all
material respects with all applicable laws relating to the employment of labor,
including provisions relating to wages, hours, equal opportunity, collective
bargaining and the payment of Social Security and other taxes.
Section 2.25 U.S. Real Property Holding Corporation. Neither the Company
nor any of its subsidiaries is now and or has never been a "United States real
property holding corporation", as defined in Section 897(c)(2) of the Code and
Section 1.897-2(b) of the Regulations promulgated by the Internal Revenues
Service, and the Company has filed with the Internal Revenue Service all
statements, if any, with its United States income tax returns which are required
under Section 1.897-2(h) of such Regulations.
Section 2.26 Environmental Protection. Neither the Company nor any of its
subsidiaries has caused or allowed, or contracted with any party for, the
generation, use, transportation, treatment, storage or disposal of any Hazardous
Substances (as defined below) in connection with the operation of its business
or otherwise. The Company, its subsidiaries, the operation of their respective
business, and, to the best knowledge of the Company, any real property that the
Company of any of its subsidiaries owns, leases or otherwise occupies or uses
(the "Premises"), are in compliance with all applicable Environmental Laws (as
defined below) and orders or directives of any governmental authorities having
jurisdiction under such Environmental Laws, including, without limitation, any
Environmental Laws or orders or directives with respect to any cleanup or
remediation of any release or threat of release of Hazardous Substances. Neither
the Company nor any if its subsidiaries has received any citation, directive,
letter or other communication, written or oral, or any notice of any proceeding,
claim or lawsuit, from any person arising out of the ownership or occupation of
the Premises, or the conduct of its operations, and the Company is not aware of
any basis therefor. The Company and each of its subsidiaries has obtained and is
maintaining in full force and effect all necessary permits, licenses and
approvals required of it by all Environmental Laws applicable to the Premises
and the business operations conducted thereon (including operations conducted by
tenants on the Premises), and is in compliance with all such permits, licenses
and approvals. Neither the Company nor any of its subsidiaries has caused or
allowed a release, or a threat of release, of any Hazardous Substance onto, at
or near the Premises, and, to the best of the Company's knowledge, neither the
Premises nor any property at or near the Premises has ever been subject to a
release, or a threat of release, of any Hazardous Substance. For the purposes of
13
this Agreement, the term "Environmental Laws" shall mean any foreign or domestic
Federal, state or local law or ordinance or regulation pertaining to the
protection of human health or the environment, including, without limitation,
the Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. Sections 9601, et seq., the Emergency Planning and Community
Right-to-Know Act, 42 U.S.C. Sections 11001, et seq., and the Resource
Conservation and Recovery Act, 42 U.S.C Sections 6901, et seq. For purposes of
this Agreement, the term "Hazardous Substances" shall include oil and petroleum
products, asbestos, polychlorinated biphenyls, urea formaldehyde and any other
materials classified as hazardous or toxic under any Environmental Laws.
Section 2.27 ERISA.
(a) Except as set forth on the Disclosure Schedule, neither the
Company nor any of its subsidiaries, prior to the date of this Agreement, has
maintained, adopted or established, contributed to or been required to
contribute to, or otherwise participated in or been required to participate in,
and, as of the date of this Agreement, has not adopted or established, does not
maintain, does not contribute to an is not required to contribute to, and does
not otherwise participate in and is not required to participate in,
(i) any "employee welfare benefit plan" or "welfare plan" as
defined under Section 3(1) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA");
(ii) any "employee pension benefit plan" or "pension plan" as
defined under Section 3(2) of ERISA;
(iii) any "excess benefit plan" as defined under Section 3(36)
of ERISA;
(iv) any "multiemployer plan" as such term is defined under
Section 3(37)(A) of ERISA;
(v) any "multiple employer welfare arrangement" as defined
under Section 3(40) of ("ERISA");
(vi) any plan, fund, program, agreement or arrangement which
is unfunded and which is maintained primarily for the purpose of providing
deferred compensation for a select group of management or highly
compensated employees as such term is referred to in Sections 201(2),
301(a)(3) and 401(a)(1) of ERISA; or;
(vii) any other plan, fund program, agreement of arrangement,
whether oral or written, which was or could have been prior to the date of
this Agreement, or which is or could be as of the date of this Agreement,
subject to any of the provisions of ERISA or the Code or any foreign law,
statute or regulation analogous thereto;
(b) Neither the Company nor any of its subsidiaries has committed
itself, orally or in writing, to create, establish, adopt, maintain or
participate in any plan, fund, program, agreement or arrangement described in
paragraph (a) hereof. In addition, except as disclosed in the Disclosure
Schedule, neither the Company nor any of its subsidiaries has committed itself,
14
orally or in writing, to provide or to cause to be provided any severance,
salary continuation, termination, disability, death, retirement, health or
medical benefit, or similar benefit to any person (including, without
limitation, any former or current employee).
(c) Notwithstanding anything else set forth herein, except as set
forth in the Disclosure Schedule, there exists no condition or set of
circumstances which has resulted in, or which could result in the imposition of
liability under ERISA, the Code, or other applicable law with respect to any
plan, fund, program agreement or arrangement described in paragraph (a) of this
Section 2.
Section 2.28 [Reserved]
Section 2.29 Foreign Corrupt Practices Act. Neither the Company nor any of
its subsidiaries has taken any action which would cause it to be in violation of
the Foreign Corrupt Practices Act of 1977, as amended, or any rules and
regulations thereunder. To the best of the Company's knowledge, there is not
now, and there has never been, any employment by the Company or any of its
subsidiaries of, or beneficial ownership in the Company or any of its
subsidiaries by, any governmental or political official in any country in the
world.
Section 2.30 Federal Reserve Regulation. Neither the Company nor any of
its subsidiaries is engaged in the business of extending credit for the purpose
of purchasing or carrying margin securities (within the meaning of Regulation G
of the Board of Governors of the Federal Reserve System), and no part of the
proceeds of the Purchased Shares will be used to purchase or carry any margin
security or to extend credit to others for the purpose of purchasing or carrying
any margin security or in any other manner which would involve a violation of
any of the regulations of the Board of Governors of the Federal Reserve System.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
AND ADDITIONAL PURCHASERS
Each Purchaser and Additional Purchaser, severally and not jointly,
represents and warrants to the Company that:
(a) such Purchaser or Additional Purchaser, if not a natural person,
is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and, whether or not a natural person, has the
power and authority (and if a natural person, the legal capacity and competence)
to execute, deliver and perform its duties and obligations under this Agreement,
and to purchase the Purchased Shares being purchased by it hereunder;
(b) the execution and delivery by such Purchaser or Additional
Purchaser of this Agreement, the performance by such Purchaser or Additional
Purchaser of its obligations hereunder, and the purchase of the Purchased Shares
have been duly authorized by all requisite organizational action;
15
(c) this Agreement has been duly executed and delivered by such
Purchaser or Additional Purchaser and constitutes the legal, valid and binding
obligation of such Purchaser or Additional Purchaser, enforceable in accordance
with its terms;
(d) such Purchaser or Additional Purchaser is an "accredited
investor" within the meaning of Rule 501 under the Securities Act and was not
organized for the specific purpose of acquiring the Purchased Shares;
(e) such Purchaser or Additional Purchaser 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;
(f) such Purchaser or Additional Purchaser has had an opportunity to
discuss the Company's business, management and financial affairs with the
Company's management;
(g) such Purchaser or Additional Purchaser is acquiring the
Purchased Shares being purchased by it hereunder (and the Conversion Shares
relating thereto) for its own account, not as a nominee or agent, for the
purpose of investment and not with a view to the resale or distribution of any
part thereof, and such Purchaser or Additional Purchaser does not have any
contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with
respect to any of such Purchased Shares or Conversion Shares;
(h) such Purchaser or Additional Purchaser understands that (i) the
Purchased Shares and the Conversion Shares have not 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 506 promulgated under the Securities Act, (ii) the Purchased Shares and,
upon conversion thereof, the Conversion Shares must be held indefinitely unless
a subsequent disposition thereof is registered under the Securities Act or is
exempt from such registration, (iii) the Purchased Shares and the Conversion
Shares will bear a legend to such effect and (iv) the Company will make a
notation on its transfer books to such effect;
(i) if such Purchaser or Additional Purchaser sells any Conversion
Shares pursuant to Rule 144A promulgated under the Securities Act, it will take
all necessary steps in order to perfect the exemption from registration provided
thereby, including (i) obtaining on behalf of the Company information to enable
the Company to establish a reasonable belief that the purchaser is a qualified
institutional buyer and (ii) advising such purchaser that Rule 144A is being
relied upon with respect to such resale; and
(j) if such Purchaser or Additional Purchaser (or if such Purchaser
or Additional Purchaser is a trust, any beneficiary thereof) is not a citizen or
resident of the United States or Canada, or any state, territory or possession
thereof, or a corporation, partnership, trust or other entity created or
existing under the laws thereof, or any entity controlled or owned by any of the
foregoing, the consummation of the transactions contemplated hereby, including,
without limitation, the purchase of the Purchased shares to be purchased by it
hereunder, shall not violate any applicable securities or other laws of such
Purchaser's or Additional Purchaser's jurisdiction,
16
and such Purchaser or Additional Purchaser is aware of and satisfied with (i)
any foreign exchange restrictions applicable to such purchase, (ii) any
governmental or other consents which may need to be obtained by it, and (iii)
the income and other tax consequences, if any, in each case which may be
relevant to the purchase, holding, redemption, sale or transfer of such
Purchased Shares and the related Conversion Shares.
