Exhibit 10.30
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
among
STARMEDIA NETWORK, INC.
and
THE SEVERAL NOTEHOLDERS NAMED IN SCHEDULE I HERETO
Dated as of September 30, 2000
THIS AGREEMENT AND THE RIGHTS TO ACQUIRE (THE "RIGHTS") THE SHARES OF COMMON
STOCK, PAR VALUE, $0.001 PER SHARE, OF STARMEDIA NETWORK, INC. PURSUANT TO THIS
AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR THE SECURITIES LAWS OF ANY STATES, AND THESE RIGHTS MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR AN EXEMPTION THEREFROM UNDER SAID ACT AND LAWS, IF APPLICABLE. THE COMPANY,
PRIOR TO PERMITTING A TRANSFER OF THESE RIGHTS MAY REQUIRE AN OPINION OF COUNSEL
OR OTHER ASSURANCE IN FORM AND SUBSTANCE SATISFACTORY TO IT AS TO COMPLIANCE
WITH, OR EXEMPTION FROM, SUCH ACT AND LAWS.
TABLE OF CONTENTS
PAGE
ARTICLE I
PURCHASE OF SEPTEMBER 12% NOTES
Section 1.1. Purchase of the September 12% Notes; Issuance of Shares of the Company......... 5
Section 1.2. Closing........................................................................ 5
Section 1.3. Registration Rights............................................................ 6
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 2.1. Organization, Qualifications and Corporate Power............................... 6
Section 2.2. Authorization of Agreements, Etc............................................... 6
Section 2.3. Validity....................................................................... 7
Section 2.4. Authorized Common Stock........................................................ 7
Section 2.5. Governmental Approvals......................................................... 7
Section 2.6. SEC Reports.................................................................... 8
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS
Section 3.1. Corporate Power, Authorization, Validity....................................... 8
Section 3.2. Accredited Investor............................................................ 8
Section 3.3. Experience..................................................................... 9
Section 3.4. Access to Data................................................................. 9
2
TABLE OF CONTENTS
(continued)
PAGE
Section 3.5. Investment..................................................................... 9
Section 3.6. Restricted Securities.......................................................... 9
ARTICLE IV
MISCELLANEOUS
Section 4.1. Expenses....................................................................... 9
Section 4.2. Survival of Agreements......................................................... 9
Section 4.3. Successors and Assigns......................................................... 9
Section 4.4. Notices........................................................................ 10
Section 4.5. Governing Law; Jurisdiction.................................................... 10
Section 4.6. Entire Agreement............................................................... 10
Section 4.7. Counterparts................................................................... 11
Section 4.8. Amendments..................................................................... 11
Section 4.9. Severability................................................................... 11
Section 4.10. Titles and Subtitles........................................................... 11
Section 4.11. Certain Defined Terms.......................................................... 11
Section 4.12. Legends........................................................................ 12
Section 4.13. WAIVER OF JURY TRIAL........................................................... 13
SCHEDULE I Noteholders
3
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT, dated as of September
30, 2000 (this "AGREEMENT"), by and among STARMEDIA NETWORK, INC., a Delaware
corporation (the "COMPANY"), and the several noteholders named in the attached
Schedule I (individually a "Noteholder" and collectively the "Noteholders").
