<Page>
SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934

<Table>

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-12

STARMEDIA NETWORK, INC.
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
</Table>

Payment of Filing Fee (Check the appropriate box):

<Table>

/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
----------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
----------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how
it was determined):
----------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------

/ / Fee paid previously with preliminary materials.

/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.

(1) Amount Previously Paid:
----------------------------------------------------------

(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------

(3) Filing Party:
----------------------------------------------------------

(4) Date Filed:
----------------------------------------------------------
</Table>
<Page>
STARMEDIA NETWORK, INC.
D/B/A CYCLELOGIC MOBILE SOLUTIONS

999 BRICKELL AVE.
SUITE #900
MIAMI, FLORIDA 33131
(305) 938-3000

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 17, 2003

TO THE STOCKHOLDERS OF STARMEDIA NETWORK, INC.:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting" or "Meeting") of StarMedia Network, Inc., a Delaware corporation, d/b/a
CycleLogic Mobile Solutions (the "Company"), will be held on March 17, 2003 at
2:00 p.m. at the JW Marriott Hotel, 1109 Brickell Avenue, Miami, Florida, 33131,
for the following purposes, as more fully described in the Proxy Statement
accompanying this Notice:

1. To elect one director to serve for a three-year term ending at the
2005 Annual Meeting of Stockholders or until a successor is duly elected and
qualified;

2. To amend the Company's Amended and Restated Certificate of
Incorporation to change the Company's name to CycleLogic, Inc.;

3. To amend the Company's Amended and Restated Certificate of
Incorporation to effect a reverse stock split of the Company's Common Stock;

4. To amend the Company's Amended and Restated Certificate of
Incorporation to provide that the minimum number of directors of the Company
shall be no less than three (3) nor more than nine (9) (exclusive of
directors, if any, to be elected by holders of preferred stock of the
Company, voting separately as a class);

5. To amend the Company's Amended and Restated Certificate of
Incorporation to provide that the stockholders of the Company may act by
written consent in lieu of a meeting; and

6. To transact such other business as may properly come before the
Meeting or any adjournment or adjournments thereof.

Among the matters to be considered at the Annual Meeting is a proposal
(Proposal 3 above) to amend the Company's Amended and Restated Certificate of
Incorporation in connection with a reverse stock split. Pursuant to this
proposal, the Company would enact a one-for-1000 reverse stock split of the
Company's issued Common Stock which, if approved, will enable the Company to "go
private" and thus terminate its obligations to file annual and periodic reports
and make other filings with the Securities and Exchange Commission.

Only stockholders of record at the close of business on February 5, 2003,
are entitled to notice of and to vote at the Annual Meeting. A list of
stockholders entitled to vote at the Meeting will be available for inspection at
the Meeting and for a period of ten days prior to the Meeting during regular
business hours at the corporate headquarters of the Company at the address
listed above.

All stockholders are cordially invited to attend the Annual Meeting in
person. Whether or not you expect to attend the Meeting, your vote is important.
To assure your representation at the Meeting, please sign and date the enclosed
proxy and return it promptly in the enclosed envelope, which requires no
additional postage if mailed in the United States. You may revoke your proxy at
any time prior to the Annual Meeting. If you attend the Annual Meeting and vote
by ballot, your proxy will be revoked automatically, and only your vote at the
Annual Meeting will count.

By Order of the Board of Directors,

Susan L. Segal
ACTING CHAIRMAN OF THE BOARD

New York, New York
February 13, 2003

YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
PLEASE READ THE ATTACHED PROXY STATEMENT CAREFULLY, COMPLETE, SIGN AND DATE THE
ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED
ENVELOPE.
<Page>
STARMEDIA NETWORK, INC.
D/B/A/ CYCLELOGIC MOBILE SOLUTIONS

999 BRICKELL AVE.
SUITE #900
MIAMI, FLORIDA 33131
(305) 938-3000

PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 17, 2003

This Proxy Statement is furnished to stockholders of record of StarMedia
Network, Inc., d/b/a CycleLogic Mobile Solutions (the "Company") by the Board of
Directors (the "Board") of the Company for use at the Annual Meeting of
Stockholders (the "Annual Meeting" or "Meeting") to be held on March 17, 2003.
The Annual Meeting will be held at the JW Marriott Hotel, 1109 Brickell Avenue,
Miami, Florida, 33131, at 2:00 p.m. This proxy statement, the accompanying proxy
card, the Company's 2001 Annual Report and certain quarterly and other reports
the Company filed with the SEC in 2002 are being mailed to stockholders of
record on or about February 13, 2003.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THIS TRANSACTION, PASSED UPON THE
MERITS OR FAIRNESS OF THE TRANSACTION OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THE DISCLOSURE IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS
AND THE ANNUAL MEETING

Q: WHY AM I RECEIVING THESE MATERIALS?

A: The Board is providing these proxy materials for you in connection with the
Annual Meeting, which will take place on March 17, 2003. As a stockholder,
you are invited to attend the Meeting and are entitled to and requested to
vote on the proposals described in this proxy statement.

Q: WHAT INFORMATION IS CONTAINED IN THESE MATERIALS?

A: The information included in this proxy statement relates to the proposals to
be voted on at the Meeting, the voting process, the compensation of our
directors and our most highly paid executive officers, and certain other
required information. Our 2001 Annual Report, including our full 2001 fiscal
year consolidated financial statements, and certain quarterly and other
reports that we filed with the Securities and Exchange Commission in 2002
are also enclosed.

Q: WHAT PROPOSALS WILL BE VOTED ON AT THE ANNUAL MEETING?

A: There are five (5) proposals scheduled to be voted on at the Meeting,
including:

- The election of one director;

- The approval of the change of our name from StarMedia Network, Inc. to
CycleLogic, Inc.;

- The approval of a reverse stock split;

- The approval of a change in the number of directors on our Board to a
minimum of three (3) and a maximum of nine (9) directors (exclusive of
directors, if any, to be elected by holders of preferred stock of the
Company, voting separately as a class); and

- The approval of an amendment to our Certificate of Incorporation to permit
stockholders of the Company to act by written consent in lieu of a
meeting.

1
<Page>
In addition, you will be asked to vote on any other business as may properly
come before the Meeting or any adjournment or adjournments thereof.

Q: WHAT IS THE COMPANY'S VOTING RECOMMENDATION?

A: Our Board recommends that you vote your shares "FOR":

- the nominee to the Board;

- the approval of the name change;

- the approval of the reverse stock split;

- the approval of the change in the minimum and maximum number of directors;
and

- the approval of the amendment permitting stockholders to act by written
consent in lieu of a meeting.

Q: WHAT SHARES CAN I VOTE?

A: You may vote all shares of Company Common Stock (the "Common Stock") that you
own as of the close of business on February 5, 2003 (the "Record Date").
These shares include (1) shares held directly in your name as the
"stockholder of record," including shares purchased through the Company's
Employee Stock Purchase Plan and (2) shares held for you as the "beneficial
owner" through a broker or bank.

For each share of Series A Convertible Preferred Stock that you own of
record as of the close of business on the Record Date, you will be entitled
to cast one vote for each whole vote that you would have been entitled to
cast had you converted your Series A Convertible Preferred Stock, as well as
accrued but unpaid dividends, into shares of Common Stock as of the date
immediately prior to the Record Date. For additional information, see "HOW
MANY VOTES WILL I BE ENTITLED TO?" below.

Q: WHAT IS THE DIFFERENCE BETWEEN HOLDING SHARES AS A STOCKHOLDER OF RECORD AND
AS A BENEFICIAL OWNER?

A: Most of our stockholders hold their shares through a broker, bank or other
nominee rather than directly in their own name. As summarized below, there
are some distinctions between shares held of record and those owned
beneficially.

STOCKHOLDER OF RECORD

If your shares are registered directly in your name with our transfer agent,
American Stock Transfer & Trust Company (the "Transfer Agent"), you are
considered, with respect to those shares, the stockholder of record, and
these proxy materials are being sent directly to you by the Company. As the
stockholder of record, you have the right to grant your voting proxy
directly to the Company or to vote in person at the Annual Meeting. The
Company has enclosed or sent a proxy card for you to use.

BENEFICIAL OWNER

If your shares are held in a stock brokerage account or by a bank or other
nominee, you are considered the "beneficial owner" of shares held "in street
name," and these proxy materials are being forwarded to you by your broker
or nominee which is considered, with respect to those shares, the
stockholder of record. As the beneficial owner, you have the right to direct
your broker how to vote and are also invited to attend the Annual Meeting.
However, as a beneficial owner, you are not the stockholder of record, and
you may not vote these shares in person at the Meeting unless you obtain a
signed proxy from the stockholder of record giving you the right to vote the
shares. Your broker or nominee has enclosed or provided a voting instruction
card for you to use in directing the broker or nominee how to vote your
shares.

2
<Page>
Q: HOW CAN I VOTE MY SHARES IN PERSON AT THE ANNUAL MEETING?

A: Shares held directly in your name as the stockholder of record may be voted
in person at the Annual Meeting. If you choose to do so, please bring the
enclosed proxy card or proof of identification.

Even if you currently plan to attend the Annual Meeting, we recommend that
you also submit your proxy as described below so that your vote will be
counted if you later decide not to attend the Meeting. Shares held in street
name may be voted in person by you only if you obtain a signed proxy from
the stockholder of record giving you the right to vote the shares.

Q: WHAT IS A REVERSE STOCK SPLIT?

A: Among the matters to be considered at the Meeting is a proposal to amend the
Company's Amended and Restated Certificate of Incorporation to provide for a
one-for-1,000 reverse stock split of the Common Stock issued as of the time
the reverse stock split is effective. If approved, this proposal will enable
the Company to "go private" and thus terminate its obligations to file
annual and periodic reports and make other filings with the Securities and
Exchange Commission (the "SEC"). The purpose behind the proposal and the
benefits of "going private" include:

- eliminating the costs associated with filing documents under the
Securities Exchange Act of 1934, as amended (the "1934 Act") with the SEC;
and

- reducing the direct and indirect costs of administering stockholder
accounts and responding to stockholder requests.

Q: WHAT DOES "GOING PRIVATE" MEAN?

A: The Company will have less than 300 stockholders of record, will be eligible
for and will file for deregistration of its Common Stock and will become a
"private company." In this regard, the Company, by going private, will no
longer have to file periodic reports, such as annual, quarterly and other
reports, with the SEC.

Q: HOW CAN I VOTE MY SHARES WITHOUT ATTENDING THE ANNUAL MEETING?

A: Whether you hold your shares directly as the stockholder of record or
beneficially in street name, you may direct your vote without attending the
Annual Meeting. You may vote by signing your proxy card or, for shares held
in street name, by signing the voting instruction card included by your
broker or nominee and mailing it in the accompanying enclosed, pre-addressed
envelope. If you provide specific voting instructions, your shares will be
voted as you instruct. If you sign but do not provide instructions, your
shares will be voted as described below in "HOW ARE VOTES COUNTED?"

Q: CAN I CHANGE MY VOTE?

A: You may change your proxy instructions at any time prior to the vote at the
Annual Meeting. For shares held directly in your name, you may change your
vote by granting a new proxy bearing a later date (which automatically
revokes the earlier dated proxy) or by attending the Annual Meeting and
voting in person. Attendance at the Meeting will not cause your previously
granted proxy to be revoked unless you specifically so request. For shares
held beneficially by you, you may change your vote by submitting new voting
instructions to your broker or nominee.

Q: HOW ARE VOTES COUNTED?

A: In the election of the director, you may vote "FOR" the nominee or your vote
may be "WITHHELD" with respect to the nominee. For the other four proposals,
you may vote "FOR," "AGAINST" or "ABSTAIN." If you "ABSTAIN," it has the
same effect as a vote "AGAINST." If you sign your proxy card or broker
voting instruction card with no further instructions, your shares will be
voted "FOR" the nominee to the Board, "FOR" the approval of the name change,
"FOR" the approval of the reverse stock split, "FOR" the change in the
minimum and maximum number of directors and "FOR"

3
<Page>
permitting stockholders to act by written consent in lieu of a meeting, all
in accordance with the recommendations of the Board.

Q: WHAT IS THE VOTING REQUIREMENT TO APPROVE EACH OF THE PROPOSALS?

A: With respect to the election of one director, the director will be elected by
a plurality, meaning the person who receives the highest number of "FOR"
votes will be elected. The proposals to modify the number of permitted
directors and to permit stockholders to act by written consent in lieu of a
meeting require the affirmative vote of 66.67% of the outstanding shares of
capital stock of the Company entitled to vote generally in the election of
directors at stockholders' meetings called for this purpose. All other
proposals require the affirmative vote of a majority of those votes entitled
to be cast at the Meeting. If you are a beneficial owner and do not provide
the stockholder of record with voting instructions, your shares may
constitute broker non-votes. In tabulating the voting result for any
particular proposal, shares that constitute broker non-votes are not
considered entitled to vote on that proposal.

Q: WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY OR VOTING INSTRUCTION
CARD?

A: It means your shares are registered differently or are in more than one
account. Please provide voting instructions for all proxy and voting
instruction cards you receive.

Q: HOW CAN I OBTAIN AN ADMISSION TICKET FOR THE ANNUAL MEETING?

A: To request admission tickets to the Annual Meeting, please contact Michael
Hartman, General Counsel and Secretary, at our corporate headquarters (999
Brickell Avenue, Suite #900, Miami, Florida 33131, (305) 938-3000). If you
forget to bring an admission ticket, you will be admitted to the Meeting
only if you are listed as a stockholder of record as of the close of
business on the Record Date and you bring proof of identification. If you
hold your shares through a broker or other nominee and fail to bring an
admission ticket, you will need to provide proof of ownership of Company
stock by bringing either a copy of the voting instruction card provided by
your broker or a copy of a brokerage statement showing your share ownership
as of the Record Date.

Q: WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING?

A: We will announce preliminary voting results at the Meeting and publish final
results in a report on Form 8-K filed with the SEC.

Q: WHAT HAPPENS IF ADDITIONAL PROPOSALS ARE PRESENTED AT THE ANNUAL MEETING?

A: Other than the five proposals described in this proxy statement, we do not
expect any other matters to be presented for a vote at the Annual Meeting.
If you grant us your proxy, the persons named as proxy holders, Jose Manual
Tost and Ana Maria Lozano-Stickley, President and Chief Financial Officer,
respectively, will have the discretion to vote your shares on any additional
matters properly presented for a vote at the Meeting. If for any unforeseen
reason our nominee is not available as a candidate for director, the persons
named as proxy holders will vote your proxy for such other candidate as may
be nominated by the Board.

Q: HOW MANY VOTES WILL I BE ENTITLED TO?

A: As of the close of business on February 5, 2003, the Record Date, we had
issued and outstanding approximately 71,041,277 shares of Common Stock and
1,431,373 shares of Series A Convertible Preferred Stock. Each share of
Common Stock is entitled to one vote per share. Each share of Series A
Convertible Preferred Stock is entitled to cast one vote for each whole vote
that the holder would have been entitled to cast had the holder converted
his or her Series A Convertible Preferred Stock, as well as accrued but
unpaid dividends, into shares of Common Stock as of the date

4
<Page>
immediately prior to the Record Date. Each share of Series A Convertible
Preferred Stock is generally convertible into ten (10) shares of Common
Stock and accrues interest at a rate of 6% per annum compounded quarterly.
Interest as of the end of any calendar quarter also accrues interest at the
specified rate. Accordingly, on the Record Date the 1,431,373 shares of
Series A Convertible Preferred Stock currently issued and outstanding had a
right to cast approximately 15,842,249 votes at the Meeting, or
approximately 18.3% of all votes eligible to vote at the Meeting.

Q: WHAT IS THE QUORUM REQUIREMENT FOR THE ANNUAL MEETING?

A: The quorum requirement for holding the Meeting and transacting business is
fifty percent (50%) of the issued and outstanding stock of the Company
present in person or represented by proxy and entitled to be voted. Both
abstentions and broker non-votes are counted as present for the purpose of
determining the presence of a quorum for the transaction of the business at
the Meeting. Abstentions also are counted as shares present and entitled to
be voted and have the same effect as a negative vote (except abstentions
have no effect on the election of directors). Broker non-votes, however, are
not considered shares "entitled to vote" and thus have no effect on the
outcome of any matters being voted upon at the Meeting. A "broker non-vote"
occurs when a nominee holding shares for a beneficiary owner (i.e., a
broker) does not vote on a particular proposal because the nominee does not
have discretionary authority to vote on that particular item and has not
received instructions from the beneficial owner.

Q: IS CUMULATIVE VOTING PERMITTED FOR THE ELECTION OF THE DIRECTOR?

A: No. There is no cumulative voting with respect to the election of the
director.

Q: WHO WILL COUNT THE VOTES?

A: The Secretary will tabulate the votes and act as the inspector of election.

Q: WHO WILL BEAR THE COST OF SOLICITING VOTES FOR THE ANNUAL MEETING?

A: The Company is making this solicitation and will pay the entire cost of
preparing, assembling, printing, mailing and distributing these proxy
materials. In addition to the mailing of these proxy materials, the
solicitation of proxies or votes may be made in person or by telephone by
our directors, officers and employees, who will not receive any additional
compensation for such solicitation activities. We will also reimburse
brokerage houses and other custodians, nominees and fiduciaries for their
reasonable out-of-pocket expenses for forwarding proxy and solicitation
materials to stockholders. We may consider retaining a proxy solicitation
firm. In the event that we choose to retain such a firm, we will bear all of
their fees, costs and expenses.

Q: MAY I PROPOSE ACTIONS FOR CONSIDERATION AT NEXT YEAR'S ANNUAL MEETING OF
STOCKHOLDERS OR NOMINATE INDIVIDUALS TO SERVE AS DIRECTORS?

A: You may submit proposals for consideration at future stockholder meetings,
including director nominations. In order for a stockholder proposal to be
considered for inclusion in our proxy statement for next year's annual
meeting, the written proposal must be received by the Company no later than
the 90th day prior to the scheduled date for such meeting or the close of
business on the tenth (10th) day following the day on which public
announcement of the date of such meeting is made by the Company and must
contain the information required by our bylaws. Such proposals also will
need to comply with SEC regulations regarding the inclusion of stockholder
proposals in Company-sponsored proxy materials unless the Company has
terminated its filing obligations and become a private company before such
time. You may contact the Secretary of the Company at our headquarters for a
copy of the relevant bylaw provisions regarding the requirements for making
stockholder proposals and nominating director candidates.

5
<Page>
SUMMARY TERM SHEET FOR REVERSE STOCK SPLIT

The following summary briefly describes the reverse stock split. While this
summary describes what we believe are the most material terms and features of
the reverse stock split, the proxy statement contains a more detailed
description of the terms. We encourage you to read the entire proxy statement
and the documents we have incorporated by reference before voting. We have
included section references to direct you to a more complete description of the
topics described in this summary.

If the reverse stock split is completed, stockholders holding fractional
shares of Common Stock will receive a price per share in cash based upon the
average closing price of Common Stock as quoted on Pink Sheets LLC's electronic
quotation system for "Over the Counter" or "OTC" securities during the ten
business days prior to the effective date of the reverse stock split for each
fractional share of Common Stock but in no event will the amount be less than
$0.01 per share of Common Stock. Stockholders with less than 1,000 shares of
Common Stock before the reverse stock split will be cashed-out and will have no
further equity interest in the Company. The total consideration to be paid as a
result of the reverse stock split is expected to be approximately $41,000.

EFFECTS OF THE REVERSE STOCK SPLIT

As a result of the reverse stock split:

- stockholders who have fewer than 1,000 shares of Common Stock before the
reverse stock split will receive cash in exchange for their shares of
Common Stock and will no longer have any interest in our future earnings
or growth;

- stockholders who have more than 1,000 shares of Common Stock before the
reverse stock split but whose total number of shares is not evenly
divisible by 1,000 will receive cash in lieu of fractional shares;

- the rates at which our outstanding shares of Series A Convertible
Preferred Stock and Junior Non-Voting Convertible Preferred Stock,
Series 1999A may be converted into shares of Common Stock (the current
conversion rate is generally ten (10) shares for one (1) share and one
(1) share for one (1) share, respectively) will be adjusted to reflect the
reverse stock split;

- we will have fewer than 300 registered holders of Common Stock, and
therefore we will be eligible to terminate our obligation to continue
filing periodic reports and proxy statements pursuant to the 1934 Act; and

- our Common Stock should continue to be quoted on the Pink Sheets
electronic quotation service, although there can be no guarantee that
brokers will continue to quote our Common Stock.