ARTICLE IV
CONDITIONS TO THE OBLIGATIONS OF THE PURCHASERS
AND ADDITIONAL PURCHASERS
Section 4.1 Conditions to the Obligations of the Purchasers on the First
Closing Date. The obligation of each Purchaser to purchase and pay for the
Initial Purchased Shares being purchased by it on the First Closing Date is, at
its option, subject to the satisfaction, on or before the First Closing Date, of
the following conditions:
(a) Opinion of Company's Counsel. The Purchasers shall have received
from Winthrop, Stimson, Xxxxxx & Xxxxxxx, counsel for the Company, an opinion
dated the First Closing Date, in form and scope satisfactory to the Purchasers
and their counsel, to the effect set forth in Exhibit C hereto.
(b) Representations and Warranties to be True and Correct. The
representations and warranties contained in Article II shall be true, complete
and correct on and as of the First Closing Date with the same effect as though
such representations and warranties had been made on and as of such date, and
the President and Treasurer of the Company shall have certified to such effect
to the Purchasers in writing.
(c) Performance. The Company shall have performed and complied with
all agreements contained herein required to be performed or complied with by it
prior to or at the First Closing Date, and the President and Treasurer of the
Company shall have certified to the Purchasers in writing to such effect and to
the further effect that all of the conditions set forth in this Article IV have
been satisfied.
(d) All Proceedings to be Satisfactory. All corporate and other
proceedings to be taken by the Company in connection with the transactions
contemplated hereby and all documents incident thereto shall be reasonably
satisfactory in form and substance to the Purchasers and their counsel, and the
Purchasers and their counsel shall have received all such counterpart originals
or certified or other copies of such documents as they reasonably may request.
(e) Supporting Documents. The Purchasers and their counsel shall
have received copies of the following documents:
(i) (A) the Charter, certified as of a recent date by the
Secretary of State of the State of Delaware, (B) a certificate of said
Secretary, dated as of a recent date, as to the due incorporation and good
standing of the Company, the payment of all excise taxes by the Company
and listing all documents of the Company on file with said Secretary
17
and (C) a certificate of the Secretary of State of the State of New York,
dated as of a recent date, as to the good standing of the Company in such
state.
(ii) a certificate of the Secretary or an Assistant Secretary
of the Company dated the First Closing Date and certifying: (A) that
attached thereto is a true and complete copy of the By-laws of the Company
as in effect on the date of such certification; (B) that attached thereto
is a true and complete copy of all resolutions adopted by the Board of
Directors or the stockholders of the Company authorizing the execution,
delivery and performance of this Agreement, the issuance, sale and
delivery of the Purchased Shares and the reservation, issuance, sale and
delivery of the Conversion Shares, and that all such resolutions are in
full force and effect and are all the resolutions adopted in connection
with the transactions contemplated hereby; (C) that the Charter has not
been amended since the date of the last amendment referred to in the
certificate delivered pursuant to clause (i)(B) above; and (D) to the
incumbency and specimen signature of each officer of the Company executing
this Agreement, the stock certificates representing the Purchased Shares
and any certificate or instrument furnished pursuant hereto, and a
certification by another officer of the Company as to the incumbency and
signature of the officer signing the certificate referred to in this
clause (ii); and
(iii) such additional supporting documents and other
information with respect to the operations and affairs of the Company as
the Purchasers or their counsel reasonably may request.
(f) Charter. The Charter shall read in its entirety as set forth in
Exhibit B.
(g) Election of Directors. The number of directors constituting the
entire Board of Directors shall have been fixed at seven and the following
persons shall have been elected as the directors and shall each hold such
position as of the First Closing Date: Xxxxxxxx Xxxxxxxx, Xxxx Xxxx, Xxxx
Xxxxxx, Xxxxx Xxxxx, Xxxxxxx Xxxxxxxxxx and Xxxxxxxxxxx Linen.
(h) [Reserved]
(i) Key Person Insurance. Key Person Insurance in an amount equal to
$2,000,000 on the life of each Founder (as each such term is defined in Section
5.5) shall be in full force and effect on the First Closing Date.
(j) Preemptive Rights. All stockholders of the Company having any
preemptive, first refusal or other rights with respect to the issuance of the
Purchased Shares or the Conversion Shares shall have exercised or irrevocably
waived the same in writing.
(k) Fees of Purchasers' Counsel. The Company shall have paid in
accordance with Section 6.1, the fees and disbursements of Purchasers' counsel
invoiced at the First Closing.
All such documents shall be reasonably satisfactory in form and substance
to the Purchasers and their counsel.
Section 4.2 Condition to the Obligations of the Additional Purchasers on
each Additional Closing Date. The obligation of each Additional Purchaser to
purchase and pay for
18
the Additional Purchased Shares being purchased by it on each Additional Closing
Date is, at its option, subject to the satisfaction, on or before each
Additional Closing Date, of the following conditions:
(a) Opinion of Company's Counsel. The Additional Purchasers shall
have received from Winthrop, Stimson, Xxxxxx & Xxxxxxx, counsel for the
Company, an opinion, dated each Additional Closing Date, in form and scope
satisfactory to the Additional Purchasers and their counsel, to the effect
set forth in Exhibit C hereto (except that for purposes hereof, references
therein to the First Closing Date shall be deemed to be references to each
Additional Closing Date).
(b) Representations and Warranties to be True and Correct. The
representations and warranties contained in Article II shall be true,
complete and correct on and as of each Additional Closing Date with the
same effect as though such representations and warranties had been made on
and as of such date, and the President and Treasurer of the Company shall
have certified to such effect to the Additional Purchasers in writing.
(c) Performance. The Company shall have performed and complied with
all agreements contained herein required to be performed or complied with
by it prior to or at each Additional Closing Date, and the President and
Treasurer of the Company shall have certified to the Additional Purchasers
in writing to such effect and to the further effect that all of the
conditions set forth in Section 4.1 and Section 4.2 have been satisfied.
(d) No Adverse Change. The Company's business and assets shall not
have been adversely affected in any material respect prior to each
Additional Closing Date.
(e) Supporting Documents. The Additional Purchasers and their
counsel shall have received copies of the documentation described in
Section 4.1(e), except that all documents required in clause (ii) therein
to have been dated as of the First Closing Date shall be dated as of each
Additional Closing Date.
All such documents shall be satisfactory in form and substance to the Additional
Purchasers and their counsel.
ARTICLE V
COVENANTS OF THE COMPANY
The Company covenants and agrees with each of the Purchasers and
Additional Purchasers that:
Section 5.1 Financial Statements, Reports, Etc. Until the consummation of
an underwritten public offering of the Company's Common Stock conducted by a
nationally recognized reputable underwriter that results in net proceeds to the
Company of at least $30 million and at a price per share of at least $7.00 (as
adjusted for stock splits, combinations and the like) (a "Qualified Public
Offering"), the Company shall furnish to each Purchaser and
19
Additional Purchaser that purchased hereunder and which continues to hold at
least 666,667 Purchased Shares:
(a) within ninety (90) days after the end of each fiscal year of the
Company a consolidated balance sheet of the Company and its subsidiaries, if
any, as of the end of such fiscal year and the related consolidated statements
of income, stockholders' equity and cash flows for the fiscal year then ended,
prepared in accordance with generally accepted accounting principles and
certified by a firm of independent public accountants of recognized national
standing selected by the Board of Directors of the Company;
(b) within forty-five (45) days after the end of each of the first
three quarters in each fiscal year, a consolidated balance sheet of the Company
and its subsidiaries, if any, and the related consolidated statements of income,
stockholders' equity and cash flows, unaudited but prepared in accordance with
generally accepted accounting principles and certified by the Chief Financial
Officer of the Company, such consolidated balance sheet to be as of the end of
such quarter and such consolidated statements of income, stockholders' equity
and cash flows to be for such quarter and for the period from the beginning of
the fiscal year to the end of such quarter, in each case with comparative
statements for the prior fiscal year;
(c) at the time of delivery of each annual financial statement
pursuant to Section 5.1(a), a certificate executed by the Chief Financial
Officer of the Company stating that such officer has caused this Agreement and
the Series A, Series B and Series C Convertible Preferred Stock to be reviewed
and has no knowledge of any default by the Company in the performance or
observance of any of the provisions of this Agreement or the Series A, Series B
or Series C Convertible Preferred Stock or, if such officer has such knowledge,
specifying such default and the nature thereof;
(d) promptly following receipt by the Company, each accountants
management letter and other written report submitted to the Company by its
independent public accountants in connection with an annual or interim audit of
the books of the Company or any of its subsidiaries;
(e) promptly after the Company learns of the commencement thereof,
notice of all actions, suits, claims, proceedings, investigations and inquiries
of the type described in Section 2.7 that could materially adversely affect the
Company or any of its subsidiaries, if any; and
(f) promptly upon sending, making available or filing the same, all
reports and financial statements that the Company sends or makes available to
its stockholders or files with the Commission.