WHEREAS, pursuant to the Note Purchase Agreement, dated as of July 18,
2000 (as amended or modified from time to time, the "SCG NOTE PURCHASE
AGREEMENT"), among StarMedia Capital Group LLC, a Delaware limited liability
company ("SCG"), and the Noteholders, the Noteholders purchased from SCG those
certain 12% Convertible Promissory Notes in the aggregate principal amount of
$5,000,000.00 (collectively, the "SCG NOTES");
WHEREAS, pursuant to the Note and Warrant Purchase Agreement, dated as
of July 18, 2000 (as amended or modified from time to time, the "GRATIS1 NOTE
PURCHASE AGREEMENT"), among Gratis1, Inc., a Delaware corporation ("GRATIS1"),
and the Purchasers listed in Annex I thereto, the Noteholders, along with the
other Purchasers, have agreed to purchase from Gratis1 from time to time those
certain 12% Convertible Promissory Notes in the aggregate principal amount of up
to $16,000,000.00 (collectively, the "GRATIS1 NOTES"), on the terms and
conditions contained therein;
WHEREAS, SCG had purchased as of August 8, 2000, Gratis1 Notes in the
aggregate principal amount of $5,000,000 (the "SCG GRATIS1 NOTES") pursuant to
the Gratis1 Note Purchase Agreement;
WHEREAS, the Noteholders have purchased Gratis1 Notes in the aggregate
principal amount of $2,000,000 (together with the SCG Gratis1 Notes, the "12%
NOTES");
WHEREAS, on the date hereof SCG is selling all of the SCG Gratis1 Notes
to the Noteholders in exchange for delivery of the SCG Notes to SCG for
cancellation;
WHEREAS, the Company owns 99 percent of the limited liability
membership interests in SCG and will derive substantial direct and indirect
benefits from the sale of the SCG Gratis1 Notes to the Noteholders;
WHEREAS, in order to induce the Noteholders to purchase the SCG Gratis1
Notes from SCG, the Company has agreed, on the terms and conditions contained
herein, to purchase the 12% Notes from the Noteholders in consideration for a
certain number of shares of the Company's authorized but unissued Common Stock,
$0.001 par value per share (the "COMMON SHARES"), to be issued by the Company to
the Noteholders pursuant to this Agreement;
WHEREAS, the Company and the Noteholders had entered into the Stock
Purchase Agreement, dated as of July 18, 2000 (as amended by the Amendment No. 1
to Stock Purchase Agreement, dated as of August 8, 2000, the "SCG STOCK PURCHASE
AGREEMENT"), providing for the sale, under certain circumstances, by the Company
of its Common Stock in consideration for the SCG Notes held by the Noteholders;
and
5
WHEREAS, the Company and the Noteholders entered into a Stock Purchase
Agreement, dated as of September 11, 2000 (the "ORIGINAL GRATIS1 STOCK PURCHASE
AGREEMENT"), providing for the sale under certain circumstances of the Common
Stock of the Company to the Noteholders in consideration for the Gratis1 Notes
held by the Noteholders;
WHEREAS, the parties hereto desire to subject the SCG Gratis1 Notes to
the provisions of the Original Gratis1 Stock Purchase Agreement by entering into
this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement, the parties agree that the Gratis1 Stock
Purchase Agreement is hereby amended and restated in its entirety as follows:
ARTICLE I
PURCHASE OF SEPTEMBER 12% NOTES
Section 1.1. PURCHASE OF THE 12% NOTES; ISSUANCE OF SHARES OF THE
COMPANY. Upon the occurrence of a Stock Purchase Event (as defined in Section
4.11(d)), the Company shall, within five Business Days (as defined in Section
4.11(a)) after such occurrence, send a written notice (the "COMPANY NOTICE") to
each of the Noteholders stating that a Stock Purchase Event has occurred and
that the Company will purchase the 12% Notes held by such Noteholder pursuant to
this Section 1.1. (A) Within 30 days after the date that the Company Notice is
delivered to the Noteholders, the Company shall (a) repurchase from each
Noteholder, and each Noteholder shall sell to the Company, the 12% Notes held by
such Noteholder and (b) issue to such Noteholder, as the sole consideration for
such 12% Notes, such number of Common Shares equal to (i) the outstanding
principal amount of, and accrued and unpaid interest on, such 12% Notes DIVIDED
BY (ii) the Current Market Price (such Common Shares issued to the Noteholders
pursuant to this Section 1.1 are referred to herein as the "EXCHANGE SHARES")
and (B) in addition to the delivery and sale to the Company of the 12% Notes
being sold to the Company by each Noteholder, such Noteholder shall pay to the
Company an amount (the "Noteholder Payment Amount") equal to the product of (x)
$0.001 multiplied by (y) the number of Exchange Shares to be issued to such
Noteholder hereunder. No fractional Common Shares shall be issued pursuant to
the foregoing clause (b); in lieu thereof, the Company shall pay to such
Noteholder the amount of cash that otherwise would have been attributed to such
fractional Common Shares.
