UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Quarterly Period Ended:
JUNE 30, 1999
OR
( ) Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period from ________ to ________.
Commission File Number 0-6983
COMCAST CORPORATION
[GRAPHIC OMITTED - LOGO]
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 23-1709202
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1500 Market Street, Philadelphia, PA 19102-2148
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code: (215) 665-1700
--------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such requirements
for the past 90 days.
Yes _X_ No ___
--------------------------
As of June 30, 1999, there were 708,502,767 shares of Class A Special Common
Stock, 31,494,976 shares of Class A Common Stock and 9,444,375 shares of Class B
Common Stock outstanding.
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
TABLE OF CONTENTS
Page
Number
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheet as of
June 30, 1999 and December 31, 1998 (Unaudited)..........2
Condensed Consolidated Statement of
Operations and Accumulated Deficit for
the Six and Three Months Ended June 30,
1999 and 1998 (Unaudited)................................3
Condensed Consolidated Statement of Cash
Flows for the Six Months Ended June 30,
1999 and 1998 (Unaudited)................................4
Notes to Condensed Consolidated
Financial Statements (Unaudited)....................5 - 15
ITEM 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations.........................................16 - 23
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings.......................................24
ITEM 4. Submission of Matters to a Vote of Security
Holders............................................24 - 25
ITEM 6. Exhibits and Reports on Form 8-K........................25
SIGNATURE.........................................................26
-----------------------------------
This Quarterly Report on Form 10-Q is for the three months ended June 30,
1999. This Quarterly Report modifies and supersedes documents filed prior to
this Quarterly Report. The SEC allows us to "incorporate by reference"
information that we file with them, which means that we can disclose important
information to you by referring you directly to those documents. Information
incorporated by reference is considered to be part of this Quarterly Report. In
addition, information we file with the SEC in the future will automatically
update and supersede information contained in this Quarterly Report. In this
Quarterly Report, "Comcast," "we," "us" and "our" refer to Comcast Corporation
and its subsidiaries.
You should carefully review the information contained in this Quarterly
Report and in other reports or documents that we file from time to time with the
SEC. In this Quarterly Report, we state our beliefs of future events and of our
future financial performance. In some cases, you can identify those so-called
"forward-looking statements" by words such as "may," "will," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"potential," or "continue" or the negative of those words and other comparable
words. You should be aware that those statements are only our predictions.
Actual events or results may differ materially. In evaluating those statements,
you should specifically consider various factors, including the risks outlined
below. Those factors may cause our actual results to differ materially from any
of our forward-looking statements.
Factors Affecting Future Operations
The cable communications industry and the provision of programming content
may be affected by, among other things:
o changes in laws and regulations,
o changes in the competitive environment,
o changes in technology,
o franchise related matters,
o market conditions that may adversely affect the availability of debt
and equity financing for working capital, capital expenditures or
other purposes,
o demand for the programming content we distribute or the willingness of
other video program providers to carry our content,
o general economic conditions.
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
(Dollars in millions, except share data)
June 30, December 31
1999 1998 ,
----------- -----------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents............................................... $2,193.7 $870.7
Investments............................................................. 5,735.7 3,653.4
Accounts receivable, less allowance for doubtful
accounts of $128.6 and $120.7......................................... 548.3 549.3
Inventories, net........................................................ 383.9 343.8
Other current assets.................................................... 110.8 100.2
----------- -----------
Total current assets................................................ 8,972.4 5,517.4
----------- -----------
INVESTMENTS................................................................ 1,364.2 602.4
----------- -----------
PROPERTY AND EQUIPMENT..................................................... 4,669.0 3,886.7
Accumulated depreciation................................................ (1,519.7) (1,362.3)
----------- -----------
Property and equipment, net............................................. 3,149.3 2,524.4
----------- -----------
DEFERRED CHARGES........................................................... 10,757.7 8,214.5
Accumulated amortization................................................ (2,358.6) (2,148.2)
----------- -----------
Deferred charges, net................................................... 8,399.1 6,066.3
----------- -----------
$21,885.0 $14,710.5
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses................................... $1,851.6 $1,600.3
Accrued interest........................................................ 96.6 73.5
Net liabilities of discontinued operations.............................. 173.3 165.2
Deferred income taxes................................................... 1,725.6 1,033.2
Current portion of long-term debt....................................... 838.4 113.5
----------- -----------
Total current liabilities........................................... 4,685.5 2,985.7
----------- -----------
LONG-TERM DEBT, less current portion....................................... 7,004.1 5,464.2
----------- -----------
DEFERRED INCOME TAXES...................................................... 2,518.4 1,500.1
----------- -----------
MINORITY INTEREST AND OTHER................................................ 884.4 834.0
----------- -----------
COMMITMENTS AND CONTINGENCIES
COMMON EQUITY PUT OPTIONS.................................................. 50.5 111.2
----------- -----------
STOCKHOLDERS' EQUITY
Preferred stock - authorized, 20,000,000 shares; 5% series A convertible,
no par value, issued, 6,370 at redemption value....................... 31.9 31.9
5.25% series B mandatorily redeemable convertible, $1,000 par value,
issued, 554,976 and 540,690 at redemption value....................... 555.0 540.7
Class A special common stock, $1 par value -authorized,
2,500,000,000 shares; issued, 708,502,767 and 698,395,170............ 708.5 698.4
Class A common stock, $1 par value - authorized,
200,000,000 shares; issued, 31,494,976 and 31,690,063 ................ 31.5 31.7
Class B common stock, $1 par value - authorized,
50,000,000 shares; issued, 9,444,375 ................................. 9.4 9.4
Additional capital...................................................... 3,280.7 2,941.7
Accumulated deficit..................................................... (592.8) (1,488.2)
Accumulated other comprehensive income.................................. 2,717.9 1,049.7
----------- -----------
Total stockholders' equity.......................................... 6,742.1 3,815.3
----------- -----------
$21,885.0 $14,710.5
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
(Unaudited)
<TABLE>
<CAPTION>
(Amounts in millions, except per share data)
Six Months Ended Three Months Ended
June 30, June 30,
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES
Service income......................................................... $1,570.5 $1,385.5 $846.1 $675.7
Net sales from electronic retailing.................................... 1,282.1 1,074.6 632.5 530.0
--------- --------- --------- ---------
2,852.6 2,460.1 1,478.6 1,205.7
--------- --------- --------- ---------
COSTS AND EXPENSES
Operating.............................................................. 789.5 741.0 415.9 353.8
Cost of goods sold from electronic retailing........................... 769.3 652.4 378.8 320.0
Selling, general and administrative.................................... 411.3 364.7 226.6 178.6
Depreciation........................................................... 254.0 227.7 137.3 110.6
Amortization........................................................... 292.1 240.8 170.2 118.7
--------- --------- --------- ---------
2,516.2 2,226.6 1,328.8 1,081.7
--------- --------- --------- ---------
OPERATING INCOME........................................................... 336.4 233.5 149.8 124.0
OTHER (INCOME) EXPENSE
Interest expense....................................................... 254.7 237.2 143.5 116.8
Investment (income) expense............................................ (128.0) 1.9 (0.2) 0.3
Equity in net losses of affiliates..................................... 1.6 236.8 2.7 107.3
Gain from equity offering of affiliate................................. (59.6)
Other.................................................................. (1,430.9) (4.1) (1,430.7) (1.4)
--------- --------- --------- ---------
(1,302.6) 412.2 (1,284.7) 223.0
--------- --------- --------- ---------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME
TAX EXPENSE, MINORITY INTEREST AND EXTRAORDINARY ITEMS................. 1,639.0 (178.7) 1,434.5 (99.0)
INCOME TAX EXPENSE......................................................... 723.7 9.3 636.3 3.0
--------- --------- --------- ---------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE
MINORITY INTEREST AND EXTRAORDINARY ITEMS.............................. 915.3 (188.0) 798.2 (102.0)
MINORITY INTEREST.......................................................... (12.8) (39.2) (28.1) (22.0)
--------- --------- --------- ---------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE
EXTRAORDINARY ITEMS.................................................... 928.1 (148.8) 826.3 (80.0)
LOSS FROM DISCONTINUED OPERATIONS, net of income tax
benefit of $11.9, $9.1, $0.0 and $3.3.................................. 20.1 14.9 4.8
--------- --------- --------- ---------
INCOME (LOSS) BEFORE EXTRAORDINARY ITEMS................................... 908.0 (163.7) 826.3 (84.8)
EXTRAORDINARY ITEMS........................................................ (3.0) (2.3)
--------- --------- --------- ---------
NET INCOME (LOSS).......................................................... 905.0 (163.7) 824.0 (84.8)
PREFERRED DIVIDENDS........................................................ (15.1) (14.3) (7.6) (7.2)
--------- --------- --------- ---------
NET INCOME (LOSS) FOR COMMON STOCKHOLDERS.................................. $889.9 ($178.0) $816.4 ($92.0)
========= ========= ========= =========
ACCUMULATED DEFICIT
Beginning of period....................................................($1,488.2)($2,415.9)($1,416.8)($2,503.3)
Net income (loss)...................................................... 905.0 (163.7) 824.0 (84.8)
Common dividends - $.024 and $.012 per share in 1998................... (17.1) (8.6)
Retirement of common stock............................................. (9.6)
--------- --------- --------- ---------
End of period.......................................................... ($592.8)($2,596.7) ($592.8)($2,596.7)
========= ========= ========= =========
BASIC EARNINGS (LOSS) FOR COMMON STOCKHOLDERS PER COMMON SHARE
Income (loss) from continuing operations before extraordinary items.... $1.23 ($.22) $1.10 ($.12)
Loss from discontinued operations...................................... (.03) (.02) (.01)
Extraordinary items....................................................
--------- --------- --------- ---------
Net income (loss)................................................... $1.20 ($.24) $1.10 ($.13)
========= ========= ========= =========
BASIC WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 742.9 727.0 744.4 738.0
========= ========= ========= =========
DILUTED EARNINGS (LOSS) FOR COMMON STOCKHOLDERS
PER COMMON SHARE
Income (loss) from continuing operations before extraordinary items.... $1.13 ($.22) $1.01 ($.12)
Loss from discontinued operations...................................... (.02) (.02) (.01)
Extraordinary items....................................................
--------- --------- --------- ---------
Net income (loss)................................................... $1.11 ($.24) $1.01 ($.13)
========= ========= ========= =========
DILUTED WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 815.1 727.0 815.3 738.0
========= ========= ========= =========
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
(Dollars in millions)
Six Months Ended June 30,
1999 1998
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss)........................................................ $905.0 ($163.7)
Adjustments to reconcile net income (loss) to net cash provided
by operating activities from continuing operations:
Depreciation........................................................... 254.0 227.7
Amortization........................................................... 292.1 240.8
Non-cash interest expense, net......................................... (2.6) 21.5
Equity in net losses of affiliates..................................... 1.6 236.8
Gain from equity offering of affiliate................................. (59.6)
Non-cash investment (income) expense, net.............................. (54.8) 32.5
Minority interest...................................................... (12.8) (39.2)
Loss from discontinued operations...................................... 20.1 14.9
Extraordinary items.................................................... 3.0
Deferred income taxes and other........................................ 388.0 (74.0)
--------- ---------
1,793.6 437.7
Changes in working capital............................................. 177.7 1.7
--------- ---------
Net cash provided by operating activities
from continuing operations .................................. 1,971.3 439.4
--------- ---------
FINANCING ACTIVITIES
Proceeds from borrowings................................................. 912.6 994.4
Retirement and repayment of debt......................................... (152.8) (805.7)
Issuances of common stock, net........................................... 0.2 13.9
Dividends................................................................ (9.4) (17.9)
Deferred financing costs................................................. (14.6) (4.5)
Other.................................................................... (3.0) 2.2
--------- ---------
Net cash provided by financing activities from
continuing operations ....................................... 733.0 182.4
--------- ---------
INVESTING ACTIVITIES
Acquisitions, net of cash acquired....................................... (708.0) (219.4)
(Purchases of) proceeds from sales of short-term investments, net........ (83.3) 115.4
Investments.............................................................. (196.2) (83.4)
Proceeds from sales of and distributions from investments................ 54.3 0.7
Proceeds from investee's repayment of loan............................... 74.7
Proceeds from sales of call options...................................... 20.7
Capital expenditures..................................................... (326.4) (402.2)
Additions to deferred charges............................................ (121.7) (29.8)
Other.................................................................... (1.4)
--------- ---------
Net cash used in investing activities
from continuing operations .................................. (1,381.3) (524.7)
--------- ---------
INCREASE IN CASH AND CASH EQUIVALENTS - CONTINUING OPERATIONS............... 1,323.0 97.1
CASH AND CASH EQUIVALENTS, beginning of period.............................. 870.7 409.1
--------- ---------
CASH AND CASH EQUIVALENTS, end of period.................................... $2,193.7 $506.2
========= =========
</TABLE>
See notes to condensed consolidated financial statements.
4
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Basis of Presentation
The condensed consolidated balance sheet as of December 31, 1998 has been
condensed from the audited consolidated balance sheet as of that date. The
condensed consolidated balance sheet as of June 30, 1999, the condensed
consolidated statements of operations and accumulated deficit for the six
and three months ended June 30, 1999 and 1998 and the condensed
consolidated statement of cash flows for the six months ended June 30, 1999
and 1998 have been prepared by Comcast Corporation (the "Company") and have
not been audited by the Company's independent auditors. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flows as of June 30, 1999 and for all periods presented
have been made.
Certain information and note disclosures normally included in the Company's
annual financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. These condensed
consolidated financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's December
31, 1998 Annual Report on Form 10-K filed with the Securities and Exchange
Commission (the "SEC"). The results of operations for the periods ended
June 30, 1999 are not necessarily indicative of operating results for the
full year.
The results of operations of Comcast Cellular Corporation ("Comcast
Cellular"), an indirect wholly owned subsidiary of the Company, have been
presented as a discontinued operation in accordance with Accounting
Principles Board ("APB") Opinion No. 30, "Reporting the Results of
Operations - Reporting the Effects of Disposal of a Segment of a Business,
and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" (see Note 3).
Stock Split
On March 3, 1999, the Company's board of directors authorized an increase
in the number of authorized shares of the Company's Class A Special Common
Stock from 500 million shares to 2.5 billion shares. On that date, the
Company's Board of Directors also authorized a two-for-one stock split in
the form of a 100% stock dividend (the "Stock Split") payable on May 5,
1999 to shareholders of record on April 20, 1999, subject to shareholder
approval of the increase in authorized shares (which was obtained on April
20, 1999). The dividend was paid in Class A Special Common Stock to the
holders of Class A Common, Class A Special Common and Class B Common Stock.
The average number of shares outstanding and related prices, per share
amounts, share conversions and stock option data have been retroactively
restated to reflect the Stock Split. The Company's board of directors also
eliminated the quarterly cash dividend of $.012 per share on all classes of
its Common Stock. The last quarterly cash dividend was paid on March 25,
1999.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
New Accounting Pronouncement
In June 1998, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting
for Derivative Instruments and Hedging Activities." This statement
establishes the accounting and reporting standards for derivatives and
hedging activity. Upon the adoption of SFAS No. 133, all derivatives are
required to be recognized in the statement of financial position as either
assets or liabilities and measured at fair value. In July 1999, the FASB
issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging
Activities - Deferral of the Effective Date of FASB Statement No. 133 - an
amendment of FASB Statement No. 133" deferring the effective date for
implementation of SFAS No. 133 to fiscal years beginning after June 15,
2000. The Company is currently evaluating the impact the adoption of SFAS
No. 133 will have on its financial position and results of operations.
Earnings (Loss) for Common Stockholders Per Common Share
Earnings (loss) for common stockholders per common share is computed by
dividing net income (loss), after deduction of preferred stock dividends,
when applicable, by the weighted average number of common shares
outstanding during the period on a basic and diluted basis.
5
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
The following table reconciles the numerator and denominator of the
computations of diluted earnings (loss) for common stockholders per common
share ("Diluted EPS") for the six and three months ended June 30, 1999 and
1998, respectively.
<TABLE>
<CAPTION>
(Amounts in millions, except per share data)
Six Months Ended Three Months Ended
June 30, June 30,
1999 1998 1999 1998
-------- -------- --------- ---------
<S> <C> <C> <C> <C>
Net income (loss) for common stockholders $889.9 ($178.0) $816.4 ($92.0)
Preferred dividends............................. 15.1 7.6
-------- -------- --------- ---------
Net income (loss) for common stockholders
used for Diluted EPS.......................... $905.0 ($178.0) $824.0 ($92.0)
======== ======== ========= =========
Basic weighted average number of common
shares outstanding............................ 742.9 727.0 744.4 738.0
Dilutive securities: (see Note 6)
Series A and B convertible preferred stock 45.2 45.2
Stock option and restricted stock plans....... 27.0 25.7
-------- -------- --------- ---------
Diluted weighted average number of common
shares outstanding............................ 815.1 727.0 815.3 738.0
======== ======== ========= =========
Diluted earnings (loss) for common stockholders
per common share.............................. $1.11 ($.24) $1.01 ($.13)
======== ======== ========= =========
</TABLE>
Put options sold by the Company on a weighted average 4.8 million shares
and 4.2 million shares, respectively, of its Class A Special Common stock
(see Note 6) were outstanding during the six and three months ended June
30, 1999 but were not included in the computation of Diluted EPS as the
options' exercise price was less than the average market price of the
Company's Class A Special Common Stock during the periods.
For the six and three months ended June 30, 1998, the Company's potential
common shares of 94.0 million shares and 94.0 million shares, respectively,
have an antidilutive effect on loss for common stockholders per common
share and, therefore, have not been used in determining the total weighted
average number of common shares outstanding.
Reclassifications
Certain reclassifications have been made to the prior year condensed
consolidated financial statements to conform to those classifications used
in 1999.
3. SIGNIFICANT EVENTS
Sale of Comcast Cellular
In July 1999, the Company completed the sale of Comcast Cellular to SBC
Communications, Inc. for approximately $360 million in cash and the
assumption of $1.315 billion of Comcast Cellular debt. The Company expects
to recognize a gain in the third quarter of approximately $350 million, net
of income tax expense. Such gain will be reflected as gain on disposal of
discontinued operations in the Company's condensed consolidated statement
of operations and accumulated deficit. Revenues for Comcast Cellular were
$241.6 million and $221.3 million for the six months ended June 30, 1999
and 1998, respectively.
Acquisition of Greater Philadelphia Cablevision
On June 30, 1999, the Company completed the acquisition of Greater
Philadelphia Cablevision, Inc. ("Greater Philadelphia"), a subsidiary of
Greater Media, Inc. that operates a cable system serving approximately
79,000 subscribers in Philadelphia, Pennsylvania, by issuing approximately
8.5 million shares of its Class A Special
6
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Common Stock with a value of $291.7 million based upon the average closing
price of the Company's Class A Special Common Stock for a ten-day period
before and after the announcement of the transaction in February 1999. The
acquisition was accounted for under the purchase method of accounting, as
such, the operating results of Greater Philadelphia have been included in
the accompanying condensed consolidated statement of operations and
accumulated deficit from the acquisition date. The allocation of the
purchase price to the assets and liabilities of Greater Philadelphia is
preliminary pending a final appraisal. As the consideration given in
exchange for Greater Philadelphia was shares of the Company's Class A
Special Common Stock, the Greater Philadelphia acquisition had no
significant impact on the Company's condensed consolidated statement of
cash flows.
Adelphia Agreement
In May 1999, the Company and Jones Intercable, Inc., a consolidated
subsidiary of the Company, ("Jones Intercable" - see "Acquisition of a
Controlling Interest in Jones Intercable" below) entered into an agreement
(the "Adelphia Agreement") to exchange certain cable systems with Adelphia
Communications ("Adelphia"). Under the terms of the Adelphia Agreement, the
Company and Jones Intercable, in the aggregate, will receive approximately
464,000 cable subscribers from Adelphia. In exchange, Adelphia will receive
current systems owned by the Company and Jones Intercable serving, in the
aggregate, approximately 440,000 subscribers. All of the systems involved
in the transactions will be valued based upon independent appraisals with
any difference in relative value to be funded with cash or additional cable
systems. The system exchanges are subject to customary closing and
regulatory approvals and are expected to close by mid-2000.
AT&T Agreement
In May 1999, the Company and AT&T Corp. ("AT&T") entered into an agreement
(the "AT&T Agreement") to exchange various cable systems (the "AT&T System
Exchanges"). Under the terms of the AT&T Agreement, the Company will pay
AT&T approximately $3.4 billion (subject to adjustment based on the actual
number of net subscribers acquired and the per subscriber price of certain
subscribers) for the approximately 750,000 net subscribers to be acquired
as a result of the AT&T System Exchanges. The Company will pay for the net
subscribers acquired in connection with the AT&T System Exchanges with
shares of AT&T common stock currently owned or subsequently acquired by the
Company and other securities or assets which would permit the AT&T System
Exchanges to be tax-free to the extent possible. The value of any currently
owned AT&T common stock to be exchanged will be $54.41 per share, based
upon the average trading price during the 20-day trading period beginning
June 3, 1999.
Under the terms of the AT&T Agreement, the Company also has an option to
acquire from AT&T, following approximately three years, additional cable
systems with a total of between 1.0 million and 1.4 million subscribers for
approximately $4.8 billion to $6.7 billion (subject to reduction for any
long-term debt and other liabilities of the acquired cable systems). The
Company will pay for these cable systems with shares of the Company's Class
A Special Common Stock (valued on the same basis as described in the prior
paragraph) and other securities or assets which would permit the
acquisition to be tax-free (or if such result can not be obtained, with
cash).
Under the terms of the AT&T Agreement, the Company has also agreed to offer
AT&T-branded residential wireline telephony in its cable system markets,
provided AT&T has concluded separate residential telephony agreements with
at least two other non-AT&T affiliated multi-system cable operators. AT&T
has agreed to grant the Company the most favorable terms AT&T has reached
with any of those or other multi-system cable operators.
The majority of the AT&T System Exchanges and the exercise of the Company's
option to acquire the additional cable systems are contingent upon the
completion of AT&T's acquisition of MediaOne (see Proposed Acquisition of
MediaOne Group, Inc. below), which is expected to close in 2000, subject to
receipt of necessary shareholder, regulatory and other approvals. There can
be no assurance, however, that such acquisition will be consummated.