Section 5.2 [Reserved]
Section 5.3 Reserve for Conversion Shares. The Company shall at all times
keep available out of its authorized but unissued shares of Common Stock, for
the purpose of effecting the conversion of the Purchased Shares and otherwise
complying with the terms of this Agreement, such number of its duly authorized
shares of Common Stock as shall be sufficient to effect the conversion of the
Purchased Shares from time to time outstanding or otherwise to
20
comply with the terms of this Agreement. If at any time the number of authorized
but unissued shares of Common Stock shall not be sufficient to effect the
conversion of the Purchased Shares or otherwise to comply with the terms of this
Agreement, the Company will forthwith take such corporate action as may be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes. The Company will use
its best efforts to obtain any authorization, consent, approval or other action
by, and will make any filing with, any court or administrative body that may be
required under applicable state securities laws in connection with the issuance
of shares of Common Stock upon conversion of the Purchased Shares.
Section 5.4 Corporate Existence. The Company shall maintain and, except as
otherwise permitted by Section 5.17 cause each of its subsidiaries (if any) to
maintain their respective corporate existence, rights and franchises in full
force and effect.
Section 5.5 Properties, Business, Insurance. The Company shall maintain
and cause each of its subsidiaries (if any) to maintain as to their respective
properties and business, with financially sound and reputable insurers,
insurance against such casualties and contingencies and of such types and in
such amounts as is customary for companies similarly situated, which insurance
shall be deemed by the Company to be sufficient. The Company shall also maintain
in effect its current "key person" life insurance policies, payable to the
Company (the "Key Person Insurance"), on the lives of Xxxxxxxx Xxxxxxxx and Xxxx
Xxxx (so long as they remain employees of the Company) (collectively, the
"Founders"), in the amount of $2,000,000 each, and use its best efforts to
obtain not later than November 15, 1998, and thereafter maintain in effect, Key
Person Insurance on the lives of the Founders (so long as they remain employees
of the Company), in the amount of $5,000,000 each. The Company shall not cause
or permit any assignment or change in beneficiary and shall not borrow against
any such policy. If requested by Purchasers holding at least a majority of the
outstanding Preferred Stock, the Company will add one designee of the Purchasers
as a notice party for each such policy and shall request that the issuer of each
policy provide such designee with ten (10) days' notice before such policy is
terminated (for failure to pay premiums or otherwise) or assigned or before any
change is made in the beneficiary thereof.
Section 5.6 Inspection, Consultation and Advice. The Company shall permit
and cause each of its subsidiaries (if any) to permit each Purchaser which has
purchased hereunder and continues to hold at least 3,125,000 Purchased Shares
and which covenants to preserve the confidentiality of the Company's proprietary
information and its agents and representatives, at such Purchaser's expense, to
visit and inspect any of the properties of the Company and its subsidiaries,
examine their books and take copies and extracts therefrom, discuss the affairs,
finances and accounts of the Company and its subsidiaries with their officers,
employees and public accountants (and the Company hereby authorizes said
accountants to discuss with such Purchaser and such designees such affairs,
finances and accounts), and consult with and advise the management of the
Company and its subsidiaries as to their affairs, finances and accounts, all at
reasonable times and upon reasonable notice.
Section 5.7 Restrictive Agreements Prohibited. Neither the Company nor any
of its subsidiaries shall become a party to any agreement which by its terms
restricts the Company's performance of either this Agreement or the Charter.
21
Section 5.8 Transactions with Affiliates. Except for transactions
contemplated by this Agreement or as otherwise approved by the Board of
Directors, neither the Company nor any of its subsidiaries shall enter into any
transaction with any director, officer, employee or holder of more than 5% of
the outstanding capital stock of any class or series of capital stock of the
Company or any of its subsidiaries, member of the family of any such person, or
any corporation, partnership, trust or other entity in which any such person, or
member of the family of any such person, is a director, officer, trustee,
partner or holder of more than 5% of the outstanding capital stock thereof,
except for transactions on customary terms related to such person's employment.
Section 5.9 Expenses of Directors. The Company shall promptly reimburse in
full each director of the Company who is not an employee of the Company for all
of his or her reasonable out-of-pocket expenses incurred in attending each
meeting of the Board of Directors of the Company or any committee thereof.
Section 5.10 Use of Proceeds. The Company shall use the proceeds from the
sale of the Purchased Shares for working capital and for such other purposes as
may be approved by the Board of Directors of the Company.
Section 5.11 Compensation. The Company shall not pay to its management
compensation in excess of that compensation customarily paid to management in
companies of similar size, of similar maturity, and in similar businesses
without the unanimous written consent of the members of the Compensation
Committee of the Company's Board of Directors.
Section 5.12 By-laws. The Company shall at all times cause its By-laws to
provide that, (a) unless otherwise required by the laws of the State of
Delaware, (i) any two directors and (ii) any holder or holders of at least
8,500,000 shares of Preferred Stock shall have the right to call a meeting of
the Board of Directors or stockholders and (b) the number of directors fixed in
accordance therewith shall in no event conflict with any of the terms or
provisions of the Preferred Stock as set forth in the Charter. The Company shall
at all times maintain provisions in its By-laws and/or Charter indemnifying all
directors against liability and absolving all directors from liability to the
Company and its stockholders to the maximum extent permitted under the laws of
the State of Delaware.
Section 5.13 Employee Nondisclosure and Developments Agreements. The
Company shall use its best efforts to obtain, and shall cause its subsidiaries
(if any) to use their best efforts to obtain, an Employee Nondisclosure and
Developments Agreement from all future officers, key employees and other
employees who will have access to confidential information of the Company or any
of its subsidiaries, upon their employment by the Company or its subsidiaries,
and, within 30 days following the Closing Date, from all current employees who
have not previously provided such agreement.
Section 5.14 Activities of Subsidiaries. The Company will not (a) organize
or acquire any entity that is a subsidiary unless such subsidiary is
wholly-owned (directly or indirectly) by the Company (other than qualifying
shares owned by nominees to the extent required by the jurisdiction in which
such subsidiary shall be domiciled), (b) permit any subsidiary to consolidate or
merge into or with or sell or transfer all or substantially all its assets,
except that
22
any subsidiary may (i) consolidate or merge into or with or sell or transfer
assets to any other subsidiary, or (ii) merge into or sell or transfer assets to
the Company, (c) sell or otherwise transfer any shares of capital stock of any
subsidiary, except to the Company or another subsidiary, or permit any
subsidiary to issue, sell or otherwise transfer any shares of its capital stock
or the capital stock of any subsidiary, except to the Company or another
subsidiary, or (d) permit any subsidiary to pay any dividend or make any
distribution on, any shares of its stock, except for dividends or other
distributions payable to the Company or another subsidiary, in each case without
the approval of a majority vote of the Board of Directors which majority must
include at least one director not designated by the holders of Common Stock.
Section 5.15 Compliance with Laws. The Company shall comply, and cause
each subsidiary to comply, with all applicable laws, rules, regulations and
orders, noncompliance with which could materially adversely affect its business
or condition, financial or otherwise.
Section 5.16 Keeping of Records and Books of Account. The Company shall
keep, and cause each subsidiary to keep, adequate records and books of account,
in which complete entries regarding its transactions will be made in accordance
with generally accepted accounting principles consistently applied, reflecting
all financial transactions of the Company and such subsidiary, and in which, for
each fiscal year, all proper reserves for depreciation, depletion, obsolescence,
amortization, taxes, bad debts and other purposes in connection with its
business shall be made.
Section 5.17 Change in Nature of Business. The Company shall not make, or
permit any subsidiary to make, any material change in the nature of its business
as set forth in the Offering Memorandum.