Section 1.2. CLOSING. Each of the closings of the purchase and sale of
the 12% Notes and the issuance of the Exchange Shares in consideration thereof
(individually, a "CLOSING" and collectively the "CLOSINGS") shall take place at
the offices of Hughes Hubbard & Reed LLP, One Battery Park Plaza, New York, New
York 10004, at 10:00 a.m., New York time, on any Business Day during the 30-day
period described in Section 1.1, or at such other date and time as may be agreed
upon between the applicable Noteholder and the Company (each such date of a
Closing being referred to herein as a "CLOSING DATE").
At each Closing, the applicable Noteholder shall deliver to the Company
the original 12%
6
Notes held by such Noteholder, free and clear of all liens and encumbrances,
duly endorsed to the Company or accompanied by a duly executed instrument of
transfer, together with the Noteholder Payment Amount applicable to such
Noteholder. As payment in full for such 12% Notes being purchased by it on a
Closing Date under this Agreement, and against delivery of the original 12%
Notes as aforesaid and Noteholder Payment Amount, on such Closing Date the
Company shall issue and deliver to the applicable Noteholder a stock certificate
or certificates in definitive form, registered in the name of such Noteholder,
representing the Exchange Shares being issued to such Noteholder at such
Closing.
Section 1.3. REGISTRATION RIGHTS. The Company and the Noteholders agree
to (a) use their reasonable best efforts to amend the Amended and Restated
Registration Rights Agreement, dated as of August 31, 1998 (the "EXISTING
REGISTRATION RIGHTS AGREEMENT"), by and among the Company, Jack C. Chen and
Fernando J. Espuelas, as Founders, and the persons identified as "Purchasers" on
the signature pages thereto, or (b) enter into a new registration rights
agreement containing registration rights substantially similar to those
contained in the Existing Registration Rights Agreement, in each case as soon as
practicable after the date hereof in order to provide to the Noteholders
registration rights with respect to the Exchange Shares. Any such amendment or
registration rights agreement shall be in form and substance satisfactory to the
Company and the Noteholders.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Noteholders that:
Section 2.1. ORGANIZATION, QUALIFICATIONS AND CORPORATE POWER. (a) The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and is duly licensed or
qualified to transact business as a foreign corporation and is in good standing
as a foreign corporation in each jurisdiction in which the nature of the
business transacted by it or the character of the properties owned or leased by
it requires such licensing or qualification, except for such failures to be so
qualified and in good standing which would not have a Material Adverse Effect
(as defined in Section 4.11(c)). The Company has the requisite corporate power
and authority to own, lease and operate its assets and properties and to carry
on its business as now conducted, to execute, deliver and perform this
Agreement, and to issue, sell and deliver the Exchange Shares.
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 purchase of the 12%
Notes pursuant to this Agreement, and the issuance and delivery of the Exchange
Shares pursuant to the terms of this Agreement have been duly authorized by all
requisite corporate action on the part of the Company, and do not violate (i)
any provision of existing law (assuming that the representations
7
and warranties of the Noteholders contained in Sections 3.2, 3.3, 3.4, 3.5 and
3.6 are true and correct), (ii) any existing order of any court or other agency
of government, (iii) the certificate of incorporation or by-laws of the Company,
or (iv) any provision of any indenture, agreement or other instrument to which
the Company or any of its properties or assets is currently bound, or conflict
with, result in a breach of, or constitute (with due notice or lapse of time or
both) a default under any such indenture, agreement or other instrument, or
result in the creation or imposition of any lien, charge, restriction, claim or
encumbrance of any nature whatsoever (each a "LIEN") upon any of the Company's
assets under any such indenture, agreement or other instrument, or result in the
creation or imposition of any Lien upon any of the properties or assets of the
Company, except, with respect to the foregoing clause (iv) only, for such
violations, conflicts, breaches, defaults, or Liens which do not and could not
reasonably be expected to have a Material Adverse Effect.