Proposed Acquisition of MediaOne Group, Inc.
In March 1999, the Company and MediaOne Group, Inc. ("MediaOne"), entered
into an Agreement and Plan of Merger (the "Merger Agreement") pursuant to
which MediaOne was to be merged with and into the Company. Under the terms
of the Merger Agreement, MediaOne could terminate the Merger Agreement
under certain conditions, provided that it pay a termination fee of $1.5
billion in cash to the Company. In April 1999, AT&T
7
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
submitted an offer to purchase MediaOne. On May 1, 1999, the MediaOne Board
of Directors notified the Company that it had determined that the AT&T
offer was superior to the Company's offer. On May 6, 1999, MediaOne
terminated the Merger Agreement and MediaOne paid the Company the
termination fee. The termination fee was recorded to other income in the
Company's condensed consolidated statement of operations and accumulated
deficit, net of transaction costs, for the six and three months ended June
30, 1999.
Acquisition of a Controlling Interest in Jones Intercable
In May 1998, the Company agreed to purchase from BCI Telecom Holding
("BTH") 6.4 million Class A Common Shares in Jones Intercable, and a 49%
interest in the BTH subsidiaries which were to continue to own BTH's
remaining 6.4 million shares of Jones Intercable Class A Common Stock. At
the same time, the Company agreed to acquire approximately 2.9 million
shares of Common Stock of Jones Intercable (the "Control Shares"), if and
when acquired by BTH from affiliates of Jones Intercable's controlling
shareholder under an existing option (the "Control Option") to acquire such
shares (which absent extraordinary circumstances would not have been
exercisable until December 2001). The Company was to purchase the remaining
51% of the BTH subsidiaries when the Control Shares were acquired. The
Company, BTH, Jones Intercable and Jones Intercable's controlling
shareholder agreed in August 1998 to accelerate the Control Option to
permit its early exercise and the early closing of the transactions with
BTH. The transaction closed on April 7, 1999. The Company paid $706.3
million in cash to acquire the 12.8 million shares of Jones Intercable
Class A Common Stock and the Control Shares. On June 29, 1999, the Company
purchased an additional 1.0 million shares of Jones Intercable Class A
Common Stock for $50.0 million through a private transaction. As of June
30, 1999, the Company controls 39.6% of the economic and 48.3% of the
voting interest in Jones Intercable. In addition, the Control Shares
represent shares having the right to elect approximately 75% of the Board
of Directors of Jones Intercable. The share acquisitions were funded with
available cash and cash equivalents. Jones Intercable is a public company,
which owns cable operations serving approximately 1.0 million customers.
The acquisition was accounted for under the purchase method of accounting,
as such, the operating results of Jones Intercable have been included in
the accompanying condensed consolidated statement of operations and
accumulated deficit from the acquisition date. The allocation of the
purchase price to the assets and liabilities of Jones Intercable is
preliminary pending a final appraisal.
On August 9, 1999, the Company announced its intention to commence an offer
to exchange 1.4 shares of its Class A Special Common Stock for each share
of Class A Common Stock or Common Stock of Jones Intercable for up to 79%
of the combined number of shares of Jones Intercable Class A Common Stock
and Common Stock outstanding (subject to certain terms and conditions to be
contained in the offer documents). The offer would commence upon
registration of the Company's Class A Special Common Stock to be offered in
the exchange offer with the SEC pursuant to an effective registration
statement.
Investment in Prime Communications
In December 1998, the Company agreed to invest in Prime Communications LLC
("Prime"), a cable television operator with cable communications systems
serving approximately 430,000 subscribers. During the fourth quarter of
1998, the Company acquired a $50 million 12.75% subordinated note due 2008
from Prime. In addition, under the terms of the agreement, in July 1999 the
Company issued to Prime a $735 million 6% ten year convertible note, giving
the Company the right to convert the note to acquire 90% of Prime. The note
cannot be converted until the build out of certain of Prime's cable systems
is complete and regulatory and other approvals are obtained, which is
expected to close no later than 2002. If the note is converted, the Company
would assume approximately $550 million of Prime debt. The Company would
have the option to acquire the remaining 10% interest in Prime for
approximately $82 million, plus accrued interest at 7% per annum.
8
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
4. INVESTMENTS
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
---------- --------------
(Dollars in millions)
<S> <C> <C>
Equity method............................................... $40.1 $11.1
Fair value method........................................... 6,882.4 4,170.0
Cost method................................................. 177.4 74.7
---------- ------------
Total investments.................................... 7,099.9 4,255.8
Less current investments.................................... 5,735.7 3,653.4
---------- ------------
Non-current investments..................................... $1,364.2 $602.4
========== ============
</TABLE>
Equity Method
The Company records its proportionate interests in the net income (loss) of
certain of its equity method investees in arrears. The Company's recorded
investments exceed its proportionate interests in the book value of the
investees' net assets by $80.5 million as of June 30, 1999 (primarily
related to the Company's investment in The Golf Channel). Such excess is
being amortized to equity in net income or loss, primarily over a period of
twenty years, which is consistent with the estimated lives of the
underlying assets. The original cost of investments accounted for under the
equity method totaled $233.5 million and $215.3 million as of June 30, 1999
and December 31, 1998, respectively.
9
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Summarized financial information for the six and three months ended June
30, 1998 for the Company's equity method investees is presented below.
Summarized financial information is not presented for Sprint PCS, Teleport
Communications Group Inc. ("Teleport") or Birmingham Cable Corporation
Limited and Cable London, PLC (together, the "UK Investees") as of or for
the six and three months ended June 30, 1999 as such investments are no
longer accounted for under the equity method (dollars in millions):
<TABLE>
<CAPTION>
Sprint UK
PCS Teleport Investees Other Combined
--------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Six months ended June 30, 1998:
Combined Results of Operations
Revenues, net............................... $285.0 $310.5 $116.1 $535.3 $1,246.9
Operating, selling, general and
administrative expenses................... 871.5 301.3 90.2 576.3 1,839.3
Depreciation and amortization............... 238.4 97.1 40.8 43.5 419.8
Operating loss.............................. (824.9) (87.9) (14.9) (84.5) (1,012.2)
Net loss (1)................................ (1,058.0) (134.7) (50.6) (113.9) (1,357.2)
Company's Equity in Net Loss
Equity in current period net loss........... ($158.7) ($19.7) ($18.2) ($37.1) ($233.7)
Amortization expense........................ (1.5) (0.3) (1.3) (3.1)
--------- --------- -------- -------- --------
Total equity in net loss.................. ($160.2) ($19.7) ($18.5) ($38.4) ($236.8)
========= ========= ======== ======== ========
Three months ended June 30, 1998:
Combined Results of Operations
Revenues, net............................... $143.8 $160.1 $58.8 $244.6 $607.3
Operating, selling, general and
administrative expenses................... 393.5 147.2 45.2 258.0 843.9
Depreciation and amortization............... 115.7 49.1 21.1 14.4 200.3
Operating loss.............................. (365.4) (36.2) (7.5) (27.8) (436.9)
Net loss (1)................................ (498.6) (62.2) (20.5) (41.3) (622.6)
Company's Equity in Net Loss
Equity in current period net loss........... ($74.8) ($9.1) ($7.8) ($14.5) ($106.2)
Amortization expense........................ (0.7) (0.1) (0.3) (1.1)
--------- --------- -------- -------- --------
Total equity in net loss.................. ($75.5) ($9.1) ($7.9) ($14.8) ($107.3)
========= ========= ======== ======== ========
<FN>
--------
(1) Net loss also represents loss from continuing operations before
extraordinary items and cumulative effect of changes in accounting
principles.
</FN>
</TABLE>
Sprint PCS. Effective November 1998, in connection with the restructuring
of Sprint PCS, the Company accounts for its investment in Sprint PCS under
the fair value method.
Teleport. In November 1997, Teleport issued shares of its Class A Common
Stock. As a result of the share issuance, the Company recognized a $59.6
million increase in its proportionate share of Teleport's net assets as a
gain from equity offering of affiliate for the six months ended June 30,
1998. The Company recorded its proportionate share of Teleport's net assets
one quarter in arrears. In July 1998, in connection with AT&T's acquisition
of Teleport, the Company exchanged its interest in Teleport for shares of
AT&T common stock. As of June 30, 1999 and December 31, 1998, the Company
has recorded its investment in AT&T at its estimated fair value.
10
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
UK Investees. In October 1998, the Company exchanged its interest in
Comcast UK Cable Partners Limited ("Comcast UK Cable") for shares of NTL
Incorporated ("NTL") common stock. As of June 30, 1999 and December 31,
1998, the Company has recorded its investment in NTL at its estimated fair
value.
Other. The Company's other equity investees include investments in cable
communications and content providers. The Company does not consider these
other equity method investments to be individually significant to its
consolidated financial position, results of operations or liquidity.
Fair Value Method
The Company holds unrestricted equity investments in certain publicly
traded companies, with an historical cost (including $1.999 billion of
pre-tax gains recognized during 1998) of $2.706 billion and $2.555 billion
as of June 30, 1999 and December 31, 1998, respectively. The Company has
recorded these investments, which are classified as available for sale, at
their estimated fair values of $6.882 billion and $4.170 billion as of June
30, 1999 and December 31, 1998, respectively. The unrealized pre-tax gains
as of June 30, 1999 and December 31, 1998 of $4.176 billion and $1.615
billion, respectively, have been reported in the Company's condensed
consolidated balance sheet as a component of accumulated other
comprehensive income, net of related deferred income tax expense of $1.462
billion and $565.1 million, respectively.
AT&T Acquisition of TCI
In March 1999, AT&T merged with Tele-Communications, Inc. ("TCI") with AT&T
as the surviving corporation (the "AT&T/TCI Merger"). Upon closing of the
AT&T/TCI Merger, the Company received approximately 3.6 million shares (as
adjusted for AT&T's 3-for-2 stock split in April 1999) of AT&T common stock
in exchange for the approximately 3.1 million shares of TCI Class A Common
Stock held by the Company and the Company received approximately 3.6
million shares of Class A Liberty Media Group ("New Liberty") Tracking
Shares for the approximately 2.3 million shares of TCI Ventures Group, Inc.
("TCI Ventures") common stock and the approximately 2.4 million shares of
Liberty Media Group ("Old Liberty") Class A Common Stock held by the
Company. As a result of the exchange, the Company recognized a pre-tax gain
of $187.6 million during the six months ended June 30, 1999, representing
the difference between the fair value of the stock received and the
Company's basis in TCI and TCI Ventures. Such gain is included in
investment (income) expense in the Company's condensed consolidated
statement of operations and accumulated deficit.
In March 1998, the Company sold call options relating to its unrestricted
equity investments in TCI, TCI Ventures and Old Liberty common stock
(together, the "TCI Stock") for $20.7 million. Such call options expire
between March and November 1999. During the six and three months ended June
30, 1999 and 1998, the Company recorded investment expense of $100.8
million, $40.2 million, $49.4 million and $25.6 million, respectively,
related to changes in the value of the call options and settlement of the
TCI and TCI Ventures call options.
Impairment Losses
During the six and three months ended June 30, 1999, the Company recorded
pre-tax losses of $35.5 million and $0.2 million, respectively, on certain
of its investments based on a decline in value that was considered other
than temporary. Such losses are included in investment (income) expense in
the Company's condensed consolidated statement of operations and
accumulated deficit.
5. LONG-TERM DEBT
PHONES
In March 1999, the Company issued 8.7 million 3.35% Exchangeable Extendable
Subordinated Debentures due 2029 (the "PHONES") for gross proceeds of
$718.3 million. At maturity, holders of the PHONES are entitled to receive
in cash an amount equal to the higher of (a) the principal amount of the
PHONES, or (b) the market value of AT&T common stock.
The PHONES are being accounted for as an indexed debt instrument, at June
30, 1999, since the maturity value is dependent upon the fair value of AT&T
common stock. The Company's investment in AT&T is accounted for
11
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
as an "available for sale" security under SFAS No. 115, with changes in
fair value being reflected in accumulated other comprehensive income (see
Note 4).
In July 1999, the Company redeemed all $718.3 million principal amount of
its PHONES. The Company redeemed the PHONES due to its recently announced
transaction with AT&T in which it intends to use AT&T shares as
consideration for the purchase of cable systems from AT&T in accordance
with the AT&T Agreement (see Note 3). In connection with the PHONES
redemption, the Company incurred debt extinguishment costs of $32.3 million
and wrote-off unamortized debt acquisition costs of $14.6 million,
resulting in an extraordinary loss, net of tax, of $30.5 million which will
be recorded in the third quarter of 1999.
Interest Rates
As of June 30, 1999 and December 31, 1998, the Company's effective weighted
average interest rate on its long-term debt outstanding was 7.15% and
7.71%, respectively.
Lines of Credit
As of June 30, 1999, certain subsidiaries of the Company had unused lines
of credit of $1.187 billion, $586.5 million of which is restricted by the
covenants of the related debt agreements and to subsidiary general purposes
and dividend declaration.
6. STOCKHOLDERS' EQUITY
Repurchase Program
In September 1998, the Company announced that its Board of Directors had
authorized a market repurchase program (the "Repurchase Program") pursuant
to which the Company may purchase, in the open market or in private
transactions up to $500.0 million of its outstanding common equity
securities, subject to certain restrictions and market conditions. Based on
the trade date for stock repurchases, during the six months ended June 30,
1999, the Company repurchased 0.4 million shares of its common stock for
aggregate consideration of $11.5 million pursuant to the Repurchase
Program. As part of the Repurchase Program, in September 1998, the Company
sold put options on 5.5 million shares of its Class A Special Common Stock.
During the six and three months ended June 30, 1999, put options covering
3.0 million shares expired unexercised. Upon expiration, the Company
reclassified $60.7 million, the amount it would have been obligated to pay
to repurchase such shares had the put options been exercised, from common
equity put options to additional capital in the Company's condensed
consolidated balance sheet. The remaining put options give the holder the
right to require the Company to repurchase such shares at specified prices
on specific dates during the period from July through September 1999. The
amount the Company would be obligated to pay to repurchase such shares if
all outstanding put options were exercised, totaling $50.5 million and
$111.2 million, respectively, has been reclassified to a temporary equity
account in the Company's condensed consolidated balance sheet as of June
30, 1999 and December 31, 1998.
Series A Preferred Stock Conversion
In July 1999, the Company exercised its right to convert all 6,370 shares
of its Series A Preferred Stock into approximately 2.7 million shares of
its Class A Special Common Stock.
Comprehensive Income (Loss)
Total comprehensive income (loss) for the six and three months ended June
30, 1999 and 1998 was $2.573 billion, ($10.5) million, $1.358 billion and
($3.8) million, respectively. Total comprehensive income (loss) includes
net income (loss), unrealized gains (losses) on marketable securities and
foreign currency translation gains (losses) for the periods presented.
12
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
7. STATEMENT OF CASH FLOWS - SUPPLEMENTAL INFORMATION
The Company made cash payments for interest of $255.2 million, $207.4
million, $198.8 million and $147.0 million during the six and three months
ended June 30, 1999 and 1998, respectively.
The Company made cash payments for income taxes of $112.5 million, $73.0
million, $93.6 million and $58.1 million during the six and three months
ended June 30, 1999 and 1998, respectively.
8. COMMITMENTS AND CONTINGENCIES
The Company is subject to legal proceedings and claims which arise in the
ordinary course of its business. In the opinion of management, the amount
of ultimate liability with respect to these actions will not materially
affect the financial position, results of operations or liquidity of the
Company.
13
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
9. FINANCIAL DATA BY BUSINESS SEGMENT
(Dollars in millions)
<TABLE>
<CAPTION>
Cable Electronic Corporate and
Communications Retailing Other (1) Total
<S> <C> <C> <C> <C>
Six Months Ended June 30, 1999
Revenues, net........................... $1,353.7 $1,282.1 $216.8 $2,852.6
Operating income before depreciation
and amortization (2)................ 623.9 252.4 6.2 882.5
Depreciation and amortization........... 454.7 57.6 33.8 546.1
Operating income (loss)................. 169.2 194.8 (27.6) 336.4
Interest expense........................ 159.0 20.6 75.1 254.7
Capital expenditures.................... 290.0 25.0 11.4 326.4
Three Months Ended June 30, 1999
Revenues, net........................... $748.9 $632.5 $97.2 $1,478.6
Operating income (loss) before
depreciation and amortization (2).... 343.4 121.5 (7.6) 457.3
Depreciation and amortization........... 260.5 29.2 17.8 307.5
Operating income (loss)................. 82.9 92.3 (25.4) 149.8
Interest expense........................ 93.3 10.2 40.0 143.5
Capital expenditures.................... 184.4 14.1 5.5 204.0
As of June 30, 1999
Assets.................................. $9,554.4 $2,197.0 $10,133.6 $21,885.0
Long-term debt, less current portion..... 5,085.9 546.8 1,371.4 7,004.1
Six Months Ended June 30, 1998
Revenues, net........................... $1,109.5 $1,074.6 $276.0 $2,460.1
Operating income (loss) before
depreciation and amortization (2).... 525.3 187.9 (11.2) 702.0
Depreciation and amortization........... 323.6 58.4 86.5 468.5
Operating income (loss)................. 201.7 129.5 (97.7) 233.5
Interest expense........................ 107.9 26.4 102.9 237.2
Capital expenditures.................... 293.7 41.6 66.9 402.2
Three Months Ended June 30, 1998
Revenues, net........................... $568.3 $530.0 $107.4 $1,205.7
Operating income (loss) before
depreciation and amortization (2).... 275.9 92.7 (15.3) 353.3
Depreciation and amortization........... 161.7 28.9 38.7 229.3
Operating income (loss)................. 114.2 63.8 (54.0) 124.0
Interest expense........................ 54.4 13.1 49.3 116.8
Capital expenditures.................... 153.4 22.1 32.0 207.5
<FN>
- ---------------
(1) Other includes segments not meeting certain quantitative guidelines for
reporting. Other includes certain other operating businesses, including
Comcast-Spectacor, L.P., E! Entertainment Television, Inc., Comcast UK
Cable (prior to October 29, 1998), the Company's DBS operations (prior to
April 1, 1998) and elimination entries related to the segments presented.
Corporate and other assets consist primarily of the Company's investments
(see Note 4).
(2) See note (a) on page 15.
14
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED
(Unaudited)
(a) Operating income (loss) before depreciation and amortization is commonly
referred to in the Company's businesses as "operating cash flow." Operating
cash flow is a measure of a company's ability to generate cash to service
its obligations, including debt service obligations, and to finance capital
and other expenditures. In part due to the capital intensive nature of the
Company's businesses and the resulting significant level of non-cash
depreciation and amortization expense, operating cash flow is frequently
used as one of the bases for comparing businesses in the Company's
industries, although the Company's measure of operating cash flow may not
be comparable to similarly titled measures of other companies. Operating
cash flow is the primary basis used by the Company's management to measure
the operating performance of its businesses. Operating cash flow does not
purport to represent net income or net cash provided by operating
activities, as those terms are defined under generally accepted accounting
principles, and should not be considered as an alternative to such
measurements as an indicator of the Company's performance.
</FN>
</TABLE>
15
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Overview
We have experienced significant growth in recent years both through
strategic acquisitions and growth in our existing businesses. We have
historically met our cash needs for operations through our cash flows from
operating activities. Cash requirements for acquisitions and capital
expenditures have been provided through our financing activities and sales of
investments, as well as our existing cash, cash equivalents and short-term
investments.
In July 1999, we completed the sale of Comcast Cellular Corporation
("Comcast Cellular") to SBC Communications, Inc. for approximately $360 million
in cash, subject to customary closing adjustments, and the assumption of $1.315
billion of Comcast Cellular debt. We expect to recognize a gain in the third
quarter of approximately $350 million, net of income tax expense. The gain will
be reflected as gain on disposal of discontinued operations in our condensed
consolidated statement of operations and accumulated deficit.
General Developments of Business
See Note 3 to our condensed consolidated financial statements included in
Item 1.
Liquidity and Capital Resources
The cable communications and the electronic retailing industry are
experiencing increasing competition and rapid technological changes. Our future
results of operations will be affected by our ability to react to changes in the
competitive environment and by our ability to implement new technologies.
However, we believe that competition and technological changes will not
significantly affect our ability to obtain financing.
We believe that we will be able to meet our current and long-term liquidity
and capital requirements, including fixed charges, through our cash flows from
operating activities, existing cash, cash equivalents, short-term investments,
lines of credit and other external financing.
Cash, Cash Equivalents and Short-term Investments
We have traditionally maintained significant levels of cash, cash
equivalents and short-term investments to meet our short-term liquidity
requirements. Our cash equivalents and short-term investments are recorded at
fair value. Cash, cash equivalents and short-term investments as of June 30,
1999 were $7.929 billion. As of June 30, 1999, our cash, cash equivalents and
short-term investments include $5.634 billion of our investments in AT&T Corp.
("AT&T"), Sprint PCS, NTL Incorporated ("NTL") and Liberty Media Group ("New
Liberty") (see Note 4 to our condensed consolidated financial statements
included in Item 1). As of June 30, 1999, $316.6 million of our cash, cash
equivalents and short-term investments is restricted to use by subsidiaries
under contractual or other arrangements.
Investments
See Notes 3 and 4 to our condensed consolidated financial statements
included in Item 1.
We do not have any significant contractual funding commitments with respect
to any of our investments. However, to the extent we do not fund our investees'
capital calls, we expose ourselves to dilution of our ownership interests. We
continually evaluate our existing investments, as well as new investment
opportunities.
Financing
See Notes 5 and 6 to our condensed consolidated financial statements
included in Item 1.
As of June 30, 1999 and December 31, 1998, our long-term debt, including
current portion, was $7.843 billion and $5.578 billion, respectively, of which
20.5% and 18.0%, respectively, was at variable rates.
We may from time to time, depending on certain factors including market
conditions, make optional repayments on our debt obligations, which may include
open market repurchases of our outstanding public notes and debentures.