Please read "PROPOSAL THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE
COMMON STOCK--Special Factors--Effect of the Proposed Reverse Split on
Stockholders" beginning on page 24 and "PROPOSAL THREE--PROPOSAL TO AMEND THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE
STOCK SPLIT OF THE COMMON STOCK--Special Factors--Effect of the Proposed Reverse
Split on the Company" beginning on page 25.

THE PURPOSE AND BENEFITS OF THE REVERSE STOCK SPLIT

If approved, the reverse stock split will enable the Company to go private
and thus terminate its obligation to file annual and periodic reports and make
other filings with the SEC. The purpose behind the proposal and the benefits of
going private include (i) eliminating the costs associated with filing documents
under the 1934 Act with the SEC and (ii) reducing the direct and indirect costs
of administering stockholder accounts and responding to stockholder requests. In
this regard, we estimate that the

6
<Page>
Company will save approximately $1,450,000 by going private. In addition,
stockholders holding less than 1000 shares will benefit from the reverse stock
split by receiving cash for their shares without having to pay brokerage
commissions and other transaction costs.

DISADVANTAGES OF THE REVERSE STOCK SPLIT

The disadvantages of the reverse stock split are that the Company will lose
its ability to raise capital in the public securities markets, remaining
stockholders will experience reduced liquidity for their shares of Common Stock,
less public information about the Company will be available after the going
private transaction, and stockholders who are cashed out as a result of this
reverse stock split will be unable to participate in any future earnings or
growth of the Company.

BOARD DETERMINATION OF THE FAIRNESS OF THE REVERSE STOCK SPLIT

The Board has determined that the reverse stock split is advisable and in
the best interests of the Company and its stockholders, as well as its
unaffiliated stockholders, and recommends that you approve the reverse stock
split.

The Board believes that in its business judgment the reverse stock split is
substantively fair to all stockholders, as well as unaffiliated stockholders,
notwithstanding the absence of a review by special committee, retention of an
independent representative of unaffiliated stockholders or appraisal by an
independent third party financial advisor. The Board believes that its use of
the Pink Sheets electronic quotation system is a reasonable method of
determining a fair price of the Common Stock for the purpose of cashing out
fractional shares. All stockholders (including those holders with less than 1000
shares whose shares may be cashed-out) and investors generally will have an
opportunity both to evaluate all of the information contained herein and to
compare the potential value of an investment in the Company with that of other
available investments.

The Pink Sheets electronic quotation service is a centralized quotation
service that collects and publishes market maker quotes for "Over the Counter"
or "OTC" securities in real time. It is not a stock exchange or a regulated
entity. Price quotations are provided by OTC market makers. OTC securities are
issued by companies that either choose not to, or are unable to, meet the
standards for listing on a stock exchange such as the NASDAQ National Market
("NASDAQ") or the New York Stock Exchange. Many OTC securities are relatively
illiquid or "thinly traded" which may increase volatility in the share price and
make it difficult to sell an equity position at a later date. There can be no
assurance that the market price of the Company's Common Stock, as reflected in
the Pink Sheets electronic quotation system, reflects a correct or accurate
valuation of the Company's Common Stock. Nonetheless, the Board has determined
that the Pink Sheets quotations represent the most readily available and
reliable determinant of the market price of the Company's Common Stock on any
given day, and that reliance on the Pink Sheets quotations is a reasonable
method of determining a fair price for the purpose of cashing out fractional
shares following the reverse stock split.

7
<Page>
In reaching its determination that the reverse stock split is substantively
fair to all stockholders, as well as unaffiliated stockholders, the Board
considered alternative valuation methods such as net book value, going concern
value and liquidation value. The Board considered these valuation methods less
appropriate in determining the fairness of the reverse split. Notwithstanding
this fact, the Board unanimously concluded that the reverse stock split, as a
whole, is in the best interests of all its stockholders, as well as unaffiliated
stockholders, and that a market based valuation was more appropriate than
reliance on net book value, going concern value or liquidation value in view of
the limited relevance of each of the other valuation alternatives.

The Board believes that the transaction is procedurally fair because, among
other things: (a) the reverse stock split is being effected in accordance with
applicable requirements under Delaware law; (b) the Board elected to submit the
reverse stock split to a vote of Company stockholders and subject it to the
approval of holders of a majority of the votes entitled to be cast on the
matter; (c) the Company's officers and directors as a group do not own of record
or beneficially a sufficient number of shares to assure approval of the reverse
stock split; (d) stockholders of the Company will have an opportunity to adjust
the number of shares of Common Stock each holder owns by purchasing additional
shares (subject to market conditions) to avoid being cashed-out and to continue
as stockholders of the Company; and (e) stockholders can also divide or
otherwise adjust their existing holdings, prior to the effective date of the
reverse split, so as to be cashed-out with respect to some or all of their
shares. After consideration of all the facts, all of the directors, none of whom
are employees of the Company, determined that the proposed reverse stock split
is procedurally fair to all stockholders, as well as unaffiliated stockholders.

REQUIRED VOTE ON THE REVERSE STOCK SPLIT

The Board has elected to make the reverse stock split subject to approval by
the affirmative vote of a majority of the votes entitled to be cast at the
Meeting by holders of Common Stock and Series A Convertible Preferred Stock. Our
officers and directors, as a group, beneficially own an aggregate of 1,358,078
shares of Common Stock and no shares of Series A Convertible Preferred Stock,
which is approximately 2% of the outstanding shares of capital stock of the
Company entitled to vote generally at the Meeting, and have stated that they
intend to vote their shares for the reverse stock split. Other than the intent
of our officers and directors to vote their shares for the reverse stock split,
the Company has not obtained any assurances or agreements from any of its
stockholders as to how they will vote on the reverse stock split.

OTHER TERMS AND FEATURES OF THE REVERSE STOCK SPLIT

If the reverse stock split is effected, the net book value of the shares of
Common Stock held by our officers and directors and holders of over 1,000 shares
of Common Stock is expected to decrease by approximately 4%. In addition, the
percentage beneficial ownership of our officers, directors and holders of over
1,000 shares of our Common Stock is expected to increase following the reverse
stock split by less than 1% of shares outstanding.

Pursuant to Delaware General Corporation Law, there will be no appraisal
rights for dissenting stockholders. Under state escheat laws, any cash for
fractional interests not claimed by the stockholder entitled to it may escheat
to, and be claimed by, various states. See "PROPOSAL THREE--PROPOSAL TO AMEND
THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A
REVERSE STOCK SPLIT OF THE COMMON STOCK--Special Factors--Appraisal Rights;
Escheat Laws" beginning on page 29.

8
<Page>
Generally, for stockholders who have fewer than 1,000 shares of Common Stock
before the reverse stock split, the receipt of cash for fractional shares will
be treated for tax purposes in the same manner as if the shares were sold in the
market for cash. For stockholders who will remain stockholders of the Company
following the reverse stock split, the receipt of shares of new Common Stock
will be treated as a tax-free reorganization and any cash received in lieu of
fractional shares by such stockholders will be treated as "boot" for Federal
income tax purposes. Accordingly, if the fair market value of the boot received
and the new Common Stock exceeds a stockholder's total tax basis in its Common
Stock, the gain will be recognized up to the amount of boot received. Please
read "PROPOSAL THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE COMMON
STOCK--Special Factors--Tax Consequences to Stockholders Who Are Cashed--Out in
the Reverse Split" on page 28 and "PROPOSAL THREE--PROPOSAL TO AMEND THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE
STOCK SPLIT OF THE COMMON STOCK--Special Factors--Tax Consequences to
Stockholders Who Remain Stockholders of the Company on page 28.

If you have more questions about the reverse stock split or would like
additional copies of this proxy statement, you should contact Michael Hartman,
General Counsel and Secretary of the Company at 305-938-3000.

9
<Page>
MARKET FOR THE COMPANY'S COMMON STOCK

Our Common Stock was quoted on NASDAQ under the symbol STRM as of our
initial public offering on May 26, 1999 and ending on January 31, 2002.
Following our announcement of plans to restate our financial statements, the
NASDAQ Listing Qualifications Department determined to halt trading of our
Common Stock on NASDAQ prior to the market opening on November 19, 2001.
Subsequently, de-listing proceedings were commenced due to our failure to
file a report on Form 10-Q for the period ended September 30, 2001, and
effective as of the opening of business on February 1, 2002, our Common Stock
was delisted from NASDAQ. Since the delisting, the Company's shares of Common
Stock have been traded on the OTC securities market. The historical quotations
provided by Pink Sheets LLC with respect to the price per share of the Company's
Common Stock during the first and second quarters of 2002 are limited and the
Company has not collected daily quotations.

The following table sets forth the high and low close prices per share of
the Common Stock as reported on NASDAQ through November 16, 2001, the last date
on which shares of our Common Stock were traded prior to the suspension of
trading. For subsequent periods, the Company has only limited and sporadic daily
information about the price of its Common Stock. As of February 5, 2003, the
last reported sale price on Pink Sheets LLC was $0.0001.

<Table>
<Caption>
HIGH LOW
-------- --------

2001(1)
Fourth Quarter (through November 16, 2001).................. $ 0.37 $ 0.13
Third Quarter............................................... $ 1.84 $ 0.16
Second Quarter.............................................. $ 2.94 $ 1.64
First Quarter............................................... $ 5.19 $ 1.63
</Table>

<Table>
<Caption>
HIGH LOW
-------- --------

2000
Fourth Quarter.............................................. $ 8.47 $ 1.50
Third Quarter............................................... $19.50 $ 6.56
Second Quarter.............................................. $30.50 $14.13
First Quarter............................................... $61.00 $28.63
</Table>

- ------------------------

(1) Source: NASDAQ

10
<Page>
MATTERS TO BE CONSIDERED AT ANNUAL MEETING

PROPOSAL ONE: ELECTION OF DIRECTOR

GENERAL

The Company's Certificate of Incorporation provides for a classified Board
consisting of three classes of directors with staggered three-year terms, with
each class consisting, as nearly as possible, of one-third of the total number
of directors. The Board currently consists of three directors. The class whose
term of office expires at the Annual Meeting currently consists of one director.
The director elected to this class will serve for a term of three years,
expiring at the 2005 annual meeting of stockholders or until a successor has
been duly elected and qualified. The nominee listed below is currently a
director of the Company. If the nominee is elected, the Board will continue to
consist of three directors, with each class consisting of one director.

The nominee for election has agreed to serve if elected, and Company
management has no reason to believe that such nominee will be unavailable to
serve. In the event that the nominee is unable or declines to serve as a
director at the time of the Annual Meeting, the proxies will be voted for any
nominee who may be designated by the present Board to fill the vacancy. Unless
otherwise instructed, the proxy holders will vote the proxies received by them
FOR the nominee named below.

INFORMATION REGARDING NOMINEE FOR TERM ENDING UPON THE 2005 ANNUAL MEETING OF
STOCKHOLDERS

The following information with respect to the principal occupation or
employment, other affiliations and business experience during the last five
years of the nominee has been furnished to the Company by such nominee. Except
as indicated, the nominee has had the same principal occupation for the last
five years.

Susan L. Segal, 49, has been a director of the Company since July 1997 and
has been acting Chairman of the Board since November 2001. Ms. Segal is
currently the Managing Member of Inspiration Partners LLC and a consultant for
J.P. Morgan Partners. Ms. Segal previously served as Partner of J.P. Morgan
Partners from 1996 until June 2002. At that firm, she was the Latin American
Group Head from December 1996 until January 2001. From 1992 to 1996, Ms. Segal
was a Senior Managing Director at Chase Securities Inc. responsible for Emerging
Markets Investment Banking. She has more than 20 years of experience in emerging
markets, particularly Latin America, where her responsibilities have included
trading, capital markets and sovereign debt rescheduling. Ms. Segal is a member
of the Council on Foreign Relations, the Advisory Board of Endeavor and the
Boards of Directors of the Tinker Foundation and the Americas Society.
Ms. Segal received an M.B.A. from Columbia University and a B.A. from Sarah
Lawrence College.

Unless marked to the contrary, any proxies received will be voted FOR the
election of Susan L. Segal as a director to serve until the 2005 annual meeting
of stockholders.

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS A VOTE "FOR" THE ELECTION OF SUSAN L. SEGAL AS DIRECTOR
TO SERVE UNTIL THE 2005 ANNUAL MEETING OF STOCKHOLDERS.

The following information with respect to the principal occupation or
employment, other affiliations and business experience during the last five
years of each director who is not a nominee for election at the Annual Meeting
has been furnished to the Company by such directors.

11
<Page>
INFORMATION REGARDING CONTINUING DIRECTORS FOR TERM ENDING UPON THE 2003 ANNUAL
MEETING OF STOCKHOLDERS

Douglas M. Karp, 47, has been a director of the Company since
September 1998. Mr. Karp has served as the managing partner of Pacific Partners
LLC, a private equity and advisory firm, since August 2000. Prior to joining
Pacific Partners, he was a Managing Director and a member of the Operating
Committee of E.M. Warburg, Pincus & Co., LLC from 1991 to 2000. Prior to joining
Warburg, Pincus, Mr. Karp was a Managing Director of Mergers and Acquisitions at
Salomon Brothers Inc. from 1986 to 1991 and a manager with the Boston Consulting
Group and founder of its New York office. Mr. Karp is a member of the Boards of
Directors of Primus Telecommunications Group and several private companies.
Mr. Karp received a B.A. from Yale University and a J.D. from Harvard Law
School.

INFORMATION REGARDING CONTINUING DIRECTORS FOR TERM ENDING UPON THE 2004 ANNUAL
MEETING OF STOCKHOLDERS

Frederick R. Wilson, 40, has been a director of the Company since
July 1997. Mr. Wilson is currently Managing Partner of Flatiron Partners, a
venture capital firm focused on early-stage, Internet-focused investments, as
well as the Flatiron Fund 1998/99, Flatiron Fund, Flatiron Fund 2000, Flatiron
Associates and is a general partner in F.J. Wilson Partners. Prior to founding
Flatiron Partners in July 1996, Mr. Wilson was associated with Euclid Partners
from 1986 to 1996. Mr. Wilson is a member of the Board of Directors of
TheStreet.com, ITXC Corporation and a number of privately held companies. He
received an M.B.A. from The Wharton School of Business at The University of
Pennsylvania and a S.B. from the Massachusetts Institute of Technology.

COMPENSATION OF DIRECTORS

Directors currently do not receive a stated salary from the Company for
their service as members of the Board of Directors. By resolution of the Board,
they may (but currently do not) receive a fixed sum and reimbursement for
expenses in connection with their attendance at Board and committee meetings. We
currently do not provide additional compensation for committee participation or
special assignments of the Board. In the past, our directors have been granted
options to purchase shares of Common Stock. However, during fiscal years 2001
and 2002, our non-management directors did not receive any grants of options to
purchase shares of Common Stock.

12
<Page>
PROPOSAL TWO: AMENDMENT TO AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO CHANGE THE COMPANY'S NAME TO "CYCLELOGIC, INC."

GENERAL

On July 3, 2002 the Company sold substantially all of the assets associated
with starmedia.com, the Company's Spanish- and Portuguese-language portal, and
LatinRed, the Company's Spanish language online community (the "Media Assets"),
to eresMas Interactive S.A. ("EresMas") for $8,000,000 in cash. As part of the
terms of the sale to EresMas, the Company has agreed to cease using the
"StarMedia" brand commercially and, subject to stockholder approval, to amend
its certificate of incorporation to change its name. Since the sale, the Company
operates commercially under the name "CycleLogic Mobile Solutions."

The Board has adopted resolutions: (i) proposing to amend the Company's
Amended and Restated Certificate of Incorporation to change the Company's name
to "CycleLogic, Inc.," subject to stockholder approval (the "Name Amendment");
(ii) declaring the Name Amendment to be advisable and in the best interests of
the Company and its stockholders and (iii) calling for submission of the Name
Amendment for approval by the Company's stockholders at the Meeting.

PROPOSED AMENDMENT TO AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

The following is the text of Article I of the Company's Amended and Restated
Certificate of Incorporation, as proposed to be amended by the Name Amendment:

"1. The name of the corporation (the "Corporation") is
CycleLogic, Inc."

PURPOSE AND EFFECT OF THE NAME AMENDMENT

The Board believes that it is in the Company's best interest to change the
Company's name for the following reasons:

- Following the sale of the Media Assets to EresMas, the Company no longer
operates any products or services using the StarMedia name.

- The Company's cessation of use of the "StarMedia" name was a condition to
EresMas's agreement to purchase the Media Assets on the terms agreed
between the parties. If the Company had been unwilling to cease using the
StarMedia name, it may have reduced the purchase price that the Company
received for the Media Assets. In addition, under the terms of our
agreement with EresMas, if the Company fails to change its name, EresMas
will have the right to seek indemnification from the Company for damages,
if any, resulting from the Company's continued use of the name "StarMedia
Network, Inc."

- Due in large part to the Company's restatement of its financial statements
for the year ended December 31, 2000 and for the quarters ended March 31,
2000 and June 30, 2000, as well as the Company's failure to make timely
filings of its Report on Form 10-Q for the quarter ended September 30,
2001, Report on Form 10-K for the year ended December 31, 2001, and Report
on Form 10-Q for the quarter ended March 31, 2002, the StarMedia brand
suffered substantial deterioration in value and, in the view of Company
management and the Board, currently has a negative market image.

- Following the sale of the Media Assets and the Company's decision to focus
its resources on its mobile solutions business, Company management and the
Board determined that it was preferable for the Company to operate under a
new name. The Company currently operates under the names "CycleLogic" and
"CycleLogic Mobile Solutions" and is authorized to conduct business under
the name "CycleLogic, Inc." in Delaware, New York and Florida.

13
<Page>
Following stockholder approval of the Name Amendment and the name change
taking effect, the Company's name will be "CycleLogic, Inc."

VOTE NECESSARY TO APPROVE THE AMENDMENT

The affirmative vote of a majority of the votes entitled to be cast at the
Meeting is necessary to approve the Name Amendment.

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE AMENDMENT TO THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO CHANGE THE
COMPANY'S NAME TO "CYCLELOGIC, INC." UNLESS A CONTRARY CHOICE IS SPECIFIED,
PROXIES SOLICITED BY THE BOARD WILL BE VOTED "FOR" APPROVAL OF THE NAME
AMENDMENT.

PROPOSAL THREE: PROPOSAL TO AMEND THE COMPANY'S AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT
OF THE COMMON STOCK

The Board has unanimously adopted resolutions declaring the advisability of,
and submits to the stockholders for approval, an amendment to the Amended and
Restated Certificate of Incorporation (the "Split Amendment") effecting a
reverse stock split of all shares of Common Stock issued as of midnight (Eastern
Time) on the date the Split Amendment is filed with the Delaware Secretary of
State (the "Effective Date"), pursuant to which each 1,000 shares of Common
Stock then issued will be converted into one share of Common Stock (the "Reverse
Split"). In lieu of issuing fractional shares that will result from the Reverse
Split to stockholders of record holding (i) less than 1,000 shares immediately
prior to the Reverse Split or (ii) a number of shares that is not evenly
divisible by 1,000, the Company will make a cash payment based on the average
daily closing price per share of the Common Stock as quoted on Pink Sheets LLC's
electronic quotation system for OTC securities for the ten trading days
immediately preceding the Effective Date, as discussed below. In no event,
however, will a stockholder be paid less than $0.01 per share of Common Stock.

The Effective Date, which will provide the time frame for determining the
amount of the Purchase Price (as defined below), shall in no event occur later
than 30 days following the date of the Annual Meeting. Upon consummation of the
Reverse Split, the conversion rates at which the Company's convertible preferred
stock may be converted into Common Stock will be adjusted in order to reflect
the Reverse Split. These adjustments will be made with respect to each series of
convertible preferred stock that is outstanding in accordance with their
respective certificate(s) of designation defining their rights and preferences.