(b) The Exchange Shares have been duly authorized and, when issued in
accordance with this Agreement as consideration for the 12% Notes, will be
validly issued and outstanding, fully paid and nonassessable Common Shares, with
no personal liability attaching to the ownership thereof, and will be free and
clear of all Liens imposed by or through the Company. The issuance and delivery
of the Exchange Shares are not subject to any preemptive right of stockholders
of the Company or to any right of first refusal or other similar right in favor
of any person or entity.
Section 2.3. VALIDITY. This Agreement has been duly executed and
delivered by the Company and constitutes the legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms,
except as may be limited by bankruptcy, insolvency, fraudulent transfer or other
similar laws affecting creditors' rights generally and subject to general
principles of equity (including possible unavailability of specific performance
or injunctive relief and the general discretion of the court considering the
matter), regardless of whether enforceability is considered in a proceeding in
equity or at law.
Section 2.4. AUTHORIZED COMMON STOCK. The authorized common stock of
the Company consists of 200,000,000 shares of Common Stock, $0.001 par value per
share (the "COMMON STOCK"). As of June 30, 2000, 65,818,853 shares of Common
Stock were issued and are outstanding. All such issued and outstanding shares of
Common Stock of the Company are fully paid and nonassessable, with no personal
liability attaching to the ownership thereof.
Section 2.5. GOVERNMENTAL APPROVALS. Subject to the accuracy of the
representations and warranties of the Noteholders set forth in Section 3.2
through Section 3.6, no registration or filing with, or consent or approval of
or other action by, any 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 or the issuance and delivery of the
Exchange Shares, other than (i) filings pursuant to federal or state securities
laws in connection with the issuance of the Exchange Shares, (ii) filings with
The Nasdaq Stock Market and (iii) any filings that may be necessary pursuant to
the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (all of which filings,
if any, have been made by the Company, other than those which are permitted to
be made after a Closing Date and which will be duly made on a timely basis).
8
Section 2.6. SEC REPORTS. The Company has made available to the
Noteholders the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1999 and Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, 2000 and June 30, 2000 (collectively, the "SEC REPORTS"). The
SEC Reports, as of the date of filing thereof with the Securities and Exchange
Commission (or if amended or superseded by a filing prior to the date of this
Agreement, on the date of such filing), did not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Since June 30, 2000,
there has been no material adverse change in the business, financial condition
or results of operations of the Company and its subsidiaries, taken as a whole.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS
Each Noteholder, severally and not jointly, represents and warrants to
the Company that:
Section 3.1. CORPORATE POWER, AUTHORIZATION, VALIDITY. Such Noteholder
has the requisite power and authority to execute, deliver and perform this
Agreement. The execution and delivery by such Noteholder of this Agreement, the
performance by such Noteholder of its obligations hereunder, and the sale of the
12% Notes held by such Noteholder pursuant to the terms of this Agreement, have
been duly authorized by all requisite action (corporate or otherwise) on the
part of such Noteholder and do not violate (i) any provision of existing law,
(ii) any existing order of any court or other agency of government, (iii) the
certificate of incorporation or by-laws (or similar governing instruments with
different names) of such Noteholder, or (iv) any provision of any indenture,
agreement or other instrument to which such Noteholder or any of its properties
or assets is currently bound, or conflict with, result in a breach of, or
constitute (with due notice or lapse of time or both), a default under any such
indenture, agreement or other instrument, or result in the creation or
imposition of any Lien upon any such Noteholder's assets under any such
indenture, agreement or other instrument, or result in the creation or
imposition of any Lien upon any of the properties or assets of such Noteholder
except, with respect to the foregoing clause (iv) only, for such violations,
conflicts, breaches, defaults or Liens which do not and could not reasonably be
expected to have a material adverse effect on the ability of such Noteholder to
perform its obligations hereunder. This Agreement has been duly executed and
delivered by such Noteholder and constitutes the legal, valid and binding
obligation of such Noteholder, enforceable against such Noteholder in accordance
with its terms, except as may be limited by bankruptcy, insolvency, fraudulent
transfer or other similar laws affecting creditors' rights generally and subject
to general principles of equity (including possible unavailability of specific
performance or injunctive relief and the general discretion of the court
considering the matter), regardless of whether enforceability is considered in a
proceeding in equity or at law.
