Memo of Understanding - Terra Networks & Telepizza

Telefonica SA
27 April 2000


MEMORANDUM OF UNDERSTANDING BETWEEN TERRA NETWORKS, S.A. AND TELEPIZZA, S.A.

Telefonica's subsidiary, TERRA NETWORKS, S.A. and TELE PIZZA, S.A. yesterday
signed a Memorandum of Understanding aimed at the joint development and
operating of the sale of convenience products (books, videos, CDs, pre pay
cards, entertainment products) through communication networks such as Internet
and telephony, offering delivery and distribution in between one and twenty-four
hours. 

This activity is due to take place through the incorporation of a new company,
in which each of the two companies will hold a 50% stake.  The Memorandum of
Understanding acknowledges that TERRA NETWORKS, S.A. will be responsible for the
contribution and application of communications networks and Internet-related
know-how, and TELE PIZZA, S.A. will contribute its prowess in such areas as the
receiving and treatment of orders, logistics, storage, customer portfolio and
direct marketing.

The Memorandum of Understanding also foresees that ANDERSEN CONSULTING and
CREDIT SUISSE FIRST BOSTON will be responsible for the drawing up and
development of the new company's Business Plan, as well as the participation of
the Telefonica Group company, ATENTO, S.A. who will provide telemarketing
services and callcentres in both this new project and of the Telepizza Group's
current activity.

In accordance with the bases already stated, and the conclusions reached by the
two interested parties, these will proceed to negotiate the formalizing of the
Collaboration Contract that will set forth the terms and conditions finally
agreed on by the two parties in order to develop the aforementioned activity.

Likewise, in accordance with the Memorandum of Understanding, ATENTO, S.A.
yesterday, April 26th, 2000, acquired a 4.89% stake in the share capital of TELE
PIZZA, S.A.