Section 5.18 Rule 144A Information. The Company shall, at all times during
which it is neither subject to the reporting requirements of Section 13 or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor
exempt from reporting pursuant to Rule 12g3-2(b) under the Exchange Act, provide
in writing, upon the written request of any Purchaser or Additional Purchaser or
a prospective buyer of Purchased Shares or shares of Common Stock issued upon
conversion of the Preferred Stock ("Conversion Stock") from any Purchaser or
Additional Purchaser, all information required by Rule 144A(d)(4)(i) of the
General Regulations promulgated by the Commission under the Securities Act
("Rule 144A Information"). The Company also shall, upon the written request of
any Purchaser or Additional Purchaser, cooperate with and assist such Purchaser
or Additional Purchaser or any member of the National Association of Securities
Dealers, Inc. PORTAL system in applying to designate and thereafter maintain the
eligibility of the Preferred Stock or Conversion Stock, as the case may be, for
trading through PORTAL. The Company's obligations under this Section 5.21 shall
at all times be contingent upon the relevant Purchaser's or Additional
Purchaser's obtaining from the prospective buyer of Purchased Shares or
Conversion Shares a written agreement to take all reasonable precautions to
safeguard the Rule 144A Information from disclosure to anyone other than a
person who will assist such buyer in evaluating the purchase of any Purchased
Shares or Conversion Shares.
Section 5.19 Compensation and Audit Committees. The Company shall maintain
a Compensation Committee and an Audit Committee of the Board of Directors, each
of which
23
shall consist of two non-management directors and which currently consist of
Xxxx Xxxxxx and Xxxxxxxxxxx Linen on the Compensation Committee and Xxxxxxx
Xxxxxxxxxx and Xxxx Xxxxxx on the Audit Committee. No increase in compensation,
bonuses or other remuneration shall be paid to, and no capital stock or options
to acquire capital stock of the Company shall be issued or granted to, any
director or executive officer of the Company or any of its subsidiaries, without
the approval of the Compensation Committee. No employee stock option plan,
employee stock purchase plan, employee restricted stock plan or other employee
stock plan shall be established without the approval of the Compensation
Committee. The Audit Committee shall select (subject to the approval of the
Board of Directors) and provide instructions to the Company's auditors and shall
approve the Company's annual audit prior to its issuance each year.
Section 5.20 Termination of Covenants. The covenants contained in this
Article V will terminate and be of no further force or effect upon the earlier
of (i) the date of a Qualified Public Offering and (ii) the date on which at
least 2,700,000 Conversion Shares have been sold in one or more public
offerings.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Expenses. Each party hereto will pay its own expenses in
connection with the transactions contemplated hereby, whether or not such
transactions shall be consummated; provided, however, that if there shall be a
Closing, the Company shall pay the reasonable fees of the Purchasers' and
Additional Purchasers' special counsel, Kalow, Springut & Xxxxxxxx, in
connection with such transactions, in an aggregate amount not to exceed $75,000,
and any subsequent amendment, waiver, consent or enforcement thereof, and all
related disbursements incurred by such counsel.
Section 6.2 Survival of Representations; Termination of Agreements. All
covenants, agreements, representations and warranties made in this Agreement or
in any certificate or instrument delivered to the Purchaser or Additional
Purchasers pursuant to or in connection with this Agreement, shall survive the
execution and delivery hereof, the issuance, sale and delivery of the Purchased
Shares, and the issuance and delivery of the Conversion Shares (i) in the case
of covenants and agreements, an indefinite period of time (subject to the
provisions of Section 5.20 hereof), and (ii) in the case of representations and
warranties, for a period of five (5) years, and all statements contained in any
certificate or other instrument delivered by the Company hereunder or in
connection herewith shall be deemed to constitute representations and warranties
made by the Company.
Section 6.3 Brokerage. Each party hereto will indemnify and hold harmless
the others against and in respect of any claim for brokerage or other
commissions relative to this Agreement or to the transactions contemplated
hereby, based in any way on agreements, arrangements or understandings made or
claimed to have been made by such party with any third party, other than as
described in Section 2.21 of the Disclosure Schedule. If the party to be
indemnified shall be a Purchaser or Additional Purchaser, then such
indemnification shall include, without limitation, losses which may be suffered
as a result of diminution in value of such Purchasers' or Additional Purchasers'
investment hereunder.
24
Section 6.4 Parties in Interest. 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.
Section 6.5 Lock-Up Agreement. Each Purchaser and Additional Purchaser and
its successors and assigns will agree, to the extent reasonably requested by any
underwriter of securities of the Company in connection with an initial public
offering of the Company's Common Stock, to enter into an agreement consistent
with then market practice for major bracket underwriters not to sell or
otherwise transfer or dispose of any shares of Common Stock for such period of
time (not to exceed 180 days) following the effective date of a registration
statement of the Company filed under the Securities Act, which agreement shall
also bind the Founders, executive officers, directors, and other shareholders on
terms and conditions substantially similar to those which shall apply to the
Purchasers and Additional Purchasers and said successors and assigns.
Section 6.6 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., 00 Xxxx
00xx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: President,
with a copy to Xxxxxx X. Macedonia, Esq., Winthrop, Stimson, Xxxxxx &
Xxxxxxx, Xxx Xxxxxxx Xxxx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to any Purchaser, at the address of such Purchaser set forth
in Schedule I, with a copy to Xxx X. Xxxx, Esq., Kalow, Springut &
Xxxxxxxx, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; and
(c) if to any Additional Purchaser, at the address of such
Additional Purchaser set forth on the Counterpart, with a copy to Xxx X.
Xxxx, Esq., Kalow, Springut & Xxxxxxxx, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000;
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 6.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
Section 6.8 Entire Agreement. This Agreement, including the Schedules and
Exhibits hereto, constitutes the sole and entire agreement of the parties with
respect to the subject matter hereof. All Schedules and Exhibits hereto are
hereby incorporated herein by reference.
Section 6.9 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.
25
Section 6.10 Amendments. This Agreement may not be amended or modified,
and no provisions hereof may be waived, without the written consent of the
Company and the holders of a majority of the outstanding shares of Common Stock
issued or issuable upon conversion of the Purchased Shares.
Section 6.11 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 6.12 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.
Section 6.13 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) "person" shall mean an individual, corporation, trust,
partnership, joint venture, unincorporated organization, government or any
agency or political subdivision thereof, or other entity.
(b) "subsidiary" shall mean, as to the Company, any corporation of
which more than 50% of the outstanding stock having ordinary voting power to
elect a majority of the Board of Directors of such corporation (irrespective of
whether or not at the time stock of any other class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency) is at the time directly or indirectly owned by the Company, or
by one or more of its subsidiaries, or by the Company and one or more of its
subsidiaries.
26
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
STARMEDIA NETWORK, INC.
By: /s/ Xxxx Xxxx
-------------------------------------------
Name: Xxxx Xxxx
Title: President
Purchasers named in Schedule I
to the Purchase Agreement:
THE FLATIRON FUND 1998/99, LLC
By: /s/ Xxxx Xxxxxx
-------------------------------------------
Name: Xxxx Xxxxxx
Title: Managing Member
CHASE VENTURE CAPITAL ASSOCIATES, L.P.
By: Chase Capital Partners, its General Partner
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: General Partner
NEW YORK CITY INVESTMENT FUND, LLC
By: /s/ [ILLEGIBLE]
-------------------------------------------
Name:
Title: President & CEO
FLATIRON ASSOCIATES, LLC
By: Flatiron Partners, LLC, Manager
By: /s/ Xxxx Xxxxxx
-------------------------------------------
Name: Xxxx Xxxxxx
Title: Managing Member
27
AURORA INVESTMENT LLC
By: /s/ [ILLEGIBLE]
------------------------------------
Name:
Title:
THE PYRAMID TRUST
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Trustee
CARAMIA LLC
By: /s/ Xxx Holleschultz
------------------------------------
Name: Xxx Holleschultz
Title: Asst. Secretary
THE GRAPA TRUST
By: /s/ Xx. Xxxxxxx X. Xxxxxxxxxx
------------------------------------
Name: Xx. Xxxxxxx X. Xxxxxxxxxxx
Title: Trustee
THE PAPAGENO TRUST
By: /s/ Xxxxxxx X. Xxxxxxxxxx, M.D.
------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Trustee
/s/ Xxxxxxx X. Xxxxxxxxx
----------------------------------------
By: Rockefeller & Co., Inc., as Attorney-in-Fact
Name: Xxxxxxx X. Xxxxxxxxx
Title: Authorized Signatory
--------------------------------------------
Xxxxx Xxxxxxxxxxx
/s/ Xxxxxxx Xxxxxxxxxx
----------------------------------------
Xxxxxxx Xxxxxxxxxx
28
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser*
thereunder.
WARBURG, XXXXXX EQUITY PARTNERS, L.P.
By: /s/ [ILLEGIBLE]
---------------------------------
Name:
Title:
WARBURG, XXXXXX VENTURE INTERNATIONAL, L.P.
By: /s/ [ILLEGIBLE]
---------------------------------
Name:
Title:
ADDRESS:
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
APPROVED AND AGREED:
STARMEDIA NETWORK, INC.