Equity Price Risk
In March 1999, we issued 8.7 million 3.35% Exchangeable Extendable
Subordinated Debentures due 2029 (the "PHONES") for gross proceeds of $718.3
million. At maturity, holders of the PHONES are entitled to receive in cash an
amount equal to the higher of (a) the principal amount of the PHONES, or (b) the
market value of AT&T common stock. We accounted for the PHONES
16
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
as an indexed debt instrument, at June 30, 1999, since the maturity value is
dependent upon the fair value of AT&T common stock. In July 1999, we redeemed
all the PHONES and incurred debt extinguishment costs of $32.3 million and
wrote-off unamortized debt acquisition costs of $14.6 million, resulting in an
extraordinary loss, net of tax, of $30.5 million which will be recorded in the
third quarter of 1999.
In June 1999, we entered into costless collar agreements (the "Equity
Collars") covering $483.7 million notional amount of investment securities
accounted for at fair value. The Equity Collars limit our exposure to and
benefits from price fluctuations in the underlying equity securities. The Equity
Collars mature in 2001. As we account for the Equity Collars as a hedge, changes
in the value of the Equity Collars are substantially offset by changes in the
value of the underlying investment securities which are also marked-to-market
through accumulated other comprehensive income in our condensed consolidated
balance sheet.
Interest Rate Risk
From January 1, 1999 through August 13, 1999, we have entered into interest
rate exchange agreements ("Swaps") with an aggregate notional amount of $300.0
million and as part of our acquisition of a controlling interest in Jones
Intercable, Inc. ("Jones Intercable") (see Note 3 to our condensed consolidated
financial statements included in Item 1), we acquired Swaps with an aggregate
notional amount of $400.0 million. Swaps with an aggregate notional amount of
$350.0 million either were terminated or expired from January 1, 1999 through
August 13, 1999. As of August 13, 1999, we have Swaps with an aggregate notional
amount of $1.412 billion having an average pay rate of 5.93% and an average
receive rate of 5.93%.
Year 2000 Readiness Disclosures
The Year 2000 Issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Certain of our
computer programs that have date-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000 (the "Year 2000 Issue"). If this
situation occurs, the potential exists for computer system failure or
miscalculations by computer programs, which could cause disruption of
operations.
We are in the process of evaluating and addressing the impact of the Year
2000 Issue on our operations to ensure that our information technology and
business systems recognize calendar Year 2000. We are utilizing both internal
and external resources in implementing our Year 2000 program, which consists of
the following phases:
o Assessment Phase. Structured evaluation, including a detailed
inventory outlining the impact that the Year 2000 Issue may have on
current operations.
o Detailed Planning Phase. Establishment of priorities, development of
specific action steps and allocation of resources to address the
issues identified in the Assessment Phase.
o Conversion Phase. Implementation of the necessary system modifications
as outlined in the Detailed Planning Phase.
o Testing Phase. Verification that the modifications implemented in the
Conversion Phase will be successful in resolving the Year 2000 Issue
so that all inventory items will function properly, both individually
and on an integrated basis.
o Implementation Phase. Final roll-out of fully tested components into
an operational unit.
Based on an inventory conducted in 1997, we have identified computer
systems that will require modification or replacement so that they will properly
utilize dates beyond December 31, 1999. Many of our critical systems are new and
are already Year 2000 compliant as a result of the recent rebuild of many of our
cable communications systems. In addition, we have initiated communications with
all of our significant software suppliers and service bureaus to determine their
plans for remediating the Year 2000 Issue in their software which we use or rely
upon.
As of June 30, 1999, except for Jones Intercable, we are in the Testing
Phase and the Implementation Phase of our Year 2000 remediation program with
respect to certain of our key systems. For Jones Intercable, as of June 30,
1999, we are in the Conversion Phase and the Testing Phase of our Year 2000
remediation program with respect to certain of our key systems. Through June 30,
1999, we have incurred approximately $9
17
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
million in connection with our Year 2000 remediation program. We estimate that
we will incur between approximately $7 million to $13 million of additional
expense through December 1999 in connection with our Year 2000 remediation
program. Our estimate to complete the remediation plan includes the estimated
time associated with mitigating the Year 2000 Issue for third party software.
However, there can be no guarantee that the systems of other companies on which
we rely will be converted on a timely basis, or that a failure to convert by
another company would not have a material adverse effect on us.
Our management will continue to periodically report the progress of our
Year 2000 remediation program to the Audit Committee of our Board of Directors.
We plan to complete the Year 2000 mitigation by the end of the third quarter of
1999, except for Jones Intercable which will be completed in November 1999. Our
management has investigated and may consider potential contingency plans in the
event that our Year 2000 remediation program is not completed by that date.
The costs of the project and the date on which we plan to complete the Year
2000 modifications and replacements are based on our best estimates, which were
derived using assumptions of future events including the continued availability
of resources and the reliability of third party modification plans. However,
there can be no guarantee that these estimates will be achieved and actual
results could differ materially from those plans. Specific factors that may
cause such material differences include, but are not limited to, the
availability and cost of personnel with appropriate necessary skills and the
ability to locate and correct all relevant computer code and similar
uncertainties.
We believe that with modifications to existing software and conversions to
new software, the Year 2000 Issue can be mitigated. However, if such
modifications and conversions are not made, or are not completed within an
adequate time frame, the Year 2000 Issue could have a material adverse impact on
our operations.
-----------------------
Statement of Cash Flows
Cash and cash equivalents increased $1.323 billion as of June 30, 1999 from
December 31, 1998. The increase in cash and cash equivalents resulted from cash
flows from operating, financing and investing activities
which are explained below.
Net cash provided by operating activities from continuing operations
amounted to $1.971 billion for the six months ended June 30, 1999, due
principally to the effects of the receipt of the $1.5 billion termination fee in
May 1999 from MediaOne Group, Inc., our acquisition of a controlling interest in
Jones Intercable in April 1999 (see Note 3 to our condensed consolidated
financial statements included in Item 1), increases in our operating income
before depreciation and amortization (see "Results of Operations") and changes
in working capital as a result of the timing of receipts and disbursements.
Net cash provided by financing activities from continuing operations, which
includes borrowings and repayments of debt, as well as the issuances and
repurchases of our equity securities, was $733.0 million for the six months
ended June 30, 1999. During the six months ended June 30, 1999, we borrowed
$912.6 million, consisting primarily of $718.3 million of PHONES and $193.5
million under revolving lines of credit held by our subsidiaries. During the six
months ended June 30, 1999, we repaid $152.8 million of our long-term debt. In
addition, during the six months ended June 30, 1999, we had net issuances of
$0.2 million of our common stock and we paid cash dividends of $9.4 million on
our common stock and Series A Preferred Stock. Deferred financing costs of $14.6
million were incurred during the six months ended June 30, 1999 primarily in
connection with the issuance of the PHONES.
Net cash used in investing activities from continuing operations was $1.381
billion for the six months ended June 30, 1999. Net cash used in investing
activities includes acquisitions, net of cash acquired of $708.0 million,
consisting primarily of our acquisition of a controlling interest in Jones
Intercable, investments of $196.2 million, capital expenditures of $326.4
million, additions to deferred charges of $121.7 million and net purchases of
short-term investments of $83.3 million, offset by proceeds from sales of and
distributions from investments of $54.3 million.
18
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
Results of Operations
Our summarized consolidated financial information for the six and three
months ended June 30, 1999 and 1998 is as follows (dollars in millions, "NM"
denotes percentage is not meaningful):
<TABLE>
<CAPTION>
Six Months Ended
June 30, Increase / (Decrease)
1999 1998 $ %
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues..................................................... $2,852.6 $2,460.1 $392.5 16.0%
Cost of goods sold from electronic retailing................. 769.3 652.4 116.9 17.9
Operating, selling, general and administrative expenses 1,200.8 1,105.7 95.1 8.6
--------- ---------
Operating income before depreciation and amortization (1) 882.5 702.0 180.5 25.7
Depreciation................................................. 254.0 227.7 26.3 11.6
Amortization................................................. 292.1 240.8 51.3 21.3
--------- ---------
Operating income............................................. 336.4 233.5 102.9 44.1
--------- ---------
Interest expense............................................. 254.7 237.2 17.5 7.4
Investment (income) expense.................................. (128.0) 1.9 129.9 NM
Equity in net losses of affiliates........................... 1.6 236.8 (235.2) (99.3)
Gain from equity offering of affiliate....................... (59.6) (59.6) NM
Other income................................................. (1,430.9) (4.1) 1,426.8 NM
Income tax expense........................................... 723.7 9.3 714.4 NM
Minority interest............................................ (12.8) (39.2) (26.4) (67.3)
--------- ---------
Income (loss) from continuing operations before
extraordinary items....................................... $928.1 ($148.8) $1,076.9 NM
========= =========
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended
June 30, Increase / (Decrease)
1999 1998 $ %
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues..................................................... $1,478.6 $1,205.7 $272.9 22.6%
Cost of goods sold from electronic retailing................. 378.8 320.0 58.8 18.4
Operating, selling, general and administrative expenses 642.5 532.4 110.1 20.7
--------- ---------
Operating income before depreciation and amortization (1) 457.3 353.3 104.0 29.4
Depreciation................................................. 137.3 110.6 26.7 24.1
Amortization................................................. 170.2 118.7 51.5 43.4
--------- ---------
Operating income............................................. 149.8 124.0 25.8 20.8
--------- ---------
Interest expense............................................. 143.5 116.8 26.7 22.9
Investment (income) expense.................................. (0.2) 0.3 0.5 NM
Equity in net losses of affiliates........................... 2.7 107.3 (104.6) (97.5)
Other income................................................. (1,430.7) (1.4) 1,429.3 NM
Income tax expense........................................... 636.3 3.0 633.3 NM
Minority interest............................................ (28.1) (22.0) 6.1 27.7
--------- ---------
Income (loss) from continuing operations before
extraordinary items....................................... $826.3 ($80.0) $906.3 NM
========= =========
<FN>
- ------------
(1) Operating income before depreciation and amortization is commonly referred
to in our businesses as "operating cash flow." Operating cash flow is a
measure of a company's ability to generate cash to service its obligations,
including debt service obligations, and to finance capital and other
expenditures. In part due to the capital intensive nature of our businesses
and the resulting significant level of non-cash depreciation expense and
amortization expense, operating cash flow is frequently used as one of the
bases for comparing businesses in our industries, although our measure of
operating cash flow may not be comparable to similarly titled measures of
other companies. Operating cash flow is the primary basis used by our
management to measure the operating performance of our businesses.
Operating cash flow does not purport to represent net income or net cash
provided by operating
19
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
activities, as those terms are defined under generally accepted accounting
principles, and should not be considered as an alternative to such
measurements as an indicator of our performance. See "Statement of Cash
Flows" above for a discussion of net cash provided by operating activities.
</FN>
</TABLE>
Operating Results by Business Segment
The following represent the operating results of our significant business
segments, "Cable Communications" and "Electronic Retailing." The remaining
components of our operations are not independently significant to our
consolidated financial position or results of operations (see Note 9 to our
condensed consolidated financial statements included in Item 1).
Cable Communications
The following table presents the operating results of our cable
communications segment (dollars in millions):
<TABLE>
<CAPTION>
Six Months Ended
June 30, Increase
1999 1998 $ %
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Service income............................................... $1,353.7 $1,109.5 $244.2 22.0%
Operating, selling, general and
administrative expenses................................. 729.8 584.2 145.6 24.9
--------- --------- --------- --------
Operating income before depreciation
and amortization (a).................................... $623.9 $525.3 $98.6 18.8%
========= ========= ========= ========
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended
June 30, Increase
1999 1998 $ %
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Service income............................................... $748.9 $568.3 $180.6 31.8%
Operating, selling, general and
administrative expenses................................. 405.5 292.4 113.1 38.7
--------- --------- --------- --------
Operating income before depreciation
and amortization (a).................................... $343.4 $275.9 $67.5 24.5%
========= ========= ========= ========
<FN>
- ---------------
(a) See footnote (1) on page 19.
</FN>
</TABLE>
Of the respective $244.2 million and $180.6 million increases in service
income for the six and three month periods from 1998 to 1999, $146.3 million and
$132.9 million are attributable to the effects of the acquisitions of cable
communications systems, $12.5 million and $5.8 million are attributable to
subscriber growth, $47.1 million and $22.2 million relate to changes in rates,
$10.6 million and $5.6 million are attributable to growth in cable advertising
sales and $27.7 million and $14.1 million relate to other product offerings
(e.g., digital cable, high speed data services, etc.).
Of the respective $145.6 million and $113.1 million increases in operating,
selling, general and administrative expenses for the six and three month periods
from 1998 to 1999, $102.6 million and $95.3 million are attributable to the
effects of the acquisitions of cable communications systems, $20.3 million and
$10.8 million are attributable to increases in the costs of cable programming as
a result of changes in rates, subscriber growth and additional channel
offerings, $2.2 million and $0.9 million are attributable to growth in
advertising sales and $20.5 million and $6.1 million result from increases in
the cost of labor, other volume related expenses and costs associated with new
product offerings. We anticipate that the cost of cable programming will
increase in the future as cable programming rates increase and additional
sources of cable programming become available.
20
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
Electronic Retailing
The following presents the operating results of our electronic retailing
segment, consisting of the operations of QVC, Inc. and its subsidiaries ("QVC"),
a majority owned and controlled subsidiary (dollars in millions):
<TABLE>
<CAPTION>
Six Months Ended
June 30, Increase
1999 1998 $ %
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Net sales from electronic retailing.......................... $1,282.1 $1,074.6 $207.5 19.3%
Cost of goods sold from electronic retailing................. 769.3 652.4 116.9 17.9
Operating, selling, general and administrative
expenses................................................ 260.4 234.3 26.1 11.1
--------- --------- --------- --------
Operating income before depreciation
and amortization (a).................................... $252.4 $187.9 $64.5 34.3%
========= ========= ========= ========
Gross margin................................................. 40.0% 39.3%
========= =========
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended
June 30, Increase
1999 1998 $ %
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Net sales from electronic retailing.......................... $632.5 $530.0 $102.5 19.3%
Cost of goods sold from electronic retailing................. 378.8 320.0 58.8 18.4
Operating, selling, general and administrative
expenses................................................ 132.2 117.3 14.9 12.7
--------- --------- --------- --------
Operating income before depreciation
and amortization (a).................................... $121.5 $92.7 $28.8 31.1%
========= ========= ========= ========
Gross margin................................................. 40.1% 39.6%
========= =========
<FN>
- ---------------
(a) See footnote (1) on page 19.
</FN>
</TABLE>
The increase in net sales from electronic retailing of $207.5 million for
the six month period from 1998 to 1999 is due to the effects of 3.8%, 11.3% and
40.1% increases in the average number of homes receiving QVC services in the
United States ("US"), United Kingdom ("UK") and Germany, respectively, and 9.7%,
12.0% and 98.6% increases in net sales per home in the US, UK and Germany,
respectively. The increase in net sales from electronic retailing of $102.5
million for the three month period from 1998 to 1999 is due to the effects of
3.4%, 11.7% and 38.0% increases in the average number of homes receiving QVC
services in the US, UK and Germany, respectively, and 10.8%, 6.4% and 109.2%
increases in net sales per home in the US, UK and Germany, respectively.
The increase in cost of goods sold is primarily related to the growth in
net sales. The increase in gross margin is a result of a slight shift in sales
mix to higher margin products.
Of the respective $26.1 million and $14.9 million increases in operating,
selling, general and administrative expenses for the six and three month periods
from 1998 to 1999, $17.8 million and $9.2 million are attributable to higher
variable costs associated with the increase in sales volume. The remaining
increases are attributable to higher personnel costs to support the increased
sales volume in the US, UK and Germany.
-----------------------
Consolidated Analysis
The effects of our recent acquisitions, as well as increased levels of
capital expenditures, were to increase our revenues and expenses resulting in
increases in our operating income before depreciation and amortization. The
increases in depreciation expense, amortization expense and interest expense for
the six and three month
21
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
periods from 1998 to 1999 are primarily due to the effects of our acquisition of
a controlling interest in Jones Intercable on April 7, 1999, offset in part by
the effects of the sale of Comcast UK Cable Partners Limited ("Comcast UK
Cable"), a consolidated subsidiary of ours, in October 1998. In addition, our
equity in net losses of affiliates has decreased principally as a result of the
restructuring of Sprint PCS in November 1998.
Interest Expense
The $17.5 million and $26.7 million increases in interest expense for the
six and three month periods from 1998 to 1999 are primarily due to the effects
of our acquisition of a controlling interest in Jones Intercable and the
issuance of the 6.20% nonrecourse notes issued by Comcast Cable Communications,
Inc. ("Comcast Cable"), a wholly owned subsidiary of ours, in November 1998,
offset in part by the effects of the sale of Comcast UK Cable in October 1998.
We anticipate that, for the foreseeable future, interest expense will be a
significant cost to us and will have a significant adverse effect on our ability
to realize net earnings. We believe we will continue to be able to meet our
obligations through our ability both to generate operating income before
depreciation and amortization and to obtain external financing.
Investment (Income) Expense
In March 1999, AT&T merged with TeleCommunications, Inc. ("TCI") with AT&T
as the surviving corporation (the "AT&T/TCI Merger"). Upon closing of the
AT&T/TCI Merger, we received approximately 3.6 million shares (as adjusted for
AT&T's 3-for-2 stock split in April 1999) of AT&T common stock in exchange for
the approximately 3.1 million shares of TCI Class A Common Stock held by us and
we received approximately 3.6 million shares of New Liberty Class A Tracking
Shares for the approximately 2.3 million shares of TCI Ventures Group, Inc.
("TCI Ventures") common stock and the approximately 2.4 million shares of
Liberty Media Group ("Old Liberty") Class A Common Stock held by us. As a result
of the exchange, we recognized a pre-tax gain of $187.6 million during the six
months ended June 30, 1999, representing the difference between the fair value
of the AT&T stock received and our basis in TCI and TCI Ventures.
In March 1998, we sold call options relating to our unrestricted equity
investments in TCI, TCI Ventures and Old Liberty common stock for $20.7 million.
Such call options expire between March and November 1999. During the six and
three months ended June 30, 1999 and 1998, we recorded investment expense of
$100.8 million, $40.2 million, $49.4 million and $25.6 million, respectively,
related to changes in the value of the call options and settlement of the TCI
and TCI Ventures call options.
During the six months ended June 30, 1999, we recorded pre-tax losses of
$35.5 million on certain of our investments based on a decline in value that was
considered other than temporary.
Gain From Equity Offering of Affiliate
In November 1997, Teleport Communications Group Inc. ("Teleport") issued
shares of its Class A Common Stock. As a result of the stock issuance, we
recognized a $59.6 million increase in our proportionate share of Teleport's net
assets as a gain from equity offering of affiliate for the six months ended June
30, 1998. We recorded our proportionate share of Teleport's net losses one
quarter in arrears.
Other Income
The $1.427 billion and $1.429 billion increases in other income for the six
and three month periods from 1998 to 1999 are primarily attributable to the
receipt of the $1.5 billion MediaOne termination fee, net of transaction costs,
in May 1999.
Income Tax Expense
The $714.4 million and $633.3 million increases in income tax expense for
the six and three month periods from 1998 to 1999 are primarily the result of
the effects of changes in our income before taxes and minority interest, and
non-deductible foreign losses and non-deductible equity in net losses of
affiliates.
Minority Interest
The changes in minority interest income for the six and three month periods
from 1998 to 1999 are attributable to the effects of our acquisition of a
controlling interest in Jones Intercable in April 1999, the sale of Comcast UK
Cable in October 1998 and to changes in the net income or loss of our other less
than 100% owned consolidated subsidiaries.
22
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
For the six and three months ended June 30, 1999 and 1998, our earnings
from continuing operations (income (loss) from continuing operations plus income
tax expense, equity in net losses of affiliates, fixed charges (interest
expense) and extraordinary items) were $1.908 billion, $334.5 million, $1.609
billion and $147.1 million, respectively. Such earnings were adequate to cover
our fixed charges of $254.7 million, $237.2 million, $143.5 million and $116.8
million for the six and three months ended June 30, 1999 and 1998, respectively.
Fixed charges include non-cash interest expense of $1.8 million, $26.0 million,
$1.3 million and $11.6 million for the six and three months ended June 30, 1999
and 1998, respectively.
We believe that any losses incurred in the future by us will not
significantly affect the performance of our normal business activities because
of our existing cash, cash equivalents and short-term investments, our ability
to generate operating income before depreciation and amortization and our
ability to obtain external financing.
We believe that our operations are not materially affected by inflation.
23
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are subject to legal proceedings and claims which arise in the ordinary
course of our business. In the opinion of our management, the amount of
ultimate liability with respect to these actions will not materially affect
our financial position, results of operations or liquidity.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At a Special Meeting on April 20, 1999, the shareholders approved the
following proposal:
To approve an amendment to the Company's Articles of Incorporation
increasing the number of authorized shares of the Company's Class A Special
Common Stock, par value $1.00 per share, from 500,000,000 shares to
2,500,000,000 shares.
Class of Stock For Against Abstain
-------------- --- ------- -------
Class A 8,257,136 126,647 820
Class B 141,665,625
At the Annual Meeting on June 21, 1999, the shareholders approved the
following proposals:
To elect nine directors to serve for the ensuing year and until their
respective successors shall have been duly elected and qualified.
<TABLE>
<CAPTION>
Director Class of Stock For Withheld
-------- -------------- --- --------
<S> <C> <C> <C>
Ralph J. Roberts Class A 25,010,711 196,883
Class B 141,665,625
Julian A. Brodsky Class A 25,018,519 189,075
Class B 141,665,625
Brian L. Roberts Class A 25,017,268 190,326
Class B 141,665,625
Gustave G. Amsterdam Class A 25,096,215 111,379
Class B 141,665,625
Sheldon M. Bonovitz Class A 25,013,847 193,747
Class B 141,665,625
Joseph L. Castle II Class A 25,117,324 90,270
Class B 141,665,625
Bernard C. Watson Class A 25,113,889 93,705
Class B 141,665,625
Irving A. Wechsler Class A 25,107,106 100,488
Class B 141,665,625
Anne Wexler Class A 25,011,443 196,151
Class B 141,665,625
</TABLE>
To approve an amendment to the Comcast Corporation 1996 Stock Option Plan.