Section 3.2. ACCREDITED INVESTOR. Such Noteholder is an "ACCREDITED
INVESTOR" within
9
the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act
of 1933, as amended (the "SECURITIES ACT"), and was not organized for the
specific purpose of acquiring the Exchange Shares.
Section 3.3. EXPERIENCE. Such Noteholder has sufficient knowledge and
experience in investing in companies similar to the Company in terms of the
Company's stage of development so as to be able to evaluate the risks and merits
of its investment in the Company and it is able financially to bear the risks
thereof.
Section 3.4. ACCESS TO DATA. Such Noteholder has had an opportunity to
discuss the Company's business, management and financial affairs with the
Company's management.
Section 3.5. INVESTMENT. Any Exchange Shares that are issued to such
Noteholder will be acquired for its own account, not as a nominee or agent, for
the purpose of investment and not with a view to or for sale in connection with
any distribution thereof in violation of any federal or state securities laws.
Such Noteholder understands that (i) the Exchange Shares have not been, and on
each Closing Date will not have been, registered under the Securities Act by
reason of their issuance in a transaction exempt from the registration
requirements of the Securities Act pursuant to Section 4(2) thereof or Rule 505
or 506 promulgated under the Securities Act, (ii) the Exchange Shares must be
held indefinitely unless a subsequent disposition thereof is registered under
the Securities Act or is exempt from such registration, (iii) the Exchange
Shares will bear the legend to this effect as such legend is set forth in
Section 4.12 hereof, and (iv) the Company will make a notation on its transfer
books to that effect.
Section 3.6. RESTRICTED SECURITIES. Such Noteholder understands that
the Exchange Shares are characterized as "restricted securities" under the
Securities Act inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under the Securities Act
and applicable regulations thereunder, such securities may be resold without
registration under the Securities Act only in certain limited circumstances. In
this connection, such Noteholder represents that such Noteholder is familiar
with Rules 144 and 144A of the Securities and Exchange Commission, as presently
in effect, and understands that the Company is under no obligation to register
any of the securities issued hereunder.
ARTICLE IV
MISCELLANEOUS
Section 4.1. EXPENSES. Each party hereto will pay its own expenses in
connection with the transactions contemplated hereby, whether or not such
transactions shall be consummated.
Section 4.2. SURVIVAL OF AGREEMENTS. All covenants, agreements,
representations and warranties made in this Agreement shall survive (and not be
affected by) any Closing.
Section 4.3. SUCCESSORS AND ASSIGNS. All representations, covenants and
agreements contained in this Agreement by or on behalf of any of the parties
hereto shall bind and inure to
10
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not; PROVIDED, HOWEVER, that no Noteholder may transfer
or assign any of its rights or obligations under this Agreement in violation of
applicable securities law and unless the Company is given written notice by such
Noteholder and its assignee of such transfer or assignment and any such assignee
shall, as a condition to such transfer or assignment, execute and deliver to the
Company a written instrument, in form and substance acceptable to the Company,
by which such assignee (i) represents that such transfer or assignment is exempt
from the registration requirements of the Securities Act, (ii) agrees to become,
and be bound by the obligations of, and entitled to the benefits of, a
Noteholder under this Agreement and (iii) such assignee shall make
representations and warranties comparable to those contained in Article III
hereof; and PROVIDED FURTHER, HOWEVER, that the Company may not assign its
rights or obligations hereunder without the prior written consent of the
Noteholders.
Section 4.4. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be delivered in person,
mailed by certified or registered mail, return receipt requested, or sent by
telecopier or telex, addressed as follows:
(a) if to the Company, to it at StarMedia Network, Inc.