By: /s/ Xxxx Xxxx
---------------------------------
Name: XXXX XXXX
Title: PRESIDENT
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
3,125,000 $15,000,000
----------
* Warburg, Xxxxxx Equity Partners, L.P. and Warburg Pincus Venture
International, L.P. shall be deemed an Additional Purchaser for all
purposes under the Series C Convertible Preferred Stock Purchase Agreement
and any entered documents.
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
PLATINUM VENTURE PARTNERS II, L.P.
/s/ Xxxxxxx X. Xxxxxx
----------------------------------
Signature
XXXXXXX X. XXXXXX
----------------------------------
Print Name:
ADDRESS:
0000 Xxxxx Xxxxxx Xxxx
---------------------------
Xxxxxxxx Xxxxxxx, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
208,333 $1,000,000
STARMEDIA NETWORK, INC.
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ [ILLEGIBLE]
----------------------------------
Signature
ESRU Investments LLC
----------------------------------
Print Name:
ADDRESS:
0 Xxxx Xxxxxxxxxx Xxxxxx
---------------------------
Dover, Delaware 19901
---------------------------
U S A
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
476,190 US$2,285,712
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
New Crussol Holdings Inc.
/s/ Xxxxx Xxxxxxx
----------------------------------
Signature
Xxxxx Xxxxxxx
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
476,190 $2,285,712
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ [ILLEGIBLE]
----------------------------------
Signature
Rosewood Ventures Ltd
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
476,190 $2,285,712
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ [ILLEGIBLE]
----------------------------------
Signature
Integrity Holdings Ltd.
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
634,923 $3,047,632
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxxx X. Xxxxxxx
----------------------------------
Signature XXXXXX X. XXXXXXX
/s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Print Name: XXXXXXX XXXXXXXXX
For: Brentwood Corporation
Apartado 87-2106, Xxxx 0
Xxxxxx, Xxxxxxxxx de Panama
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
634,920 $3,047,616
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ [ILLEGIBLE]
----------------------------------
Signature
JEMIAK LTD.
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
634,920 $3,047,616
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
GENERAL ELECTRIC CAPITAL
CORPORATION
/s/ Xxxx X. Xxxxxxx
----------------------------------
Signature
Xxxx X. Xxxxxxx
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
1,041,667 $5,000,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx X. Xxxxx
----------------------------------
Signature
Xxxxx X. Xxxxx
----------------------------------
Print Name: [ILLEGIBLE]
ADDRESS:
Bayview Investors, Ltd
---------------------------
[ILLEGIBLE]
---------------------------
[ILLEGIBLE]
---------------------------
[ILLEGIBLE]
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
20,833 $100,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
Chacallit Associates
/s/ Xxxxxxx Xxxxxxx, General Partner
----------------------------------
Signature
Xxxxxxx Xxxxxxx
----------------------------------
Print Name:
ADDRESS:
Chacallit Associates
---------------------------
X.X. Xxx 0000
---------------------------
Xxxxxxxxxx, XX 00000-0000
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
20,833 $100,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ E. Xxxx Xxxx Jr.
----------------------------------
Signature
E. Xxxx Xxxx Jr.
----------------------------------
Print Name:
ADDRESS:
770 [ILLEGIBLE] Island Dr.
---------------------------
# 610
---------------------------
Xxxxx, XX 00000
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
18,750 $90,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx Xxxxxx
----------------------------------
Signature
XXXXX XXXXXX
----------------------------------
Print Name:
ADDRESS:
0000 XXXXX XXXXX
---------------------------
XxXXXX, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
20,833 $100,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxxxx X. End
----------------------------------
Signature
Xxxxxxx X. End
----------------------------------
Print Name:
ADDRESS:
00 XXXXXX XX
---------------------------
X.X. Xxx 000
---------------------------
S. Freeport, ME
---------------------------
04078
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
10,417 $50,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxx X. Xxxxxxx
----------------------------------
Signature
Xxxx X. Xxxxxxx
----------------------------------
Print Name:
ADDRESS:
0000 Xxxxxxxx Xx.
---------------------------
Xxxxxxx, XX
---------------------------
77021
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
8,333 $40,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx X. Xxxxx
----------------------------------
Signature
Xxxxx X. Xxxxx
----------------------------------
Print Name:
ADDRESS:
000 Xxxxxxxx Xx.
---------------------------
Xxxxxxxx, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
5,208 $25,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxxx X. Wash
----------------------------------
Signature
Xxxxxx X. Wash
----------------------------------
Print Name:
ADDRESS:
00 Xxxx 00xx #0X
---------------------------
Xxx Xxxx, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
4,167 $20,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx Xxxxxxx
----------------------------------
Signature
Xxxxx Xxxxxxx
----------------------------------
Print Name:
ADDRESS:
0 X. 00xx Xx.
---------------------------
Xxx. 0x
---------------------------
Xxx Xxxx, XX 00000
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
3,125 $15,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxxxx Xxxx III
----------------------------------
Signature
Xxxxxxx Xxxx III
----------------------------------
Print Name:
ADDRESS:
000 Xxxx 00xx Xx. #0X
---------------------------
XX, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
2,000 $9,600
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx Xxxxxxxxx
----------------------------------
Signature
Xxxxx Xxxxxxxxx
----------------------------------
Print Name:
ADDRESS:
105 50th St.
---------------------------
Xxxxxxx Xxxxx, XX 00000
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
2,000 $9,600
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx Xxxxx Xxxxxxxx
----------------------------------
Signature
Xxxxx Xxxxx Xxxxxxxx
----------------------------------
Print Name:
ADDRESS:
000 XXXX 00xx Xx.
---------------------------
Apt 12C
---------------------------
Xxx Xxxx, XX 00000
---------------------------
USA
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
417 $2,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
-----------
LEGAL OK /s/ Xxxxx X. Labrador
----------- ----------------------------------
TUR 9/24/98 Signature
-----------
Xxxxx X. Labrador
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
625,000 $3,000,000
Intel/StarMedia -- Stock Purchase Agreement
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxxx X. Xxxxxx
----------------------------------
Signature
Xxxxxx X. Xxxxxx, PhD
----------------------------------
Print Name:
ADDRESS:
---------------------------
---------------------------
---------------------------
---------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
208,333 $1,000,000
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
XXXXXX XXXXXXX XXXX XXXXXX EQUITY
FUNDING, INC.
/s/ Xxxxx X. Xxxxxx
----------------------------------
Signature
Xxxxx X. Xxxxxx
----------------------------------
Print Name:
ADDRESS:
c/o Xxxxxx Xxxxxxxx Xxxx Xxxxxx
-------------------------------
0000 Xxxxxxxx
-------------------------------
36th Floor
-------------------------------
Xxx Xxxx, XX 00000
-------------------------------
Attn: Xxxxx Xxxxxx
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
208,333 $999,998.40
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser
thereunder.
ADDITIONAL PURCHASER:
/s/ Xxxxx Xxxxx
----------------------------------
Signature
Xxxxx Xxxxx
----------------------------------
Print Name:
ADDRESS:
000 Xxxxxxxx
-------------------------------
Xxx Xxxx, XX
-------------------------------
10010
-------------------------------
-------------------------------
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
28,918 $138,798.40
COUNTERPART SIGNATURE PAGE TO SERIES C
CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
DATED AS OF AUGUST 24, 1998
IN WITNESS WHEREOF, the undersigned has executed this counterpart
signature page to the Series C Convertible Preferred Stock Purchase Agreement
dated as of August 24, 1998, intending to become a party thereto, and be bound
by the obligations of, and entitled to the benefits of, an Additional Purchaser*
thereunder.
WARBURG, XXXXXX EQUITY PARTNERS, L.P.
By: /s/ [ILLEGIBLE]
---------------------------------
Name:
Title:
WARBURG, XXXXXX VENTURE INTERNATIONAL, L.P.
By: /s/ [ILLEGIBLE]
---------------------------------
Name:
Title:
ADDRESS:
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
APPROVED AND AGREED:
STARMEDIA NETWORK, INC.
By: /s/ Xxxx Xxxx
---------------------------------
Name: XXXX XXXX
Title: PRESIDENT
Number of Aggregate
Purchased Shares Purchase Price for
to be Purchased Purchased Shares
---------------- ------------------
1,635,417 $7,850,000
----------
* Warburg, Xxxxxx Equity Partners, L.P. and Warburg Pincus Venture
International, L.P. shall be deemed as Additional Purchaser for all
purposes under the Series C Convertible Preferred Stock Purchase Agreement
and any entered documents.
SCHEDULE I
Purchasers
Number of Aggregate
Name and Purchased Shares Purchase Price for
Address of Purchaser to be Purchased Purchased Shares
-------------------- ---------------- ------------------
Chase Venture Capital Associates, L.P. 3,750,000 $18,000,000
000 Xxxxxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Attn: Mr. I. Xxxxxx Xxxxxx
The Flatiron Fund 1998/99, LLC 416,667 $ 2,000,000
000 Xxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Mr. Xxxx Xxxxxx
Flatiron Associates, LLC 41,667 $ 200,000
000 Xxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Mr. Xxxx Xxxxxx
New York City Investment Fund, LLC 156,250 $ 750,000
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
Aurora Investments LLC 1,250,000 $ 6,000,000
x/x Xxxxxxxx Xxxxxx Xxxxxxx & Co.