Class of Stock For Against Abstain
-------------- --- ------- -------
Class A 21,054,324 4,057,055 96,215
Class B 141,665,625
24
<PAGE>
To approve an amendment to the Comcast Corporation 1996 Executive Cash
Bonus Plan.
Class of Stock For Against Abstain
-------------- --- ------- -------
Class A 23,634,706 1,456,475 116,413
Class B 141,665,625
To ratify the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the 1999 fiscal year.
Class of Stock For Against Abstain
-------------- --- ------- -------
Class A 25,123,975 48,493 35,126
Class B 141,665,625
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits required to be filed by Item 601 of Regulation S-K:
10.1* Comcast Corporation 1996 Stock Option Plan, as amended and
restated, effective June 21, 1999.
10.2* Comcast Corporation 1996 Deferred Compensation Plan, as
amended and restated, effective June 21, 1999.
10.3* Comcast Corporation 1990 Restricted Stock Plan, as amended and
restated, effective June 21, 1999.
10.4* Comcast Corporation 1996 Cash Bonus Plan, as amended and
restated, effective June 21, 1999.
10.5* Comcast Corporation 1996 Executive Cash Bonus Plan, as amended
and restated, effective June 21, 1999.
10.6* Comcast Corporation 1997 Deferred Stock Option Plan, as
amended and restated, effective June 21, 1999.
27.1 Financial Data Schedule.
(b) Reports on Form 8-K:
(i) We filed a Current Report on Form 8-K under Item 5 on April 8,
1999 relating to our announcement that we had completed the
acquisition of a controlling interest in Jones Intercable,
Inc.
(ii) We filed a Current Report on Form 8-K under Item 5 on May 6,
1999 relating to our announcement that we had entered into an
agreement with AT&T Corp. to exchange certain cable systems
and that we had terminated our Agreement and Plan of Merger
with MediaOne Group, Inc.
(iii) We filed a Current Report on Form 8-K under Item 5 on May 27,
1999 relating to our announcement that we had entered into an
agreement with Adelphia Communications to exchange certain
cable systems.
(iv) We filed a Current Report on Form 8-K under Item 5 on May 27,
1999 relating to our announcement that we intend to redeem all
$718.3 million principal amount of our 3.35% Exchangeable
Subordinated Debentures due 2029.
- ---------------
* Constitutes a management contract or compensatory plan or arrangement.
25
<PAGE>
COMCAST CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COMCAST CORPORATION
----------------------------------------
/S/ LAWRENCE S. SMITH
----------------------------------------
Lawrence S. Smith
Executive Vice President
(Principal Accounting Officer)
Date: August 16, 1999
26
COMCAST CORPORATION
1996 STOCK OPTION PLAN
(As Amended and Restated, Effective June 21, 1999)
1. Purpose of Plan
The purpose of the Plan is to assist the Company in retaining
valued employees, officers and directors by offering them a greater stake in the
Company's success and a closer identity with it, and to aid in attracting
individuals whose services would be helpful to the Company and would contribute
to its success.
2. Definitions
(a) "Affiliate" means, with respect to any Person,
any other Person that, directly or indirectly, is in control of, is controlled
by, or is under common control with, such Person. For purposes of this
definition, the term "control," including its correlative terms "controlled by"
and "under common control with," mean, with respect to any Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
(b) "Board" means the board of directors of the
Sponsor.
(c) "Cash Right" means any right to receive cash in
lieu of Shares granted under the Plan and described in Paragraph 3(a)(iii).
(d) "Cause" means:
(i) for an employee of a Company, a
finding by the Committee, after full consideration of the facts
presented on behalf of both the Company and the employee, that the
employee has breached his employment contract with a Company, has
disclosed trade secrets of a Company or has been engaged in any sort of
disloyalty to a Company, including, without limitation, fraud,
embezzlement, theft, commission of a felony or proven dishonesty in the
course of his employment.
(ii) for a Non-Employee Director, a
finding by the Committee, after full consideration of the facts
presented on behalf of both the Company and the Director, that such
Non-Employee Director has disclosed trade secrets of a Company, or has
been engaged in any sort of disloyalty to a Company, including, without
limitation, fraud, embezzlement, theft, commission of a felony or
proven dishonesty in the course of his service as a Non-Employee
Director.
-1-
<PAGE>
(e) "Change of Control" means any transaction or
series of transactions as a result of which any Person who was a Third Party
immediately before such transaction or series of transactions owns
then-outstanding securities of the Sponsor having more than 50 percent of the
voting power for the election of directors of the Sponsor.
(f) "Code" means the Internal Revenue Code of 1986,
as amended.
(g) "Comcast Plan" means any restricted stock, stock
bonus, stock option or other compensation plan, program or arrangement
established or maintained by the Company or an Affiliate, including but not
limited to this Plan, the Comcast Corporation 1997 Deferred Stock Option Plan,
the Comcast Corporation 1990 Restricted Stock Plan and the Comcast Corporation
1987 Stock Option Plan.
(h) "Committee" means the committee described in
Paragraph 5.
(i) "Common Stock" means the Sponsor's Class A
Special Common Stock, par value, $1.00.
(j) "Company" means the Sponsor, Jones Intercable,
Inc. and each of the Parent Companies and Subsidiary Companies.
(k) "Date of Grant" means the date as of which an
Option is granted.
(l) "Disability" means a disability within the
meaning of section 22(e)(3) of the Code.
(m) "Election Date" means the date on which an
individual is first elected to the Board as a Non-Employee Director, or is
elected to the Board as a Non-Employee Director following a period of one year
or more during which such individual was not a member of the Board.
(n) "Fair Market Value." If Shares are listed on a
stock exchange, Fair Market Value shall be determined based on the last reported
sale price of a Share on the principal exchange on which Shares are listed on
the last trading day prior to the date of determination, or, if Shares are not
so listed, but trades of Shares are reported on the Nasdaq National Market, the
last quoted sale price of a Share on the Nasdaq National Market on the last
trading day prior to the date of determination.
(o) "Grant Date" means each February 1st after the
date of adoption of the Plan by the Board.
-2-
<PAGE>
(p) "Immediate Family" means an Optionee's spouse and
lineal descendants, any trust all beneficiaries of which are any of such persons
and any partnership all partners of which are any of such persons.
(q) "Incentive Stock Option" means an Option granted
under the Plan, designated by the Committee at the time of such grant as an
Incentive Stock Option within the meaning of section 422 of the Code and
containing the terms specified herein for Incentive Stock Options; provided,
however, that to the extent an Option granted under the Plan and designated by
the Committee at the time of grant as an Incentive Stock Option fails to satisfy
the requirements for an incentive stock option under section 422 of the Code for
any reason, such Option shall be treated as a Non-Qualified Option.
(r) "Non-Employee Director" means an individual who
is a member of the Board, and who is not an employee of a Company, including an
individual who is a member of the Board and who previously was an employee of a
Company.
(s) "Non-Qualified Option" means:
(i) an Option granted under the Plan,
designated by the Committee at the time of such grant as a
Non-Qualified Option and containing the terms specified herein
for Non-Qualified Options; and
(ii) an Option granted under the Plan and
designated by the Committee at the time of grant as an
Incentive Stock Option, to the extent such Option fails to
satisfy the requirements for an incentive stock option under
section 422 of the Code for any reason.
(t) "Option" means any stock option granted under the
Plan and described in either Paragraph 3(a)(i) or Paragraph 3(a)(ii).
(u) "Optionee" means a person to whom an Option has
been granted under the Plan, which Option has not been exercised in full and has
not expired or terminated.
(v) "Other Available Shares" means, as of any date,
the excess, if any of:
(i) the total number of Shares owned by
an Optionee; over
(ii) the sum of:
(a) the number of Shares owned
by such Optionee for
less than six months; plus
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(b) the number of Shares owned
by such Optionee that has,
within the preceding six
months, been the
subject of a withholding
certification pursuant to
Paragraph 16(b) or any
similar withholding
certification under any
other Comcast Plan; plus
(c) the number of Shares owned
by such Optionee that has,
within the preceding six
months, been received in
exchange for Shares
surrendered as payment, in
full or in part, of the
exercise price for an
option to purchase any
securities of the Sponsor
or an Affiliate under any
Comcast Plan, but only to
the extent of the number of
Shares surrendered; plus
(d) The number of Shares owned
by such Optionee as to
which evidence of ownership
has, within the preceding
six months, been provided
to the Company in
connection with the
crediting of "Deferred
Stock Units" to such
Optionee's Account under
the Comcast Corporation
1997 Deferred Stock Option
Plan.
For purposes of this Paragraph 2(v), a Share that is subject to a deferral
election pursuant to another Comcast Plan shall not be treated as owned by an
Optionee until all conditions to the delivery of such Share have lapsed. For
purposes of Paragraphs 7(d), 8(d) and 16(b), the number of Other Available
Shares shall be determined separately for the Sponsor's Class A Special Common
Stock, par value, $1.00, and for the Sponsor's Class A Common Stock, par value,
$1.00.
(w) "Outside Director" means a member of the Board
who is an "outside director" within the meaning of section 162(m)(4)(C) of the
Code and applicable Treasury Regulations issued thereunder.
(x) "Parent Company" means all corporations that, at
the time in question, are parent corporations of the Sponsor within the meaning
of section 424(e) of the Code.
(y) "Person" means an individual, a corporation, a
partnership, an association, a trust or any other entity or organization.
(z) "Plan" means the Comcast Corporation 1996 Stock
Option Plan.
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(aa) "Roberts Family." Each of the following is a
member of the Roberts Family:
(i) Brian L. Roberts;
(ii) a lineal descendant of Brian L.
Roberts; or
(iii) a trust established for the benefit
of any of Brian L. Roberts and/or a lineal descendant or descendants of Brian
L. Roberts.
(bb) "Share" or "Shares" means:
(i) for all purposes of the Plan, a
share or shares of Common Stock or such other securities issued by the
Sponsor as may be the subject of an adjustment under Paragraph 11.
(ii) solely for purposes of Paragraphs
2(n), 2(v), 7(d), 8(d) and 16(b), the term "Share" or "Shares" also
means a share or shares of the Sponsor's Class A Common Stock, par
value, $1.00.
(cc) "Sponsor" means Comcast Corporation, a
Pennsylvania corporation, including any successor thereto by merger,
consolidation, acquisition of all or substantially all the assets thereof,
or otherwise.
(dd) "Subsidiary Companies" means
(i) all corporations that, at the time
in question, are subsidiary corporations of the Sponsor within the
meaning of section 424(f) of the Code; and
(ii) Jones Intercable, Inc. and all
corporations that, at the time in question, are subsidiary corporations
of Jones Intercable, Inc. within the meaning of section 424(f) of the
Code.
(ee) "Ten Percent Shareholder" means a person who on
the Date of Grant owns, either directly or within the meaning of the attribution
rules contained in section 424(d) of the Code, stock possessing more than 10% of
the total combined voting power of all classes of stock of his employer
corporation or of its parent or subsidiary corporations, as defined respectively
in sections 424(e) and (f) of the Code, provided that the employer corporation
is a Company.
(ff) "Terminating Event" means any of the following
events:
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(i) the liquidation of the Sponsor; or
(ii) a Change of Control.
(gg) "Third Party" means any Person other than a
Company, together with such Person's Affiliates, provided that the term "Third
Party" shall not include the Sponsor, an Affiliate of the Sponsor or any member
or members of the Roberts Family.
(hh) "1933 Act" means the Securities Act of 1933, as
amended.
(ii) "1934 Act" means the Securities Exchange Act of
1934, as amended.
3. Rights To Be Granted
(a) Types of Options and Other Rights Available for
Grant. Rights that may be granted under the Plan are:
(i) Incentive Stock Options, which
give an Optionee who is an employee of a Company the right for a
specified time period to purchase a specified number of Shares for a
price not less than the Fair Market Value on the Date of Grant;
(ii) Non-Qualified Options, which give
the Optionee the right for a specified time period to purchase a
specified number of Shares for a price determined by the Committee; and
(iii) Cash Rights, which give an
Optionee the right for a specified time period, and subject to such
conditions, if any, as shall be determined by the Committee and stated
in the option document, to receive a cash payment of such amount per
Share as shall be determined by the Committee and stated in the option
document, in lieu of exercising a Non-Qualified Option.
(b) Limit on Grant of Options. The maximum number of
Shares for which Options may be granted to any single individual in any calendar
year, adjusted as provided in Paragraph 11, shall be 10,000,000 Shares.
(c) Presumption of Incentive Stock Option Status.
Each Option granted under the Plan to an employee of a Company is intended to be
an Incentive Stock Option, except to the extent any such grant would exceed the
limitation of Paragraph 9 and except for any Option specifically designated at
the time of grant as an Option that is not an Incentive Stock Option.
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4. Shares Subject to Plan
Subject to adjustment as provided in Paragraph 11, not more
than 40,000,000 Shares in the aggregate may be issued pursuant to the Plan upon
exercise of Options. Shares delivered pursuant to the exercise of an Option may,
at the Sponsor's option, be either treasury Shares or Shares originally issued
for such purpose. If an Option covering Shares terminates or expires without
having been exercised in full, other Options may be granted covering the Shares
as to which the Option terminated or expired.
5. Administration of Plan
(a) Committee. The Plan shall be administered by the
Subcommittee on Performance Based Compensation of the Compensation Committee of
the Board or any other committee or subcommittee designated by the Board,
provided that the committee administering the Plan is composed of two or more
non-employee members of the Board, each of whom is an Outside Director.
Notwithstanding the foregoing, if Non-Employee Directors are granted Options in
accordance with the provisions of Paragraph 8, the directors to whom such
Options will be granted, the timing of grants of such Options, the Option Price
of such Options and the number of Option Shares included in such Options shall
be as specifically set forth in Paragraph 8. No member of the Committee shall
participate in the resolution of any issue that exclusively involves an Option
granted to such member.
(b) Meetings. The Committee shall hold meetings at
such times and places as it may determine. Acts approved at a meeting by a
majority of the members of the Committee or acts approved in writing by the
unanimous consent of the members of the Committee shall be the valid acts of the
Committee.
(c) Exculpation. No member of the Committee shall be
personally liable for monetary damages for any action taken or any failure to
take any action in connection with the administration of the Plan or the
granting of Options thereunder unless (i) the member of the Committee has
breached or failed to perform the duties of his office, and (ii) the breach or
failure to perform constitutes self-dealing, wilful misconduct or recklessness;
provided, however, that the provisions of this Paragraph 5(c) shall not apply to
the responsibility or liability of a member of the Committee pursuant to any
criminal statute.
(d) Indemnification. Service on the Committee shall
constitute service as a member of the Board. Each member of the Committee shall
be entitled without further act on his part to indemnity from the Sponsor to the
fullest extent provided by applicable law and the Sponsor's By-laws in
connection with or arising out of any actions, suit or proceeding with respect
to the administration of the Plan or the granting of Options thereunder in which
he may be involved by reasons of his being or having been a member of the
Committee, whether or not he continues to be such member of the Committee at the
time of the action, suit or proceeding.
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6. Eligibility
(a) Eligible individuals to whom Options may be
granted shall be employees, officers or directors of a Company who are selected
by the Committee for the grant of Options. Eligible individuals to whom Cash
Rights may be granted shall be individuals who are employees of a Company on the
Date of Grant. The terms and conditions of Options granted to individuals other
than Non-Employee Directors shall be determined by the Committee, subject to
Paragraph 7. The terms and conditions of Cash Rights shall be determined by the
Committee, subject to Paragraph 7. The terms and conditions of Options granted
to Non-Employee Directors shall be determined by the Committee, subject to
Paragraph 8.
(b) An Incentive Stock Option shall not be granted to
a Ten Percent Shareholder except on such terms concerning the option price and
term as are provided in Paragraph 7(b) and 7(g) with respect to such a person.
An Option designated as Incentive Stock Option granted to a Ten Percent
Shareholder but which does not comply with the requirements of the preceding
sentence shall be treated as a Non-Qualified Option. An Option designated as an
Incentive Stock Option shall be treated as a Non-Qualified Option if (i) the
Optionee is not an employee of a Company on the Date of Grant or (ii) the only
Company by which the Optionee is employed on the Date of Grant is an entity
described in Paragraph 2(dd)(ii).
7. Option Documents and Terms - In General
All Options granted to Optionees other than Non-Employee
Directors shall be evidenced by option documents. The terms of each such option
document shall be determined from time to time by the Committee, consistent,
however, with the following:
(a) Time of Grant. All Options shall be granted
within 10 years from the earlier of (i) the date of adoption of the Plan by the
Board, or (ii) approval of the Plan by the shareholders of the Sponsor.
(b) Option Price. The option price per Share with
respect to any Option shall be determined by the Committee, provided, however,
that with respect to any Incentive Stock Options, the option price per share
shall not be less than 100% of the Fair Market Value of such Share on the Date
of Grant, and provided further that with respect to any Incentive Stock Options
granted to a Ten Percent Shareholder, the option price per Share shall not be
less than 110% of the Fair Market Value of such Share on the Date of Grant.
(c) Restrictions on Transferability. No Option
granted under this Paragraph 7 shall be transferable otherwise than by will or
the laws of descent and distribution and, during the lifetime of the Optionee,
shall be exercisable only by him or for his benefit by his attorney-in-fact or
guardian; provided that the Committee may, in its discretion, at the time of
grant of a Non-Qualified Option or by amendment of an option document for an
Incentive Stock Option or a Non-Qualified Option, provide that Options granted
to or held by an Optionee may
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be transferred, in whole or in part, to one or more transferees and exercised by
any such transferee; provided further that (i) any such transfer is without
consideration and (ii) each transferee is a member of such Optionee's Immediate
Family; and provided further that any Incentive Stock Option granted pursuant to
an option document which is amended to permit transfers during the lifetime of
the Optionee shall, upon the effectiveness of such amendment, be treated
thereafter as a Non-Qualified Option. No transfer of an Option shall be
effective unless the Committee is notified of the terms and conditions of the
transfer and the Committee determines that the transfer complies with the
requirements for transfers of Options under the Plan and the option document.
Any person to whom an Option has been transferred may exercise any Options only
in accordance with the provisions of Paragraph 7(g) and this Paragraph 7(c).
(d) Payment Upon Exercise of Options. Full payment
for Shares purchased upon the exercise of an Option shall be made in cash, by
certified check payable to the order of the Sponsor, or, at the election of the
Optionee and as the Committee may, in its sole discretion, approve, by
surrendering Shares with an aggregate Fair Market Value equal to the aggregate
option price, or by delivering such combination of Shares and cash as the
Committee may, in its sole discretion, approve; provided, however, that Shares
may be surrendered in satisfaction of the option price only if the Optionee
certifies in writing to the Sponsor that the Optionee owns a number of Other
Available Shares as of the date the Option is exercised that is at least equal
to the number of Shares to be surrendered in satisfaction of the Option Price;
provided further, however, that the option price may not be paid in Shares if
the Committee determines that such method of payment would result in liability
under section 16(b) of the 1934 Act to an Optionee. Except as otherwise provided
by the Committee, if payment is made in whole or in part in Shares, the Optionee
shall deliver to the Sponsor certificates registered in the name of such
Optionee representing Shares legally and beneficially owned by such Optionee,
free of all liens, claims and encumbrances of every kind and having a Fair
Market Value on the date of delivery that is not greater than the option price
accompanied by stock powers duly endorsed in blank by the record holder of the
Shares represented by such certificates. If the Committee, in its sole
discretion, should refuse to accept Shares in payment of the option price, any
certificates representing Shares which were delivered to the Sponsor shall be
returned to the Optionee with notice of the refusal of the Committee to accept
such Shares in payment of the option price. The Committee may impose such
limitations and prohibitions on the use of Shares to exercise an Option as it
deems appropriate.
(e) Issuance of Certificate Upon Exercise of Options;
Payment of Cash. Only whole Shares shall be issuable upon exercise of Options.
Any right to a fractional Share shall be satisfied in cash. Upon satisfaction of
the conditions of Paragraph 10, a certificate for the number of whole Shares and
a check for the Fair Market Value on the date of exercise of any fractional
Share to which the Optionee is entitled shall be delivered to such Optionee by
the Sponsor.
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(f) Termination of Employment. For purposes of the
Plan, a transfer of an employee between two employers, each of which is a
Company, shall not be deemed a termination of employment. For purposes of
Paragraph 7(g), an Optionee's termination of employment shall be deemed to occur
on the date an Optionee ceases to serve as an active employee of a Company, as
determined by the Committee in its sole discretion, or, if the Optionee is a
party to an employment agreement with a Company, on the effective date of the
Optionee's termination of employment as determined under such agreement.
(g) Periods of Exercise of Options. An Option shall
be exercisable in whole or in part at such time or times as may be determined by
the Committee and stated in the option document, provided, however, that if the
grant of an Option would be subject to section 16(b) of the 1934 Act, unless the
requirements for exemption therefrom in Rule 16b-3(c)(1), under such Act, or any
successor provision, are met, the option document for such Option shall provide
that such Option is not exercisable until not less than six months have elapsed
from the Date of Grant. Except as otherwise provided by the Committee in its
discretion, no Option shall first become exercisable following an Optionee's
termination of employment for any reason; provided further, that:
(i) In the event that an Optionee
terminates employment with the Company for any reason other
than death or Cause, any Option held by such Optionee and
which is then exercisable shall be exercisable for a period of
90 days following the date the Optionee terminates employment
with the Company (unless a longer period is established by the
Committee); provided, however, that if such termination of
employment with the Company is due to the Disability of the
Optionee, he shall have the right to exercise those of his
Options which are then exercisable for a period of one year
following such termination of employment (unless a longer
period is established by the Committee); provided, however,
that in no event shall an Incentive Stock Option be
exercisable after five years from the Date of Grant in the
case of a grant to a Ten Percent Shareholder, nor shall any
other Option be exercisable after ten years from the Date of
Grant.
(ii) In the event that an Optionee
terminates employment with the Company by reason of his death,
any Option held at death by such Optionee which is then
exercisable shall be exercisable for a period of one year from
the date of death (unless a longer period is established by
the Committee) by the person to whom the rights of the
Optionee shall have passed by will or by the laws of descent
and distribution; provided, however, that in no event shall an
Incentive Stock Option be exercisable after five years from
the Date of Grant in the case of a grant to a Ten Percent
Shareholder, nor shall any other Option be exercisable after
ten years from the Date of Grant.