75 Varick Street, New York, New York 10013, Attention: General Counsel,
with a copy to Kenneth Lefkowitz, Esq., Hughes Hubbard & Reed LLP,
One Battery Park Plaza, New York, New York 10004; and
(b) if to any Noteholder, at the address of such Noteholder
set forth in Schedule I, with a copy to Michael J. O'Brien, Esq.,
O'Sullivan Graev & Karabell, LLP, 30 Rockefeller Plaza, New York,
New York 10112;
or, in any such case, at such other address or addresses as shall have been
furnished in writing by such party to the others.
Section 4.5. GOVERNING LAW; JURISDICTION. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York.
Each of the Company and the Noteholders irrevocably submits to the exclusive
jurisdiction of (a) the Supreme Court of the State of New York, New York County,
and (b) the United States District Court for the Southern District of New York,
and the appellate courts therefrom, for the purposes of any suit, action or
other proceeding arising out of this Agreement or any transaction contemplated
hereby. Each of the Company and the Noteholders further agrees that service of
any process, summons, notice or document by U.S. registered mail to such party's
respective address set forth in Section 4.4 shall be effective service of
process for any action, suit or proceeding in New York with respect to any
matters to which it has submitted to jurisdiction in this Section 4.5. Each of
the Company and the Noteholders agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum.
Section 4.6. ENTIRE AGREEMENT. This Agreement, including the Schedule
hereto, constitutes the sole and entire agreement of the parties with respect to
the subject matter hereof and supersedes all prior
11
agreements or understandings between the parties, except any prior agreements
relating to confidentiality of disclosed information. The Schedule hereto is
hereby incorporated herein by reference.
Section 4.7. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 4.8. AMENDMENTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Noteholders.
Section 4.9. SEVERABILITY. If any provision of this Agreement shall be
declared void or unenforceable by any judicial or administrative authority, the
validity of any other provision and of the entire Agreement shall not be
affected thereby.
Section 4.10. TITLES AND SUBTITLES. The titles and subtitles used in
this Agreement are for convenience only and are not to be considered in
construing or interpreting any term or provision of this Agreement.
Section 4.11. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined).
(a) "BUSINESS DAY" shall mean any day that is not a Saturday,
Sunday, or legal holiday in the State of New York.
(e) "CURRENT MARKET PRICE" shall mean the average of the
reported last sales prices of a Common Share for the five consecutive
Trading Days before the Closing Date. The reported last sales price of
a Common Share for each Trading Day shall be: (i) the reported last
sales price as reported on the National Market tier of The Nasdaq Stock
Market; or (ii) if the Common Shares are not listed or admitted to
trading on the National Market tier of the Nasdaq Stock Market at such
time, in the principal consolidated or composite transaction reporting
system on the principal national securities exchange on which the
Common Shares are listed or admitted to trading; or (iii) if the Common
Shares are not quoted on such National Market tier or any national
securities exchange, the average of the highest bid and lowest asked
prices on such day as reported on The Nasdaq Stock Market.
Notwithstanding anything to the contrary contained herein, the "Current
Market Price" for purposes of this Agreement shall in no event be less
than $7.00 per Common Share (subject to any adjustment for any
stocksplits, dividends, combination and similar events).
(b) "PERSON" shall mean an individual, corporation, trust,
partnership, limited liability company, joint venture, unincorporated
organization, government agency or any agency or political subdivision
thereof, or other entity.