0 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Xxxxx Xxxxxxxxxxx 416,667 $ 2,000,000
Rockefeller & Co.
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxxxxx Xxxxxxxxxx 20,833 $ 100,000
00 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
The Pyramid Trust 20,833 $ 100,000
00 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
Caramia LLC 20,833 $ 100,000
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxx Xxxxxxxxxxx
The Grapa Trust 20,833 $ 100,000
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxx Xxxxxxxxxxx
The Papageno Trust 20,833 $ 100,000
0000 X. Xxxxxxxxx Xxxxx #0000
Xxxxxxx, XX 00000
--------- -----------
TOTAL: 6,135,416 $29,450,000
SCHEDULE II
Disclosure Schedule
Section 2.1
The Company maintains ownership in the following corporations:
StarMedia Network Americas Sociedad Anonima Financera de Inversion (SAFI) an
Uruguayan corporation owned 100% by StarMedia Network, Inc. (US).
StarMedia Chile Sociedad de Responsabilidad Limitada (SRL), a Chilean
corporation owned 99% by StarMedia Network, Inc. (US) and 1% by StarMedia
Network Americas SAFI (Uruguay).
StarMedia Argentina Sociedad de Responsabilidad Limitada (SRL), an Argentine
corporation owned 99% by StarMedia Network, Inc. (US) and 1% by StarMedia
Network Americas SAFI (Uruguay).
StarMedia Colombia Sociedad de Responsabilidad Limitada (SRL), a Colombian
corporation owned 99% by StarMedia Network, Inc. (US) and 1% by StarMedia
Network Americas SAFI (Uruguay).
StarMedia Brazil Limitada, a Brazilian corporation owned 96% by StarMedia
Network, Inc. (US) and 4% by Xxxxx Xxxxxxx--VP, GM, Southern Cone for StarMedia
(transfer to StarMedia Network Americas SAFI (Uruguay) in process).
SMN de Mexico (SRL), a Mexican corporation owned 99% by StarMedia Network, Inc.
(US) and 1% by StarMedia Network Americas SAFI (Uruguay).
Section 2.2
With respect to the Purchased Shares of those Purchasers which are party
thereto, the Registration Rights Agreement dated as of July 25, 1997, among the
Company and certain stockholders of the Company named therein (as amended, the
"Registration Rights Agreement") and the Voting Agreement, dated as of August
24, 1998, among the Company and certain stockholders of the Company named
therein (the "Voting Agreement").
The Preemptive Rights Agreement, dated as of August 24, 1998, among the Company
and certain stockholders of the Company named therein (the "Preemptive Rights
Agreement").
Section 2.4
8% Convertible Subordinated Note Payable in the amount of $1,800,000 to Chase
Venture Capital Associates, L.P. dated August 14, 1998, due December 31, 1998
and 8% Convertible Subordinated Note Payable in the amount of $200,000 to The
Flatiron Fund, LLC dated August 14, 1998, due December 31, 1998 (the "Bridge
Notes").
There are twenty (25) holders of Common Stock whom in the aggregate hold
10,392,000 shares of Common Stock.
There are twenty-nine (29) holders of Series A Preferred Stock whom in the
aggregate hold 7,330,000 shares of Preferred Stock.
There are thirty-four (34) holders of Series B Preferred Stock whom in the
aggregate hold 8,000,000 shares of Preferred Stock.
There are fifty-nine (59) holders of options on Common Stock whom in the
aggregate hold options to purchase 3,830,433 shares of Common Stock.
Stockholders Agreement, dated as of July 25, 1997, among the Company and certain
stockholders of the Company named therein (the "Stockholders Agreement").
The Preemptive Rights Agreement.
The Voting Agreement.
Section 2.5
The Bridge Notes.
Section 2.6
The Bridge Notes.
Section 2.7
On August 7, 1998, StarMedia commenced a trademark infringement suit against
Wasnet, S.L. and NSI Web, Inc. (the "Defendants") concerning, among other
things, the Defendants' (i) infringement and dilution of StarMedia's PIZARRAS
service xxxx; (ii) dilution of the trade dress of StarMedia's PIZARRAS bulletin
board service; and (iii) misappropriation of other elements of StarMedia's
Internet site. StarMedia is seeking a permanent injunction enjoining the
Defendants from using the PIZARRAS service xxxx, any element of the PIZARRAS
bulletin board service, and any other element of StarMedia's Internet Site, as
well as damages, costs and attorneys' fees.
Company has recently applied for incorporation in Venezuela.
Section 2.9
(i)
STARMEDIA NETWORK, INC.
--------------------------------------------------------------------------------------------
Registered Marks Country Registration No. Registration Date
--------------------------------------------------------------------------------------------
STARMEDIA United States 2,123,636 12/23/97
--------------------------------------------------------------------------------------------
XXXXXXXXX Xxxx 000000 06/19/98
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
Pending Marks Country Serial No. Filing Date Publication Date
--------------------------------------------------------------------------------------------
STARMEDIA Argentina 2,111,343 10/29/97 Published 5/6/98
--------------------------------------------------------------------------------------------
Bolivia 18490 12/23/97
--------------------------------------------------------------------------------------------
Brazil (38) 820333646 11/5/97 Published 3/3/98
--------------------------------------------------------------------------------------------
Brazil (9)
--------------------------------------------------------------------------------------------
Brazil (42)
--------------------------------------------------------------------------------------------
Brazil (35)
--------------------------------------------------------------------------------------------
Chile 396794 11/12/97 Published 3/5/98
--------------------------------------------------------------------------------------------
Colombia 97-066116 11/11/97 Published 3/31/98
--------------------------------------------------------------------------------------------
Costa Rica Ref No. 116939 01/14/98
--------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
--------------------------------------------------------------------------------------------
Dominican 06/24/98
Republic
--------------------------------------------------------------------------------------------
Ecuador 84003 12/30/97
--------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 03/05/98
--------------------------------------------------------------------------------------------
Guatemala 0848-8 02/06/98
--------------------------------------------------------------------------------------------
Honduras 000-00 00/09/98 Published 3/27/98
--------------------------------------------------------------------------------------------
Nicaragua 98-00524 02/10/98
--------------------------------------------------------------------------------------------
Xxxxxx 000000 12/11/97
--------------------------------------------------------------------------------------------
Xxxxxx 00000 04/17/98
--------------------------------------------------------------------------------------------
Xxxxxxxx 00000 12/23/97 Published 2/28/98
--------------------------------------------------------------------------------------------
Portugal 328214 01/20/98 Published 4/30/98
--------------------------------------------------------------------------------------------
Spain 2138590 1/26/98 Published 3/16/98
--------------------------------------------------------------------------------------------
Uruguay 300399 12/22/97
--------------------------------------------------------------------------------------------
Venezuela 97-022325 11/04/97 Published 06/12/98
--------------------------------------------------------------------------------------------
PENDING APPLICATIONS
----------------------------------------------------------------------------------------------------
Registered Marks Country Registration No. Registration Date
----------------------------------------------------------------------------------------------------
STARMEDIA and design United States 2,121,588 12/16/97
----------------------------------------------------------------------------------------------------
STARMEDIA and design Peru 014756 06/19/98
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Pending Marks Country Serial No. Filing Date Publication Date
----------------------------------------------------------------------------------------------------
STARMEDIA and design Argentina 2,120,115 12/11/97 Published 03/18/98
----------------------------------------------------------------------------------------------------
Bolivia 18492 12/23/97
----------------------------------------------------------------------------------------------------
Brazil(Cl. 38) 820434248 12/29/97 Published 04/07/98
----------------------------------------------------------------------------------------------------
Chile 400806 12/19/97 Published 05/05/98
----------------------------------------------------------------------------------------------------
Colombia 00000000 12/26/97 Published 3/31/98
----------------------------------------------------------------------------------------------------
Xxxxx Xxxx Xxx. Xx. 000000 01/14/98
----------------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
----------------------------------------------------------------------------------------------------
Dominican 06/24/98
Republic
----------------------------------------------------------------------------------------------------
Ecuador 83999 12/30/97
----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 03/05/98 Published 4/29/98
----------------------------------------------------------------------------------------------------
Guatemala 0850-8 02/06/98
----------------------------------------------------------------------------------------------------
Honduras 000-00 00/09/98 Published 3/27/98
----------------------------------------------------------------------------------------------------
Nicaragua 98-00664 02/16/98
----------------------------------------------------------------------------------------------------
Xxxxxx 000000 12/18/97
----------------------------------------------------------------------------------------------------
Xxxxxx 00000 04/17/98
----------------------------------------------------------------------------------------------------
Xxxxxxxx 00000 12/23/97
----------------------------------------------------------------------------------------------------
Portugal 328215 01/20/98 Published 4/30/98
----------------------------------------------------------------------------------------------------
Spain 2138591 1/26/98 Published 3/16/98
----------------------------------------------------------------------------------------------------
Uruguay 300400 12/22/97
----------------------------------------------------------------------------------------------------
Venezuela 97-025325 12/15/97
----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
----------------------------------------------------------------------------------------------------
XXXXXXXXX.XXX United States
----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Registered Marks Country Registration No. Registration Date
-----------------------------------------------------------------------------------------------------
TALK PLANET Peru 014757 06/19/98
-----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Pending Marks Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
