UNITEDGLOBALCOM
December 12, 2002
Personal & Confidential
-----------------------
Mr. Xxxxxx Xxxxxxxx
Senior Vice President
Capital Research and Management Company
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xx. 00000
Dear Xxxxx:
This letter agreement sets forth our mutual understanding with respect to
the proposed transaction (the "Transaction") among Capital Research and
Management Company on behalf of The Income Fund of America, Capital World Growth
and Income Fund, Inc. and Fundamental Investors, Inc. (together, the "Sellers"),
and UnitedGlobalCom, Inc. (the "Purchaser").
The Transaction will be structured as an acquisition of (x) 2,400
Preference Shares A of United Pan-Europe Communications, N.V. ("UPC"), nominal
value (euro)1.00 per share (the "Preference Shares") and (y) to the extent not
prohibited by Dutch law, warrants to purchase 1,165,352 ordinary shares A of
UPC, nominal value (euro)1.00 per share (the "Ordinary Shares"), at an exercise
price of (euro)42.546 per Ordinary Share (the "Warrants," and, together with the
Preference Shares, the "UPC Securities"; provided, that to the extent that the
Sellers' transfer of the Warrants to the Purchaser is prohibited by Dutch law,
"UPC Securities" shall be deemed to be only the Preference Shares), by the
Purchaser in exchange for 482,217 shares of its Class A Common Stock, par value
$.01 per share ("UGC Shares") in accordance with the attached term sheet (the
"Term Sheet"). The Term Sheet constitutes an integral part of this letter
agreement and is incorporated herein by reference. The Sellers will deliver the
UPC Securities to the Purchaser free and clear of any liens or encumbrances. The
Purchaser will deliver the UGC Shares to the Sellers free and clear of any liens
or encumbrances, including without limitation, any contractual "lock-up"
obligations or rights of first refusal.
Except as required by law (including the Purchaser's disclosure obligations
under Section 13(d) of the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder and any disclosures required to be
December 12, 2002
Page 2
made in connection with the restructuring of UPC), the Purchaser and the
Sellers, on behalf of themselves and their representatives, agree to keep
strictly confidential all terms of the Transaction and the terms of this letter
agreement and Term Sheet.
The rights and liabilities of the parties to this letter agreement shall be
governed by and construed in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in the State of Delaware,
without regard to principles of conflicts of laws, and may be signed in any
number of counterparts. Each of the parties irrevocably and unconditionally
consents and submits to the jurisdiction of the state and federal courts located
in the State of Delaware for purposes of any action, suit or proceeding arising
out of or relating to this letter agreement and irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or proceeding
arising out of or relating to this letter agreement in any state or federal
court located in the State of Delaware.
This letter agreement shall not be amended or modified except in writing,
signed by the parties hereto. This letter agreement may be executed in one or
more counterparts, each of which shall be an original, but all such counterparts
shall together constitute but one and the same instrument. All references herein
to the date of this letter agreement shall be deemed to be the date that all
parties to this agreement shall have executed counterparts of this letter and
delivered such counterparts to the other parties hereto.
Upon its acceptance by you, this letter agreement will evidence our binding
mutual understanding with respect to consummating the Transaction substantially
in the manner outlined herein and in the attached Term Sheet. Until execution
and delivery of definitive documentation with respect to the Transaction (the
"Transaction Documents"), the parties agree that this letter shall be binding
upon the parties hereto. Upon its acceptance by you, the parties agree to use
their commercially reasonable efforts to prepare and execute the Transaction
Documents and consummate the Transaction substantially on the terms set forth in
this letter agreement as soon as reasonably practicable and in any event on or
prior to February 14, 2003, unless otherwise agreed in writing by the parties.
The Transaction Documents shall contain customary terms and conditions,
including, without limitation, customary representations and warranties.
December 12, 2002
Page 3
If the foregoing meets with your approval, please indicate your acceptance
of this letter, by signing and returning the accompanying copy of this letter,
whereupon it will become our binding agreement.
Very truly yours,
UNITEDGLOBALCOM, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Sr. VP
December 12, 2002
Page 4
Accepted and agreed to
this 12 day of December, 2002:
CAPITAL RESEARCH AND
MANAGEMENT COMPANY
On behalf of
The Income Fund of America,
Capital World Growth and Income
Fund, Inc.,
and Fundamental Investors, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President and Secretary
December 12, 2002
Page 5
TERM SHEET
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Consideration: Sellers will receive 482,217 UGC Shares in
exchange for the UPC Securities.
Closing Date: The business day on which the Sellers delivers
the UPC Securities to the Purchaser in
accordance with the Transaction Documents and
the Purchaser delivers the UGC Shares to the
Sellers in accordance with the Transaction
Documents.
Registration Rights: The Purchaser will cause the UGC Shares to be
delivered to the Sellers to be included in a
registration statement on an appropriate form
under the Securities Act of 1933, as amended,
within 30 days of the Closing Date by amendment
to an existing registration statement or by
filing a new registration statement, and will
use its commercially reasonable efforts to cause
such registration statement to become effective
within 120 days of the Closing Date.