The filing of the Split Amendment and the consummation of the Reverse Split,
including the making of cash payments to stockholders whose shares of Common
Stock are converted into less than a whole share of Common Stock in the Reverse
Split, are collectively referred to herein as the "Transaction."

14
<Page>
The net effect of the Transaction on the holders of Common Stock and Company
preferred stock will be as follows:

<Table>
<Caption>
STOCKHOLDER AS OF EFFECTIVE DATE NET EFFECT AFTER TRANSACTION
- -------------------------------- ----------------------------

Registered holders of 1,000 or Each 1,000 shares Common Stock held prior to the Reverse
more shares of Common Stock in a Split will be converted into one (1) share of Common Stock.
record account immediately prior For any remaining shares that would otherwise convert into
to the Reverse Split. less than a whole share, the Company will make a cash
payment in lieu of issuing any fractional shares. See
"PROPOSAL THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE
STOCK SPLIT OF THE COMMON STOCK--Special Factors--Cash
Payment in Lieu of Fractional Shares" beginning on page 22.

Registered holders of less than Each share of Common Stock will be cashed-out at a price
1,000 shares of Common Stock in based on the average closing price of the Common Stock
a record account immediately during the ten days prior to the Reverse Split. You will not
prior to the Reverse Split. have to pay any commissions or other fees in connection with
this cash-out. Holders of these shares will not have any
continuing equity interest in the Company. See "PROPOSAL
THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT
OF THE COMMON STOCK--Special Factors--Cash Payment in Lieu
of Fractional Shares" beginning on page 22.

Holders of Junior Non-Voting Under the terms of the Certificate of Designation for the
Convertible Preferred Stock, Company's Junior Non-Voting Convertible Preferred Stock,
Series 1999A Series 1999A, the conversion rate specified for this series
of preferred stock will become 1,000 shares of preferred
stock to one (1) share of Common Stock. (The conversion rate
is currently one (1) share of preferred stock to one (1)
share of Common Stock.)

Holders of Series A Convertible Under the terms of the Certificate of Designation for the
Preferred Stock Company's Series A Convertible Preferred Stock, the
conversion rate specified for this series of preferred stock
will become 100 shares of preferred stock to one (1) share
of Common Stock. (The conversion rate is currently one (1)
share of preferred stock to ten (10) shares of Common
Stock.)
</Table>

ANY HOLDER OF RECORD OF LESS THAN 1,000 SHARES OF COMMON STOCK WHO DESIRES
TO RETAIN AN EQUITY INTEREST IN THE COMPANY AFTER THE EFFECTIVE DATE MAY DO SO
BY PURCHASING, PRIOR TO THE EFFECTIVE DATE, A SUFFICIENT NUMBER OF SHARES OF
COMMON STOCK IN THE OPEN MARKET SUCH THAT THE TOTAL NUMBER OF SHARES HELD OF
RECORD IN HIS NAME IMMEDIATELY PRIOR TO THE REVERSE SPLIT IS EQUAL TO OR GREATER
THAN 1,000. HOWEVER, DUE TO THE LIMITED TRADING MARKET FOR THE COMMON STOCK, IT
IS POSSIBLE THAT A STOCKHOLDER DESIRING TO RETAIN AN EQUITY INTEREST IN THE
COMPANY MAY NOT BE ABLE TO PURCHASE, AT A FAIR PRICE, IF AT ALL, ENOUGH SHARES
TO RETAIN AN EQUITY INTEREST IN THE COMPANY. ANY BENEFICIAL OWNER OF LESS THAN
1,000 SHARES WHO IS NOT A HOLDER OF RECORD AND WHO DESIRES TO HAVE HIS SHARES
EXCHANGED FOR CASH PURSUANT TO THE TRANSACTION SHOULD INSTRUCT HIS BROKER TO

15
<Page>
TRANSFER HIS SHARES INTO HIS NAME IN A TIMELY MANNER SO THAT SUCH BENEFICIAL
OWNER WILL BE DEEMED A HOLDER OF RECORD IMMEDIATELY PRIOR TO THE REVERSE SPLIT.

SPECIAL FACTORS

BACKGROUND OF THE REVERSE SPLIT

As of the January 9, 2003, approximately 294 record holders of Common Stock,
or approximately 66% of the total number of record holders, owned less than
1,000 shares of Common Stock. In addition, such record holders owning less than
1,000 shares own in the aggregate less than 0.1% of the outstanding shares of
Common Stock. Based on the average daily closing price per share of the Common
Stock on Pink Sheets LLC's electronic quotation service for OTC securities for
the ten trading days immediately preceding the Record Date of approximately
$0.0014, ownership of 1,000 shares of Common Stock has a market value of
approximately $1.40. However, the actual amount paid for fractional shares will
be based on the average daily last sales price per share of the Common Stock on
Pink Sheets LLC's electronic quotation service for OTC securities for the ten
days immediately preceding the Effective Date of the Reverse Split, if approved,
but in no event will the amount be less than $0.01 per share of Common Stock.

The Board believes that the disadvantages of remaining a public company
outweigh any advantages. The Company incurs direct and indirect costs associated
with compliance with the SEC's filing and reporting requirements imposed on
public companies. The Company believes these annual costs would amount to
approximately $1,450,000 if the Company were to remain public. In addition, the
Company expects the various costs associated with remaining a public company
will continue to increase in light of new legislation enacted on July 30, 2002,
relating to corporate governance and accounting practices. The Company also
incurs substantial indirect costs as a result of, among other things,
management's time expended in preparing and reviewing such filings. The Board
believes that in light of the Company's business and circumstances, these costs
could have a material adverse effect on the Company's prospects. At the same
time, the Board believes that the Company will not benefit significantly from
remaining public. The Board has no present intention to raise capital through
sales of securities in a public offering in the future or to acquire other
business entities using its stock as the consideration for any such acquisition,
and the Company is therefore unlikely to take advantage of its current status as
a public company for these purposes. In addition, the Company's securities are
not currently listed on a stock exchange such as the NASDAQ that would otherwise
require the Company to continue reporting and filing reports as a public
company, and the Board has no present intention to have the Company listed on a
stock exchange. The Company's shares will continue to qualify for quotation as
an OTC security on the Pink Sheets once the Company is private although there is
no guarantee that the Company will continue to be quoted on the Pink Sheets
electronic quotation system in the future. In light of the foregoing, the Board
believes that it is in the best interests of the Company and its stockholders,
as well as unaffiliated stockholders, to change the status of the Company to a
private company at this time.

The cost of administering each stockholder's account and the amount of time
spent by Company management in responding to stockholder requests is the same
regardless of the number of shares held in the account. Accordingly, the burden
to the Company of maintaining many small accounts is disproportionately high
when compared with the total number of shares involved. Unlike many public
companies, the Company does not have employees assigned to managing investor
relations. Instead, the Company's executive officers respond directly to
stockholder requests, and time spent fulfilling these duties limits the time
that such officers are able to allocate to other aspects of managing the
Company. Therefore, Company management believes that it would be beneficial to
the Company and its stockholders as a whole to eliminate the administrative
burden and cost associated with the approximately 294 record stockholder
accounts containing less than 1,000 shares of Common Stock.

16
<Page>
Since the Company is unable to locate certain of its stockholders with small
holdings, the Board believes it would be unable to acquire the shares of Common
Stock of such stockholders by means of a tender offer in order to realize the
savings described above. Accordingly, if the Company is to acquire these shares,
the Board believes it must do so by means of the Reverse Split.

During July 2002, following the disposition of the Company's
www.starmedia.com Internet portal and other Internet properties, and its
increased focus on the mobile solutions business, members of management and the
Board began to consider and explore all business strategies and alternatives for
the Company and its stockholders going forward. On August 8, 2002, the Board met
in a meeting at which all directors were present and formally discussed for the
first time the possibility of changing the Company's status from a public to a
private company and the various means by which that could be accomplished, which
are described below.

Going private was not the purpose for, nor the motivation behind, the sale
of the Company's internet properties. Rather, the Board's decision to evaluate
the possibility of going private was prompted by its review of the Company's
business plan and its financial state following the sale of its Internet
properties. As part of that analysis, the Board considered the relative
advantages and disadvantages of continuing as a public company to both the
Company and its stockholders, particularly in light of the anticipated costs of
continuing as a public company, which the Board considered would be very
significant as a percentage of projected revenues and expenses following the
sale of the Internet properties. The Board continued to consider the possibility
of going private, and on September 11, 2002, the Board met again, with all
directors being present, and after consultation with its outside legal counsel
and management, determined that the Reverse Split was the most efficient means
to reduce the number of stockholders to permit the Company to go private. The
Board determined based on the number of stockholders with a nominal number of
shares that the reverse stock split ratio of one-for-1000 shares of Common Stock
was the appropriate ratio to ensure a reduction in the number of record holders
to fewer than 300 persons.

Approximately 199,934,000 shares of Common Stock will be authorized but
unissued after the Transaction. The number of shares held by the Company as
treasury shares is expected to be approximately 9,200 shares (on a post-split
basis), based on record ownership of Common Stock as of January 13, 2003. At
this time, the Company has no current specific plans to issue Common Stock other
than pursuant to the 1998 Stock Option Plan and 2000 Stock Incentive Plan or in
connection with any eventual conversions of preferred stock. Nonetheless, the
Board is considering a plan under which the Company would issue options to
Company employees. However, any such issuance would be in accordance with and
subject to the 1998 Stock Option Plan and the 2000 Stock Incentive Plan. See
"EXECUTIVE OFFICERS AND COMPENSATION--Security Ownership of Certain Beneficial
Owners and Management" beginning on page 42.

The Board believes that the decrease in outstanding shares of Common Stock
as a result of the Transaction is in the best interests of the Company and its
stockholders, and that the high number of outstanding shares of Common Stock and
the low trading price thereof impairs the acceptability of the Common Stock by
the financial community and the investing public. The Company believes that the
Split Amendment, by reducing the number of outstanding shares of Common Stock,
should increase the per share market price accordingly. It is possible, however,
that any increase in per share market price may be proportionately less than the
decrease in the number of outstanding shares.

RECOMMENDATION OF THE BOARD; FAIRNESS OF THE TRANSACTION

The Board believes that the Transaction, taken as a whole, is fair to, and
in the best interests of the Company and its stockholders, as well as
unaffiliated stockholders, as discussed below, regardless of whether a
stockholder receives cash in lieu of fractional shares, shares of new Common
Stock, or both cash and shares of new Common Stock. The Board also believes that
the process for approving the Transaction is procedurally fair. The Board
recommends that stockholders vote for approval and adoption of the Split

17
<Page>
Amendment. Each Board member and each Company officer who owns shares of Company
stock has advised the Company that he/she intends to vote those shares in favor
of the Split Amendment.

The Board has retained for itself the absolute authority to reject (and not
implement) the Split Amendment (even after approval thereof) if it determines
subsequently that the Split Amendment is not then in the best interests of the
Company and its stockholders. If for any reason the Split Amendment is not
approved, or, if approved, is not implemented, the Common Stock will not be
deregistered until such time as the Company otherwise is eligible to do so.

The Board considered a number of factors in determining whether it was in
the best interests of the Company and its stockholders to undertake a
transaction to reduce the number of stockholders to fewer than 300 record
holders in order to terminate the registration of its Common Stock under the
1934 Act. The Board reviewed and discussed the cost savings to be achieved by
terminating the registration of the Common Stock, and the anticipated effect of
such savings on the Company's total expenses and future prospects. The Board
also considered the time and effort currently required of Company management in
complying with the reporting and other requirements associated with continued
registration of the Common Stock under the 1934 Act. The Board considered the
effect that terminating the registration of the Common Stock might have on the
market for the Common Stock and the ability of stockholders to buy and sell
shares. The Board determined that the cost savings and reduced burden on Company
management that could be achieved by terminating registration of the Common
Stock under the 1934 Act outweighed any potential detriment from deregistration.

The Board considered several alternative transactions to accomplish the
reduction in the number of stockholders to fewer than 300 record holders and
ultimately determined that the Split Amendment is the preferred method. Company
management conducted an analysis of the Company and in doing so considered the
following alternative strategies:

(a) A cash tender offer, but the Board believes that it would not result
in the purchase of a sufficient number of shares to reduce the number of
holders to accomplish the going private objectives because many stockholders
with a small number of shares would not make the effort to tender their
shares and the cost of completing the tender offer could be significant in
relation to the value of the shares sought to be purchased; and

(b) A purchase of shares in the open market, but the established trading
market for the Common Stock is characterized by relatively low volume and
limited participation (as compared to a stock exchange such as the NASDAQ),
and thus it is highly unlikely the Company could acquire shares from a
sufficient number of holders to accomplish the Board's objectives.

The Board has determined that the Reverse Split proposal is the most
expeditious and economical way of changing the Company's status from that of a
reporting company to that of a private, non-reporting company. In addition to
the matters discussed above, the Board considered the opportunity presented by
the Transaction to provide stockholders of record owning fewer than 1,000 shares
immediate liquidity for their holdings without incurring brokerage costs,
particularly in light of the relatively illiquid market for shares of the Common
Stock. The Company has not sought, and has not received, any proposals from any
unaffiliated persons for the merger or consolidation of the Company, or for the
sale or other transfer of all or any substantial portion of the Company's
current assets, or for securities of the Company that would enable the holder
thereof to exercise control of the Company. See "PROPOSAL THREE--PROPOSAL TO
AMEND THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT
A REVERSE STOCK SPLIT OF THE COMMON STOCK--Special Factors--Background of the
Reverse Split" on page 16.

The Company did not obtain an independent fairness opinion in connection
with the proposed Reverse Split, and no independent committee of the Board
reviewed the fairness of the Transaction. No unaffiliated representative was
retained to act on behalf of the unaffiliated stockholders for the purpose of

18
<Page>
negotiating the terms of the Transaction or to prepare a report addressing the
fairness of the Transaction by the Company or by a majority of directors who are
not employees of the Company. The Company did not obtain any report, opinion or
appraisal from an outside party relating to the consideration or the fairness of
the consideration to be paid to stockholders holding fewer than 1,000 shares of
Common Stock of record in any one account or the fairness of the Transaction to
the Company and its remaining stockholders. The Board determined that the cost
of obtaining a fairness opinion would be prohibitively high given the small
number of shares involved in the Transaction and the low price at which the
Common Stock currently trades. While the Board was generally aware of the
historical prices for the Company's stock, it did not deem such prices
particularly relevant in reaching its fairness determination because: (i) there
have been significant changes in the overall securities markets and valuations
for securities of companies in the same industry as the Company; (ii) the
Company's historical stock prices reflect market valuations at a time before the
Company sold its internet assets; and (iii) the Board's reasonable belief that
the market prices for the Company's stock are not likely to return to their
former levels at any time in the near future. The Transaction is expected to
result in the cash-out of approximately 4,100,000 shares of Common Stock (on a
pre-Split basis) at the Purchase Price (currently estimated to be $0.01 per
share), for a total purchase price approximating $41,000.

The Board believes that in its business judgment the Transaction is
substantively fair to all stockholders, as well as unaffiliated stockholders,
notwithstanding the absence of a review by special committee, retention of a
representative of stockholders or third party appraisal. Present stockholders
(including those whose shares are expected to be cashed-out) and investors
generally will have an opportunity both to evaluate all of the information
contained herein and to compare the potential value of an investment in the
Company with that of other available investments.

In addition to the alternative transactions that the Board considered, as
described above, the Board also considered alternative methods for valuing our
Common Stock and in reaching its determination that the Transaction is
substantively fair to all our stockholders, as well as unaffiliated
stockholders, that might either own fewer than 1000 shares of Common Stock or
unaffiliated stockholders that will continue to hold an equity interest in the
Company after the Transaction.

As part of its evaluation, the Board focused on, among other things, the
fairness of the Transaction to unaffiliated holders of fewer than 1,000 shares
of Common Stock who will receive a price per share in cash in lieu of fractional
shares based upon the average of the closing price of Common Stock as quoted on
Pink Sheets LLC's electronic quotation system for the ten business days prior to
the Effective Date of the Reverse Split. In no event, however, will the amount
be less than $0.01 per share of Common Stock. Although the Board considered its
use of prevailing market price and Pink Sheets quotations as the most
appropriate measure of value for the fractional shares, it recognized that the
Common Stock is thinly traded, has a limited number of market makers, and is in
a market with which investors are generally less familiar, as opposed to a
national exchange such as the NYSE and NASDAQ, all of which may affect the price
of shares traded in this market.

In determining to rely on prevailing market price as the measure of value
for cashing out fractional shares, the Board considered that the weighted
average sale price of $0.008 per share reported by Pink Sheets LLC's electronic
quotation service for our Common Stock during the months of August and
September 2002 ("Current Market Price") reflected a substantial premium to our
net book value of approximately -$0.34 per share at September 30, 2002. The
Board acknowledges that there is a significant risk that the Company will not
continue as a going concern. Accordingly, the Board determined that any effort
to apply this traditional valuation method, which assumes that the Company will
continue as a going concern, would be inappropriate under current circumstances.
In addition, the absence of any contemporary earnings history also makes any
alternative valuation for cashing out fractional shares equally inappropriate in
the Board's view.

19
<Page>
The Board also considered using liquidation value as an alternative measure
of value per share in connection with cashing out fractional shares. As of
September 30, 2002, the Company's primary assets had a book value of
approximately -$24,190,000 and the Company estimates that their fair market
value could be less than their book value. The Company has never reported
profits and faces significant financial and other obstacles that must be
overcome in order for us to become profitable. An orderly liquidation of the
Company over a reasonable period of time would require that a significant
portion of the value of our assets be allocated to paying liabilities of the
Company and liquidation expenses. Any remaining assets would be distributed to
holders of common and preferred shares. Under the terms of the Company's
Series A Convertible Preferred Stock, holders of this class of preferred stock
have a liquidation preference that would require that they receive $25.50 per
share plus accrued and unpaid dividends before any distribution may be made to
holders of Common Stock. As of September 30, 2002, the aggregate amount of
assets required to satisfy this liquidation preference was approximately
$39 million. Because this amount clearly exceeds the estimated proceeds of an
orderly liquidation, the Board determined that the liquidation value of Common
Stock was $0.00 per share, and that it was more favorable to cash-out fractional
shares at a price determined based on prevailing market prices.

In reaching its determination on the substantive fairness of the
Transaction, the Board did not assign any specific weights to the foregoing
alternatives. On the cumulative import of the alternatives, the Board
unanimously concluded that the Transaction as a whole is in the best interests
of the Company and is fair to all its stockholders, as well as unaffiliated
stockholders, from a substantive point of view. In selecting a valuation method
for the cash-out of fractional shares, the Board concluded that a market based
valuation was more appropriate than reliance on net book value, going concern
value or liquidation value in view of the limited relevance of each alternative.

The Board did not appoint an independent committee, engage an independent
representative or retain an investment bank or other financial adviser to
represent the interests of unaffiliated stockholders of our Common Stock in
connection with the Transaction. The Board considered several alternative
transaction structures, as described above, to accomplish a reduction in the
number of our record holders to fewer than 300 but unanimously opted for the
Reverse Split as the simplest and least expensive approach. The Board considered
but rejected a structure requiring approval not only from holders of a majority
of our outstanding shares but also from a majority of unaffiliated stockholders.
However, the Board considered the fact that the number of shares held by
affiliated stockholders was not sufficient to approve this transaction.

Despite the absence of an independent committee, representative or third
party appraisal and the lack of a separate voting requirement for approval from
unaffiliated stockholders, the Board believes that the Transaction is
procedurally fair to unaffiliated stockholders because, among other things:

- The Reverse Split is being effected in accordance with all applicable
requirements of Delaware law and our organizational documents.

- The Board elected to submit the Transaction to a vote of Company
stockholders and subject it to the approval of a majority of the votes
entitled to be cast on the matter in order to consummate the Reverse
Split, recognizing that record stockholders cashed out in the Transaction
hold a nominal percentage of the vote.

- Our officers, directors and affiliated stockholders as a group do not own
a sufficient number of shares to assure approval of the Transaction.

- Other than the expressed intent of our officers and directors to vote
their shares of Common Stock for the Split Amendment, the Company has not
obtained any prior assurances from any of its stockholders regarding the
vote on the Split Amendment.