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(iii) In the event that an Optionee's
employment with the Company is terminated for Cause, each
unexercised Option held by such Optionee shall terminate and
cease to be exercisable; provided further, that in such event,
in addition to immediate termination of the Option, the
Optionee, upon a determination by the Committee shall
automatically forfeit all Shares otherwise subject to delivery
upon exercise of an Option but for which the Sponsor has not
yet delivered the Share certificates, upon refund by the
Sponsor of the option price.
(h) Date of Exercise. The date of exercise of an
Option shall be the date on which written notice of exercise, addressed to the
Sponsor at its main office to the attention of its Secretary, is hand delivered,
telecopied or mailed first class postage prepaid; provided, however, that the
Sponsor shall not be obligated to deliver any certificates for Shares pursuant
to the exercise of an Option until the Optionee shall have made payment in full
of the option price for such Shares. Each such exercise shall be irrevocable
when given. Each notice of exercise must (i) specify the Incentive Stock Option,
Non-Qualified Option or combination thereof being exercised; and (ii) include a
statement of preference (which shall binding on and irrevocable by the Optionee
but shall not be binding on the Committee) as to the manner in which payment to
the Sponsor shall be made (Shares or cash or a combination of Shares and cash).
Each notice of exercise shall also comply with the requirements of Paragraph 15.
(i) Cash Rights. The Committee may, in its sole
discretion, provide in an option document for an eligible Optionee that Cash
Rights shall be attached to Non-Qualified Options granted under the Plan. All
Cash Rights that are attached to Non-Qualified Options shall be subject to the
following terms:
(i) Such Cash Right shall expire no
later than the Non- Qualified Option to which it is attached.
(ii) Such Cash Right shall provide for
the cash payment of such amount per Share as shall be
determined by the Committee and stated in the option document.
(iii) Such Cash Right shall be subject
to the same restrictions on transferability as the
Non-Qualified Option to which it is attached.
(iv) Such Cash Right shall be
exercisable only when such conditions to exercise as shall be
determined by the Committee and stated in the option document,
if any, have been satisfied.
(v) Such Cash Right shall expire upon
the exercise of the Non- Qualified Option to which it is
attached.
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(vi) Upon exercise of a Cash Right
that is attached to a Non- Qualified Option, the Option to
which the Cash Right is attached shall expire.
8. Option Documents and Terms - Non-Employee Directors
Options granted pursuant to the Plan to Non-Employee Directors
shall be granted, without any further action by the Committee, in accordance
with the terms and conditions set forth in this Paragraph 8. Options granted
pursuant to Paragraph 8(a) shall be evidenced by option documents. The terms of
each such option document shall be consistent with Paragraphs 8(b) through 8(g),
as follows:
(a) Grant of Options to Non-Employee Directors. Each
Non- Employee Director shall be granted, commencing on the Grant Date next
following the adoption of this Plan by the Board and on each successive Grant
Date thereafter, a Non-Qualified Option to purchase 5,400 Shares.
Notwithstanding the preceding sentence, each newly elected Non- Employee
Director:
(i) shall be granted a Non-Qualified Option
to purchase 9,000 Shares on the Election Date; and
(ii) shall not be entitled to the grant of
an Option hereunder on the Grant Date immediately following the
Non-Employee Director's Election Date if such Election Date is within
ninety (90) days of the Grant Date.
(b) Option Price. The option price per Share with
respect to any Option granted under this Paragraph 8 shall be 100% of the Fair
Market Value of such Share on the Grant Date.
(c) Restrictions on Transferability. No Option
granted under this Paragraph 8 shall be transferable otherwise than by will or
the laws of descent and distribution and, during the lifetime of the Optionee,
shall be exercisable only by him or for his benefit by his attorney-in-fact or
guardian; provided that the Committee may, in its discretion, at the time of
grant of an Option or by amendment of an option document for an Option, provide
that Options may be transferred, in whole or in part, to one or more transferees
and exercised by any such transferee; provided further that (i) any such
transfer is without consideration, and (ii) each transferee is a member of such
Optionee's Immediate Family. No transfer of an Option shall be effective unless
the Committee is notified of the terms and conditions of the transfer and the
Committee determines that the transfer complies with the requirements for
transfers of Options under the Plan and the option document. Any person to whom
an Option has been transferred may exercise any Options only in accordance with
the provisions of Paragraph 8(f) and this Paragraph 8(c).
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(d) Payment Upon Exercise of Options. Full payment
for Shares purchased upon the exercise of an Option shall be made in cash, by
certified check payable to the order of the Sponsor, or, at the election of the
Optionee and as the Committee may, in its sole discretion, approve, by
surrendering Shares with an aggregate Fair Market Value equal to the aggregate
option price, or by delivering such combination of Shares and cash as the
Committee may, in its sole discretion, approve; provided, however, that Shares
may be surrendered in satisfaction of the option price only if the Optionee
certifies in writing to the Sponsor that the Optionee owns a number of Other
Available Shares as of the date the Option is exercised that is at least equal
to the number of Shares to be surrendered in satisfaction of the Option Price;
provided further, however, that the option price may not be paid in Shares if
the Committee determines that such method of payment would result in liability
under section 16(b) of the 1934 Act to an Optionee. Except as otherwise provided
by the Committee, if payment is made in whole or in part in Shares, the Optionee
shall deliver to the Sponsor certificates registered in the name of such
Optionee representing Shares legally and beneficially owned by such Optionee,
free of all liens, claims and encumbrances of every kind and having a Fair
Market Value on the date of delivery that is not greater than the option price
accompanied by stock powers duly endorsed in blank by the record holder of the
Shares represented by such certificates. If the Committee, in its sole
discretion, should refuse to accept Shares in payment of the option price, any
certificates representing Shares which were delivered to the Sponsor shall be
returned to the Optionee with notice of the refusal of the Committee to accept
such Shares in payment of the option price. The Committee may impose such
limitations and prohibitions on the use of Shares to exercise an Option as it
deems appropriate.
(e) Issuance of Certificate Upon Exercise of Options;
Payment of Cash. Only whole Shares shall be issuable upon exercise of Options
granted under this Paragraph 8. Any right to a fractional Share shall be
satisfied in cash. Upon satisfaction of the conditions of Paragraph 10, a
certificate for the number of whole Shares and a check for the Fair Market Value
on the date of exercise of any fractional Share to which the Optionee is
entitled shall be delivered to such Optionee by the Sponsor.
(f) Periods of Exercise of Options. An Option granted
under this Paragraph 8 shall not be exercisable for six months after the Date of
Grant, and shall then be exercisable in its entirety. No Option shall first
become exercisable following an Optionee's termination of service as a
Non-Employee Director for any reason; provided further, that:
(i) In the event that an Optionee
terminates service as a Non-Employee Director for any reason
other than death or Cause, any Option held by such Optionee
and which is then exercisable shall be exercisable for a
period of 90 days following the date the Optionee terminates
service as a Non-Employee Director; provided, however, that if
such termination of employment with the Company is due to the
Disability of the Optionee, he shall have the right to
exercise those of his Options which are then exercisable for a
period of one year following the date the Optionee terminates
service as a Non-Employee Director;
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provided, however, that in no event shall an Option be
exercisable after five years from the Grant Date.
(ii) In the event that an Optionee
terminates service as a Non-Employee Director by reason of his
death, any Option held at death by such Optionee which is then
exercisable shall be exercisable for a period of one year from
the date of death by the person to whom the rights of the
Optionee shall have passed by will or by the laws of descent
and distribution; provided, however, that in no event shall an
Option be exercisable after five years from the Grant Date.
(iii) In the event that an Optionee's
service as a Non- Employee Director is terminated for Cause,
each unexercised Option shall terminate and cease to be
exercisable; provided further, that in such event, in addition
to immediate termination of the Option, the Optionee shall
automatically forfeit all Shares otherwise subject to delivery
upon exercise of an Option but for which the Sponsor has not
yet delivered the Share certificates, upon refund by the
Sponsor of the option price.
(g) Date of Exercise. The date of exercise of an
Option granted under this Paragraph 8 shall be the date on which written notice
of exercise, addressed to the Sponsor at its main office to the attention of its
Secretary, is hand delivered, telecopied or mailed first class postage prepaid;
provided, however, that the Sponsor shall not be obligated to deliver any
certificates for Shares pursuant to the exercise of an Option until the Optionee
shall have made payment in full of the option price for such Shares. Each such
exercise shall be irrevocable when given. Each notice of exercise must (i)
specify the Option being exercised; and (ii) include a statement as to the
manner in which payment to the Sponsor shall be made (Shares or cash or a
combination of Shares and cash). Each notice of exercise shall also comply with
the requirements of Paragraph 15.
9. Limitation on Exercise of Incentive Stock Options.
The aggregate Fair Market Value (determined as of the time
Options are granted) of the Shares with respect to which Incentive Stock Options
may first become exercisable by an Optionee in any one calendar year under the
Plan and any other plan of the Company shall not exceed $100,000. The
limitations imposed by this Paragraph 9 shall apply only to Incentive Stock
Options granted under the Plan, and not to any other options or stock
appreciation rights. In the event an individual receives an Option intended to
be an Incentive Stock Option which is subsequently determined to have exceeded
the limitation set forth above, or if an individual receives Options that first
become exercisable in a calendar year (whether pursuant to the terms of an
option document, acceleration of exercisability or other change in the terms and
conditions of exercise or any other reason) that have an aggregate Fair Market
Value (determined as of the time the Options are granted) that exceeds the
limitations set forth above, the Options in excess of the limitation shall be
treated as Non-Qualified Options.
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10. Rights as Shareholders
An Optionee shall not have any right as a shareholder with
respect to any Shares subject to his Options until the Option shall have been
exercised in accordance with the terms of the Plan and the option document and
the Optionee shall have paid the full purchase price for the number of Shares in
respect of which the Option was exercised and the Optionee shall have made
arrangements acceptable to the Sponsor for the payment of applicable taxes
consistent with Paragraph 16.
11. Changes in Capitalization
(a) Except as provided in Paragraph 11(b), in the
event that Shares are changed into or exchanged for a different number or kind
of shares of stock or other securities of the Sponsor, whether through merger,
consolidation, reorganization, recapitalization, stock dividend, stock split-up
or other substitution of securities of the Sponsor, the Board shall make
appropriate equitable anti-dilution adjustments to the number and class of
shares of stock available for issuance under the Plan, and subject to
outstanding Options, and to the option prices and the amounts payable pursuant
to any Cash Rights. Any reference to the option price in the Plan and in option
documents shall be a reference to the option price as so adjusted. Any reference
to the term "Shares" in the Plan and in option documents shall be a reference to
the appropriate number and class of shares of stock available for issuance under
the Plan, as adjusted pursuant to this Paragraph 11. The Board's adjustment
shall be effective and binding for all purposes of this Plan.
(b) Paragraph 11(a) shall not apply to the number of
Shares that become subject to the grant of Options under Paragraph 8(a).
Paragraph 11(a) shall apply for the purpose of making appropriate equitable
anti-dilution adjustments to Options granted pursuant to Paragraph 8(a) before
the effective date of the relevant event giving rise to the adjustment under
Paragraph 11(a).
12. Terminating Events
(a) The Sponsor shall give Optionees at least thirty
(30) days' notice (or, if not practicable, such shorter notice as may be
reasonably practicable) prior to the anticipated date of the consummation of a
Terminating Event. Upon receipt of such notice, and for a period of ten (10)
days thereafter (or such shorter period as the Board shall reasonably determine
and so notify the Optionees), each Optionee shall be permitted to exercise the
Option to the extent the Option are then exercisable; provided that, the Sponsor
may, by similar notice, require the Optionee to exercise the Option, to the
extent the Option is then exercisable, or to forfeit the Option (or portion
thereof, as applicable). The Committee may, in its discretion, provide that upon
the Optionee's receipt of the notice of a Terminating Event under this Paragraph
12(a), the entire number of Shares covered by Options shall become immediately
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exercisable. Upon the close of the period described in this Paragraph 12(a)
during which an Option may be exercised in connection with a Terminating Event,
such Option (including such portion thereof that is not exercisable) shall
terminate to the extent that such Option have not theretofore been exercised.
(b) Notwithstanding Paragraph 12(a), in the event the
Terminating Event is not consummated, the Option shall be deemed not to have
been exercised and shall be exercisable thereafter to the extent it would have
been exercisable if no such notice had been given.
13. Interpretation
The Committee shall have the power to interpret the Plan and
to make and amend rules for putting it into effect and administering it. It is
intended that the Incentive Stock Options granted under the Plan shall
constitute incentive stock options within the meaning of section 422 of the
Code, and that Shares transferred pursuant to the exercise of Non-Qualified
Options shall constitute property subject to federal income tax pursuant to the
provisions of section 83 of the Code. The provisions of the Plan shall be
interpreted and applied insofar as possible to carry out such intent.
14. Amendments
The Board or the Committee may amend the Plan from time to
time in such manner as it may deem advisable. Nevertheless, neither the Board
nor the Committee may, without obtaining approval within twelve months before or
after such action by such vote of shareholders as may be required by
Pennsylvania law for any action requiring shareholder approval, or by a majority
of votes cast at a duly held shareholders' meeting at which a majority of all
voting stock is present and voting on such amendment, either in person or in
proxy (but not, in any event, less than the vote required pursuant to Rule
16b-3(b) under the 1934 Act) change the class of individuals eligible to receive
an Incentive Stock Option, extend the expiration date of the Plan, decrease the
minimum option price of an Incentive Stock Option granted under the Plan or
increase the maximum number of shares as to which Options may be granted, except
as provided in Paragraph 11 hereof. In addition, the provisions of Paragraph 8
that determine (i) which directors shall be granted Options; (ii) the number of
Shares subject to Options; (iii) the option price of Shares subject to Options;
and (iv) the timing of grants of Options shall not be amended more than once
every six months, other than to comport with changes in the Code or the Employee
Retirement Income Security Act of 1974, as amended, if applicable. No
outstanding Option shall be affected by any such amendment without the written
consent of the Optionee or other person then entitled to exercise such Option.
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15. Securities Law
(a) In General. The Committee shall have the power to
make each grant under the Plan subject to such conditions as it deems necessary
or appropriate to comply with the then-existing requirements of the 1933 Act or
the 1934 Act, including Rule 16b-3 (or any similar rule) of the Securities and
Exchange Commission.
(b) Acknowledgment of Securities Law Restrictions on
Exercise. To the extent required by the Committee, unless the Shares subject to
the Option are covered by a then current registration statement or a
Notification under Regulation A under the 1933 Act, each notice of exercise of
an Option shall contain the Optionee's acknowledgment in form and substance
satisfactory to the Committee that:
(i) the Shares subject to the Option
are being purchased for investment and not for distribution or resale
(other than a distribution or resale which, in the opinion of counsel
satisfactory to the Sponsor, may be made without violating the
registration provisions of the Act);
(ii) the Optionee has been advised and
understands that (A) the Shares subject to the Option have not been
registered under the 1933 Act and are "restricted securities" within
the meaning of Rule 144 under the 1933 Act and are subject to
restrictions on transfer and (B) the Sponsor is under no obligation to
register the Shares subject to the Option under the 1933 Act or to take
any action which would make available to the Optionee any exemption
from such registration;
(iii) the certificate evidencing the
Shares may bear a restrictive legend; and
(iv) the Shares subject to the Option
may not be transferred without compliance with all applicable federal
and state securities laws.
(c) Delay of Exercise Pending Registration of
Securities. Notwithstanding any provision in the Plan or an option document to
the contrary, if the Committee determines, in its sole discretion, that issuance
of Shares pursuant to the exercise of an Option should be delayed pending
registration or qualification under federal or state securities laws or the
receipt of a legal opinion that an appropriate exemption from the application of
federal or state securities laws is available, the Committee may defer exercise
of any Option until such Shares are appropriately registered or qualified or an
appropriate legal opinion has been received, as applicable.
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16. Withholding of Taxes on Exercise of Option
(a) Whenever the Company proposes or is required to
deliver or transfer Shares in connection with the exercise of an Option, the
Company shall have the right to (i) require the recipient to remit to the
Sponsor an amount sufficient to satisfy any federal, state and local withholding
tax requirements prior to the delivery or transfer of any certificate or
certificates for such Shares or (ii) take any action whatever that it deems
necessary to protect its interests with respect to tax liabilities. The
Sponsor's obligation to make any delivery or transfer of Shares on the exercise
of an Option shall be conditioned on the recipient's compliance, to the
Sponsor's satisfaction, with any withholding requirement. In addition, if the
Committee grants Options or amends option documents to permit Options to be
transferred during the life of the Optionee, the Committee may include in such
option documents such provisions as it determines are necessary or appropriate
to permit the Company to deduct compensation expenses recognized upon exercise
of such Options for federal or state income tax purposes.
(b) Except as otherwise provided in this Paragraph
16(b), any tax liabilities incurred in connection with the exercise of an Option
under the Plan other than an Incentive Stock Option shall be satisfied by the
Sponsor's withholding a portion of the Shares underlying the Option exercised
having a Fair Market Value approximately equal to the minimum amount of taxes
required to be withheld by the Sponsor under applicable law, unless otherwise
determined by the Committee with respect to any Optionee. Notwithstanding the
foregoing, the Committee may permit an Optionee to elect one or both of the
following: (i) to have taxes withheld in excess of the minimum amount required
to be withheld by the Sponsor under applicable law; provided that the Optionee
certifies in writing to the Sponsor that the Optionee owns a number of Other
Available Shares having a Fair Market Value that is at least equal to the Fair
Market Value of Option Shares to be withheld by the Company for the then-current
exercise on account of withheld taxes in excess of such minimum amount, and (ii)
to pay to the Sponsor in cash all or a portion of the taxes to be withheld upon
the exercise of an Option. In all cases, the Shares so withheld by the Company
shall have a Fair Market Value that does not exceed the amount of taxes to be
withheld minus the cash payment, if any, made by the Optionee. Any election
pursuant to this Paragraph 16(b) must be in writing made prior to the date
specified by the Committee, and in any event prior to the date the amount of tax
to be withheld or paid is determined. An election pursuant to this Paragraph
16(b) may be made only by an Optionee or, in the event of the Optionee's death,
by the Optionee's legal representative. No Shares withheld pursuant to this
Paragraph 16(b) shall be available for subsequent grants under the Plan. The
Committee may add such other requirements and limitations regarding elections
pursuant to this Paragraph 16(b) as it deems appropriate.
(c) Except as otherwise provided in this Paragraph
16(c), any tax liabilities incurred in connection with the exercise of an
Incentive Stock Option under the Plan shall be satisfied by the Optionee's
payment to the Sponsor in cash all of the taxes to be withheld upon exercise of
the Incentive Stock Option. Notwithstanding the foregoing, the Committee may
permit an Optionee to elect to have the Sponsor withhold a portion of the Shares
underlying the
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Incentive Stock Option exercised having a Fair Market Value approximately equal
to the minimum amount of taxes required to be withheld by the Sponsor under
applicable law. Any election pursuant to this Paragraph 16(c) must be in writing
made prior to the date specified by the Committee, and in any event prior to the
date the amount of tax to be withheld or paid is determined. An election
pursuant to this Paragraph 16(c) may be made only by an Optionee or, in the
event of the Optionee's death, by the Optionee's legal representative. No Shares
withheld pursuant to this Paragraph 16(c) shall be available for subsequent
grants under the Plan. The Committee may add such other requirements and
limitations regarding elections pursuant to this Paragraph 16(c) as it deems
appropriate.
17. Effective Date and Term of Plan
This amendment and restatement of the Plan is effective as of
June 21, 1999, provided that the amendments to Paragraphs 2(j), 2(x) and 2(dd)
to permit employees, officers and directors of Jones Intercable, Inc. and its
parent and subsidiary corporations to become eligible to receive option grants
under the Plan shall be effective as of May 3, 1999. The Plan shall expire no
later than March 13, 2006, the tenth anniversary of the date the Plan was
initially adopted by the Board, unless sooner terminated by the Board.
18. General
Each Option shall be evidenced by a written instrument
containing such terms and conditions not inconsistent with the Plan as the
Committee may determine. The issuance of Shares on the exercise of an Option
shall be subject to all of the applicable requirements of the corporation law of
the Sponsor's state of incorporation and other applicable laws, including
federal or state securities laws, and all Shares issued under the Plan shall be
subject to the terms and restrictions contained in the Articles of Incorporation
and By-Laws of the Sponsor, as amended from time to time.
Executed as of the 21st day of June, 1999.
COMCAST CORPORATION
BY: /s/ Stanley Wang
ATTEST: /s/ Arthur Block
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COMCAST CORPORATION
1996 DEFERRED COMPENSATION PLAN
(As Amended and Restated, Effective June 21, 1999)
1. ESTABLISHMENT OF PLAN
COMCAST CORPORATION, a Pennsylvania corporation, hereby amends and
restates the Comcast Corporation 1996 Deferred Compensation Plan (the "Plan"),
effective as of June 21, 1999. The Plan was adopted effective as of August 15,
1996, to permit outside directors and eligible employees to defer the receipt of
compensation otherwise payable to such outside directors and eligible employees
in accordance with the terms of the Plan. The Plan is a continuation of the
Prior Plan, which was initially effective as of February 12, 1974. The Plan is
unfunded and is maintained primarily for the purpose of providing deferred
compensation to outside directors and to a select group of management or highly
compensated employees.
2. DEFINITIONS
2.1 "Account" means the bookkeeping accounts established
pursuant to Section 5.1 and maintained by the Administrator in the names of the
respective Participants, to which all amounts deferred and earnings allocated
under the Plan shall be credited, and from which all amounts distributed under
the Plan shall be debited.
2.2 "Active Participant" means:
2.2.1 Each Participant who is in active service as an
Outside Director; and
2.2.2 Each Participant who is actively employed by a
Participating Company as an Eligible Employee.
2.3 "Administrator" means the Committee.
2.4 "Affiliate" means, with respect to any Person, any other
Person that, directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person. For purposes of this definition, the
term "control," including its correlative terms "controlled by" and "under
common control with," mean, with respect to any Person, the possession, directly
or indirectly, of the power to direct or cause the direction of the management
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and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise.