12
(c) "MATERIAL ADVERSE EFFECT" shall mean, when used with
respect to any representation, an occurrence, event or condition that
individually or in the aggregate is reasonably likely to be materially
adverse to the business, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
(d) "STOCK PURCHASE EVENT" shall mean each of the following:
(i) with respect to each Noteholder and the 12% Notes
held by such Noteholder, November 15, 2000, BUT ONLY IF (A)
the Subsequent Round (as defined in the Note Purchase
Agreement) has not occurred on or before such date and (B)
such 12% Notes has not been repaid in full in cash or
converted into Initial Round Securities or Subsequent Round
Securities (as such terms are defined in the Note Purchase
Agreement) on or before such date; or
(ii) if Gratis1, shall (A) discontinue its business,
(B) apply for or consent to the appointment of a receiver,
trustee, custodian or liquidator of it or any of its property,
(C) make a general assignment for the benefit of creditors, or
(D) file a voluntary petition in bankruptcy, or a petition or
an answer seeking reorganization or an arrangement with
creditors, or to take advantage of any bankruptcy,
reorganization, insolvency, readjustment of debt, dissolution
or liquidation laws or statutes, or an answer admitting the
material allegations of a petition filed against it in any
proceeding under any such law; or
(iii) there shall be filed against Gratis1 an
involuntary petition seeking reorganization of Gratis1 or the
appointment of a receiver, trustee, custodian or liquidator of
Gratis1 or a substantial part of its assets, or an involuntary
petition under any bankruptcy, reorganization or insolvency
law of any jurisdiction, whether now or hereafter in effect
(any of the foregoing petitions being hereinafter referred to
as an "INVOLUNTARY PETITION") and such Involuntary Petition
shall not have been dismissed within sixty (60) days after it
was filed; or
(iv) if Gratis1 shall fail to make any required
prepayment of the 12% Notes pursuant to Section 2(b) or 2(c)
of the 12% Notes and such failure shall continue unremedied
for five Business Days.
Section 4.12. LEGENDS. It is understood that the certificates
evidencing the Exchange Shares will bear the legends set forth below:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATES, AND THESE SECURITIES
MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND LAWS, IF APPLICABLE.
THE COMPANY, PRIOR TO PERMITTING A TRANSFER OF THESE SECURITIES MAY REQUIRE AN
13
OPINION OF COUNSEL OR OTHER ASSURANCE IN FORM AND SUBSTANCE SATISFACTORY TO IT
AS TO COMPLIANCE WITH, OR EXEMPTION FROM, SUCH ACT AND LAWS.
The legend set forth in the immediately preceding paragraph above shall be
removed by the Company from any certificate evidencing Exchange Shares upon
delivery to the Company of an opinion by counsel, reasonably satisfactory to the
Company, that a registration statement under the Securities Act is at that time
in effect with respect to the legended security or that such security can be
freely transferred in a public sale without such a registration statement being
in effect and that such transfer will not jeopardize the exemption or exemptions
from registration pursuant to which the Company issued the Exchange Shares.
Section 4.13. WAIVER OF JURY TRIAL. Each of the Company and the
Noteholders hereby waives all right to trial by jury in any action, proceeding
or counterclaim with respect to, in connection with, or arising out of the
transactions contemplated by this Agreement or any document or instrument
delivered hereunder. ANY SUCH PERSON MAY FILE AN ORIGINAL COUNTERPART OR A COPY
OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Company and the Noteholders have executed this
Agreement as of the day and year first above written.
STARMEDIA NETWORK, INC.
By:
-----------------------------------
Name:
Title:
CHASE EQUITY ASSOCIATES, LP
By: CHASE CAPITAL PARTNERS,
as Investment Manager
By:
-----------------------------------
Name:
Title:
THE FLATIRON FUND 2000 LLC
By:
-----------------------------------
Name:
Title:
FLATIRON ASSOCIATES II LLC
By:
-----------------------------------
Name:
Title:
SCHEDULE I
NOTEHOLDERS
NAME AND ADDRESS:
- ----------------
Chase Equity Associates, LP
c/o Chase Capital Partners
1221 Avenue of the Americas
40th Floor
New York, New York 10022
Telephone: (212) 899-3470
Telecopy: (212) 899-3528
Attention: Susan Segal
The Flatiron Fund 2000 LLC
c/o Flatiron Partners LLC
257 Park Avenue South
12th Floor
New York, New York 10010
Telephone: (212) 228-3800
Telecopy: (212) 228-0552
Attention: Fred Wilson
Flatiron Associates II LLC
c/o Flatiron Partners LLC
257 Park Avenue South
12th Floor
New York, New York 10010
Telephone: (212) 228-3800
Telecopy: (212) 228-0552
Attention: Fred Wilson