- Between the date of this proxy statement and the effective date of the
Reverse Split, all of our stockholders will have an opportunity to adjust
the number of shares of Common Stock they will

20
<Page>
own as of the Effective Date. In this way, holders who would otherwise be
cashed out can become continuing holders and holders of more than 1,000
shares can divide or otherwise adjust their holdings into amounts evenly
divisible by 1,000.

- The approximately 4% decrease in the net book value per share that
remaining unaffiliated stockholders may encounter and the reduction in
available information about the Company will be offset by the
approximately 4% increase in beneficial ownership that may be experienced
by remaining unaffiliated stockholders.

The Board also took into consideration the following additional factors:

- Although holders of shares that are cashed out in lieu of issuance of
fractional shares will receive cash consideration for their shares, the
remaining stockholders will bear the burden of the expenses of the
Transaction, reduced liquidity and greater uncertainty regarding the price
they may receive for their shares in the event they attempt to liquidate
their investment of Common Stock.

- As of the Effective Date, stockholders who own fewer than 1,000 shares of
Common Stock are expected to account for less than 4% of our outstanding
capital stock.

After consideration of all the facts, all of the directors, none of whom are
employees of the Company, determined that the proposed Split Amendment, taken as
a whole, is fair to, and in the best interests of the Company and its
stockholders, as well as unaffiliated stockholders.

Although stockholders who are not cashed out in the Transaction will
indirectly bear the transaction costs associated with taking the Company
private, the Board believes that such expenses will be offset by the anticipated
savings of approximately $1,450,000 on an annual basis once the Company is
private. None of the directors is expected to adjust his/her holdings so as to
become a cashed-out stockholder, but the Board believes, in making their
decision to base the Purchase Price on the ten day average trading price and
being aware that the Transaction will affect both continuing stockholders as
well as stockholders who are cashed-out, that it acted in accordance with its
fiduciary duties to the Company and its stockholders.

The Board believes that the disadvantages of remaining a public company
outweigh any advantages. The Board has no present intention to raise capital
through sales of securities in a public offering in the future or to acquire
other business entities using stock as the consideration for any such
acquisition. Accordingly, the Company is not likely to take advantage of its
current status as a public company to raise capital. Nonetheless, as a private
company, the Company may still use Common Stock or Company preferred stock to
raise additional capital in private placements or otherwise facilitate
acquisitions.

PURPOSE OF THE SPLIT AMENDMENT

The purpose of the Reverse Split is to cash-out the equity interests in the
Company of each of the approximately 294 record holders of Common Stock that, as
of the Effective Date, own fewer than 1,000 shares of Common Stock in any
discrete account at a price determined to be fair by the entire Board in order
(i) to eliminate the cost of maintaining small stockholder accounts, (ii) to
permit small stockholders to receive cash for their shares without having to pay
brokerage commissions or other fees and (iii) to reduce the number of
stockholders of record of the Company to fewer than 300 persons in order to
relieve the Company of the administrative burden and cost and competitive
disadvantages associated with filing reports and otherwise complying with the
requirements under the 1934 Act, by deregistering its Common Stock under the
1934 Act. If the Split Amendment is approved and implemented, the officers and
directors of the Company who own more than 1,000 shares of Common Stock may
benefit by an approximately 6% increase in their percentage beneficial ownership
of Common Stock while incurring an approximately 6% decrease in the net book
value of their holdings per share. However, following the deregistration of the
Common Stock under the 1934 Act, there will be limited public information
concerning the Company. The Transaction will provide those registered
stockholders with fewer than 1,000 shares of Common Stock with a cost-effective
way to cash-out their investments in the Company, because the Company will pay
all transaction costs in connection with the Reverse Split. Moreover, the
Company will benefit from substantial cost savings (as described below) as a
result of the Transaction.

21
<Page>
The Company incurs direct and indirect costs associated with compliance with
the SEC's filing and reporting requirements imposed on public companies. The
Company also incurs substantial indirect costs as a result of, among other
things, management's time expended in preparing and reviewing such filings.
Since the Company has relatively few executive personnel, these indirect costs
can be substantial. Based on the Company's experience in prior years, the direct
annual costs resulting from the Company being a public company are estimated as
follows:

<Table>

Independent Auditors........................................ $ 220,000
SEC Counsel................................................. $ 360,000
Transfer Agent, Printing and Mailing........................ $ 100,000
Insurance................................................... $ 720,000
Other....................................................... $ 50,000
----------
Total..................................................... $1,450,000
==========
</Table>

Estimates of the annual savings expected to be realized if the Split
Amendment is implemented are based upon (i) the actual costs to the Company of
the services and disbursements in each of the above categories that were
reflected in its recent historical financial statements and (ii) the allocation
to each category of its management's estimates of the portion of the expenses
and disbursements in such category believed to be solely or primarily
attributable to the Company's public reporting company status. In some
instances, Company management's estimates were based on information provided or
upon verifiable assumptions. For example, its auditors have informed the
Company, informally, that there will be a reduction in auditing fees if the
Company ceased to be public, and further, there will be no need for SEC counsel
if the Company no longer files reports with the SEC. Other estimates were more
subjective (E.G., the savings in transfer agent's fees that could be expected
because of the 60% plus reduction in the number of accounts to be handled by the
transfer agent, the lower printing and mailing costs attributable to such
reduction and the less complicated disclosure required by the Company's private
status, the need for fewer directors' meetings (and the consequent reduction in
associated expenses), and the reduction in direct miscellaneous clerical and
other expenses (E.G., the word processing, edgarizing, telephone and fax charges
associated with SEC filings) and the elimination of the charges imposed by
brokers and banks to forward materials to beneficial holders).

The estimates set forth above are just that-estimates, and the actual
savings to be realized may be higher or lower than estimated above. The Company
expects that if it becomes private before its Report on Form 10-K for the year
ended December 31, 2002 is otherwise due, then it will not be required to file
such report and as a result a portion of the estimated savings could be realized
in the current fiscal year due to reductions in audit and legal fees associated
with the preparation of the Report. In addition, the Company expects the various
costs associated with remaining a public company will continue to increase in
light of new legislation enacted on July 30, 2002 relating to corporate
governance and accounting practices. Based on the Company's size and resources,
the Board does not believe the costs associated with remaining a public company
are justified. In light of these disproportionate costs, the Board believes that
it is in the best interests of the Company and its stockholders, as well as
unaffiliated stockholders, to eliminate the administrative burden and costs
associated with these small record accounts.

CASH PAYMENT IN LIEU OF FRACTIONAL SHARES

In lieu of issuing the fraction of a share of Common Stock that will result
from the Reverse Split to each holder of record holding (i) less than 1,000
shares or (ii) a number of shares that is not evenly divisible by 1,000, the
Company will value each outstanding share of Common Stock held at the close of
business on the Effective Date at the average daily last sales price per share
of the Common Stock on Pink Sheets LLC's electronic quotation service for OTC
securities for the ten trading days immediately preceding the Effective Date
(the "Purchase Price"), but in no event will the amount be less than $0.01 per

22
<Page>
share of Common Stock. As of the Record Date, the last reported sales price of
the Common Stock was $0.0001. However, since the Effective Date is later than
the date of the Annual Meeting, the Purchase Price received for the Common Stock
may be less than the price of the Common Stock at the time of the Annual
Meeting, but in no event will the amount be less than $0.01 per share of Common
Stock. The Effective Date will not be later than 30 days following the date of
the Annual Meeting, although the Effective Date may be less than 30 days
following the date of the Annual Meeting.

The Pink Sheets electronic quotation service is a centralized quotation
service that collects and publishes market maker quotes for OTC securities in
real time. It is not a stock exchange or a regulated entity. Price quotations
are provided by OTC market makers. OTC securities are issued by companies that
either choose not to, or are unable to, meet the standards for listing on a
stock exchange such as NASDAQ or the NYSE. Many OTC securities are relatively
illiquid or "thinly traded" which may increase volatility in the share price and
make it difficult to sell an equity position at a later date. There can be no
assurance that the market price of the Company's Common Stock, as reflected in
the Pink Sheets electronic quotation system reflects a correct or accurate
valuation of the Company's Common Stock. Notwithstanding the foregoing, the
Board has determined that the Pink Sheets quotations represent the most readily
available and reliable determinant of the market price of the Company's Common
Stock on any given day, and that reliance on the Pink Sheets is a reasonable
method of determining a fair price for the purpose of cashing out fractional
shares following the reverse stock split. Although the Board considers its use
of the prevailing market price as reported on the Pink Sheets electronic
quotation service as the most appropriate measure of value for the fractional
shares, it recognized that the Common Stock is thinly traded with a limited
number of market makers. Nonetheless, the Board also took into consideration
that stockholders will have an opportunity to purchase additional shares at a
relatively low cost, subject to existing market conditions, in order to avoid
being cashed-out at the Purchase Price.

The Board has retained for itself the absolute authority to reject (and not
implement) the Split Amendment (even after approval thereof) if it determines
subsequently that the Split Amendment is not then in the best interests of the
Company and its stockholders. If the Purchase Price increases significantly, the
Board may determine that the Transaction is no longer in the best interests of
the Company and its stockholders and may elect not to file the Split Amendment
with the Delaware Secretary of State and not to proceed with the Transaction.

If the Transaction occurs, each stockholder of record holding less than
1,000 shares of Common Stock immediately prior to the Reverse Split will be
entitled to receive, in lieu of the fraction of a share resulting from the
Reverse Split, cash in the amount of the Purchase Price multiplied by the number
of shares of Common Stock held by such stockholder immediately prior to the
Reverse Split. Each stockholder of record holding more than 1,000 shares of
Common Stock immediately prior to the Reverse Split will be entitled to receive
(if applicable), in lieu of any fraction of a share resulting from the Reverse
Split, cash in the amount of the Purchase Price multiplied by the fraction of a
share of Common Stock that would otherwise be issuable to such stockholder after
giving effect to the Reverse Split. All amounts payable to stockholders will be
subject to applicable state laws relating to abandoned property. No service
charges or brokerage commissions will be payable by stockholders in connection
with the Transaction. The Company will not pay interest on cash sums due to any
stockholder pursuant to the Transaction.

Promptly following the consummation of the Reverse Split on the Effective
Date, the Company will mail a letter of transmittal to each stockholder of
record. The letter of transmittal will contain instructions for the surrender of
Common Stock certificates to the Company's exchange agent in exchange for, as
applicable, new stock certificates and a cash payment in lieu of the fractional
share into which each such holder's shares of Common Stock were converted in the
Reverse Split. No cash payment will be made to any such stockholder until he has
surrendered his outstanding certificate(s), together with the letter of
transmittal, to the Company's exchange agent. No interest will be paid on the
cash payment for fractional shares. No appraisal rights are available under the
Delaware General Corporation Law, the Company's By-laws or its Charter to any
stockholders who dissent from the proposed Transaction. See "PROPOSAL

23
<Page>
THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE COMMON STOCK--Special
Factors--Appraisal Rights; Escheat Laws" at page 29.

SOURCE OF FUNDS AND FINANCIAL EFFECT OF THE TRANSACTION

The Transaction and the use of approximately $200,000 cash to complete the
Reverse Split, which includes professional fees and other expenses related to
the Transaction and payments to be made in lieu of issuing fractional shares,
are not expected to have a material adverse effect on the Company's
capitalization, liquidity, results of operations or cash flow. Because the
actual number of fractional shares which will be purchased by the Company and
the price to be paid in lieu of fractional shares are unknown at this time, the
total cash to be paid for fractional shares is unknown, but is estimated to be
approximately $41,000.

The Company expects to use funds from its current working capital to cover
the costs of the Transaction.

Based on the Company's estimates and its current working capital position,
the Transaction is not expected to have a material adverse effect on the
Company's financial position.

EFFECT OF THE PROPOSED REVERSE SPLIT ON STOCKHOLDERS

Upon consummation of the Reverse Split at midnight (Eastern Time) on the
Effective Date, each stockholder of record holding less than 1,000 shares of
Common Stock immediately prior to the Reverse Split will have only the right to
receive cash based upon the Purchase Price in lieu of receiving a fractional
share resulting from the Reverse Split. The equity interest of each such
stockholder in the Company will be terminated, and each such stockholder will
have no further right to vote as a stockholder or share in the Company's assets,
earnings, or profits following the Reverse Split. It will not be possible for
cashed-out stockholders to re-acquire an equity interest in the Company unless
they purchase an interest from a remaining stockholder following the Reverse
Split.

Upon consummation of the Reverse Split at midnight (Eastern Time) on the
Effective Date, each stockholder of record holding 1,000 or more shares of
Common Stock immediately prior to the Reverse Split will continue as a
stockholder with respect to the share or shares of Common Stock resulting from
the Reverse Split. Each such stockholder will continue to share in the Company's
assets, earnings or profits, if any, to the extent of their respective ownership
of Common Stock following the Transaction.

For stockholders of record who hold 1,000 or more shares of Common Stock
immediately prior to the Reverse Split, the net effect of the Transaction will
be a one-for-1,000 reverse split of the Common Stock. Except for the payment of
cash in lieu of fractional shares to holders of shares holding greater than
1,000 shares, after the Transaction such stockholders will hold 1/1000 as many
shares of Common Stock as such stockholders held immediately prior to the
Reverse Split. In addition, excluding the reduction in outstanding shares of
Common Stock due to the payment of cash for all fractional shares resulting from
the Reverse Split, the Board has no plans to further decrease the total number
of outstanding shares of Common Stock.

If the Reverse Split is effected, the Company intends to promptly terminate
the registration of its Common Stock under the 1934 Act. As a result of such
termination, the Company will no longer be subject to the periodic reporting
requirements and the proxy rules of the 1934 Act. Potential detriments to those
remaining Company stockholders if the Reverse Split is effected include
substantially less access to information about the Company and decreased
liquidity.

As a result of the Reverse Split, it is expected that (a) the percentage of
beneficial ownership of Common Stock of the Company held by officers and
directors of the Company as a group will remain

24
<Page>
substantially the same at approximately 2%, and (b) the collective book value of
the shares of Common Stock held by officers and directors as a group will remain
substantially the same at approximately 2%.

EFFECT OF THE PROPOSED REVERSE SPLIT ON OPTION HOLDERS

The number of shares underlying each outstanding stock option will be
decreased by a factor of 1,000 and the exercise price of each outstanding stock
option will be increased by a factor of 1,000 as a result of the Reverse Split.
When existing options are exercised, any fractional shares of Common Stock that
may result from the Reverse Split will not be issued, rather, we will pay the
optionee cash for any fractional shares as described above in "PROPOSAL
THREE--PROPOSAL TO AMEND THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE COMMON STOCK--Special
Factors--Cash Payment in Lieu of Fractional Shares" at page 22.

EFFECT OF THE PROPOSED REVERSE SPLIT ON THE COMPANY

The Amended and Restated Certificate of Incorporation currently authorizes
the issuance of 200,000,000 shares of Common Stock and 10,000,000 shares of
Company preferred stock, for an aggregate of 210,000,000 shares. As of the
Record Date, the number of outstanding shares of Common Stock was 71,041,277 and
the number of outstanding shares of preferred stock was 1,431,373 Series A
Convertible Preferred Shares and 58,140 Junior Non-Voting Convertible Preferred,
Series 1999A. Based upon the Company's best estimates, if the Transaction had
been consummated as of the Record Date, the number of outstanding shares of
Common Stock would have been reduced from 71,041,277 to approximately 65,787 or
by approximately 70,975,490 shares, and the number of holders of record of
Common Stock would have been reduced from approximately 446 to approximately
152, or by approximately 294 stockholders.

The Common Stock is currently registered under Section 12(g) of the 1934 Act
and, as a result, the Company is subject to the periodic reporting and other
requirements of the 1934 Act. As a result of the Transaction, the Company will
have less than 300 holders of record of Common Stock, and will be eligible to
terminate its obligation to continue filing periodic reports under the 1934 Act.
As soon as possible after the Reverse Split, the Company will file for
deregistration of the Common Stock under the 1934 Act and will become a
"private" company. In connection with the proposed Transaction, the Company has
filed a Rule 13e-3 Transaction Statement on Schedule 13E-3 (the
"Schedule 13E-3") with the SEC which incorporates by reference the information
contained in this proxy statement.

Based on the aggregate number of shares owned by holders of record of less
than 1,000 shares as of the Record Date and the average daily closing price per
share of the Common Stock on Pink Sheets LLC's electronic quotation service for
OTC securities for the ten trading days immediately preceding the Record Date,
the Company estimates that payments of cash in lieu of the issuance of
fractional shares to persons who held less than 1,000 shares of Common Stock and
a number of shares not evenly divisible into 1,000 immediately prior to the
Reverse Split will total approximately $41,000 in the aggregate (based on
4,100,00 shares multiplied by an assumed Purchase Price of $0.01 per share).

The par value of the Common Stock will remain at $.001 per share, and the
number of authorized shares of Common Stock will continue to be 200,000,000
following consummation of the Transaction. After the consummation of the
Transaction, the outstanding shares will represent less than 1% of the total
authorized shares of Common Stock. The Company has no current plans,
arrangements or understandings to issue any Common Stock.

CONDUCT OF THE COMPANY'S BUSINESS AFTER THE TRANSACTION

Following the sale of the Media Assets in July 2002, the Company has focused
its resources on its "mobile solutions business" or "mobile Internet solutions"
business. The Company is now principally engaged in providing mobile Internet
software and application solutions to wireless telephone operators

25
<Page>
targeting Spanish and Portuguese speaking audiences. The Company's mobile
Internet solutions allow users to access and receive Internet content, tools and
applications through wireless devices, such as pagers, cellular phones, PCS
handsets and personal digital assistants, or PDAs.

The Company expects its business and operations to continue as they are
currently being conducted and, except as disclosed below, the Transaction is not
anticipated to have any effect upon the conduct of its business. If the
Transaction is consummated, all stockholders of record holding fewer than 1,000
shares at the Effective Date of the Reverse Split will no longer have any equity
interest in, and will not be stockholders of, the Company and therefore will not
participate in its future potential or earnings and growth. Instead, each such
owner of Common Stock will have the right to receive, upon surrender of his
stock certificate, the Purchase Price per share in cash, without interest.

If the Transaction is effected, the Company believes that, based on the
Company's stockholder records, approximately 152 stockholders of record will
remain. In addition, individuals who are members of the Board and of Company
management now owning approximately 1.9% of the Common Stock will own
approximately 2.0% of the Common Stock after the Transaction. See "EXECUTIVE
OFFICERS AND COMPENSATION--Security Ownership of Certain Beneficial Owners and
Management" at page 42.

The Company expects, as a result of the Reverse Split, to become a privately
held company. The registration of the Common Stock under the 1934 Act will be
terminated. In addition, because the Common Stock will no longer be publicly
held, the Company will be relieved of the periodic reporting obligations and the
requirement to comply with the proxy rules of Regulation 14A under Section 14 of
the 1934 Act, its officers and directors and stockholders owning more than 10%
of the Common Stock will be relieved of certain reporting obligations and short
swing trading profits restrictions under Section 16 of the 1934 Act and will not
be required to comply with the "going private" disclosure requirements of
Rule 13e-3 of the 1934 Act.

Other than as described in this proxy statement, neither the Company nor its
management has any current plans or proposals to effect any extraordinary
corporate transaction; such as a merger, reorganization or liquidation; to sell
or transfer any material amount of its assets; to change its Board or
management; to change materially its indebtedness or capitalization; or
otherwise effect any material change in its corporate structure of business.
However, the Company may engage in such a transaction in the future to the
extent that management and the Board determines it to be in the interest of the
Company and its stockholders.

EXCHANGE OF STOCK CERTIFICATES

Promptly following the consummation of the Reverse Split on the Effective
Date, the Company will send letters of transmittal to all stockholders of
record. The letter of transmittal is for use in transmitting Common Stock
certificates to the Company's designated exchange agent. Upon proper completion
and execution of a letter of transmittal and return thereof to the exchange
agent, together with certificates, each such stockholder will receive a new
stock certificate and cash in the amount to which the holder is entitled, as
described above, in lieu of any fractional share into which such stockholder's
shares were converted in the Reverse Split. After the Reverse Split and until
surrendered, each outstanding certificate held by a stockholder of record who
held less than 1,000 shares immediately prior to the Reverse Split will be
deemed for all purposes to represent only the right to receive the amount of
cash to which the holder is entitled pursuant to the Transaction. In the event
that the Company is unable to locate these small holders, funds otherwise
payable to such holders pursuant to the Transaction will be held until proper
claim therefore is made, subject to applicable escheat laws.