2.5 "Annual Rate of Pay" means, as of any date, an employee's
annualized base pay rate. An employee's Annual Rate of Pay shall not include
sales commissions or other similar payments or awards.
2.6 "Applicable Interest Rate" means:
2.6.1 Except as otherwise provided in Section
2.6.2, the Applicable Interest Rate means
12% per annum, compounded annually as of the
last day of the Plan Year.
2.6.2 Except to the extent otherwise required by
Section 9.2, effective for the period
extending from a Participant's employment
termination date to the date the
Participant's Account is distributed in
full, the Administrator, in its sole
discretion, may designate the term
"Applicable Interest Rate" for such
Participant's Account to mean the lesser of
(1) the rate in effect under Section 2.6.1
or (2) the Prime Rate plus one percent,
compounded annually as of the last day of
the Plan Year. Notwithstanding the
foregoing, the Administrator may delegate
its authority to determine the Applicable
Interest Rate under this Section 2.6.2 to an
officer of the Company or committee of two
or more officers of the Company.
2.7 "Board" means the Board of Directors of the Company, or the
Executive Committee of the Board of Directors of the Company.
2.8 "Change of Control" means any transaction or series of
transactions as a result of which any Person who was a Third Party immediately
before such transaction or series of transactions directly or indirectly owns
then-outstanding securities of the Company having more than 50 percent of the
voting power for the election of directors of the Company.
2.9 "Committee" means the Subcommittee on Performance Based
Compensation of the Compensation Committee of the Board of Directors of the
Company.
2.10 "Company" means Comcast Corporation, a Pennsylvania
corporation, including any successor thereto by merger, consolidation,
acquisition of all or substantially all the assets thereof, or otherwise.
2.11 "Company Stock" means Comcast Corporation Class A Special
Common Stock, par value, $1.00, including a fractional share, or such other
securities issued by Comcast
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Corporation as may be the subject to adjustment in the event that shares of
Company Stock are changed into or exchanged for a different number or kind of
shares of stock or other securities of the Company, whether through merger,
consolidation, reorganization, recapitalization, stock dividend, stock split-up
or other substitution of securities of the Company. In such event, the Committee
shall make appropriate equitable anti-dilution adjustments to the number and
class of hypothetical shares of Company Stock credited to Participants' Accounts
under the Company Stock Fund. Any reference to the term "Company Stock" in the
Plan shall be a reference to the appropriate number and class of shares of stock
as adjusted pursuant to this Section 2.12. The Committee's adjustment shall be
effective and binding for all purposes of the Plan.
2.12 "Company Stock Fund" means a hypothetical investment fund
pursuant to which income, gains and losses are credited to a Participant's
Account as if the Account, to the extent deemed invested in the Company Stock
Fund, were invested in hypothetical shares of Company Stock, and all dividends
and other distributions paid with respect to Company Stock were held uninvested
in cash, and reinvested in additional hypothetical shares of Company Stock as of
the next succeeding December 31 (to the extent the Account continues to be
deemed invested in the Company Stock Fund through such December 31), based on
the Fair Market Value for such December 31.
2.13 "Compensation" means:
2.13.1 In the case of an Outside Director, the
total cash remuneration for services as a
member of the Board and as a member of any
Committee of the Board; and
2.13.2 In the case of an Eligible Employee, the
total cash remuneration for services payable
by a Participating Company, excluding sales
commissions or other similar payments or
awards.
2.14 "Deceased Participant" means:
2.14.1 A Participant whose employment, or, in the case of
a Participant who was an Outside Director, a Participant whose service as an
Outside Director, is terminated by death; or
2.14.2 An Inactive Participant who dies following
termination of active service.
2.15 "Disabled Participant" means:
2.15.1 A Participant whose employment or, in the case of
a Participant who is an Outside Director, a Participant whose service as an
Outside Director, is terminated by reason of disability;
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2.15.2 An Inactive Participant who becomes disabled (as
determined by the Committee) following termination of active service; or
2.15.3 The duly-appointed legal guardian of an individual
described in Section 2.15.1 or 2.15.2 acting on behalf of such individual.
2.16 "Election" means a written election on a form provided by
the Administrator, filed with the Administrator in accordance with Article 3,
pursuant to which an Outside Director or an Eligible Employee may:
2.16.1 Elect to defer all or any portion of the
Compensation payable for the performance of
services as an Outside Director or as an
Eligible Employee following the time that
such election is filed;
2.16.2 Designate the time that part or all of the
Account shall be distributed; and
2.16.3 Designate the manner in which income, gains
and losses will be credited to the Account.
2.17 "Eligible Employee" means:
2.17.1 Each employee of a Participating Company
who, as of December 31, 1989, was eligible
to participate in the Prior Plan;
2.17.2 Each employee of a Participating Company who
was, at any time before January 1, 1995,
eligible to participate in the Prior Plan
and whose Annual Rate of Pay is $90,000 or
more as of both (1) the date on which an
Election with respect to the deferral of
Compensation is filed with the Administrator
and (2) the first day of each calendar year
beginning after December 31, 1994.
2.17.3 Each employee of a Participating Company
whose Annual Rate of Pay is $125,000 or more
as of both (1) the date on which an Election
is filed with the Administrator and (2) the
first day of the Plan Year in which such
Election is filed.
2.17.4 Each employee of a Participating Company who
has a title at or above the level of vice
president, whose Annual Rate of Pay is
$100,000 or more as of both (1) the date on
which an Election is filed with the
Administrator and (2) the first day of the
Plan Year in which such Election is filed.
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2.17.5 Each New Key Employee.
2.17.6 Each other employee of a Participating
Company who is designated by the Committee,
in its discretion, as an Eligible Employee.
2.18 "Fair Market Value."
2.18.1 If shares of Company Stock are listed on a
stock exchange, Fair Market Value shall be
determined based on the last reported sale
price of a Share on the principal exchange
on which Shares are listed on the last
trading day prior to the date of
determination; or
2.18.2 If shares of Company Stock are not so
listed, but trades of Shares are reported on
the Nasdaq National Market, the last quoted
sale price of a share on the Nasdaq National
Market on the last trading day prior to the
date of determination.
2.18.3 If shares of Company Stock are not so listed
nor trades of Shares so reported, Fair
Market value shall be determined by the
Committee in good faith.
2.19 "Former Eligible Employee" means an employee of a
Participating Company who, as of any relevant date, does not satisfy the
requirements of an "Eligible Employee" but who previously met such requirements
under the Plan or the Prior Plan.
2.20 "Grandfathered Participant" means an Inactive Participant
who, on or before December 31, 1991, entered into a written agreement with the
Company to terminate service to the Company or gives written notice of intention
to terminate service to the Company, regardless of the actual date of
termination of service.
2.21 "Hardship" means a Participant's serious financial
hardship, as determined by the Board on a uniform and nondiscriminatory basis
pursuant to the Participant's request under Section 7.3.
2.22 "Inactive Participant" means each Participant who is not
in active service as an Outside Director and is not actively employed by a
Participating Company.
2.23 "Income Fund" means a hypothetical investment fund
pursuant to which income, gains and losses are credited to a Participant's
Account as if the Account, to the extent deemed invested in the Income Fund,
were credited with interest at the Applicable Interest Rate.
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2.24 "Insider" means an Eligible Employee or Outside Director
who is subject to the short-swing profit recapture rules of section 16(b) of the
Securities Exchange Act of 1934, as amended.
2.25 "New Key Employee" means:
2.25.1 Each employee of a Participating Company
hired on or after August 15, 1996 whose
Annual Rate of Pay on his date of hire is
$125,000 or more;
2.25.2 Each employee of a Participating Company
hired on or after June 21, 1999 who has a
title at or above the level of vice
president and whose Annual Rate of Pay on
his date of hire is $100,000 or more; and
2.25.3 Each employee of a Participating Company who
first becomes an Eligible Employee as a
result of the amendment of the Plan
effective June 21, 1999.
2.26 "Normal Retirement" means:
2.26.1 For a Participant who is an employee of a
Participating Company immediately preceding
his termination of employment, a termination
of employment that is treated by the
Participating Company as a retirement under
its employment policies and practices as in
effect from time to time; and
2.26.2 For a Participant who is an Outside Director
immediately preceding his termination of
service, his normal retirement from the
Board.
2.27 "Outside Director" means a member of the Board, or a
member of the board of directors of Jones Intercable, Inc., who is not an
employee of a Participating Company.
2.28 "Parent Company" means all corporations that, at the time
in question, are parent corporations of the Company within the meaning of
section 424(e) of the Code.
2.29 "Participant" means each individual who has made an
Election, and who has an undistributed amount credited to an Account under the
Plan, including an Active Participant, a Deceased Participant, a Disabled
Participant, a Grandfathered Participant and an Inactive Participant.
2.30 "Participating Company" means:
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2.30.1 the Company;
2.30.2 Comcast Cable Communications, Inc. and its
subsidiaries;
2.30.3 Comcast International Holdings, Inc.;
2.30.4 Comcast Online Communications, Inc.;
2.30.5 Comcast Telecommunications, Inc.;
2.30.6 Jones Intercable, Inc. and its subsidiaries; and
2.30.7 any other entities identified in the
discretion of the Subcommittee.
2.31 "Person" means an individual, a corporation, a
partnership, an association, a trust or any other entity or organization.
2.32 "Plan" means the Comcast Corporation 1996 Deferred
Compensation Plan, as set forth herein, and as may be amended from time to time.
2.33 "Plan Year" means the calendar year.
2.34 "Prime Rate" means the annual rate of interest identified
by PNC Bank as its prime rate as of a Participant's employment termination date
and as of the first day of each calendar year beginning thereafter.
2.35 "Prior Plan" means the Comcast Corporation Deferred
Compensation Plan.
2.36 "Retired Participant" means a Participant who has
terminated service pursuant to a Normal Retirement.
2.37 "Roberts Family." Each of the following is a member
of the Roberts Family:
2.37.1 Brian L. Roberts;
2.37.2 A lineal descendant of Brian L. Roberts; or
2.37.3 A trust established for the benefit of any
of Brian L. Roberts and/or a lineal
descendant or descendants of Brian L.
Roberts.
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2.38 "Severance Pay" means any amount identified by a
Participating Company as severance pay, or any amount which is payable on
account of periods beginning after the last date on which an employee (or former
employee) is required to report for work for a Participating Company.
2.39 "Subsidiary Companies" means all corporations that, at the
time in question, are subsidiary corporations of the Company within the meaning
of section 424(f) of the Code.
2.40 "Terminating Event" means any of the following events:
2.40.1 The liquidation of the Company; or
2.40.2 A Change of Control.
2.41 "Third Party" means any Person, together with such
Person's Affiliates, provided that the term "Third Party" shall not include the
Company, an Affiliate of the Company or any member or members of the Roberts
Family.
3. ELECTION TO DEFER COMPENSATION
3.1 Elections. Each Outside Director and Eligible Employee
shall have the right to defer all or any portion of the Compensation (including
bonuses, if any) which he or she shall receive in the following Plan Year by
filing an Election at the time and in the manner described in this Article 3;
provided that Severance Pay shall be included as "Compensation" for purposes of
this Section 3.1 only to the extent permitted by the Administrator in its sole
discretion. The amount of Compensation deferred by a Participant for a Plan Year
pursuant to an Election shall be withheld on a pro-rata basis from each periodic
installment payment of the Participant's Compensation for the Plan Year (in
accordance with the general pay practices of the Participating Companies), and
credited to the Participant's Account in accordance with Section 5.1. Except to
the extent permitted by the Administrator in its sole discretion, no Election
filed by a Former Eligible Employee shall be valid or effective.
3.2 Filing of Elections. An Election to defer all or any
portion of the Compensation payable for the performance of services as an
Outside Director or as an Eligible Employee shall be made on the form provided
by the Administrator for this purpose. Except as provided in Section 3.3, no
such Election shall be effective unless it is filed with the Administrator on or
before the close of business on December 31 of the Plan Year preceding the Plan
Year to which the Election applies.
3.3 Filing of Elections by New Key Employees. Notwithstanding
Section 3.1 and Section 3.2, a New Key Employee may elect to defer all or any
portion of his or her compensation to be earned in the Plan Year in which the
New Key Employee was hired,
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beginning with the payroll period next following the filing of an Election with
the Administrator and before the close of such Plan Year by making and filing
the Election with the Administrator within 30 days of such New Key Employee's
date of hire. Elections by such New Key Employee for succeeding Plan Years shall
be made in accordance with Section 3.1 and Section 3.2.
3.4 Plan Years to which Elections May Apply. A separate
Election may be made for each Plan Year as to which an Outside Director or
Eligible Employee desires to defer all or any portion of his or her
Compensation, but the failure of an Outside Director or Eligible Employee to
make an Election for any Plan Year shall not affect such Employee's right to
make an Election for any other Plan Year.
3.5 Election of Distribution Date. Each Participant who elects
to defer all or any portion of his or her Compensation for any Plan Year shall,
on the Election, also elect the time of payment and form of distribution of the
amount of the deferred Compensation to which the particular Election relates;
provided, however, that, subject to acceleration pursuant to Section 3.6.3,
Section 3.6.4, Section 7.1, Section 7.2 or Section 7.3, no distribution may
commence earlier than January 2nd of the second calendar year beginning after
the date the Election is filed with the Administrator, nor later than January
2nd of the eleventh calendar year beginning after the date the Election is filed
with the Administrator. Each Participant may select a form of distribution in
accordance with Article 4.
3.6 Designation of Payment Date.
3.6.1 The designation of the time for distribution
of benefits to begin under the Plan may vary
with each separate Election, provided that
except as otherwise provided in Section
3.6.3 or 3.6.4, no portion of a
Participant's Account subject to
distribution in installments pursuant to
Section 4.1.2 or Section 4.1.3 may be
deferred to a later date after such
distribution has begun.
3.6.2 Each Active Participant who has previously
elected to receive a distribution of part or
all of his or her Account, or who, pursuant
to this Section 3.6.2, has elected to defer
payment for an additional period from the
originally-elected payment date, may elect
to change the form of distribution or defer
the time of payment of such amount to begin
for a minimum of one and a maximum of ten
additional years from the previously-elected
payment date, by filing an Election with the
Administrator on or before the close of
business on June 30 of the Plan Year
preceding the Plan Year in which the
distribution would otherwise be made,
provided that an Election applicable to the
1997 Plan Year shall not be effective unless
it is filed with the Administrator on or
before the close of business on October 15,
1996.
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3.6.3 A Deceased Participant's estate or
beneficiary to whom the right to payment
under the Plan shall have passed may elect
to change the form of distribution from the
form of distribution that payment of the
Deceased Participant's Account would
otherwise be made, and
3.6.3.1 Defer the time of payment of the
Deceased Participant's Account to
begin for a minimum of one
additional year from the date
payment would otherwise begin
(provided that if an Election is
made pursuant to this Section
3.6.3.1, the Deceased Participant's
Account shall be distributed in full
on or before the fifth anniversary
of the Deceased Participant's
death); or
3.6.3.2 Accelerate the time of payment of
such amount to begin from the date
payment would otherwise be made to
January 2nd of the calendar year
beginning after the Deceased
Participant's death.
An Election pursuant to this Section 3.6.3
must be filed with the Administrator on or
before the close of business on (i) the June
30 following the Participant's death on or
before May 1 of a calendar year, (ii) the
60th day following the Participant's death
after May 1 and before November 2 of a
calendar year or (iii) the December 31
following the Participant's death after
November 1 of a calendar year. Such estate
or beneficiary, as applicable, shall be
entitled to one and only one Election
pursuant to this Section 3.6.3 with respect
to a Participant's Account, but shall
otherwise be treated as the Participant for
all other purposes of the Plan.
3.6.4 A Disabled Participant may elect to:
3.6.4.1 Change the form of distribution from
the form of distribution that
payment of the Disabled
Participant's Account would
otherwise be made; and
3.6.4.2 Accelerate the time of payment of
the Disabled Participant's Account
to begin from the date payment would
otherwise be made to January 2nd of
the calendar year beginning after
the Participant became disabled.
An Election pursuant to this Section 3.6.4
must be filed with the Administrator on or
before the close of business on the later of
(i) the June 30 following the date the
Participant becomes a Disabled
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Participant if the Participant becomes a
Disabled Participant on or before May 1 of a
calendar year, (ii) the 60th day following
the date the Participant becomes a Disabled
Participant if the Participant becomes a
Disabled Participant after May 1 and before
November 2 of a calendar year or (iii) the
December 31 following the date the
Participant becomes a Disabled Participant
if the Participant becomes a Disabled
Participant after November 1 of a calendar
year.
3.6.5 A Retired Participant may elect to:
3.6.5.1 Change the form of distribution from
the form of distribution that
payment of the Retired Participant's
Account would otherwise be made, and
3.6.5.2 Defer the time of payment of the
Retired Participant's Account to
begin for a minimum of one
additional year from the date
payment would otherwise begin
(provided that if an Election is
made pursuant to this Section
3.6.5.2, the Retired Participant's
Account shall be distributed in full
on or before the fifth anniversary
of the Retired Participant's Normal
Retirement).
An Election pursuant to this Section 3.6.5
must be filed with the Administrator on or
before the close of business on the later of
(i) the June 30 following the Participant's
Normal Retirement on or before May 1 of a
calendar year, (ii) the 60th day following
the Participant's Normal Retirement after
May 1 and before November 2 of a calendar
year or (iii) the December 31 following a
Participant's Normal Retirement after
November 1 of a calendar year.
3.6.6 Except as provided in Section 3.6.4, Section
3.6.5 or Section 3.6.7, or if permitted by
the Administrator in its sole discretion
pursuant to this Section 3.6.6, no Inactive
Participant who has previously elected to
receive a distribution of part or all of his
her Account, or who, pursuant to this
Section 3.6.6, has elected to defer payment
for an additional period from the originally
elected payment date, may elect to defer the
payment of such amount to any subsequent
date. An Inactive Participant, if permitted
by the Administrator in its sole discretion,
may elect to defer the payment of such
amount for a minimum of one and a maximum of
ten additional years from the
previously-elected payment date, but not
later than the date
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permitted by the Administrator, by filing an
Election with the Administrator on or before
the close of business on June 30 of the Plan
Year preceding the Plan Year in which the
distribution would otherwise be made.
3.6.7 Except as provided in Section 3.6.4 or
Section 3.6.6, no Grandfathered Participant
who has previously elected to receive a
distribution of part or all of his or her
Account, or who, pursuant to this Section
3.6, has elected to defer payment for an
additional period from the
originally-elected payment date, may elect
to defer the payment of such amount to any
subsequent date.
3.6.8 Subject to acceleration pursuant to Section
3.6.3, Section 3.6.4, Section 7.1, Section
7.2 or Section 7.3, no distribution of the
amounts deferred by a Participant for any
Plan Year shall be made before the payment
date designated by the Participant on the
most recently filed Election with respect to
such deferred amounts. Distribution of the
amounts deferred for any Plan Year by a
Participant (other than a Grandfathered
Participant and an Inactive Participant who
makes an Election under Section 3.6.5) who
ceases to be an Active Participant shall be
made on the payment date designated by the
Participant on the last Election filed with
respect to such deferred amounts before the
Participant ceased to be an Active
Participant.
3.7 Distribution in Full Upon Terminating Event. The Company
shall give Participants at least thirty (30) days' notice (or, if not
practicable, such shorter notice as may be reasonably practicable) prior to the
anticipated date of the consummation of a Terminating Event. The Committee may,
in its discretion, provide in such notice that notwithstanding any other
provision of the Plan or the terms of any Election, upon the consummation of a
Terminating Event, the Account balance of each Participant shall be distributed
in full.
4. FORMS OF DISTRIBUTION
4.1 Forms of Distribution. Amounts credited to an Account shall
be distributed, pursuant to an Election, from among the following forms of
distribution:
4.1.1 A lump sum payment.
4.1.2 Substantially equal annual installments over
a five (5), ten (10) or fifteen (15) year
period.
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4.1.3 Substantially equal monthly installments
over a period not exceeding fifteen (15)
years.
Notwithstanding any Election to the contrary, distributions pursuant to
Elections made after December 10, 1996 shall be made in the form of a lump sum
payment unless the portion of a Participant's Account subject to distribution
pursuant to Section 4.1.2 or Section 4.1.3, as of both the date of the Election
and the benefit commencement date, is more than $10,000.
4.2 Valuation of Account For Purposes of Distribution. The
amount of any distribution made pursuant to Section 4.1 shall be based on the
value of the Participant's Account on the date of distribution and the
applicable distribution period. For this purpose, the value of a Participant's
Account shall be calculated by crediting income, gains and losses under the
Company Stock Fund and the Income Fund, as applicable, through the date
immediately preceding the date of distribution.
5. BOOK ACCOUNTS
5.1 Deferred Compensation Account. A deferred Compensation
Account shall be established for each Outside Director and Eligible Employee
when such Outside Director or Eligible Employee becomes a Participant. The
balance of each Participant's Account as of January 1, 1997 shall include the
balance of such Participant's account under the Prior Plan as of December 31,
1996. Compensation deferred pursuant to the Plan shall be credited to the
Account on the date such Compensation would otherwise have been payable to the
Participant. Income, gains and losses on the balance of the Account shall be
credited to the Account as provided in Section 5.2.
5.2 Crediting of Income, Gains and Losses on Accounts.
5.2.1 In General. Except as otherwise provided in
this Section 5.2, the Administrator shall
credit income, gains and losses with respect
to each Participant's Account as if it were
invested in the Income Fund.
5.2.2 Investment Fund Elections.
5.2.2.1 Each Active Participant, other than
an Active Participant who is an
Insider, may elect to have all or
any portion of his Account (to the
extent credited through the December
31 preceding the effective date of
such Election) credited with income,
gains and losses as if it were
invested in the Company Stock Fund
or the Income Fund.
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5.2.2.2 An investment fund Election shall
continue in effect until revoked or
superseded, provided that
notwithstanding any investment fund
Election to the contrary, as of the
valuation date (as determined under
Section 4.2) for the distribution of
all or any portion of a
Participant's Account that is
subject to distribution in the form
of installments described in Section
4.1.2 or 4.1.2, such Account, or
portion thereof, shall be deemed
invested in the Income Fund (and
transferred from the Company Stock
Fund to the Income Fund, to the
extent necessary) until such
Account, or portion thereof, is
distributed in full.