TALK PLANET United States 75/212492 10/3/98
-----------------------------------------------------------------------------------------------------
Argentina 2115045 11/17/97 Published 01/11/98
-----------------------------------------------------------------------------------------------------
Bolivia 18489 12/23/97
-----------------------------------------------------------------------------------------------------
Brazil 8203570 11/18/97 Published 03/03/98
-----------------------------------------------------------------------------------------------------
Chile 398407 11/26/97 Published 04/01/98
-----------------------------------------------------------------------------------------------------
Colombia 97-068302 11/21/97 Published 03/31/98
-----------------------------------------------------------------------------------------------------
Costa Rica Ref No. 116941 01/14/98 Published 04/16/98
-----------------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
-----------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxxxx 00/00/00
-----------------------------------------------------------------------------------------------------
Xxxxxxx 00000 12/30/97
-----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 03/05/98
-----------------------------------------------------------------------------------------------------
Guatemala 0847-8 02/06/98
-----------------------------------------------------------------------------------------------------
Honduras 000-00 00/09/98
-----------------------------------------------------------------------------------------------------
Nicaragua 98-00525 02/10/98
-----------------------------------------------------------------------------------------------------
12/11/97
Office Action
Mexico 317244 pending
-----------------------------------------------------------------------------------------------------
Panama 93524 04/17/98
-----------------------------------------------------------------------------------------------------
Xxxxxxxx 00000 12/23/97
-----------------------------------------------------------------------------------------------------
Portugal 328216 01/20/98
-----------------------------------------------------------------------------------------------------
Spain 2138592 1/26/98
-----------------------------------------------------------------------------------------------------
Uruguay 300401 12/22/97
-----------------------------------------------------------------------------------------------------
Venezuela 97-023267 11/17/97
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Registered Marks Country Registration No. Registration Date
-----------------------------------------------------------------------------------------------------
XXXXXXXXXXX.XXX Peru 014760 06/19/98
-----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Pending Marks Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
XXXXXXXXXXX.XXX United States 75/396626 11/26/97
-----------------------------------------------------------------------------------------------------
Argentina 2,120,116 12/11/97 Published 03/18/98
-----------------------------------------------------------------------------------------------------
Bolivia 18491 12/23/97
-----------------------------------------------------------------------------------------------------
Brazil 820412317 12/12/97 Published 04/07/98
-----------------------------------------------------------------------------------------------------
Chile 400809 12/19/97 Published 05/05/98
-----------------------------------------------------------------------------------------------------
Colombia 97,072,337 12/11/97 Published 06/19/98
-----------------------------------------------------------------------------------------------------
Xxxxx Xxxx Xxx. Xx. 000000 02/25/98
-----------------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
-----------------------------------------------------------------------------------------------------
Dominican 06/24/98
Republic
-----------------------------------------------------------------------------------------------------
Ecuador 84004 12/30/97
-----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 03/05/98
-----------------------------------------------------------------------------------------------------
Guatemala 0849-8 02/06/98
-----------------------------------------------------------------------------------------------------
Honduras 2499/98 02/25/98
-----------------------------------------------------------------------------------------------------
Nicaragua 98-00787 02/26/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 000000 12/15/97
-----------------------------------------------------------------------------------------------------
Xxxxxx 00000 04/17/98
-----------------------------------------------------------------------------------------------------
Paraguay 3738 02/23/98
-----------------------------------------------------------------------------------------------------
Portugal 329014 03/03/98 Published 06/30/98
-----------------------------------------------------------------------------------------------------
Spain 2138593 1/26/98
-----------------------------------------------------------------------------------------------------
Uruguay 300402 12/22/97
-----------------------------------------------------------------------------------------------------
Venezuela 97-025196 12/12/97
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Registered Marks Country Registration No. Registration Date
-----------------------------------------------------------------------------------------------------
XXXXXXXXXXX.XXX Xxxx 000000 06/19/98
-----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Pending Marks Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
XXXXXXXXXXX.XXX United States 75/396625 11/26/97
-----------------------------------------------------------------------------------------------------
Argentina 2123249 12/30/97 Published 4/1/98
-----------------------------------------------------------------------------------------------------
Bolivia 02707 03/02/98
-----------------------------------------------------------------------------------------------------
Brazil 820,412,309 12/12/97
-----------------------------------------------------------------------------------------------------
Chile 408563 03/16/98
-----------------------------------------------------------------------------------------------------
Colombia 98-00953 02/23/98
-----------------------------------------------------------------------------------------------------
Xxxxx Xxxx Xxx. Xx. 000000 02/25/98
-----------------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
-----------------------------------------------------------------------------------------------------
Dominican 06/24/98
Republic
-----------------------------------------------------------------------------------------------------
Ecuador 85762 03/06/98
-----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 03/05/98
-----------------------------------------------------------------------------------------------------
Guatemala 1609-98 03/03/98
-----------------------------------------------------------------------------------------------------
Honduras 2498/98 02/25/98
-----------------------------------------------------------------------------------------------------
Nicaragua 98-00788 02/26/98 Published 06/19/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 000000 03/17/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 00000 04/17/98
-----------------------------------------------------------------------------------------------------
Paraguay 3737 02/23/98
-----------------------------------------------------------------------------------------------------
Portugal 329013 03/03/98
-----------------------------------------------------------------------------------------------------
Spain 2138594 1/26/98
-----------------------------------------------------------------------------------------------------
Uruguay 301697 02/26/98
-----------------------------------------------------------------------------------------------------
Venezuela 08-002981 02/20/98
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
BUSCAWEB United States 03/06/98
-----------------------------------------------------------------------------------------------------
Argentina 2142387 04/03/98
-----------------------------------------------------------------------------------------------------
Bolivia 05054 04/16/98
-----------------------------------------------------------------------------------------------------
Brazil 820590967 04/03/98
-----------------------------------------------------------------------------------------------------
Chile 412239 04/20/98
-----------------------------------------------------------------------------------------------------
Colombia 00000000 04/03/98 Published 07/01/98
-----------------------------------------------------------------------------------------------------
Costa Rica 4/13/98
-----------------------------------------------------------------------------------------------------
Cuba 000-00 00/03/98
-----------------------------------------------------------------------------------------------------
Dominican 06/24/98
Republic
-----------------------------------------------------------------------------------------------------
Ecuador 86681 04/07/98
-----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 04/03/98
-----------------------------------------------------------------------------------------------------
Guatemala 2620-98 04/15/98
-----------------------------------------------------------------------------------------------------
Honduras 4830-98 04/17/98
-----------------------------------------------------------------------------------------------------
Nicaragua 98-01399 04/17/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 000000 04/07/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 00000 04/17/98
-----------------------------------------------------------------------------------------------------
Paraguay 6948 04/03/98
-----------------------------------------------------------------------------------------------------
Xxxx 00000 04/03/98
-----------------------------------------------------------------------------------------------------
Portugal 329774 04/14/98
-----------------------------------------------------------------------------------------------------
Spain 2157119 04/20/98
-----------------------------------------------------------------------------------------------------
Uruguay 302671 04/03/98
-----------------------------------------------------------------------------------------------------
Venezuela 98-006005 04/06/98
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
ORBITA United States 05/20/98
-----------------------------------------------------------------------------------------------------
Argentina 2153128 05/27/98
-----------------------------------------------------------------------------------------------------
Bolivia 08770 07/03/98
-----------------------------------------------------------------------------------------------------
Brazil 820691046 05/27/98
-----------------------------------------------------------------------------------------------------