In connection with the Transaction, the Common Stock will be identified by a
new CUSIP number, which will appear on all certificates representing shares of
Common Stock issued after the Effective Date. After the Effective Date, each
certificate representing shares of Common Stock that was outstanding prior to
the Effective Date and that was held by a stockholder of record of 1,000 or more
shares immediately

26
<Page>
prior to the Reverse Split, until surrendered and exchanged for a new
certificate, will be deemed for all corporate purposes to evidence ownership of
such number of shares as is set forth on the face of the certificate divided by
1,000, rounded down to the next whole number, with the stockholder entitled to
receive cash in lieu of any fractional share resulting from the Transaction. Any
stockholder desiring to receive a new certificate bearing the new CUSIP number
can do so at any time in accordance with instructions set forth in the
transmittal letter or otherwise by contacting the exchange agent as set forth in
the transmittal letter for surrendering his old certificates. After the
Effective Date, an old certificate presented to the exchange agent in settlement
of a trade will be exchanged for a new certificate bearing the new CUSIP number.

All amounts payable to stockholders will be subject to applicable state laws
relating to abandoned property. No service charges or brokerage commissions will
be payable by stockholders in connection with the Transaction. No interest will
be paid on the cash due to a holder of a fractional share of Common Stock
following the Reverse Split. See "PROPOSAL THREE--PROPOSAL TO AMEND THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE
STOCK SPLIT OF THE COMMON STOCK--Special Factors--Cash Payment in Lieu of
Fractional Shares" at page 22.

PROPOSED LANGUAGE AMENDING THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION

The following is the text of a new Paragraph D in Article IV of the
Company's Amended and Restated Certificate of Incorporation, as proposed to be
amended by the Split Amendment:

"D. REVERSE STOCK SPLIT. Effective at midnight (Eastern Time) on
, 2003 each 1,000 shares of Common Stock of the Company then
issued will be converted into one share of Common Stock (the "Reverse
Split"). If immediately prior to the Reverse Split a stockholder holds less
than 1,000 shares or a number of shares that is not evenly divisible by
1,000, then the Company will make a cash payment equal to $ per
share (the "Purchase Price") for each fractional share following the Reverse
Split. Upon consummation of the Reverse Split,

(i) each stockholder of record holding less than 1,000 shares of
Common Stock immediately prior to the Reverse Split will have only the
right to receive cash based upon the Purchase Price and the equity
interest of each such stockholder in the Company will be terminated and
shall no longer confer on such stockholder any further right to vote as a
stockholder or share in the Company's assets, earnings, or profits
following the Reverse Split; and

(ii) each stockholder of record holding 1,000 or more shares of
Common Stock immediately prior to the Reverse Split will continue as a
stockholder with respect to the share or shares of Common Stock resulting
from the Reverse Split.

Upon consummation of the Reverse Split, the conversion rates at which
the Company's convertible preferred stock may be converted into Common Stock
will be adjusted in order to reflect the Reverse Split. These adjustments
will be made with respect to each series of preferred stock that is
outstanding in accordance with their respective certificate(s) of
designation defining their rights and preferences."

The text above will give effect to the Reverse Split by changing and
reclassifying each 1,000 shares of authorized Common Stock to one (1) share of
Common Stock on the terms described above.

MATERIAL FEDERAL INCOME TAX CONSEQUENCES

The following is a summary of the anticipated material Federal income tax
consequences of the Reverse Split for stockholders who hold their interests in
the Company as a capital asset. This summary is based upon the Federal income
tax laws currently in effect and as currently interpreted. It does not take into
account possible changes in such laws or interpretations, including any
amendments to applicable

27
<Page>
statutes, regulations and proposed regulations, or changes in judicial or
administrative rulings, some of which may have retroactive effect. This summary
is provided for general information purposes only, and does not purport to
address all aspects of Federal income tax consequences of the Reverse Split and
is not intended as tax advice to any person. In particular, and without limiting
the foregoing, this summary does not account for or consider the Federal income
tax consequences to stockholders of the Company in light of their individual
investment circumstances or to holders subject to special treatment under the
Federal income tax laws (for example, life insurance companies, regulated
investment companies, and foreign taxpayers). This summary does not discuss any
consequence of the Reverse Split under any state, local, foreign or estate tax
laws.

No ruling from the Internal Revenue Service or opinion of counsel will be
obtained regarding the Federal income tax consequences to the stockholders of
the Company in connection with the Reverse Split. Accordingly, each stockholder
is encouraged to consult its own tax adviser regarding the specific tax
consequences of the proposed Reverse Split, including the application and effect
of federal, state, local, foreign and estate taxes, and any other tax laws.

TAX CONSEQUENCES TO STOCKHOLDERS WHO ARE CASHED-OUT IN THE REVERSE SPLIT

Generally, a stockholder of Common Stock who is completely cashed-out in the
Reverse Split will recognize a capital gain or loss equal to the difference
between the cash received for the cashed-out stock and the stockholder's
adjusted tax basis in his stock.

In addition to a stockholder's direct interest, a stockholder may own an
"indirect" interest in the Company because of certain Federal income tax
attribution rules. Pursuant to these rules Common Stock owned by relatives
(i.e., spouses, parents or children) and related entities of a stockholder will
be attributed to such stockholder. Accordingly, even though a stockholder's
direct interest in the Company is terminated as a result of the Reverse Split
such stockholder's overall percentage interest in the Company may increase
because of an increased indirect interest in the Company (such stockholder shall
be referred to as an "Increased Stockholder").

An Increased Stockholder will recognize a capital gain on the transaction,
as discussed above, if the amount of cash received exceeds such stockholder's
basis in its Common Stock. However, an Increased Stockholder will not be able to
recognize any loss on the transaction. In addition, although the Company does
not believe it will have any earnings and profits for the current year, if it
does have earnings and profits, the cash received in the Reverse Split by an
Increased Stockholder will be treated as a taxable dividend to the extent of
such stockholder's proportionate share of the earnings and profits.

Stockholders holding an indirect interest are urged to consult their own tax
advisors regarding the possible tax consequences of the Reverse Split.

TAX CONSEQUENCE TO STOCKHOLDERS WHO REMAIN STOCKHOLDERS OF THE COMPANY

The Board believes that the Reverse Split would be a tax-free
recapitalization to the Company and to the stockholders who remain stockholders
of the Company pursuant to Section 368(a)(1)(E) of the Internal Revenue Code of
1986, as amended.

Assuming the Reverse Split qualifies as a tax-free reorganization, a
stockholder who remains a stockholder of the Company will recognize no gain or
loss on the exchange of its Common Stock for new Common Stock, provided that any
cash received in lieu of fractional shares will be treated as "boot" for Federal
income tax purposes. Any boot received by a stockholder will be taxable as a
capital gain to the extent that the fair market value of the boot received and
the new Common Stock exceeds the stockholder's total tax basis in its Common
Stock.

The tax basis of the new Common Stock received by holders of Common Stock
will be the same as the tax basis of the Common Stock exchanged increased by the
capital gain recognized and reduced by the

28
<Page>
amount of any cash received in the transaction. In addition, the holding period
of the new Common Stock in the hands of holders of new Common Stock will include
the holding period of their Common Stock exchanged therefore, provided that such
Common Stock was held as a capital asset immediately prior to the exchange.

TAX CONSEQUENCES TO STOCKHOLDERS WHO RECEIVE CASH

A stockholder who receives cash in the Reverse Split may be required to
furnish the stockholder's social security number or taxpayer identification
number to the Company or the Transfer Agent. Failure to provide such information
may result in backup withholding.

All stockholders should consult their own tax advisors in order to determine
the tax consequences of the Reverse Split.

APPRAISAL RIGHTS; ESCHEAT LAWS

No appraisal rights are available under the Delaware General Corporation Law
to stockholders who dissent from a reverse stock split. There may exist other
rights or actions under state law for stockholders who are aggrieved by reverse
stock splits generally. Although the nature and extent of such rights or actions
are uncertain and may vary depending upon facts or circumstances, stockholder
challenges to corporate action in general are related to the fiduciary
responsibilities of corporate officers and directors and to the fairness of
corporate transactions. For example, stockholders could, if they deemed such to
be applicable, take appropriate legal action against the Company and its Board,
and claim that the Transaction was unfair to the unaffiliated stockholders,
and/or that there was no justifiable or reasonable business purpose for the
Reverse Split.

The unclaimed property and escheat laws of each state provide that under
circumstances defined in that state's statutes, holders of unclaimed or
abandoned property must surrender that property to the state. Persons whose
shares are eliminated and whose addresses are unknown to the Company, or who do
not return their Common Stock certificate(s) and request payment therefore,
generally will have a period of years (depending on applicable state law) from
the Effective Date in which to claim the cash payment payable to them. For
example, with respect to stockholders whose last known addresses are in New
York, as shown by the records of the Company, the period is three years.
Following the expiration of that three-year period, the Abandoned Property Law
of New York would likely cause the cash payments to escheat to the State of New
York. For stockholders who reside in other states or whose last known addresses,
as shown by the records of the Company, are in states other than New York, such
states may have abandoned property laws which call for such state to obtain
either (i) custodial possession of property that has been unclaimed until the
owner reclaims it or (ii) escheat of such property to the state. Under the laws
of such other jurisdictions, the "holding period" or the time period which must
elapse before the property is deemed to be abandoned may be shorter or longer
than three years. If the Company does not have an address for the holder of
record of the shares, then unclaimed cash-out payments would be turned over to
its state of incorporation, the state of Delaware, in accordance with its
escheat laws.

VOTE NECESSARY TO APPROVE THE SPLIT AMENDMENT

The affirmative vote of a majority of the votes entitled to be cast at the
Meeting is necessary to approve the Split Amendment.

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE PROPOSAL APPROVING
THE SPLIT AMENDMENT. UNLESS A CONTRARY CHOICE IS SPECIFIED, PROXIES SOLICITED BY
THE BOARD WILL BE VOTED "FOR" APPROVAL OF THE SPLIT AMENDMENT.

29
<Page>
PROPOSAL FOUR: AMENDMENT TO AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION TO MODIFY NUMBER OF DIRECTORS

GENERAL

Article V of the Company's Amended and Restated Certificate of Incorporation
requires that the number of directors of the Company be not less than seven
(7) nor more than fifteen (15). The Board has adopted resolutions (i) proposing
to amend the Company's Amended and Restated Certificate of Incorporation to
change the number of directors of the Company to not less than three (3) nor
more than nine (9), subject to stockholder approval (the "Number of Directors
Amendment"); (ii) declaring the Number of Directors Amendment to be advisable
and in the best interests of the Company and its stockholders; and
(iii) calling for submission of the Number of Directors Amendment for approval
by the Company's stockholders at the Annual Meeting.

PROPOSED AMENDMENT TO AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

The following is the text of the first sentence of Article V A. of the
Company's Amended and Restated Certificate of Incorporation, as proposed to be
amended by the Number of Directors Amendment:

"A. Number. The number of directors of the Corporation shall be such
number, not less than three (3) nor more than nine (9) (exclusive of
directors, if any, to be elected by holders of preferred stock of the
Corporation, voting separately as a class), as shall be set forth from time
to time in the bylaws, provided that no action shall be taken to decrease or
increase the number of directors unless at least 66.67% of the outstanding
shares of capital stock of the Corporation entitled to vote generally in the
election of directors (considered for this purpose as one class) cast at a
meeting of the stockholders called for that purpose approve such decrease or
increase."

PURPOSE AND EFFECT OF THE NUMBER OF DIRECTORS AMENDMENT

The Board believes that it is in the Company's best interest to change the
permitted range in the number of directors of the Company for the following
reasons:

(a) The Company currently has three directors, and has never had more
than nine directors. In addition, the Board anticipates that, given the
current nature and scope of the Company's business, in the foreseeable
future the Company will not require more than nine (9) directors, and that
it may be more efficient for the Company to operate with a board of
directors consisting of as few as three (3) directors, particularly if the
Company becomes private.

(b) Although the Company does not currently compensate its directors or
reimburse them for their expenses, it may do so in the future and may be
required to do so in order to attract qualified persons interested in
serving as a director of the Company. In addition, under the Company's
Amended and Restated Certificate of Incorporation, the Company is obligated
to indemnify its directors for certain liabilities incurred in connection
with services rendered to the Company. Therefore, reducing the minimum
number of required directors may reduce the Company's future costs
associated with the management and operation of the Board.

VOTE NECESSARY TO APPROVE THE AMENDMENT

Under Articles V A. and X of the Company's Amended and Restated Certificate
of Incorporation, the Number of Directors Amendment requires the approval of at
least 66.67% of the outstanding shares of capital stock of the Company entitled
to vote generally in the election of directors (considered for this purpose as
one class).

30
<Page>
RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE AMENDMENT TO THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO CHANGE THE
MINIMUM AND MAXIMUM NUMBER OF PERMITTED DIRECTORS OF THE COMPANY. UNLESS A
CONTRARY CHOICE IS SPECIFIED, PROXIES SOLICITED BY THE BOARD WILL BE VOTED "FOR"
APPROVAL OF THE NUMBER OF DIRECTORS AMENDMENT.

PROPOSAL FIVE: AMENDMENT TO AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION TO PERMIT STOCKHOLDER APPROVAL BY
WRITTEN CONSENT IN LIEU OF A MEETING

GENERAL

Article VI of the Company's Amended and Restated Certificate of
Incorporation prohibits stockholders of the Company from taking any action by
written consent in lieu of a meeting. The Board has adopted resolutions
(i) proposing to amend, subject to stockholder approval, the Company's Amended
and Restated Certificate of Incorporation in order to permit the stockholders to
act by written consent in lieu of a meeting in accordance with and to the extent
permitted under Delaware law, (the "Written Consent Amendment"); (ii) declaring
the Written Consent Amendment to be advisable and in the best interests of the
Company and its stockholders; and (iii) calling for submission of the Written
Consent Amendment for approval by the Company's stockholders at the Annual
Meeting.

PROPOSED AMENDMENT TO AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

The following is the text of Article VI of the Company's Amended and
Restated Certificate of Incorporation, as proposed to be amended by the Written
Consent Amendment:

"Meetings of stockholders may be held within or without the State of
Delaware, as the bylaws may provide. The books of the Corporation may be
kept (subject to any provision contained in the statutes) outside the State
of Delaware at such place or places as may be designated from time to time
by the Board of Directors or in the bylaws of the Corporation. The
stockholders of the Corporation may take any action by written consent in
lieu of a meeting in accordance with and to the extent permitted under
Delaware law."

PURPOSE AND EFFECT OF THE WRITTEN CONSENT AMENDMENT

The Board believes that it is in the Company's best interest to permit
stockholders to take action by written consent in lieu of a meeting due to the
following:

Based on available information, Company management estimates that
approximately six persons or entities (counting affiliates as a single person or
entity) beneficially own shares representing approximately 48% of all votes
entitled to be cast in the election of the Company's directors. Calling meetings
of stockholders and issuing proxy statements is relatively time consuming and
expensive in terms of direct costs (e.g., legal fees, printing and mailing, fees
associated with holding meetings, etc.) and allocation of management resources.
Therefore, if stockholder approval is required for any matter in the future, the
Board believes that, subject to stockholder approval, it would be more efficient
in terms of time and cost for the Company if stockholders were able to act by
written consent rather being required to call a formal stockholders' meeting and
solicit proxies.

VOTE NECESSARY TO APPROVE THE WRITTEN CONSENT AMENDMENT

Under Article X of the Company's Amended and Restated Certificate of
Incorporation, the Written Consent Amendment requires the approval of at least
66.67% of the outstanding shares of capital stock of

31
<Page>
the Company entitled to vote generally in the election of directors (considered
for this purpose as one class).

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE AMENDMENT TO THE
COMPANY'S AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO PERMIT
STOCKHOLDER ACTION BY WRITTEN CONSENT IN LIEU OF A MEETING. UNLESS A CONTRARY
CHOICE IS SPECIFIED, PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE VOTED
"FOR" APPROVAL OF THE WRITTEN CONSENT AMENDMENT.

GENERAL NOTES REGARDING MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING

PROVISIONS FOR UNAFFILIATED SECURITY HOLDERS

In connection with the proposals above, no provision has been made to grant
unaffiliated stockholders of the Company access to the corporate files of the
Company or to obtain counsel or appraisal services at the expense of the Company
or any other such party.

RESERVATION OF RIGHTS

Although the Board requests stockholder approval of the proposed amendments
to the Amended and Restated Certificate of Incorporation, the Board reserves the
right to decide, in its discretion, to withdraw one or more of the proposed
amendments from the agenda of the Annual Meeting prior to any stockholder vote
thereon or to abandon the Reverse Split proposal after such vote and before the
Effective Date even if the proposal is approved. Although the Board presently
believes that the proposed amendments are in the best interests of the Company
and its stockholders, and thus has recommended a vote for the proposed
amendments, the Board nonetheless believes that it is prudent to recognize that,
between the date of this proxy statement and the effective date of any such
amendment, factual circumstances could possibly change such that it might not be
appropriate or desirable to effect one or more of the proposed amendments at
that time. If the Board decides to withdraw a proposed amendment from the agenda
of the Meeting, the Board will notify the stockholders of such decision promptly
by mail or by announcement at the Meeting. If the Board decides to abandon the
Reverse Split proposal after the Meeting and before the Effective Date, the
Board will notify the stockholders of such decision promptly by mail.

EXECUTIVE OFFICERS AND COMPENSATION

EXECUTIVE OFFICERS

The following individuals were serving as executive officers of the Company
on February 5, 2003:

<Table>
<Caption>
NAME AGE POSITION WITH THE COMPANY
- ---- -------- -------------------------

Jose Manuel Tost....................... 41 President
Ana Maria Lozano-Stickley.............. 39 Chief Financial Officer
Michael Hartman........................ 39 General Counsel and Secretary
</Table>

JOSE MANUEL TOST, 41, has been President of the Company since April 2002.
Prior to his appointment as President, Mr. Tost served as the Company's Chief
Operating Officer from December 2001 until April 2002 and as Senior Vice
President, Product Marketing and Operations from July 2001 until December 2001.
Mr. Tost joined the Company in July 2001. Prior to that time, Mr. Tost spent
over five years, from 1996 until 2001, at TelCel/BellSouth working in a variety
of management roles, the most recent of which was General Manager of Technology.
In addition, Mr. Tost was General Manager of T-NET, an Internet service
provider, and T-DATA, a private network operator, each of which is a division of
TelCel/

32
<Page>
BellSouth. Mr. Tost previously served as Vice President of Operations of
Cadtronic Consulting Services, a management and engineering consulting firm,
advisor to an investment banking firm, and General Manager for a consulting firm
that specializes in high-tech industries. Mr. Tost holds a Bachelor of Science
and a Master of Science in Engineering Technology from the University of Central
Florida.

ANA MARIA LOZANO-STICKLEY, 39, has been Chief Financial Officer of the
Company since May 2002. In January 2002, Ms. Lozano-Stickley joined the Company
as a consultant acting as its Vice President of Accounting and Administration.
From August 2000 to December 2002, Ms. Lozano- Stickley was Vice President of
Finance for SportsYa!, a sports media company focused on the Hispanic market in
the U.S., Latin America and Spain. From May 1999 to June 2000,
Ms. Lozano-Stickley was Vice President of Finance for Espanol.com, Inc., a B2C
e-commerce site targeting its products to the Hispanic market in the U.S. and
Latin America. From May 1998 to April 1999, Ms. Lozano-Stickley was
International Controller for General Cinemas Corporation, a leading motion
picture exhibitor in the U.S. and Latin America. Ms. Lozano-Stickley is a
Certified Public Accountant and holds a Bachelor of Science in Business
Administration from Boston University with a dual concentration in accounting
and finance.