5.2.2.3 In the absence of an effective
Election, a Participant shall be
deemed to have elected to have the
Account credited with income, gains
and losses as if it were invested in
the Income Fund.
5.2.2.4 Investment fund Elections under this
Section 5.2.2 shall be effective as
of the first day of each Plan Year
beginning on and after January 1,
1997, provided that the election is
filed with the Committee on or
before the close of business on
December 31 of the Plan Year
preceding such Plan Year. An Active
Participant may only make an
investment fund Election with
respect to the Participant's
accumulated Account as of December
31, and not with respect to
Compensation to be deferred for a
Plan Year.
5.2.2.5 If an Active Participant who was not
an Insider becomes an Insider, then,
notwithstanding the foregoing, such
Active Participant may elect to
transfer the portion of his Account,
if any, deemed invested in the
Company Stock Fund to be deemed
invested in the Income Fund,
effective as of the first day of any
calendar month beginning after such
Active Participant becomes an
Insider.
5.2.2.6 If a Participant ceases to continue
in service as an Active Participant,
then, notwithstanding any Election
to the contrary, such Participant's
Account shall be deemed invested in
the Income Fund, effective as of the
first day of any calendar year
beginning after such Participant
ceases to continue in service as an
Active Participant.
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5.2.3 Timing of Credits. Compensation deferred
pursuant to the Plan shall be deemed
invested in the Income Fund on the date such
Compensation would otherwise have been
payable to the Participant. Accumulated
Account balances subject to an investment
fund Election under Section 5.2.2 shall be
deemed invested in the applicable investment
fund as of the effective date of such
Election. The value of amounts deemed
invested in the Company Stock Fund shall be
based on hypothetical purchases and sales of
Company Stock at Fair Market Value as of the
effective date of an investment Election.
5.3 Status of Deferred Amounts. Regardless of whether or not
the Company is a Participant's employer, all Compensation deferred under this
Plan shall continue for all purposes to be a part of the general funds of the
Company.
5.4 Participants' Status as General Creditors. Regardless of
whether or not the Company is a Participant's employer, an Account shall at all
times represent the general obligation of the Company. The Participant shall be
a general creditor of the Company with respect to this obligation, and shall not
have a secured or preferred position with respect to his or her Accounts.
Nothing contained herein shall be deemed to create an escrow, trust, custodial
account or fiduciary relationship of any kind. Nothing contained herein shall be
construed to eliminate any priority or preferred position of a Participant in a
bankruptcy matter with respect to claims for wages.
6. NON-ASSIGNABILITY, ETC.
The right of each Participant in or to any account, benefit or payment
hereunder shall not be subject in any manner to attachment or other legal
process for the debts of such Participant; and no Account, benefit or payment
shall be subject to anticipation, alienation, sale, transfer, assignment or
encumbrance.
7. DEATH OR DISABILITY OF PARTICIPANT
7.1 Death of Participant. A Deceased Participant's Account
shall be distributed in accordance with the last Election made by the Deceased
Participant before the Deceased Participant's death, unless the Deceased
Participant's estate or beneficiary to whom the right to payment under the Plan
shall have passed timely elects to accelerate or defer the time or change the
form of payment pursuant to Section 3.6.3.
7.2 Disability of Participant. A Disabled Participant's Account
shall be distributed in accordance with the last Election made by the Disabled
Participant before the Disabled Participant's termination of service or date of
disability, as applicable, unless the
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Disabled Participant timely elects to accelerate the time or change the form of
payment pursuant to Section 3.6.4.
7.3 Hardship Distributions. Notwithstanding the terms of an
Election, if, at the Participant's request, the Board determines that the
Participant has incurred a Hardship, the Board may, in its discretion, authorize
the immediate distribution of all or any portion of the Participant's Account.
7.4 Designation of Beneficiaries. Each Participant shall have
the right to designate one or more beneficiaries to receive distributions in the
event of the Participant's death by filing with the Administrator a beneficiary
designation on the form provided by the Administrator for such purpose. The
designation of beneficiary or beneficiaries may be changed by a Participant at
any time prior to his or her death by the delivery to the Administrator of a new
beneficiary designation form. If no beneficiary shall have been designated, or
if no designated beneficiary shall survive the Participant, the Participant's
estate shall be deemed to be the beneficiary.
8. INTERPRETATION
8.1 Authority of Committee. The Committee shall have full and
exclusive authority to construe, interpret and administer this Plan and the
Committee's construction and interpretation thereof shall be binding and
conclusive on all persons for all purposes.
8.2 Claims Procedure. The Committee shall administer a
reasonable claims procedure with respect to the Plan in accordance with
Department of Labor Regulation section 2560.503-1, or any successor provision.
9. AMENDMENT OR TERMINATION
9.1 Amendment or Termination. Except as otherwise provided by
Section 9.2, the Company, by action of the Board or by action of the Committee,
reserves the right at any time, or from time to time, to amend or modify this
Plan. The Company, by action of the Board, reserves the right at any time, or
from time to time terminate this Plan.
9.2 Amendment of Rate of Credited Earnings. No amendment shall
change the Applicable Interest Rate with respect to the portion of a
Participant's Account that is attributable to an Election made with respect to
Compensation earned in a Plan Year and filed with the Administrator before the
date of adoption of such amendment by the Board. For purposes of this Section
9.2, an Election to defer the payment of part or all of an Account for an
additional period after a previously-elected payment date (as described in
Section 3.6) shall be treated as a separate Election from any previous Election
with respect to such Account.
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10. MISCELLANEOUS PROVISIONS
10.1 No Right to Continued Employment. Nothing contained herein
shall be construed as conferring upon any Participant the right to remain in
service as an Outside Director or in the employment of a Participating Company
as an executive or in any other capacity.
10.2 Governing Law. This Plan shall be interpreted under the
laws of the Commonwealth of Pennsylvania.
11. EFFECTIVE DATE
The effective date of the Plan this amendment and restatement of the
Plan shall be June 21, 1999.
IN WITNESS WHEREOF, COMCAST CORPORATION has caused this Plan to be
executed by its officers thereunto duly authorized, and its corporate seal to be
affixed hereto, as of the 21st day of June, 1999.
COMCAST CORPORATION
BY: /s/ Stanley Wang
ATTEST: /s/ Arthur Block
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COMCAST CORPORATION
1990 RESTRICTED STOCK PLAN
(As Amended and Restated, Effective June 21, 1999)
1. PURPOSE
The purpose of the Plan is to promote the ability of Comcast
Corporation (the "Company") to retain certain key employees and enhance the
growth and profitability of the Company by providing the incentive of long-term
awards for continued employment and the attainment of performance objectives.
2. DEFINITIONS
(a) "Active Grantee" means each Grantee who is actively employed by a
Participating Company.
(b) "Affiliate" means, with respect to any Person, any other person
that, directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, the term
"control," including its correlative terms "controlled by" and "under common
control with," mean, with respect to any Person, the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.
(c) "Award" means an award of Restricted Stock granted under the Plan.
(d) "Board" means the Board of Directors of the Company.
(e) "Change of Control" means any transaction or series of transactions
as a result of which any Person who was a Third Party immediately before such
transaction or series of transactions directly or indirectly owns
then-outstanding securities of the Company having more than 50 percent of the
voting power for the election of directors of the Company.
(f) "Code" means the Internal Revenue Code of 1986, as amended.
(g) "Comcast Plan" means any restricted stock, stock bonus, stock
option or other compensation plan, program or arrangement established or
maintained by the Company or an Affiliate, including but not limited to this
Plan, the Comcast Corporation 1997 Deferred Stock Option Plan, the Comcast
Corporation 1996 Stock Option Plan and the Comcast Corporation 1987 Stock Option
Plan.
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(h) "Committee" means the Subcommittee on Performance Based
Compensation of the Compensation Committee of the Board.
(i) "Company" means Comcast Corporation, a Pennsylvania corporation,
including any successor thereto by merger, consolidation, acquisition of all or
substantially all the assets thereof, or otherwise.
(j) "Date of Grant" means the date on which an Award is granted.
(k) "Deceased Grantee" means:
(i) A Grantee whose employment by a Participating Company
is terminated by death; or
(ii) A Grantee who dies following termination of employment
by a Participating Company.
(l) "Disabled Grantee" means:
(i) A Grantee whose employment by a Participating Company
is terminated by reason of disability;
(ii) A Grantee who becomes disabled (as determined by the
Committee) following termination of employment by a
Participating Company; or
(iii) The duly-appointed legal guardian of an individual
described in Paragraph 2(l)(i) or 2(l)(ii) acting on
behalf of such individual.
(m) "Election" means a written election on a form provided by the
Committee, filed with the Committee in accordance with Paragraph 8, pursuant to
which a Grantee:
(i) Elects, within the time or times specified in Paragraph
8, to defer the distribution date of Restricted Stock;
and
(ii) Designates the distribution date of Restricted Stock.
(n) "Eligible Employee" means a management employee of a Participating
Company, as determined by the Committee.
(o) "Grantee" means an Eligible Employee who is granted an Award.
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(p) "Normal Retirement" means a Grantee's termination of employment
that is treated by the Participating Company as a retirement under its
employment policies and practices as in effect from time to time.
(q) "Other Available Shares" means, as of any date, the excess, if any
of:
(i) the total number of Shares owned by a Grantee; over
(ii) the sum of:
(a) the number of Shares owned by such Grantee for less
than six months; plus
(b) the number of Shares owned by such Grantee that has,
within the preceding six months, been the subject of a
withholding certification pursuant to Paragraph
9(c)(ii) or any similar withholding certification under
any other Comcast Plan; plus
(c) the number of Shares owned by such Grantee that has,
within the preceding six months, been received in
exchange for Shares surrendered as payment, in full or
in part, of the exercise price for an option to
purchase any securities of the Company or an Affiliate
under any Comcast Plan, but only to the extent of the
number of Shares surrendered; plus
(d) The number of Shares owned by such Grantee as to which
evidence of ownership has, within the preceding six
months, been provided to the Company in connection with
the crediting of "Deferred Stock Units" to such
Optionee's Account under the Comcast Corporation 1997
Deferred Stock Option Plan.
For purposes of this Paragraph 2(q), a Share that is subject to a deferral
election pursuant to Paragraph 8 or another Comcast Plan shall not be treated as
owned by a Grantee until all conditions to the delivery of such Share have
lapsed. For purposes of Paragraph 9(c), the number of Other Available Shares
shall be determined separately for the Company's Class A Special Common Stock,
par value, $1.00, and for the Company's Class A Common Stock, par value, $1.00.
(r) "Parent Company" means all corporations that, at the time in
question, are parent corporations of the Company within the meaning of section
424(e) of the Code.
(s) "Participating Company" means the Company and each of the Parent
Companies and Subsidiary Companies.
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(t) "Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization.
(u) "Plan" means the Comcast Corporation 1990 Restricted Stock Plan, as
set forth herein, and as amended from time to time.
(v) "Plan Year" means the 365-day period (or the 366-day period)
extending from January 3 to the next following January 2.
(w) "Restricted Stock" means Shares subject to restrictions as set
forth in an Award.
(x) "Retired Grantee" means a Grantee who has terminated employment
pursuant to a Normal Retirement.
(y) "Roberts Family." Each of the following is a member of the Roberts
Family:
(i) Brian L. Roberts;
(ii) a lineal descendant of Brian L. Roberts; or
(iii) a trust established for the benefit of any of Brian L.
Roberts and/or a lineal descendant or descendants of Brian L. Roberts.
(z) "Rule 16b-3" means Rule 16b-3 promulgated under the 1934 Act, as in
effect from time to time.
(aa) "Share" or "Shares" means:
(i) for all purposes of the Plan, a share or shares of Class A
Special Common Stock, $1.00 par value, of the Company.
(ii) solely for purposes of Paragraphs 2(q) and 9(c), the term
"Share" or "Shares" also means a share or shares of the Company's Class A Common
Stock, par value, $1.00.
(bb) "Subsidiary Companies" means:
(i) all corporations that, at the time in question, are
subsidiary corporations of the Sponsor within the meaning of section 424(f) of
the Code; and
(ii) Jones Intercable, Inc. and all corporations that, at the
time in question, are subsidiary corporations of Jones Intercable, Inc. within
the meaning of section 424(f) of the Code.
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(cc) "Terminating Event" means any of the following events:
(i) the liquidation of the Company; or
(ii) a Change of Control.
(dd) "Third Party" means any Person, together with such Person's
Affiliates, provided that the term "Third Party" shall not include the Company,
an Affiliate of the Company or any member or members of the Roberts Family.
(ee) "1933 Act" means the Securities Act of 1933, as amended.
(ff) "1934 Act" means the Securities Exchange Act of 1934,
as amended.
3. RIGHTS TO BE GRANTED
Rights that may be granted under the Plan are rights to Restricted
Stock, which gives the Grantee ownership rights in the Shares subject to the
Award, subject to a substantial risk of forfeiture, as set forth in Paragraph 7,
and to deferred payment, as set forth in Paragraph 8.
4. SHARES SUBJECT TO THE PLAN
(a) Not more than 4,875,000 Shares in the aggregate may be issued under
the Plan pursuant to the grant of Awards, subject to adjustment in accordance
with Paragraph 10. The Shares issued under the Plan may, at the Company's
option, be either Shares held in treasury or Shares originally issued for such
purpose.
(b) If Restricted Stock is forfeited pursuant to the times of an Award,
other Awards with respect to such Shares may be granted.
5. ADMINISTRATION OF THE PLAN
(a) Administration. The Plan shall be administered by the Committee.
(b) Grants. Subject to the express terms and conditions set forth in
the Plan, the Committee shall have the power, from time to time,
to:
(i) select those Employees to whom Awards shall
be granted under the Plan, to determine the
number of Shares to be granted pursuant to
each Award, and, pursuant to the provisions
of the Plan, to determine the terms and
conditions of each Award, including the
restrictions applicable to such Shares; and
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(ii) interpret the Plan's provisions, prescribe,
amend and rescind rules and regulations for
the Plan, and make all other determinations
necessary or advisable for the
administration of the Plan.
The determination of the Committee in all matters as stated above shall be
conclusive.
(c) Meetings. The Committee shall hold meetings at such times and
places as it may determine. Acts approved at a meeting by a majority of the
members of the Committee or acts approved in writing by the unanimous consent of
the members of the Committee shall be the valid acts of the Committee.
(d) Exculpation. No member of the Committee shall be personally liable
for monetary damages for any action taken or any failure to take any action in
connection with the administration of the Plan or the granting of Awards
thereunder unless (i) the member of the Committee has breached or failed to
perform the duties of his office, and (ii) the breach or failure to perform
constitutes self-dealing, wilful misconduct or recklessness; provided, however,
that the provisions of this Paragraph 5(d) shall not apply to the responsibility
or liability of a member of the Committee pursuant to any criminal statute.
(e) Indemnification. Service on the Committee shall constitute service
as a member of the Board. Each member of the Committee shall be entitled without
further act on his part to indemnity from the Company to the fullest extent
provided by applicable law and the Company' s Articles of Incorporation and
By-laws in connection with or arising out of any action, suit or proceeding with
respect to the administration of the Plan or the granting of Awards thereunder
in which he may be involved by reason of his being or having been a member of
the Committee, whether or not he continues to be such member of the Committee at
the time of the action, suit or proceeding.
6. ELIGIBILITY
Awards may be granted only to Eligible Employees, as determined by the
Committee. No Awards shall be granted to an individual who is not an employee of
a Participating Company.
7. RESTRICTED STOCK AWARDS
The Committee may grant Awards in accordance with the Plan. The terms
and conditions of Awards shall be set forth in writing as determined from time
to time by the Committee, consistent, however, with the following:
(a) Time of Grant. All Awards shall be granted within ten (10) years
from the date of adoption of the Plan by the Board.
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(b) Shares Awarded. The provisions of Awards need not be the same with
respect to each Grantee. No cash or other consideration shall be required to be
paid by the Grantee in exchange for an Award.
(c) Awards and Agreements. A certificate shall be issued to each
Grantee in respect of Shares subject to an Award. Such certificate shall be
registered in the name of the Grantee and shall bear an appropriate legend
referring to the terms, conditions and restrictions applicable to such Award.
The Company may require that the certificate evidencing such Restricted Stock be
held by the Company until all restrictions on such Restricted Stock have lapsed.
(d) Restrictions. Subject to the provisions of the Plan and the Award,
during a period set by the Committee commencing with the Date of Grant, which,
for Grantees who are subject to the short-swing profit recapture rules of
section 16(b) of the 1934 Act by virtue of their position as either a director,
officer or holder of more than 10 percent of any class of equity securities of
the Company, shall extend for at least six (6) months from the Date of Grant,
the Grantee shall not be permitted to sell, transfer, pledge or assign
Restricted Stock awarded under the Plan.
(e) Lapse of Restrictions. Subject to the provisions of the Plan and
the Award, restrictions upon Shares subject to an Award shall lapse at such time
or times and on such terms and conditions as the Committee may determine and as
are set forth in the Award; provided, however, that the restrictions upon such
Shares shall lapse only if the Grantee on the date of such lapse is, and has
been an employee of a Participating Company continuously from the Date of Grant.
The Award may provide for the lapse of restrictions in installments, as
determined by the Committee. The Committee may, in its sole discretion, waive,
in whole or in part, any remaining restrictions with respect to such Grantee's
Restricted Stock.
(f) Rights of the Grantee. Grantees may have such rights with respect
to Shares subject to an Award as may be determined by the Committee and set
forth in the Award, including the right to vote such Shares, and the right to
receive dividends paid with respect to such Shares.
(g) Termination of Grantee's Employment. A transfer of an Eligible
Employee between two employers, each of which is a Participating Company, shall
not be deemed a termination of employment. In the event that a Grantee
terminates employment with all Participating Companies, all Shares remaining
subject to restrictions shall be forfeited by the Grantee and deemed canceled by
the Company.
(h) Delivery of Shares. Except as otherwise provided by Paragraph 8,
when the restrictions imposed on Restricted Stock lapse with respect to one or
more Shares, the Company shall notify the Grantee that such restrictions no
longer apply, and shall deliver to the Grantee (or the person to whom ownership
rights may have passed by will or the laws of descent and distribution) a
certificate for the number of Shares for which restrictions have lapsed without
any
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legend or restrictions (except those that may be imposed by the Committee, in
its sole judgment, under Paragraph 9(a)). The right to payment of any fractional
Shares that may have accrued shall be satisfied in cash, measured by the product
of the fractional amount times the fair market value of a Share at the time the
applicable restrictions lapse, as determined by the Committee.
8. DEFERRAL ELECTIONS
Effective for Awards granted after September 16, 1997, a Grantee may
elect to defer the receipt of Restricted Stock as to which restrictions have
lapsed as provided by the Committee in the Award, consistent, however, with the
following:
(a) Deferral Election.
(i) Election. Each Grantee shall have the right to defer
the receipt of all or any portion of the Restricted
Stock as to which the Award provides for the
potential lapse of applicable restrictions by filing
an Election to defer the receipt of such Restricted
Stock on a form provided by the Committee for this
purpose.
(ii) Deadline for Deferral Election. No Election to defer
the receipt of Restricted Stock as to which the Award
provides for the potential lapse of applicable
restrictions shall be effective unless it is filed
with the Committee on or before the last day of the
calendar year ending before the first day of the Plan
Year in which the applicable restrictions may lapse;
provided that an Election to defer the receipt of
Restricted Stock as to which the Award provides for
the potential lapse of applicable restrictions within
the same Plan Year as the Plan Year in which the
Award is granted shall be effective if it is filed
with the Committee on or before the earlier of (A)
the 30th day following the Date of Grant or (B) the
last day of the month that precedes the month in
which the applicable restrictions may lapse.
(b) Effect of Failure of Restrictions on Shares to Lapse. An Election
shall be null and void if the restrictions on Restricted Stock do not lapse
before the distribution date for such Restricted Stock identified in such
Election by reason of the failure to satisfy any condition precedent to the
lapse of the restrictions.
(c) Deferral Period. Except as otherwise provided in Paragraph 8(d),
all Restricted Stock that is subject to an Election shall be delivered to the
Grantee (or the person to whom ownership rights may have passed by will or the
laws of descent and distribution) without any legend or restrictions (except
those that may be imposed by the Committee, in its sole judgment, under
Paragraph 9(a)), on the distribution date for such Restricted Stock designated
by the Grantee on the most recently filed Election. Subject to acceleration or
deferral pursuant to
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Paragraph 8(d) or Paragraph 11, no distribution may be made earlier than January
2nd of the second calendar year beginning after the date on which the applicable
restrictions may lapse, nor later than January 2nd of the tenth calendar year
beginning after the date on which the applicable restrictions may lapse. The
distribution date may vary with each separate Election.
(d) Additional Deferral Election.
(i) Each Active Grantee who has previously made an
Election to receive a distribution of part or all of
his or her Account, or who, pursuant to this
Paragraph 8(d)(i) has made an Election to defer the
distribution date for Restricted Stock for an
additional period from the originally-elected
distribution date, may elect to defer the
distribution date for a minimum of two and a maximum
of ten additional years from the previously-elected
distribution date, by filing an Election with the
Committee on or before the close of business on June
30 of the calendar year preceding the calendar year
in which the distribution would otherwise be made.
(ii) A Deceased Grantee's estate or beneficiary to whom
the right to payment under the Plan shall have passed
may elect to (A) defer the distribution date for the
Deceased Grantee's Restricted Stock for a minimum of
two additional years from the date payment would
otherwise be made (provided that if an Election is
made pursuant to this Paragraph 8(d)(ii)(A), the
Deceased Grantee's deferred Restricted Stock shall be
distributed in full on or before the fifth
anniversary of the Deceased Grantee's death); or (B)
accelerate the distribution date for the Deceased
Grantee's Restricted Stock from the date payment
would otherwise be made to January 2nd of the
calendar year beginning after the Deceased Grantee's
death. An Election pursuant to this Paragraph
8(d)(ii) must be filed with the Committee on or
before the close of business on (x) the June 30
following the Grantee's death on or before May 1 of a
calendar year, (y) the 60th day following the
Grantee's death after May 1 and before November 2 of
a calendar year or (z) the December 31 following the
Grantee's death after November 1 of a calendar year.