Chile 417546 06/12/98
-----------------------------------------------------------------------------------------------------
Colombia 98-030007 05/28/97
-----------------------------------------------------------------------------------------------------
Costa Rica 07/01/98
-----------------------------------------------------------------------------------------------------
Cuba 1022/98 06/30/98
-----------------------------------------------------------------------------------------------------
Dominican 07/09/98
Republic
-----------------------------------------------------------------------------------------------------
Ecuador 89227 07/10/98
-----------------------------------------------------------------------------------------------------
Xx Xxxxxxxx 0000-00 06/26/98
-----------------------------------------------------------------------------------------------------
Guatemala 5242-98 07/10/98
-----------------------------------------------------------------------------------------------------
Honduras 8152-98 07/02/98
-----------------------------------------------------------------------------------------------------
Xxxxxx 000000 06/08/98
-----------------------------------------------------------------------------------------------------
Nicaragua 98-02408 07/01/98
-----------------------------------------------------------------------------------------------------
Panama 09-5155 07/29/98
-----------------------------------------------------------------------------------------------------
Xxxxxxxx 00000 06/29/98 07/23/98
-----------------------------------------------------------------------------------------------------
Xxxx 00000 07/14/98
-----------------------------------------------------------------------------------------------------
Portugal 331379 07/08/98
-----------------------------------------------------------------------------------------------------
Spain 2172995 07/07/98
-----------------------------------------------------------------------------------------------------
Uruguay 305255 07/03/98
-----------------------------------------------------------------------------------------------------
Venezuela 9500 05/27/98
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
GALAFON United States 75/508029 06/24/98
-----------------------------------------------------------------------------------------------------
Argentina
-----------------------------------------------------------------------------------------------------
Bolivia
-----------------------------------------------------------------------------------------------------
Brazil
-----------------------------------------------------------------------------------------------------
Chile
-----------------------------------------------------------------------------------------------------
Colombia
-----------------------------------------------------------------------------------------------------
Costa Rica
-----------------------------------------------------------------------------------------------------
Cuba
-----------------------------------------------------------------------------------------------------
Dominican
Republic
-----------------------------------------------------------------------------------------------------
Ecuador
-----------------------------------------------------------------------------------------------------
El Salvador
-----------------------------------------------------------------------------------------------------
Guatemala
-----------------------------------------------------------------------------------------------------
Honduras
-----------------------------------------------------------------------------------------------------
Mexico
-----------------------------------------------------------------------------------------------------
Nicaragua
-----------------------------------------------------------------------------------------------------
Panama
-----------------------------------------------------------------------------------------------------
Paraguay
-----------------------------------------------------------------------------------------------------
Peru
-----------------------------------------------------------------------------------------------------
Portugal
-----------------------------------------------------------------------------------------------------
Spain
-----------------------------------------------------------------------------------------------------
Uruguay
-----------------------------------------------------------------------------------------------------
Venezuela
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
INFORMATICA HOY United States 75/408200 12/19/97
-----------------------------------------------------------------------------------------------------
INFORMATICA HOJE United States 12/19/97
-----------------------------------------------------------------------------------------------------
PENDING APPLICATIONS
-----------------------------------------------------------------------------------------------------
Xxxx Country Serial No. Filing Date Publication Date
-----------------------------------------------------------------------------------------------------
PIZARRAS United States
-----------------------------------------------------------------------------------------------------
Spain
-----------------------------------------------------------------------------------------------------
(ii)
See Section 2.14 below.
Section 2.14
The Company's employees in Brazil have indicated they are considering becoming
members of the Sindicato dos Trabalhadores em Processamento de Dados e
Empregados de Empresas de Processamento de Dados do Estado de Sao Paulo (SINDPD)
------------------------------------------
StarMedia Network, Inc.
------------------------------------------
Agreements
------------------------------------------
Date
------------------------------------------
Company Signed
------------------------------------------
AFP 6/1/98
------------------------------------------
Allied Domecq 6/5/98
------------------------------------------
Banco Real 6/30/98
------------------------------------------
BMW 8/1/98
------------------------------------------
Bottle Rocket 8/5/98
------------------------------------------
Xxxxxxx Xxxxxx 8/17/98
International
------------------------------------------
Chrysler-Dodge 8/6/98
------------------------------------------
Citibank 3/18/98
------------------------------------------
Xxxxxxx Management 4/8/98
------------------------------------------
Critical Path 7/6/98
Cyberian Outpost 7/16/98
------------------------------------------
eDrive 6/10/98
------------------------------------------
Epson 6/24/98
------------------------------------------
Fenasoft 8/10/98
------------------------------------------
Ford 7/9/98
------------------------------------------
Fox Latin America 1/22/97
------------------------------------------
Futbol de Primera 4/6/98
------------------------------------------
Galaxy/DirecTV 4/16/98
------------------------------------------
Hispanic Radio Network 8/1/98
------------------------------------------
IDT 5/1/98
------------------------------------------
Inter-Continental 6/3/98
------------------------------------------
Internet Profiles Corp. 1/15/97
------------------------------------------
Xxxxx Xxxxxx Casinos 6/24/98
------------------------------------------
Leasetec 5/15/98
------------------------------------------
Manhattan House 5/5/98
------------------------------------------
N2K 2/16/98
------------------------------------------
------------------------------------------
Netscape 5/1/98
------------------------------------------
Once TV 7/29/98
------------------------------------------
Oracle Corporation 5/8/98
------------------------------------------
Pager@ccess 7/1/98
------------------------------------------
Teleglobe/Galafon 5/14/98
------------------------------------------
Tropcom 7/20/98
------------------------------------------
UPI 4/22/98
------------------------------------------
USA 5/15/98
------------------------------------------
Weatherlabs 5/5/98
------------------------------------------
World Capital Financial 8/6/98
------------------------------------------
------------------------------------------
------------------------------------------
Bridge Notes.
Stockholders Agreement.
Preemptive Rights Agreement.
Voting Agreement.
Registration Rights Agreement.
The Company's 1997 Stock Option Plan
The Company's 1998 Stock Plan
Employment Agreement with Xxxxxxxx Xxxxxxxx dated July 25, 1997.
Employment Agreement with Xxxx Xxxx dated July 25, 1997.
Office Lease for New York City offices with Xxxxxxxxx Real Estate dated
September 15, 1997.
Office Lease for Miami offices with Manhattan House, Inc. dated May 6, 1998.
Office Lease for Sao Paulo, Brazil offices with Condominio Civil do World Trade
Center de Sao Paulo dated July 1, 1998.
Office Lease for Bogota, Colombia offices with Xxxxxxxx Y Xxxxx Ltda. dated
August 6, 1998.
Office Lease for Mexico City offices with Informix Software De Mexico, S.A. de
C.V. dated June 2, 1998.
"Key-man" life insurance policy for Xxxxxxxx Xxxxxxxx dated February 6, 1998.
"Key-man" life insurance policy for Xxxx Xxxx dated February 6, 1998.
Disability insurance for Xxxxxxxx Xxxxxxxx and Xxxx Xxxx.
Engagement Agreements with X.X. Xxxxxx Securities, Inc. and Chase Securities
Inc.
Section 2.15
As of July 31, 1998, the Company was due advances to employees and expected
employees of approximately $42,000.
Section 2.17
Oral agreement with Spelling/TeleUno for co-marketing has expired.
Section 2.21
X.X. Xxxxxx Securities, Inc. and Chase Securities Inc. are acting as agents on
this transaction.
Section 2.22
Xxxxxxxx Xxxxxxxx
Chairman and CEO
$135,416
Xxxx X. Xxxx
President
$135,416
Xxxx Xxxxxxxx
Senior Vice President, Corporate Relations
$118,750
Xxxxx Xxxxx
Senior Vice President, Business Operations
$104,375
Xxxxxx X. Xxxxxx
Vice President, Finance & Administration
$90,000
Xxxxx Xxxx
Vice President, Sales
$150,000
Xxxxxxx Xxxxxxxx,
Vice President, General Manager, Mexico
$87,499
Xxxxx Xxxxxxx
Vice President, General Manager, Southern Cone
$104,167
Xxxxx Xxxxxxx
Vice President, Business Development, Latin America
$84,167
Xxxx Xxxxxxx
General Manager, Argentina
$73,843
Indio Brasiliero Neto
General Manager, Brazil
$89,307
Xxxx Xxxxx Xxxxxx
Manager, Chile
$36,000
Xxxx Xxxxx Xxxxxxxx
Manager, Colombia
$36,000
Employment Agreement with Xxxxxxxx Xxxxxxxx dated July 25, 1997.
Employment Agreement with Xxxx Xxxx dated July 25, 1997.
Section 2.24
The majority of employees have executed a non-disclosure agreement. Consistent
with Section 5.16, the Company will use its best efforts to have all current
employees execute non-disclosure agreements within thirty days. The founders
(Xxxxxxxx Xxxxxxxx and Xxxx Xxxx) and all members of senior management have
executed non-disclosure agreements.
Section 2.27
The Company's U.S. benefit plan includes medical, dental, vision, life and
long-term disability insurance and a 401(k) program and is available to all U.S.
employees.
The Company's non-U.S. offices provide benefits in accordance with corresponding
local law.
Disability insurance for Xxxxxxxx Xxxxxxxx and Xxxx Xxxx.
Employment Agreement with Xxxxxxxx Xxxxxxxx dated July 25, 1997.
Employment Agreement with Xxxx Xxxx dated July 25, 1997.