MICHAEL HARTMAN, 39, has been General Counsel and Secretary of the Company
since November 2001. Prior to his appointment, Mr. Hartman had been the
Company's Assistant General Counsel since joining the Company in July 2000. From
November 1994 to June 2000 Mr. Hartman was an associate in the Corporate
Department of Debevoise & Plimpton, where he focused in transactions in Latin
America and the Iberian Peninsula. He received a J.D. from the Columbia
University School of Law, an M.A. from the University of California at Berkeley,
and a B.A. from the University of Michigan.

EXECUTIVE COMPENSATION

The following table sets forth the total compensation paid for each of the
three years ended December 31, 2000, 2001 and 2002, respectively, to the
individuals who served as our chief executive officer in 2002. The table also
includes information regarding each of our other most highly compensated
executive officers in 2001 who were executive officers as of the end of fiscal
year 2002 and who earned greater than $100,000, of which there were two
officers. In addition, we have included information regarding one individual who
would have been among our most highly compensated officers except that he was
not serving as an executive at the end of fiscal year 2002. We refer to these
individuals collectively as our "Named Executive Officers."

33
<Page>
SUMMARY COMPENSATION TABLE

<Table>
<Caption>
LONG-TERM
ANNUAL COMPENSATION
COMPENSATION(1) AWARDS
------------------- ------------
SECURITIES
UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION
- --------------------------- -------- -------- -------- ------------ ------------

Jose Manual Tost (2) ............................ 2002 $190,000 $ 95,000 -- --
President 2001 46,753 50,000 -- --
2000 -- -- -- --

Enrique Narciso (3) ............................. 2002 77,724 100,000 -- 82,129(4)
Chief Executive Officer and President 2001 207,483 200,000 -- --
2000 164,074 -- 350,000 --

Ana Maria Lozano-Stickley ....................... 2002 106,667 40,000 -- 40,385(6)
Chief Financial Officer (5) 2001 -- -- -- --
2000 -- -- -- --

Michael Hartman (7) ............................. 2002 180,000 90,000 -- --
General Counsel 2001 136,093 45,000 25,000 --
2000 57,291 30,000 125,000 --

Jorge Rincon (8) ................................ 2002 189,167 95,000 -- 95,000(9)
Chief Operating Officer 2001 156,969 50,000 -- --
2000 123,008 3,382 55,000 --
</Table>

- ------------------------

(1) In accordance with the rules of the SEC, compensation in the form of
perquisites and other personal benefits has been omitted for our Named
Executive Officers because the aggregate amount of such perquisites and
other personal benefits constituted less than the lesser of $50,000 or 10%
of the total of annual salary and bonuses for each Named Executive Officer
in 2002.

(2) Mr. Tost joined the Company in July 2001. He was appointed President of the
Company in April 2002.

(3) Mr. Narciso joined the Company in October 1999. He was appointed President
in June 2001 and Chief Executive Officer in August 2001. He resigned from
the Company in April 2002.

(4) This amount includes: (i) a one-time payment of $75,000 by the Company to
Mr. Narciso in connection with his resignation in April 2002; and
(ii) payment of post-termination medical and dental premiums totaling
$7,129.

(5) Mrs. Lozano-Stickley joined the Company as a consultant in January 2002 and
became an employee and was appointed Chief Financial Officer in May 2002.

(6) This amount reflects amounts paid to Mrs. Lozano-Stickley in consulting fees
prior to commencement of her employment in May 2002.

(7) Mr. Hartman joined the Company in July 2000. He was appointed General
Counsel in November 2001.

(8) Mr. Rincon joined the Company in October 1999. He was appointed Chief
Technology Officer of the Company in December 2001 and subsequently
appointed Chief Operating Officer of the Company in April 2002. His
employment by the Company terminated in December 2002.

(9) This amount reflects a one-time payment by the Company to Mr. Rincon in
connection with his termination in December 2002.

34
<Page>
OPTION GRANTS IN LAST FISCAL YEAR

During the year ended December 31, 2002 the Company did not grant any
options to its Named Executive Officer or to any other employees of the Company.
We have never granted any stock appreciation rights.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

The following table provides information about stock options held as of
December 31, 2002 by our Named Executive Officers. The value of unexercised
in-the-money options at fiscal year-end is based on the market price of $0.0004
per share, which was the average "last sale" price quoted on Pink Sheets LLC
electronic quotation system during December 2002.

<Table>
<Caption>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
NUMBER UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
OF SHARES AT FISCAL YEAR-END 2002 AT FISCAL YEAR END($)(1)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------- ----------- ------------- ----------- -------------

Jose Manual Tost................... -- -- -- -- -- --
Enrique Narciso.................... -- -- -- -- -- --
Ana Maria Lozano-Stickely.......... -- -- -- -- -- --
Michael Hartman.................... -- -- 104,166 45,834 -- --
Jorge Rincon....................... -- -- 60,208 4,972 -- --
</Table>

- ------------------------

(1) None of the options were in-the-money as of December 31, 2002.

EMPLOYMENT AND SEPARATION AGREEMENTS

On January 31, 2001, the Company amended the letter of credit agreement with
Fernando J. Espuelas, the Company's former Chief Executive Officer. This
amendment increased the line of credit granted to him to the lesser of
$4,000,000 or the market value of shares of the Company's common stock held as
collateral. Interest accrued at 6.75% per annum. SEE "CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS" beginning on page 41 for more information.

On August 7, 2001, the Company entered into a separation and release
agreement with Fernando J. Espuelas, under which he ceased his employment with
the Company. The separation and release agreement superceded Mr. Espuelas'
employment agreement with the Company. Under the agreement: (i) Mr. Espuelas
received a one-time payment of $650,000, which was paid in August 2001,
(ii) payment of medical and dental premiums through February 2003 and (iii) the
Line of Credit provided to Mr. Espuelas under certain agreements dated
December 28, 2000 (as amended on January 31, 2001) remained in full force and
effect in accordance with its terms. Even though the Line of Credit remained
intact under the agreement, Mr. Espuelas agreed not to draw down any additional
amounts thereunder. Mr. Espuelas agreed to remain the Chairman of the Company's
Board of Directors, until November 15, 2001, at which time he resigned from such
position. Mr. Espuelas remained as a director of the Company until July 1, 2002,
at which time he resigned.

In September 2001, the Company entered into an employment agreement with
Mr. Enrique Narciso, who had previously been appointed as President and Chief
Executive Officer of the Company. Under the terms of this agreement,
Mr. Narciso was to be paid an initial annual base salary of $250,000, as well as
signing bonus of $100,000 and a performance bonus of $100,000 payable on
December 31, 2001, if Mr. Narciso continued to be employed by the Company on
that date. In addition, under the agreement, Mr. Narciso would be paid a bonus
payable in the event of a "company sale" (as defined in the agreement) in the
amount of 0.5-1.0% of the proceeds from the sale, depending on a number of
factors, and subject to a minimum bonus payment of $425,000. The agreement also
obligated the Company to issue to

35
<Page>
Mr. Narciso options to purchase up to 1,500,000 shares of the Company's common
stock, one-third of which options would vest on the first three anniversaries of
the agreement. In the event of a company sale, 50% of the unvested options
granted to Mr. Narciso would vest. In the event that Mr. Narciso was terminated
other than for cause or constructively discharged (as defined in the agreement),
Mr. Narciso would be entitled to a severance payment of $425,000.

On December 27, 2001, the Company entered into a separation agreement with
Ms. Kampfner covering the terms of her resignation as Senior Vice President,
Global Sales and Strategy on December 31, 2001. This agreement provided that
(i) the Company would pay Ms. Kampfner a one-time payment of $64,167, (ii) the
Company was obligated to pay Ms. Kampfner any unpaid salary through the date of
separation and all reasonable unpaid expenses incurred in connection with
service on or prior to the separation date, and (iii) on the separation date,
the Company would forgive the remaining balance of her American Express
Corporate Credit Card balance pursuant to the Capital Reimbursement Agreement of
July 6, 2001. On the separation date, that amount was $24,947.33. The agreement
also provided for the termination of a line of credit provided pursuant to the
letter of credit agreement dated December 28, 2000 between Ms. Kampfner and the
Company.

On April 19, 2002 the Company and Enrique Narciso entered into an agreement
setting out the terms and conditions of Mr. Narciso's resignation as Chief
Executive Officer, President and director of the Company. Under this agreement,
the Company paid Mr. Narciso $75,000 and agreed to provide continued health
insurance coverage for one year in consideration for Mr. Narciso's cooperation
in transitioning to a new management team and contacting existing customers and
vendors of the Company in order to facilitate the transition.

On May 2, 2002, the Company entered into bonus and severance retention
agreements (the "Severance Agreements") with various executive officers,
including Mr. Tost, Mr. Rincon, Mrs. Lozano-Stickley and Mr. Hartman (each an
"Executive"). The general terms of the Severance Agreements provide that if the
Executive is terminated "For Cause," as defined in the Severance Agreements, or
if the Executive voluntarily terminates his or her employment and is not
"Constructively Discharged," as defined in the Severance Agreements, the Company
is only responsible for payment of compensation due to the Executive through the
last day worked. The Severance Agreements also provide for performance and
retention bonuses to be paid on July 10, 2002 and January 10, 2003 in the amount
of (1) $47,500 for Mr. Tost; (2) $47,500 for Mr. Rincon, (3) $40,000 for
Mrs. Lozano-Stickley and (4) $45,000 for Mr. Hartman, provided that the
Executive is employed by the Company on the date of payment. Additionally, the
Severance Agreements provide for a severance payment if the Executive is
terminated for a reason other than For Cause or Constructive Discharge in the
amount of (1) $95,000 for Mr. Tost; (2) $95,000 for Mr. Rincon, (3) $80,000 for
Mr.s Lozano-Stickley and (4) $90,000 for Mr. Hartman. The Severance Agreements
are valid for a term of one year after May 2, 2002. Mr. Rincon's employment was
terminated as of December 31, 2002 and he was paid full severance in
January 2003.

COMMITTEES AND MEETINGS

Set forth below is a list of the Board's standing committees. The membership
of these committees is usually determined at the organizational meeting of the
Board held immediately after the annual meeting of stockholders. The current
membership of each committee is as follows, with the chairman of the committee
listed first:

<Table>
<Caption>
AUDIT COMPENSATION SPECIAL COMMITTEE SPECIAL COMMITTEE
COMMITTEE COMMITTEE (ACCOUNTING IRREGULARITIES) (IPO CLASS ACTION)
- --------------------- ------------------- --------------------------- -------------------

Susan L. Segal Susan L. Segal Susan L. Segal Susan L. Segal
Douglas M. Karp Douglas M. Karp Douglas M. Karp Douglas M. Karp
Frederick R. Wilson Frederick R. Wilson Frederick R. Wilson Frederick R. Wilson
</Table>

36
<Page>
AUDIT COMMITTEE. The Audit Committee represents the Board in discharging
its responsibilities relating to the accounting, reporting, and financial
practices of the Company and its subsidiaries, and has general responsibility
for oversight and review of the accounting and financial reporting practices,
internal controls and accounting and audit activities of the Company and its
subsidiaries. Specifically, the Audit Committee (1) reviews prior to publication
the Company's annual financial statements with management and the Company's
independent accountants; (2) reviews with the Company's independent accountants
the scope, procedures and timing of the annual audits; (3) reviews the adequacy
and effectiveness of the Company's internal accounting controls; (4) reviews the
scope of other auditing services to be performed by the Company's independent
accountants; (5) reviews the independence and effectiveness of the Company's
independent accountants, and their significant relationships with the Company;
(6) recommends the retention or appointment of the independent auditor of the
Company, which is ultimately accountable to the Board through the Audit
Committee; (7) reviews the adequacy of the Company's accounting and financial
personnel resources; (8) reviews the Audit Committee Charter on an annual basis;
(9) reviews or designates the Chairman of the Committee to review with
management and the Company's independent accountants the results of any
significant matters identified as a result of the accountants' review procedures
prior to filing any Form 10-Q or as soon thereafter as possible; (10) reviews
material pending legal proceedings involving the Company and other material
contingent liabilities; and (11) reviews any other matters relative to the audit
of the Company's accounts and the preparation of its financial statements that
the Committee deems appropriate.

COMPENSATION COMMITTEE. The Compensation Committee is responsible for
approving and reporting to the Board on all elements of compensation for
executive officers. The Compensation Committee also reviews and approves various
other Company policies and compensation matters and administers the Company's
Employee Stock Purchase Plan.

SPECIAL COMMITTEE (ACCOUNTING IRREGULARITIES). This Special Committee is
responsible for overseeing investigations into alleged accounting irregularities
that occurred at the Company during 2000 and 2001. Initially, this Special
Committee oversaw an independent investigation into whether the Company's two
Mexican subsidiaries improperly recognized revenues during the period
October 1, 2000 through June 30, 2001. Subsequently, this Special Committee
oversaw an internal investigation by the Company's management into whether any
additional accounting irregularities occurred. As a result of these
investigations, the Special Committee and the Company determined that accounting
irregularities did in fact occur and consequently, in July 2002 the Company
restated its audited consolidated financial statements for the year ended
December 31, 2000 (which included adjustments to the fiscal quarters ended
March 31, June 30 and September 30 and December 31, 2000) and its unaudited
consolidated financial statements for the quarters ended March 31, 2001 and
June 30, 2001, respectively. This Special Committee oversaw these restatements
and advised the Board with respect to them. Although this Special Committee has
not been dissolved, it is currently inactive.

SPECIAL COMMITTEE (IPO CLASS ACTION). This Special Committee is responsible
for overseeing matters relating to the class action claims pending against the
Company in connection with its initial public offering. In August 2001, the
Company, three of its executive officers and each of the underwriters who
participated in the Company's May 25, 1999 initial public offering were named as
defendants in three class action complaints filed in the United States District
Court for the Southern District of New York: Earl Arneson v. StarMedia Network,
Inc, et al; John R. Longman v. StarMedia Network, Inc., et al; and BH Holdings
LLC v. StarMedia Network, Inc., et al. The complaints, which are substantially
identical, each seek unspecified damages for alleged violations of Sections 11,
12 and 15 of the Securities Act of 1933, as amended, Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated
thereunder in connection with the Company's initial public offering. The
complaints allege that the underwriters charged the Company excessive
commissions and inflated transaction fees not disclosed in the registration
statement and allocated shares of the Company's initial public offering to
favored customers in exchange for purported promises by such customers to
purchase additional shares in

37
<Page>
the aftermarket, thereby allegedly inflating the market price for the Company's
Common Stock. These actions have been consolidated with hundreds of other
securities class actions commenced against more than 300 companies and
approximately 40 investment banks in which plaintiffs have made substantially
similar allegations as those made against the Company with respect to the
initial public offerings at issue in those cases. All of these actions have been
consolidated under the caption In re: Initial Public Offering Securities
Litigation, 21 MC 92 (SAS). On October 9, 2002, all claims against individual
defendants were dismissed without prejudice. This Special Committee was formed
in October 2002 and met at that time to evaluate settlement proposals made to
the Company in connection with this litigation. This Special Committee will meet
in the future as necessary to consider further matters related to the
litigation.

MEETINGS. During fiscal year 2002, there were twelve meetings of the Board,
five meetings of the Audit Committee, two meetings of the Compensation Committee
and two meetings of the Special Committee (Accounting Irregularities). The
Special Committee (IPO Class Action) was not formed until October 2002 and has
not met since it was founded. Each of the directors attended 75% or more of the
total number of meetings of the Board and the meetings of the committees of the
Board on which he or she served during the period that he or she served.

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board of Directors reviews and makes
recommendations to the Board of Directors regarding the Company's compensation
policies and all terms of compensation to be provided to our executive officers
and directors. In addition, the Compensation Committee reviews the policies
underlying bonuses and stock compensation arrangements for all of our other
employees. The Board of Directors has reviewed and is in accord with the
compensation paid to executive officers in the 2002 fiscal year and with the
Company's other compensation policies.

GENERAL COMPENSATION POLICY. The Company's compensation philosophy and
policy is intended to attract and retain top managerial talent to lead the
Company through the use of competitive compensation packages that seek to
motivate superior performance. In addition, the Compensation Committee believes
that it is appropriate to align the financial interests of management with those
of stockholders of the Company by offering employees equity-based incentives
under appropriate circumstances. In determining the level of executive
compensation, the Compensation Committee evaluates whether the compensation
awarded to an executive is competitive with compensation awarded to executives
holding similar positions within and outside the industry, combined with an
evaluation of the executive's individual performance.

The elements of total compensation for the Company's executive officers
include annual salary, annual performance bonus and long-term stock-based
incentives. In general, each year the Compensation Committee reviews base
salaries for executive officers for appropriateness, establishes performance
factors, based on individual and Company-wide performance. The Committee
believes that the use of long-term incentives provided through stock options
grants to incentivize senior executives and further link the interests of these
individuals who lead the Company with those of the Company's stockholders is
crucial to the future success of the Company and the long-term creation of
stockholder value. However, given the decline in the Company's stock price and
the suspension of trading and delisting of the Company's common shares on Nasdaq
National Market, the Compensation Committee generally placed less emphasis on
the granting of long-term stock-based incentives than in prior years. To this
end, the Company did not grant any to executive officers in the 2002 fiscal
year. In considering the number of options to be granted, where applicable, the
Compensation Committee may consider a number of factors, including unvested
options held by an executive officer, although it does not adhere to specific
guidelines as to the relative option holdings of the Company's executive
officers.

In recognition of the significant contribution of the officers to the
success of the Company, and in order to ensure the continued retention of these
key employees into the future, in May 2002, the Company entered into retention
and severance agreements with certain of our executive officers. The
compensation

38
<Page>
package set forth in each agreement reflects the Compensation Committee's
compensation philosophy and policy as described above. See "Employment and
Separation Agreements."

CEO COMPENSATION. Consistent with the Compensation Committee's general
compensation philosophy for the Company's executives, the Compensation Committee
seeks to achieve two objectives: (i) establish a level of base salary
competitive with that paid by companies within the industry which are of
comparable size to the Company and by companies outside of the industry with
which the Company competes for executive talent and (ii) make a significant
percentage of the total compensation package contingent upon the Company's
performance and stock price appreciation, where appropriate.

FERNANDO ESPUELAS. Fernando Espuelas was Chief Executive Officer of the
Company until his resignation in August 2001. Under the terms of his
December 27, 2000 employment agreement with the Company, Mr. Espuelas was
granted a base salary of $350,000 per annum and a performance bonus of at least
$150,000 payable after the end of the year if he satisfied mutually agreed on
performance criteria. In addition, Mr. Espuelas was granted a $1,000,000 Line of
Credit, which was required to be guaranteed to the extent permitted by
Regulation U by shares of the Company's common stock, and was otherwise
non-recourse to him. On January 31, 2001 the amount of the available line of
credit was extended to $4,000,000. As of Mr. Espuelas' resignation as Chief
Executive Officer, he had received a total of $209,168 in base salary payments
in 2001 and approximately $2,875,216 (principal and interest) was outstanding
under his Line of Credit. He was not paid any portion of the performance bonus.

During the 2001 fiscal year, the Committee reviewed the status of
Mr. Espuelas' option holdings based on a review of option holdings by
individuals in comparable positions in comparable companies. There were no
options granted to Mr. Espuelas in 2001.

ENRIQUE NARCISO. In August 2001, the Board appointed Mr. Enrique Narciso as
Chief Executive Officer of the Company in replacement of Mr. Fernando Espuelas.
In recognition of the significant contribution of Mr. Narciso to the success of
the Company, and in order to ensure the continued retention of Mr. Narciso into
the future, the Company entered into an employment agreement with him at the
time he was appointed Chief Executive Officer. The compensation package set
forth in the agreement reflects the Compensation Committee's compensation
philosophy and policy as described above. See "Employment and Severance
Agreements." The base salary established for Mr. Narciso on the basis of the
foregoing criteria was intended to provide a level of stability and certainty
each year. Accordingly, this element of compensation was not affected to any
significant degree by Company performance factors. In accordance with these
objectives, under his employment agreement with the Company, Mr. Narciso was
granted a base salary of $250,000, a one-time signing bonus of $100,000 payable
within five days of the execution of his employment agreement and a
discretionary employment bonus of $100,000 payable if he continued to be
employed by the Company as of December 31, 2002. During 2001, the Company paid
him $207,483 of salary. The Company also paid him the agreed signing and
performance bonuses in respect of 2001.

Upon Mr. Narciso's appointment as Chief Executive Officer, the Committee
reviewed the status of his option holdings based on a review of option holdings
by individuals in comparable positions in comparable companies, and based on a
desire to maximize stockholder value by directly linking Mr. Narciso's
compensation to the achievement of a higher stock price for the Company's Common
Stock. Accordingly, the Company agreed to grant Mr. Narciso options to purchase
1,500,000 shares of the Company's Common Stock that would vest ratably over a
three-year period. However, such options were not granted to him as of the date
of his resignation from the Company in April 2002. In addition, in light of the
possibility of a restructuring or sale of the Company following Mr. Narciso's
appointment, Mr. Narciso was guaranteed certain compensation in the event of a
"change of control" and certain other circumstances, none of which occurred
during the term of his employment agreement.

39
<Page>
JOSE MANUEL TOST. In April 2002 the Board appointed Mr. Jose Manuel Tost as
President of the Company in replacement of Mr. Enrique Narciso, who as Chief
Executive Officer and President of the Company. In recognition of the
significant contribution of Mr. Tost to the success of the Company, and in order
to ensure the continued retention of Mr. Tost into the future, the Company
entered into an employment agreement with him at the time he was appointed
President. The compensation package set forth in the agreement reflects the
Compensation Committee's compensation philosophy and policy as described above.
See "Employment and Severance Agreements." The base salary established for
Mr. Tost on the basis of the foregoing criteria was intended to provide a level
of stability and certainty for the following year. Accordingly, this element of
compensation was not affected to any significant degree by Company performance
factors. In accordance with these objectives, under his employment agreement
with the Company, Mr. Tost was granted a base salary of $190,000, and a
retention bonus of $95,000 payable in two installments on June 10, 2002 and
January 10, 2003 provided that he was employed by the Compan on the date of
payment. In addition, Mr. Tost was guaranteed a severance payment in the amount
of $95,000 if his employment is terminated other than For Cause or he is
Constructively Discharged during the term of the agreement, which is valid until
May 2, 2003. During 2002, the Company paid him $190,000 of salary. The Company
also paid him the agreed bonuses in respect of 2002.

COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M). Section 162(m) of the
Internal Revenue Code, enacted in 1993, generally disallows a tax deduction to
publicly held companies for compensation exceeding $1 million paid to certain of
the corporation's executive officers. The limitation applies only to
compensation which is not considered to be performance-based. The
non-performance based compensation paid to the Company's executive officers for
the 2002 fiscal year did not exceed the $1 million limit per officer, nor is it
expected that the non-performance based compensation to be paid to the Company's
executive officers for fiscal year 2002 will exceed that limit. Because it is
very unlikely that the cash compensation payable to any of the Company's
executive officers in the foreseeable future will approach the $1 million limit,
the Compensation Committee has decided at this time not to take any other action
to limit or restructure the elements of cash compensation payable to the
Company's executive officers. The Compensation Committee has stated that it will
reconsider this decision should the individual compensation of any executive
officer ever approach the $1 million level.

The directors who currently comprise the Compensation Committee are Susan L.
Segal, Frederick R. Wilson and Douglas M. Karp.

RESPECTFULLY SUBMITTED,

Susan L. Segal
Frederick R. Wilson
Douglas M. Karp

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During fiscal 2002, the Compensation Committee initially consisted of Ms.
Segal, Mr. Wilson and Mr. Karp. No member of the Compensation Committee is a
current or former officer or employee of the Company. There are no Compensation
Committee interlocks between the Company and other entities involving the
Company's executive officers and Board members who serve as executive officers
or board members of such other entities.

40
<Page>
PERFORMANCE GRAPH

The following graph compares the cumulative return on shares of the
Company's Common Stock to such return for The Nasdaq National Market (U.S.)
Index and the J.P. Morgan H&Q Internet Index, for the period commencing on
May 25, 1999, the date on which the Company's Common Stock first traded on The
Nasdaq National Market through December 31, 2002, except that information
provided with respect to the Company's common stock is provided only through
November 16, 2001, the date on which trading of shares of the Company's Common
Stock on The Nasdaq National Market was suspended and the information for the
J.P. Morgan H&Q Internet Index is presented only through April 2, 2002, as of
which date it was discontinued. SEE "Item 5. Market for Registrant's Common
Equity and Related Stockholder Matters", incorporated by reference to the
Company's Form 10-K. This chart assumes (i) $100 was invested on May 25, 1999
and (ii) reinvestment of dividends.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
<Caption>
STRM EQUITY HMQTINET INDEX CCMP INDEX

$100.00
Date Px Last Shares Date Px Last Date
5/25/99 15.000 6.67 5/25/99 392.47 0.25 5/25/99
5/28/99 58.875 392.50 5/28/99 424.33 108.12 5/28/99
6/30/99 64.125 427.50 6/30/99 458.71 116.88 6/30/99
7/30/99 43.125 287.50 7/30/99 404.6 103.09 7/30/99
8/31/99 38.688 257.92 8/31/99 425.95 108.53 8/31/99
9/30/99 36.719 244.79 9/30/99 471.52 120.14 9/30/99
10/29/99 28.750 191.67 10/29/99 521.35 132.84 10/29/99
11/30/99 29.750 198.33 11/30/99 657.07 167.42 11/30/99
12/31/99 40.063 267.08 12/31/99 912.76 232.57 12/31/99
1/31/00 32.125 214.17 1/31/00 855.8 218.05 1/31/00
2/29/00 47.000 313.33 2/29/00 1088 277.22 2/29/00
3/31/00 30.063 200.42 3/31/00 953.38 242.92 3/31/00
4/28/00 21.875 145.83 4/28/00 718.48 183.07 4/28/00
5/31/00 17.938 119.58 5/31/00 604.46 154.01 5/31/00
6/30/00 18.875 125.83 6/30/00 707.27 180.21 6/30/00
7/31/00 15.125 100.83 7/31/00 663.11 168.96 7/31/00
8/31/00 8.500 56.67 8/31/00 769.34 196.03 8/31/00
9/29/00 7.500 50.00 9/29/00 680.39 173.36 9/29/00
10/31/00 6.125 40.83 10/31/00 576.45 146.88 10/31/00
11/30/00 3.125 20.83 11/30/00 384.4 97.94 11/30/00
12/29/00 1.891 12.60 12/29/00 351.2 89.48 12/29/00
1/31/01 4.563 30.42 1/31/01 393.54 100.27 1/31/01
2/28/01 3.000 20.00 2/28/01 277.88 70.80 2/28/01
3/30/01 3.000 20.00 3/30/01 217.14 55.33 3/30/01
4/30/01 2.450 16.33 4/30/01 272.04 69.31 4/30/01
5/31/01 2.770 18.47 5/31/01 277.03 70.59 5/31/01
6/29/01 1.860 12.40 6/29/01 273.5 69.69 6/29/01
7/31/01 0.670 4.47 7/31/01 240.34 61.24 7/31/01
8/31/01 0.320 2.13 8/31/01 199.47 50.82 8/31/01
9/28/01 0.160 1.07 9/28/01 158.86 40.48 9/28/01
10/31/01 0.260 1.73 10/31/01 183.15 46.67 10/31/01
11/16/2001* 0.380 2.53 11/16/01 213.62 54.43 11/16/01
11/30/01 11/30/01 217.75 55.48 11/30/01
12/31/01 12/31/01 225.98 57.58 12/31/01
1/31/02 1/31/02 218.11 55.57 1/31/02
2/28/02 0.065 0.43 2/28/02 190.61 48.57 2/28/02
3/28/02 0.040 0.27 3/28/02 205.63 52.39 3/28/02
4/30/02 0.055 0.37 4/30/2002^ 194.51 49.56 4/30/02
5/31/02 0.030 0.20 5/31/02 5/31/02
6/30/02 0.040 0.27 6/30/02 6/30/02
7/31/02 0.010 0.07 7/31/02 7/31/02
8/30/02 0.010 0.07 8/30/02 8/30/02
9/30/02 0.007 0.05 9/30/02 9/30/02
10/31/02 0.001 0.01 10/31/02 10/31/02
11/29/02 0.000 0.00 11/29/02 11/29/02
12/31/02 0.000 0.00 12/31/02 12/31/02
*Nov 16, 2001 trading of strm stock was on hold, trading
resumed Feb 2002
+discontinued april 4, 2002, closing price was 194.51

<Caption>
STRM EQUITY

Date Px Last
5/25/99 2,380.90 0.04
5/28/99 2,470.52 103.76
6/30/99 2,686.12 112.82
7/30/99 2,638.49 110.82
8/31/99 2,739.35 115.06
9/30/99 2,746.16 115.34
10/29/99 2,966.43 124.59
11/30/99 3,336.16 140.12
12/31/99 4,069.31 170.91
1/31/00 3,940.35 165.50
2/29/00 4,696.69 197.27
3/31/00 4,572.83 192.06
4/28/00 3,860.66 162.15
5/31/00 3,400.91 142.84
6/30/00 3,966.11 166.58
7/31/00 3,766.99 158.22
8/31/00 4,206.35 176.67
9/29/00 3,672.82 154.26
10/31/00 3,369.63 141.53
11/30/00 2,597.93 109.12
12/29/00 2,470.52 103.76
1/31/01 2,772.73 116.46
2/28/01 2,151.83 90.38
3/30/01 1,840.26 77.29
4/30/01 2,116.24 88.88
5/31/01 2,110.49 88.64
6/29/01 2,161.24 90.77
7/31/01 2,027.13 85.14
8/31/01 1,805.43 75.83
9/28/01 1,498.80 62.95
10/31/01 1,690.20 70.99
11/16/2001* 1,898.58 79.74
11/30/01 1,930.58 81.09
12/31/01 1,950.40 81.92
1/31/02 1,934.03 81.23
2/28/02 1,731.49 72.72
3/28/02 1,845.35 77.51
4/30/02 1,688.23 70.91
5/31/02 1,615.73 67.86
6/30/02 1,463.21 61.46
7/31/02 1,328.26 55.79
8/30/02 1,314.85 55.22
9/30/02 1,172.06 49.23
10/31/02 1,329.75 55.85
11/29/02 1,478.78 62.11
12/31/02 1,335.51 56.09
*Nov 16, 2001 trading of strm stock was on hold, trading
resumed Feb 2002
+discontinued april 4, 2002, closing price was 194.51
</Table>

41
<Page>
ANALYSIS

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Section 16(a) of the 1934 Act requires the Company's directors, executive
officers and persons who own more than ten percent of the Company's equity
securities to report their beneficial ownership of, and transactions in the
Company's equity securities on Forms 3, 4 and 5 with the SEC and NASDAQ (if
applicable). Based solely upon its review of the copies of such forms received
by it, the Company believes that, during fiscal year 2002, all persons complied
with such filing requirements except that Jose Manual Tost, Jorge Rincon,
Michael Hartman and Ana Maria Lozano-Stickley each did not timely file a Form 3
reporting their initial beneficial ownership.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

To the Company's knowledge, the following table sets forth information with
respect to beneficial ownership of our outstanding Common Stock as of
February 5, 2003 by:

- each person known by us to beneficially own more than 5% of our Common
Stock;

- each of our Named Executive Officers;

- each of our directors; and

- all of our executive officers and directors as a group.

Beneficial ownership is determined in accordance with the rules of the SEC
and includes voting and investment power with respect to the securities. Unless
otherwise indicated, the address for those listed below is c/o StarMedia
Network, Inc. (d/b/a CycleLogic Mobile Solutions), 999 Brickell Avenue, Suite
900, Miami, Florida, 33131. Except as indicated by footnote, and subject to
applicable community property laws, the persons named in the table have sole
voting and investment power with respect to all shares of common stock shown as
beneficially owned by them. The number of shares of Common Stock outstanding
used in calculating the percentage for each listed person includes the shares of
Common Stock underlying options held by such persons that are exercisable within
60 days of February 5, 2003, but excludes shares of Common Stock underlying
options held by any other person. As of February 5, 2003, the number of shares
of the Company's Common Stock outstanding was 71,041,277 and the number of
Series A Preferred

42
<Page>
Shares outstanding was 1,431,373. Except as noted otherwise, the amounts
reflected below are based upon information provided to the Company and filings
with the SEC.

<Table>
<Caption>
NUMBER NUMBER
SHARES OF SHARES OF ESTIMATED
COMMON PREFERRED PERCENT OF PERCENT OF
STOCK STOCK COMMON COMMON
BENEFICIALLY BENEFICIALLY STOCK STOCK
NAME OF BENEFICIAL OWNER OWNED OWNED(1) (PRE-SPLIT) (POST-SPLIT) (2)
- ------------------------ ------------ ------------ ----------- ----------------

Fernando J. Espuelas (3)...................... 8,000,000 0 10.8 11.4
Jack C. Chen (4).............................. 3,944,000 0 5.6 5.9
Douglas M. Karp (5)........................... 60,000 0 * *
Susan L. Segal (6)............................ 0 0 -- --
Frederick R. Wilson (7)....................... 1,193,845 0 1.7 1.8
Jose Manuel Tost.............................. 0 0 -- --
Jorge Rincon (8)(10).......................... 60,275 0 * *
Ana Maria Lozano-Stickley..................... 0 0 -- --
Michael Hartman (9)........................... 104,166 0 * *
Enrique Narciso (10).......................... 0 0 -- --
J.P. Morgan Partners (SBIC), L.L.C (11)....... 13,102,548 117,647 18.3 19.4
J.P. Morgan Partners (BHCA), L.L.C (11)....... 2,857,955 0 4.0 4.3
Quetzal/J.P. Morgan Partners, L.P. (11)....... 98,361 0 * *
BellSouth Enterprises, Inc. (12).............. 15,350,854 980,392 17.8 18.7
Warburg, Pincus Equity Partners, L.P. (13).... 1,692,709 0 2.4 2.5
Warburg, Pincus Ventures International,
L.P. (13)................................... 1,692,708 0 2.4 2.5
All directors and executive officers as a
group (6 persons)........................... 1,358,011 0 1.9 2.0
</Table>

- ------------------------

* Indicates less than one percent of the Common Stock.

(1) Please note that the number of shares of Common Stock beneficially owned as
well as the percent of Common Stock in the table above accounts for the
conversion of the shares of Preferred Stock into Common Stock.

(2) Assumes that there is no change in beneficial ownership of the Company's
Common Stock except as a result of the Reverse Split.

(3) Includes (a) 3,437,500 shares issuable upon the exercise of currently
exercisable stock options and (b) 160,614 shares held by a trust, of which
Mr. Chen and the spouse of Mr. Espuelas are trustees. This information is
based on holdings reported by Mr. Espuelas to the Company in connection with
previous Company periodic reports.

(4) Includes (a) 1,201,368 shares directly owned by Mr. Chen and (b) an
aggregate of 2,742,632 shares held by Mr. Chen's spouse and various trusts
for which Mr. Chen is trustee.

(5) Includes options to purchase 60,000 shares of Common Stock that are
immediately exercisable.

(6) Ms. Segal is no longer an employee of JPMorgan Partners and, even though she
is a consultant of JPMorgan Partners, the Company does not view her as
beneficially owning shares owned by JPMorgan Partners and its affiliates.
The address of Ms. Segal is c/o JPMorgan Partners 1221 Avenue of the
Americas, New York, NY 10020.

(7) Holdings include (a) 50,000 shares owned by the Flatiron Fund, LLC, which
are controlled by Mr. Wilson, (b) 208,739 shares owned by The Flatiron Fund
1998/99, LLC which are controlled by Mr. Wilson, (c) 252,478 shares owned by
The Flatiron Fund 2000, LLC, which are controlled by Mr. Wilson, (d) 66,157
shares owned by The Flatiron Fund 2001, LLC, which are controlled by

43
<Page>
Mr. Wilson, (e) 35,772 shares owned by Flatiron Associates II, which are
controlled by Mr. Wilson, (f) 118,294 shares owned by The Frederick R.
Wilson 1999 Irrevocable Trust, (g) 357,405 shares held directly and
(h) options to purchase 105,000 shares of common stock that are immediately
exercisable. Mr. Wilson's address is c/o Flatiron Partners, 1221 Avenue of
the Americas, 40th Floor, New York, NY 10020.

(8) Includes (a) 67 shares held directly, and (b) options to purchase 60,208
shares of Common Stock that are immediately exercisable.

(9) Includes options to purchase 104,166 shares of Common Stock that are
immediately exercisable.

(10) These Named Executive Officers are no longer employed by the Company and
the holdings reported reflect the Named Executive Officer's ownership of
Company Common Stock to the best of the Company's knowledge.

(11) Holdings by J.P. Morgan Partners (SBIC), L.L.C. include (a) 85,000 options
to purchase shares of the Company's Common Stock, (b) 11,738,333 shares of
Common Stock and (c) 117,647 shares of the Company's Series A Convertible
Preferred Stock, which shares including accrued and unpaid interest thereon
are immediately convertible into 1,279,215 shares of Common Stock. Each
holder has sole investment and voting control over the number of shares
reported. However, J.P. Morgan Partners (SBIC), L.L.C., J.P. Morgan Partners
(BHCA), L.P. and Quetzal/J.P. Morgan Partners, L.P. filed a Schedule 13D as
a group. The address of J.P. Morgan Partners (SBIC), L.L.C., J.P. Morgan
Partners (BHCA), L.P. and Quetzal/J.P. Morgan Partners, L.P. is 1221 Avenue
of the Americas, New York, NY 10020.

(12) Holdings include 980,392 shares of the Company's Series A Convertible
Preferred Stock, which shares including accrued and unpaid interest thereon
are immediately convertible into approximately 10,850,854 shares of the
Company's Common Stock. In addition, BellSouth holds warrants to purchase up
to 4,500,000 shares of the Company's Common Stock. These warrants vested in
May 2002. The address of BellSouth Enterprises, Inc. is 15G03 Campanile
Building, 1155 Peachtree Street, Atlanta, Georgia 30309.

(13) The Warburg, Pincus stockholders are comprised of Warburg, Pincus Equity
Partners, L.P., including three related limited partnerships, and Warburg,
Pincus Ventures International, L.P. Warburg, Pincus & Co. is the sole
general partner of each of these entities. The Warburg, Pincus stockholders
are each managed by E.M. Warburg, Pincus & Co., LLC. Lionel I. Pincus is the
managing partner of Warburg, Pincus & Co. and the managing member of E.M.
Warburg, Pincus & Co., LLC, and may be deemed to control both entities. The
address of the Warburg, Pincus entities is 466 Lexington Avenue, New York,
NY 10017.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

It is our current policy that all transactions with officers, directors,
greater than five percent stockholders and their affiliates must be entered into
only if they are approved by a majority of the disinterested directors, are on
terms no less favorable to us than could be obtained from unaffiliated parties
and are reasonably expected to benefit the Company. Each of the transactions
described below was approved in accordance with this policy.

OBSIDIANA

On April 30, 2001, the Company agreed to acquire certain assets of
Obsidiana, Inc. in exchange for 1,125,000 shares of the Company's Common Stock.
The acquired assets include Obsidiana's content library, its key trademarks and
domain names, and certain fixed assets located in the United States, Mexico and
Argentina. The stockholders of Obsidiana included entities managed by J.P.
Morgan Partners and Flatiron Partners.

44
<Page>
BELLSOUTH

In May 2001, the Company entered into an agreement with BellSouth to create
multi-access portals in Latin America (the "BellSouth Strategic Agreement").
Under the terms of the five-year agreement, the Company will design and service
the multi-access portals and mobile applications and provide content, software
application integration and support to BellSouth's operating companies in Latin
America. BellSouth will supply wireless communications, marketing of services
and billing capabilities. The two companies will share revenues generated by the
new multi-access portals. All revenues associated with design and maintenance
activities and the technology licenses are being recognized ratably over the
life of the specific agreements with BellSouth's operating subsidiaries, while
the user fees and transaction revenues are being recognized when the services
are rendered. For the year ended December 31, 2002, the Company recognized
$850,000 in revenue, net of amortization for warrants, in connection with the
BellSouth Strategic Agreement.

LOANS TO FORMER OFFICERS AND DIRECTORS

During the year ended December 31, 2001, the Company provided loans to
certain employees and, in addition, had balances outstanding with respect to
loans previously granted to these same employees. The largest amount of
indebtedness outstanding since January 1, 2001 and the balance outstanding as of
December 31, 2002 were as follows:

<Table>
<Caption>
LARGEST AMOUNT
OF INDEBTEDNESS
OUTSTANDING SINCE BALANCE AS OF
JANUARY 1, 2001 DECEMBER 31, 2002
----------------- ------------------

Due from Fernando Espuelas, bearing interest at 6.75% (1)... $2,965,611 $2,965,611
Due from Jack Chen, bearing interest at 6.75% (2)........... $4,418,039 $4,418,039
Due from Steve Heller, bearing interest at 7.0% (3)......... $2,142,205 --
Due from Adriana Kampfner, bearing interest at 7.0% (4)..... $1,144,197 --
Due from Francisco Loureiro, bearing interest at 10% (5).... $ 506,267 --
Due from Justin Macedonia, bearing interest at 7.0% (6)..... $1,455,454 $1,455,454
</Table>

- ------------------------

(1) Mr. Espuelas was Chief Executive Officer until August 2001, Chairman of the
Board until November 2001, and a director of the Company until July 1, 2002.

(2) Mr. Chen was President of the Company until June 2001 and Vice Chairman of
the Board until August 2001.

(3) Mr. Heller was Chief Financial Officer of the Company until November 2001.

(4) Ms. Kampfner was President of StarMedia Network and Senior Vice President,
Global Sales of the Company until December 2001.

(5) Mr. Loureiro was Chief Operating Officer of the Company until May 2001.

(6) Mr. Macedonia was Senior Vice President, General Counsel of the Company
until November 2001.

Loans to Mssrs. Espuelas, Chen, Heller and Macedonia were made pursuant to
lines of credit granted to them in accordance with their employment agreements
and related line of credit agreements dated December 2000 and, in the case of
Mssrs. Espuelas and Chen, amended in January 2001. The loan to Ms. Kampfner was
made pursuant to a line of credit agreement dated December 2000. The loan to
Mr. Loureiro was made pursuant to a promissory note dated May 2000.

The agreements with Messrs. Espuelas, Chen, Macedonia, Heller and
Ms. Kampfner made available lines of credit from the Company to each executive,
up to (i) $4,000,000 for each of Messrs. Espuelas and Chen, with interest
accruing at 6.75% per annum, (ii) $1.3 million for Mr. Macedonia, with interest

45
<Page>
accruing at 7% per annum, (iii) $2 million for Mr. Heller, with interest
accruing at 7% per annum, and (iv) $1.1 million of Ms. Kampfner, with interest
accruing at 7% per annum. Under the terms of their respective loans, each of
Mssrs. Espuelas and Chen granted the Company a security interest in one million
shares of the Company's Common Stock owned by him, but the loans were otherwise
non-recourse to the borrower. Under the terms of their respective loans, each of
Mr. Heller, Mr. Macedonia and Ms. Kampfner granted the Company a security
interest in all shares of common stock owned by them as of the date of the
borrower's line of credit agreement or subsequently acquired by the borrower,
but the loans were otherwise non-recourse to the borrower. All of the foregoing
loans and the securities interests granted thereby were required to be made
subject to and in accordance with Regulation U under the 1934 Act.

Under the agreements with Messrs. Espuelas and Chen, (i) the Company agreed
to forgive up to $1,000,000 in outstanding principal, together with accrued but
unpaid interest thereon, if the Company experiences a change of control in its
ownership, (ii) if the Company experiences a change of control in its ownership,
each executive has the right to require the Company to purchase 1,000,000 shares
of Common Stock at a price per share equal to the fair market value on the date
of such change of control, (iii) as of May 31, 2002, the Company has the right
to require each executive to sell to the Company a sufficient number of shares
of Common Stock, at a price per share of the greater of $6 and the fair market
value on the date of the call notice, to pay off outstanding principal amounts.
Under the agreements with Messrs. Macedonia and Heller, the Company agreed to
forgive up to $500,000 and any interest thereon under each line of credit, with
one-third of such amount to be forgiven by the Company in each of the next three
years to the extent he continued to be employed by the Company.

Under the respective terms of their loan and employment agreements, as well
as their separation agreements, the loans provided to Mr. Espuelas and Mr. Chen
remain outstanding. Under the terms of his separation agreement, Mr. Heller's
loan was discharged in full by means of delivery of approximately 326,000 shares
of the Company's Common Stock. Under the terms of his loan and employment
agreement, the loans provided to Mr. Macedonia are outstanding, although
Mr. Macedonia has advised the Company that he does not own a significant number
of shares of the Company's Common Stock. Under the terms of her separation
agreement, the loan provided to Ms. Kampfner was forgiven in full based on
inability to pay. Mr. Loureiro's promissory note was forgiven.

The Company has fully reserved against all amounts outstanding under the
foregoing loans.

SEPARATION AGREEMENT

In August 2001, the Company entered into a separation and release agreement
with Mr. Jack C. Chen, the Company's former President and Vice Chairman of the
Company's Board of Directors under which he would cease his employment with the
Company. This separation and release agreement supercedes the executive's
respective employment agreement with the Company. Under the agreement,
(i) Mr. Chen is entitled to a one time payment of $650,000, which was paid to
him in August 2001, (ii) payment of medical and dental premiums through
February 2003, (iii) the line of credit provided to Mr. Chen under certain
agreements dated December 28, 2000 (as amended on January 31, 2001) will remain
in full force and effect in accordance with its terms, and (iv) he received
limited administrative support through December 31, 2001. Even though
Mr. Chen's line of credit remains intact under the agreement, he agreed not to
draw down any additional amounts thereunder.

In October 2001, the Company entered into a separation and release agreement
with Mr. Steven J. Heller, the Company's Chief Financial Officer, under which
Mr. Heller ceased his employment with the Company on November 15, 2001. Under
the agreement, the executive's employment agreement expired and became null and
void. Under the separation and release agreement, the Company agreed to
terminate the line of credit provided to the executive under a letter agreement
dated December 28, 2000, and completely discharged all amounts owed thereunder,
and in consideration for such termination of the line

46
<Page>
of credit, the executive agreed to deliver to the Company 326,000 shares of the
Company's Common Stock which has been accounted for as treasury stock using the
value on the date the agreement was finalized of $114,000. In addition, the
executive was entitled to a one-time payment of $350,000, which was paid to him
in November 2001.

In April 2002 the Company entered into a separation agreement with
Mr. Enrique Narciso, the Company's former director, Executive Officer and
President, under which he tendered his resignation and would cease his
employment with the Company. Under the agreement, Mr. Narciso was entitled to a
one-time payment of $75,000 in consideration for assisting the Company in
transitional matters following his resignation.

TRANSACTIONS WITH FORMER SHAREHOLDERS OF ADNET

In connection with the Company's purchase of AdNet S.A. de C.V. from Grupo
MVS, S.A. de C.V. ("Grupo MVS") and Harry Moller Publicidad, S.A. de C.V.
("HMP") in April 2000, MVS and HMP were paid in part with shares of the
Company's Common Stock, and thereby became stockholders of the Company. In
addition, under the AdNet purchase agreement, each of Grupo MVS and HMP entered
into long-term services agreements with AdNet pursuant to which each of them
would provide to AdNet certain advertising and promotional services in
consideration for fees to be mutually agreed, subject to agreed parameters. It
was further contemplated under the AdNet purchase agreement that Grupo MVS and
HMP would act as agents of AdNet in selling advertising. The revenues and
expenses of the Company from this arrangement were restated and, as restated,
are not material.

In addition, in December 2000 SMN de Mexico, S.A. de C.V. entered into
arrangements with Grupo MVS and HMP that were similar to those already in place
with AdNet. The revenues and expenses of the Company associated with these
arrangements were restated in their entirety, and the Company's restated
financial statements reflect no such revenues or expenses.

In November 2001, the Company, AdNet and the former stockholders of AdNet
entered into a Termination Agreement pursuant to which the Company agreed to
issue to the stockholders of AdNet 8,000,000 shares of the Company's Common
Stock, in full satisfaction of the Company's obligations under the stock
purchase agreement and certain other related agreements between the Company and
the former stockholders of AdNet. As of December 31, 2001, the Company had
issued a total of 7,600,000 shares. The Company has not issued the remaining
400,000 shares pending resolution of outstanding claims that the Company has
against the former stockholders of AdNet.

On October 3, 2002 the Company entered into an agreement with Grupo MVS,
S.A. de C.V. and Harry Moller Publicidad, S.A. de C.V. pursuant to which the
former shareholders agreed to (a) refund to the Company 100% of their respective
holdings of common stock of the Company and (b) not to purchase any additional
common stock of the Company for two years. In exchange, the Company agreed to
release the shareholders from any and all claims it might otherwise have against
them under the stock purchase agreement pursuant to which it acquired Adnet from
them. The total number of shares delivered to the Company under the release
agreement consisted of 4,599,156 delivered by Grupo MVS and 4,288,797 delivered
by Harry Moller Publicidad. These shares will be included in treasury stock as
of the date of the agreement at the fair market value established in the over
the counter securities market.

47
<Page>
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

THE FOLLOWING IS A REPORT OF THE AUDIT COMMITTEE DATED SEPTEMBER 30, 2002.
THE INFORMATION CONTAINED IN THIS REPORT SHALL NOT BE DEEMED "SOLICITING
MATERIAL" OR TO BE "FILED" WITH THE SECURITIES AND EXCHANGE COMMISSION, NOR
SHALL SUCH INFORMATION BE INCORPORATED BY REFERENCE INTO ANY FUTURE FILINGS BY
US UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED, EXCEPT TO THE EXTENT THAT WE SPECIFICALLY INCORPORATE IT BY
REFERENCE IN SUCH FILING.

The Audit Committee of the Board of Directors of the Company serves as the
representative of the Board of Directors for general oversight of the Company's
financial accounting and reporting process, system of internal control, audit
process, and process for monitoring compliance with laws and regulations. The
Company's management has primary responsibility for preparing the Company's
financial statements and the Company's financial reporting process. The
Company's independent accountants, Ernst & Young LLP, are responsible for
expressing an opinion on the conformity of the Company's audited financial
statements to generally accepted accounting principles.

In this context, the Audit Committee hereby reports as follows:

1. The Audit Committee has reviewed and discussed the audited financial
statements with the Company's management.

2. The Audit Committee has discussed with the independent accountants
the matters required to be discussed by SAS 61, as amended.

3. The Audit Committee has received the written disclosures and the
letter from the independent accountants required by Independence Standards
Board Standard No. 1 and has discussed with the independent accountants the
independent accountants' independence.

4. Based on the review and discussion referred to in paragraphs
(1) through (3) above, the Audit Committee recommended to the Board of
Directors, and the Board of Directors has approved, that the audited
financial statements be included in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 2001, for filing with the
Securities and Exchange Commission.

Each of the members of the Audit Committee is independent as defined under
the listing standards of the National Association of Securities Dealers. The
undersigned members of the Audit Committee have submitted this Report to the
Board of Directors:

THE AUDIT COMMITTEE:

SUSAN L. SEGAL, MEMBER
DOUGLAS M. KARP, MEMBER
FREDERICK R. WILSON, MEMBER

48
<Page>
INDEPENDENT PUBLIC ACCOUNTANTS

Upon the recommendation of the Audit Committee, the Board selected the firm
of Ernst & Young ("E&Y") to be independent public accountants for the year ended
December 31, 2003. The Company expects a representative of E&Y to be present at
the Meeting, to have the opportunity to make a statement if he or she desires to
do so, and to be available to respond to appropriate questions.

E&Y's report on the financial statements for the year ended December 31,
2001 did not contain an adverse opinion or a disclaimer of opinion, and were not
qualified or modified as to audit scope or accounting principles, except to note
that the "financial statements were prepared assuming that the Company would
continue as a going concern," although the Company's recurring operating losses
and capital "raised substantial doubt about the Company's ability to continue as
a going concern." In addition, during the two most recent fiscal years, there
were no disagreements with E&Y on any matter of accounting principles or
practices, financial statement disclosures or auditing scope or procedure.
During these same periods, there have occurred none of the "reportable events"
listed in Item 304(a)(1)(v)(A-D) of Regulation S-K. In addition, no
consultations listed in Item 304(a)(2)(i)-(ii) occurred during these same
periods.

AUDIT FEES

The fees incurred to the Company's independent public accountants, E&Y,
during the years ended December 31, 2001 and December 31, 2002 for professional
services rendered for audit of the Company's 2001 and 2002 financial statements
and reviews of our financial statements included in the Company's quarterly
reports on Form 10-Q for 2001 and 2002 were approximately $563,000 and $129,000,
respectively. Amounts for 2002 did not include any fees for the audit of the
Company's year end financial statements, which audit has not yet commenced.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION

The Company's independent public accountants have performed no services
relating to the operation or supervising of our information system, managing our
local area network, or designing or implementing a hardware or software system
that aggregates source data underlying the financial statements or generates
information significant to the Company's financial statements as a whole.

ALL OTHER FEES

During the years ended December 31, 2001 and December 31, 2002, the Company
also incurred to E&Y approximately $434,000 and $497,000, respectively, of fees
for all other services, including tax services.

49
<Page>
OTHER INFORMATION

INCORPORATION BY REFERENCE

In our filings with the SEC, information is sometimes incorporated by
reference. This means that we are referring you to information that we have
filed separately with the SEC. The information incorporated by reference should
be considered part of this proxy statement, except for any information
superceded by information contained directly in this proxy statement. Based on
SEC regulations, the stock performance graph on page 41 of this proxy statement
and the Audit Committee Report on page 48 specifically are not incorporated by
reference into any other filings with the SEC. This proxy statement incorporates
by reference the following:

- Our 2001 Report on Form 10-K, as amended, for the year ended December 31,
2001;

- Our Quarterly Report on Form 10-Q, as amended, for the quarter ended
March 31, 2002, as filed with the SEC concurrently herewith;

- Our Quarterly Report on Form 10-Q, as amended, for the quarter ended
June 30, 2002, as filed with the SEC concurrently herewith;

- Our Quarterly Report on Form 10-Q, as amended, for the quarter ended
September 30, 2002, as filed with the SEC concurrently herewith;

- Our Current Report on Form 8-K, as filed with the SEC on January 8, 2002;

- Our Current Report on Form 8-K, as filed with the SEC on January 25, 2002;

- Our Current Report on Form 8-K, as filed with the SEC on April 19, 2002;
and

- Our Current Report on Form 8-K, as filed with the SEC on July 3, 2002.

The documents that we incorporate by reference, as listed above, are being
concurrently delivered with this proxy statement.

This proxy statement is sent to you as part of the proxy materials for the
2002 Annual Meeting of Stockholders. You may not consider this proxy statement
as material for soliciting the purchase or sale of our Common Stock.

AVAILABLE INFORMATION

The proposed Split Amendment will result in a "going private" transaction
subject to Rule 13e-3 of the 1934 Act. The Company has filed a Rule 13e-3
Transaction Statement on Schedule 13E-3 under the 1934 Act with respect to the
Transaction. The Schedule 13E-3 contains additional information about the
Company. Copies of the Schedule 13E-3 are available for inspection and copying
at the principal executive offices of the Company during regular business hours
by any interested stockholder of the Company, or a representative who has been
so designated in writing, and may be inspected and copied, or obtained by mail,
by written request directed to StarMedia Network, Inc, 999 Brickell Ave., Suite
#900, Miami, Florida 33131.

The Company is currently subject to the information requirements of the 1934
Act and in accordance therewith files periodic reports, proxy statements and
other information with the SEC relating to its business, financial and other
matters. Stockholders of the Company as of the Record Date for the Meeting are
being forwarded a copy of the Company's Annual Report on Form 10-K (exclusive of
exhibits) as filed with the SEC, and the consolidated statements of financial
condition of the Company as of December 31, 2001 and the related consolidated
statements of income, changes in stockholders' equity and cash flows for each of
the three years ended December 31, 2001, 2000 and 1999 prepared in accordance
with generally accepted accounting principles. Copies of the Company's
Form 10-Qs, as amended, for the quarterly periods ended March 31, 2002,
June 30, 2002 and September 30, 2002 are also being forwarded to all

50
<Page>
stockholders. For additional copies, write to StarMedia Network, Inc, 999
Brickell Ave., Suite #900, Miami, Florida 33131.

Copies of such reports, proxy statements and other information, as well as
the Schedule 13E-3, may be copied (at prescribed rates) at the public reference
facilities maintained by the SEC at Room 1024, 450 Fifth Street, N.W., Judiciary
Plaza, Washington, D.C. 20549. For further information concerning the SEC's
public reference rooms, you may call the SEC at 1-800-SEC-0330. Some of this
information may also be accessed on the World Wide Web through the SEC's
Internet address at "http://www.sec.gov." The Company's Common Stock is quoted
on the Pink Sheets electronic quotation system under the symbol "STRM." In
addition, certain reports, proxy statements and other information may be
inspected and copied at the offices of the National Association of Securities
Dealers, 33 Whitehall Street, New York, NY 10004-2193.

OTHER MATTERS

As of the date of this proxy statement, management knows of no matters other
than those set forth herein which will be presented for consideration at the
Meeting. If any other matter or matters are properly brought before the Meeting
or any adjournment thereof, the persons named in the accompanying proxy will
have discretionary authority to vote or otherwise act, with respect to such
matters in accordance with their judgment.

By Order of the Board of Directors,

Susan L. Segal
ACTING CHAIRMAN OF THE BOARD OF
DIRECTORS

New York, NY
February 13, 2003

51
<Page>

ANNUAL MEETING OF STOCKHOLDERS OF

STARMEDIA NETWORK, INC.

THURSDAY, MARCH 17, 2003

------------------------------
Please date, sign and mail your proxy COMPANY NUMBER
card in the envelope provided as soon ------------------------------
as possible. ACCOUNT NUMBER
------------------------------

Please detach and mail in the envelope provided.

<Table>

THE BOARD OF DIRECTORS RECOMMENDS AVOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS 2 THROUGH 6.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE /X/

FOR AGAINST ABSTAIN
1.Election of Director 2. Amendment to Amended and Restated Certificate of / / / / / /
Incorporation to change the Company's name to
NOMINEE "Cyclelogic, Inc:"
/ / FOR NOMINEE Susan L. Segal
3. Amendment to Amended and Restated Certificate of / / / / / /
/ / WITHHOLD AUTHORITY Incorporation to effect a one-for-1,000 Reverse Stock
Split of the Common Stock:

4. Amendment to Amended and Restated Certificate of / / / / / /
Incorporation to Modify Number of Directors to not
less than three (3) nor more than nine (9):

5. Amendment to Amended and Restated Certificate of / / / / / /
Incorporation to Permit Stockholder Approval by
Written Consent in Lieu of a Meeting:

6. In their discretion upon such other matters as may properly come before
the meeting.

- ----------------------------------------------------
To change the address on your account,
please check the box at right and
indicate your new address in the address
space above. Please note that changes / /
to the registered name(s) on the account
may not be submitted via this method.
- ----------------------------------------------------

Signature of Stockholder __________________ Date:_____________ Signature of Stockholder _______________________ Date: _____________
</Table>

NOTE: This proxy must be signed exactly as the name appears hereon.
When shares are held jointly, each holder should sign. When signing as
executor, administrator, attorney, trustee or guardian, please give full title
as such. If the signer is a corporation, please sign full corporate name by
duly authorized officer, giving full title as such. If signer is a partnership,
please sign in partnership name by authorized person.

<Page>

PROXY

STARMEDIA NETWORK, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
(THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS)

The undersigned stockholder of StarMedia Network, Inc. hereby appoints
Jose Manual Tost, President, and Ana Maria Lozano-Stickley, Chief Financial
Officer, and each of them, with full power of substitution in each proxy to vote
the shares of stock, in accordance with the undersigned's specifications, which
the undersigned could vote if personally present at the Annual Meeting of
Stockholders of StarMedia Network, Inc. to be held on Monday, March 17, 2003 at
2:00 p.m. Eastern Standard Time, or any adjournments.

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)