One and only one Election shall be permitted pursuant
to this Paragraph 8(d)(ii) with respect to a Deceased
Grantee.
(iii) A Disabled Grantee may elect to accelerate the
distribution date of the Disabled Grantee's
Restricted Stock from the date payment would
otherwise be made to January 2nd of the calendar year
beginning after the Grantee became disabled. An
Election pursuant to this Paragraph 8(d)(iii) must be
filed with the Committee on or before the close of
business on the (x) the June 30 following the date
the Grantee becomes a Disabled Grantee if the Grantee
becomes a Disabled Grantee on or before May 1 of a
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calendar year, (y) the 60th day following the date
the Grantee becomes a Disabled Grantee if the Grantee
becomes a Disabled Grantee after May 1 and before
November 2 of a calendar year or (z) the December 31
following the date the Grantee becomes a Disabled
Grantee if the Grantee becomes a Disabled Grantee
after November 2 of a calendar year.
(iv) A Retired Grantee may elect to defer the distribution
date of the Retired Grantee's Restricted Stock for a
minimum of two additional years from the date payment
would otherwise be made (provided that if an Election
is made pursuant to this Paragraph 8(d)(iv), the
Retired Grantee's Account shall be distributed in
full on or before the fifth anniversary of the
Retired Grantee's Normal Retirement). An Election
pursuant to this Paragraph 8(d)(iv) must be filed
with the Committee on or before the close of business
on the later of (x) the June 30 following the
Grantee's Normal Retirement on or before May 1 of a
calendar year, (y) the 60th day following the
Grantee's Normal Retirement after May 1 and before
November 2 of a calendar year or (z) the December 31
following the Grantee's Normal Retirement after
November 1 of a calendar year.
(e) Status of Deferred Shares. A Grantee's right to delivery of Shares
subject to an Election under this Paragraph 8 shall at all times represent the
general obligation of the Company. The Grantee shall be a general creditor of
the Company with respect to this obligation, and shall not have a secured or
preferred position with respect to such obligation. Nothing contained in the
Plan or an Award shall be deemed to create an escrow, trust, custodial account
or fiduciary relationship of any kind. Nothing contained in the Plan or an Award
shall be construed to eliminate any priority or preferred position of a Grantee
in a bankruptcy matter with respect to claims for wages.
(f) Non-Assignability, Etc. The right of a Grantee to receive Shares
subject to an Election under this Paragraph 8 shall not be subject in any manner
to attachment or other legal process for the debts of such Grantee; and no right
to receive Shares hereunder shall be subject to anticipation, alienation, sale,
transfer, assignment or encumbrance.
9. SECURITIES LAWS; TAXES
(a) Securities Laws. The Committee shall have the power to make each
grant of Awards under the Plan subject to such conditions as it deems necessary
or appropriate to comply with the then-existing requirements of the 1933 Act and
the 1934 Act, including Rule 16b-3. Such conditions may include the delivery by
the Grantee of an investment representation to the Company in connection with
the lapse of restrictions on Shares subject to an Award, or the execution of an
agreement by the Grantee to refrain from selling or otherwise disposing of the
Shares acquired for a specified period of time or on specified terms.
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(b) Taxes. Subject to the rules of Paragraph 9(c), the Company shall be
entitled, if necessary or desirable, to withhold the amount of any tax, charge
or assessment attributable to the grant of any Award or lapse of restrictions
under any Award. The Company shall not be required to deliver Shares pursuant to
any Award until it has been indemnified to its satisfaction for any such tax,
charge or assessment.
(c) Payment of Tax Liabilities; Election to Withhold Shares or Pay Cash
to Satisfy Tax Liability.
(i) In connection with the grant of any Award or the lapse of
restrictions under any Award, the Company shall have the
right to (A) require the Grantee to remit to the Company an
amount sufficient to satisfy any federal, state and/or local
withholding tax requirements prior to the delivery or
transfer of any certificate or certificates for Shares
subject to such Award, or (B) take any action whatever that
it deems necessary to protect its interests with respect to
tax liabilities. The Company's obligation to make any
delivery or transfer of Shares shall be conditioned on the
Grantee's compliance, to the Company's satisfaction, with
any withholding requirement.
(ii) Except as otherwise provided in this Paragraph 9(c)(ii), any
tax liabilities incurred in connection with grant of any
Award or the lapse of restrictions under any Award under the
Plan shall be satisfied by the Company's withholding a
portion of the Shares subject to such Award having a fair
market value approximately equal to the minimum amount of
taxes required to be withheld by the Company under
applicable law, unless otherwise determined by the Committee
with respect to any Grantee. Notwithstanding the foregoing,
the Committee may permit a Grantee to elect one or both of
the following: (A) to have taxes withheld in excess of the
minimum amount required to be withheld by the Company under
applicable law; provided that the Grantee certifies in
writing to the Company at the time of such election that the
Grantee owns Other Available Shares having a fair market
value that is at least equal to the fair market value to be
withheld by the Company in payment of withholding taxes in
excess of such minimum amount; and (B) to pay to the Company
in cash all or a portion of the taxes to be withheld in
connection with such grant or lapse of restrictions. In all
cases, the Shares so withheld by the Company shall have a
fair market value that does not exceed the amount of taxes
to be withheld minus the cash payment, if any, made by the
Grantee. The fair market value of such Shares shall be
determined based on the last reported sale price of a Share
on the principal exchange on which Shares are listed or, if
not so listed, on the NASDAQ Stock Market on the last
trading day prior to the date of such grant or lapse of
restriction.
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Any election pursuant to this Paragraph 9(c)(ii) must be in
writing made prior to the date specified by the Committee,
and in any event prior to the date the amount of tax to be
withheld or paid is determined. An election pursuant to this
Paragraph 9(c)(ii) may be made only by a Grantee or, in the
event of the Grantee's death, by the Grantee's legal
representative. No Shares withheld pursuant to this
Paragraph 9(c)(ii) shall be available for subsequent grants
under the Plan. The Committee may add such other
requirements and limitations regarding elections pursuant to
this Paragraph 9(c)(ii) as it deems appropriate.
10. CHANGES IN CAPITALIZATION
The aggregate number of Shares and class of Shares as to which Awards
may be granted and the number of Shares covered by each outstanding Award shall
be appropriately adjusted in the event of a stock dividend, stock split,
recapitalization or other change in the number or class of issued and
outstanding equity securities of the Company resulting from a subdivision or
consolidation of the Shares and/or other outstanding equity security or a
recapitalization or other capital adjustment (not including the issuance of
Shares and/or other outstanding equity securities on the conversion of other
securities of the Company which are convertible into Shares and/or other
outstanding equity securities) affecting the Shares which is effected without
receipt of consideration by the Company. The Committee shall have authority to
determine the adjustments to be made under this Paragraph 10 and any such
determination by the Committee shall be final, binding and conclusive.
11. TERMINATING EVENTS
The Committee shall give Grantees at least thirty (30) days'
notice (or, if not practicable, such shorter notice as may be reasonably
practicable) prior to the anticipated date of the consummation of a Terminating
Event. The Committee may, in its discretion, provide in such notice that upon
the consummation of such Terminating Event, any restrictions on Restricted Stock
(other than Restricted Stock that has previously been forfeited) shall be
eliminated, in full or in part. Further, the Committee may, in its discretion,
provide in such notice that notwithstanding any other provision of the Plan or
the terms of any Election made pursuant to Paragraph 8, upon the consummation of
a Terminating Event, all Restricted Stock subject to an Election made pursuant
to Paragraph 8 shall be transferred to the Grantee.
12. AMENDMENT AND TERMINATION
The Plan may be terminated by the Board at any time. The Plan may be
amended by the Board or the Committee at any time. No Award shall be affected by
any such termination or amendment without the written consent of the Grantee.
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13. EFFECTIVE DATE
The effective date of this amendment and restatement of the Plan is the
date on which it is adopted by the Board. The adoption of this amendment and
restatement of the Plan and the grant of Awards pursuant to this amendment and
restatement of the Plan is subject to the approval of the shareholders of the
Company to the extent that the Committee determines that such approval (a) is
required pursuant to the By-laws of the National Association of Securities
Dealers, Inc., and the schedules thereto, in connection with issuers whose
securities are included in the NASDAQ National Market System, or (b) is required
to satisfy the conditions on Rule 16b-3. If the Committee determines that
shareholder approval is required to satisfy the foregoing conditions, the Board
shall submit the Plan to the shareholders the Company for their approval at the
first annual meeting of shareholders held after the adoption of the Plan by the
Board.
14. GOVERNING LAW
The Plan and all determinations made and actions taken pursuant to the
Plan shall be governed in accordance with Pennsylvania law.
Executed as of the 21st day of June 1999.
COMCAST CORPORATION
BY: /s/ Stanley Wang
ATTEST: /s/ Arthur Block
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COMCAST CORPORATION
1996 CASH BONUS PLAN
(Amended and Restated, Effective June 21, 1999)
1. PURPOSE
The purpose of the Plan is to promote the ability of
Comcast Corporation (the "Company") and its Subsidiaries (as defined below) to
retain and recruit employees and enhance the growth and profitability of the
Company by providing the incentive of short-term and long-term cash bonus awards
for continued employment and the attainment of performance objectives.
2. DEFINITIONS
(a) "Affiliate" means, with respect to any Person,
any other person that, directly or indirectly, is in control of, is controlled
by, or is under common control with, such Person. For purposes of this
definition, the term "control," including its correlative terms "controlled by"
and "under common control with," mean, with respect to any Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
(b) "Applicable Percent" means the percentage that
corresponds to a Modified Target, as identified in Exhibit A.
(c) "Annual Amount at Risk" means the amount
designated by the Committee for each Plan Year as the maximum portion of the
Award payable for such Plan Year, provided that the "Annual Amount at Risk" for
the last Plan Year of an Award shall not include the Last Year Amount at Risk.
(d) "Award" or "Cash Bonus Award" means a cash bonus
award granted under the Plan.
(e) "Award Period" means the period extending from
January 1 of the first Plan Year for which there is an Annual Amount at Risk
through December 31 of the last Plan Year for which there is an Annual Amount at
Risk.
(f) "Base Year" means 1995, except as otherwise
provided by the Committee and provided in an Award.
(g) "Board" means the Board of Directors of the
Company.
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(h) "C" means the Consolidated Operating Cash Flow of
the Company, the Cable Division or the Cellular Division, as applicable, for the
Base Year.
(i) "Cable Division" means the Company's cable
television business, as determined by the Committee in its sole discretion.
(j) "Cellular Division" means the Company's cellular
telephone business, as determined by the Committee in its sole discretion.
(k) "Change of Control" means any transaction or
series of transactions as a result of which any Person who was a Third Party
immediately before such transaction or series of transactions directly or
indirectly owns then-outstanding securities of the Company having more than 50
percent of the voting power for the election of directors of the Company.
(l) "Committee" means the Subcommittee on Performance
Based Compensation of the Compensation Committee of the Board.
(m) "Company."
(i) Except as otherwise provided in Paragraph
2(m)(ii), "Company" means Comcast Corporation, a Pennsylvania corporation,
including any successor thereto by merger, consolidation, acquisition of all or
substantially all the assets thereof, or otherwise.
(ii) For purposes of determining an Eligible
Employee's employer, "Company" means Comcast Corporation, a Pennsylvania
corporation.
(n) "Compounded Annual Growth Rate" means the value
determined under the following mathematical formula:
n
C[(1+r) ]
where C, r and n have the definitions provided in this Paragraph 2 of the Plan.
(o) "Consolidated Operating Cash Flow" means the
consolidated operating income plus depreciation and amortization, of the
Company, the Cable Division or the Cellular Division, as applicable, for a Plan
Year, as determined by the Committee in accordance with generally accepted
accounting principles. If the results of operations of a business acquired or
disposed of after December 31 of the Base Year would, under generally accepted
accounting principles, be included (in the case of an acquisition) or excluded
(in the case of a disposition) from the consolidated financial statements of the
Company, the Cable Division or the Cellular
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Division, as applicable, from the date of acquisition or disposition, and, in
such event, the Committee decides in its sole discretion that such inclusion or
exclusion will materially affect the comparability of such amount for the Plan
Year in which the acquisition or disposition occurs and each Plan Year
thereafter to that for the Base Year, then for the purpose of determining
whether the Target has been met for the Plan Year in which the acquisition or
disposition occurs and each Plan Year thereafter only, the Consolidated
Operating Cash Flow for the Base Year shall be restated to account for such
acquisition or disposition as if it had occurred on January 1 of the Base Year,
using actual historical financial information for the acquired or disposed of
business. The Committee may also decide in its sole discretion that an event
(such as a non-recurring item or the results of a start-up or development stage
business) in a Plan Year will materially affect the comparability of the results
of operations for such Plan Year to that for the Base Year, in which case the
Committee may restate the results of operations for such Plan Year to make an
equitable adjustment thereto.
(p) "Cumulative Annual Amount at Risk" means, for any
Plan Year, the sum of the Annual Amount at Risk for such Plan Year and each
preceding Plan Year in the Award Period.
(q) "Date of Grant" means the date on which an Award
is granted.
(r) "Eligible Employee" means an employee of the
Company or a Subsidiary, as determined by the Committee.
(s) "Grantee" means an Eligible Employee who is
granted an Award.
(t) "Last Year Amount at Risk" means the amount
designated by the Committee as the portion of the Award at risk for the last
Plan Year in the Award Period, provided that the "Last Year Amount at Risk"
shall not include the portion of the Award designated by the Committee as the
Annual Amount at Risk for the such Plan Year.
(u) "Modified Target" means for any Plan Year
beginning after 1996, Consolidated Operating Cash Flow for the Company, the
Cable Division or the Cellular Division, as applicable, which equals or exceeds
a percentage of the Compounded Annual Growth Rate for such Plan Year as
established by the Committee for the Company, the Cable Division or the Cellular
Division, as applicable; provided that any fractional percentage shall be
rounded to the nearest identified percentage.
(v) "n" means a value applied for purposes of
determining the Compounded Annual Growth Rate for the Company, the Cable
Division or the Cellular Division, as applicable, as follows:
(i) for purposes of determining Compounded
Annual Growth Rate for the first Plan Year beginning after the Base Year, n = 1.
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(ii) for purposes of determining Compounded
Annual Growth Rate for the second Plan Year beginning after the Base Year, n=2.
(iii) for purposes of determining Compounded
Annual Growth Rate for the third Plan Year beginning after the Base Year, n = 3.
(iv) for purposes of determining Compounded
Annual Growth Rate for the fourth Plan Year beginning after the Base Year, n=4.
(v) for purposes of determining Compounded
Annual Growth Rate for the fifth Plan Year beginning after the Base Year, n = 5.
(w) "Person" means an individual, a corporation, a
partnership, an association, a trust or any other entity or organization.
(x) "Plan" means the Comcast Corporation 1996 Cash
Bonus Plan, as set forth herein, and as amended from time to time.
(y) "Plan Year" means the calendar year.
(z) "r" means the interest rate established by the
Committee for purposes of determining the Compounded Annual Growth Rate for the
Company, the Cable Division or the Cellular Division, as applicable.
(aa) "Roberts Family." Each of the following is a
member of the Roberts Family:
(i) Brian L. Roberts;
(ii) a lineal descendant of Brian L. Roberts; or
(iii) a trust established for the benefit of any
of Brian L. Roberts and/or a lineal descendant or descendants of Brian L.
Roberts.
(bb) "Subsidiary" means:
(i) a corporation that, at the time in question,
is a subsidiary corporation of the Company, within the meaning of section 424(f)
of the Code; and
(ii) Jones Intercable, Inc. and each corporation
that, at the time in question, is a subsidiary corporation of Jones Intercable,
Inc. within the meaning of section 424(f) of the Code.
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(cc) "Target" means, for any Plan Year beginning
after the Base Year, Consolidated Operating Cash Flow for the Company, the Cable
Division or the Cellular Division, as applicable, which equals or exceeds the
Compounded Annual Growth Rate for such Plan Year, based on the annualized
interest rate, "r," established by the Committee for the Company, the Cable
Division or the Cellular Division, as applicable.
(dd) "Terminating Event" means any of the following
events:
(i) the liquidation of the Sponsor; or
(ii) a Change of Control.
(ee) "Third Party" means any Person, together with
such Person's Affiliates, provided that the term "Third Party" shall not include
the Company, an Affiliate of the Company or any member or members of the Roberts
Family.
(ff) "Total Annual Amounts at Risk" means the sum of
the Annual Amounts at Risk for an Award.
3. RIGHTS TO BE GRANTED
Rights that may be granted under the Plan are rights
to cash payments, payable in accordance with the terms of the Plan and the Award
document.
4. ADMINISTRATION OF THE PLAN
(a) Administration. The Plan shall be administered by
the Committee.
(b) Grants. Subject to the express terms and
conditions set forth in the Plan, the Committee shall have the power, from time
to time, to:
(i) select those Eligible Employees to whom
Awards shall be granted under the Plan, to determine the amount of cash to be
paid pursuant to each Award, and, pursuant to the provisions of the Plan, to
determine the terms and conditions of each Award; and
(ii) interpret the Plan's provisions, prescribe,
amend and rescind rules and regulations for the Plan, and make all other
determinations necessary or advisable for the administration of the Plan.
The determination of the Committee in all matters as stated above shall be
conclusive.
(c) Meetings. The Committee shall hold meetings at
such times and places as it may determine. Acts approved at a meeting by a
majority of the members of the
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Committee or acts approved in writing by the unanimous consent of the members of
the Committee shall be the valid acts of the Committee.
(d) Exculpation. No member of the Committee shall be
personally liable for monetary damages for any action taken or any failure to
take any action in connection with the administration of the Plan or the
granting of Awards thereunder unless (i) the member of the Committee has
breached or failed to perform the duties of his office, and (ii) the breach or
failure to perform constitutes self-dealing, wilful misconduct or recklessness;
provided, however, that the provisions of this Paragraph 4(d) shall not apply to
the responsibility or liability of a member of the Committee pursuant to any
criminal statute.
(e) Indemnification. Service on the Committee shall
constitute service as a member of the Board. Each member of the Committee shall
be entitled without further act on his part to indemnity from the Company to the
fullest extent provided by applicable law and the Company's Articles of
Incorporation and By-laws in connection with or arising out of any action, suit
or proceeding with respect to the administration of the Plan or the granting of
Awards thereunder in which he may be involved by reason of his being or having
been a member of the Committee, whether or not he continues to be such member of
the Committee at the time of the action, suit or proceeding.
5. ELIGIBILITY
Awards may be granted only to Eligible Employees of
the Company and its Subsidiaries, as determined by the Committee. No Awards
shall be granted to an individual who is not an Eligible Employee of the Company
or a Subsidiary.
6. CASH BONUS AWARDS
The Committee may grant Awards in accordance with the
Plan. The terms and conditions of Awards shall be set forth in writing as
determined from time to time by the Committee, consistent, however, with the
following:
(a) Time of Grant. All Awards shall be granted within
five years from the date of adoption of the Plan by the Board.
(b) Non-uniformity of Awards. The provisions of
Awards need not be the same with respect to each Grantee.
(c) Awards and Agreements. The terms of each Award
shall be reflected in an Award document in form and substance satisfactory to
the Committee.
(d) Conditions to Payment of Awards. The Committee
shall establish such conditions on the payment of a bonus pursuant to an Award
as it may, in its sole discretion,
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deem appropriate. The conditions shall be set forth in the Award document. The
Award may provide for the payment of Awards in installments, or upon the
satisfaction of divisional or Company-wide performance targets, as determined by
the Committee. The Committee may, in its sole discretion, waive, in whole or in
part, any remaining conditions to payment of a Grantee's Award. The Grantee
shall not be permitted to sell, transfer, pledge or assign any amount payable
pursuant to the Plan or an Award (provided that the right to payment under an
Award may pass by will or the laws of descent and distribution).
(e) Termination of Grantee's Employment.
(1) A transfer of an Eligible Employee between
two employers, each of which is the Company or a Subsidiary (a "Transfer"),
shall not be deemed a termination of employment. The Committee may grant Awards
pursuant to which the Committee reserves the right to modify the calculation of
an Award in connection with a Transfer. In general, except as otherwise provided
by the Committee at the time an Award is granted or in connection with a
Transfer, upon the Transfer of a Grantee between divisions while an Award is
outstanding and unexpired, the outstanding Award shall be treated as having
terminated and expired, and a new Award shall be treated as having been made,
effective as of the effective date of the Transfer, for the portion of the Award
which had not expired or been paid, but subject to the performance and payment
conditions applicable generally to Awards for Grantees who are employees of the
transferee division, all as shall be determined by the Committee in an equitable
manner.
(2) In the event that a Grantee terminates
employment with the Company and its Subsidiaries, all Awards remaining subject
to conditions to payment shall be forfeited by the Grantee and deemed canceled
by the Company.
(f) Time of Grant. Subject to Paragraph 11, and as
further provided in Paragraphs 7, 8, 9 and 10, following the satisfaction of the
conditions to payment of an Award, the Company shall pay the Grantee (or the
person to whom the right to payment may have passed by will or the laws of
descent and distribution) the amount payable in connection with the lapse of
such restrictions.
7. CONDITIONS TO PAYMENT OF CASH BONUS AWARDS
Except as otherwise determined by the Committee and
provided in the terms of an Award:
(a) The restrictions on the payment of Awards of
Grantees employed by the Company shall be determined pursuant to Paragraph 8.
(b) The conditions to the payment of Awards of
Grantees employed by the Cable Division shall be determined pursuant to
Paragraph 9.
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(c) The conditions to the payment of Awards of
Grantees employed by the Cellular Division shall be determined pursuant to
Paragraph 10.
8. CORPORATE TARGET AND CASH BONUS
(a) Amount of Cash Bonus Award. The amount of an
Award to Eligible Employees of the Company shall be determined by the Committee.
(b) Target. The Target for Eligible Employees of the
Company shall be met for each Plan Year beginning after the Base Year if
Consolidated Operating Cash Flow for the Company equals or exceeds the
Compounded Annual Growth Rate for such Plan Year, where "r" equals 12 percent
(0.12); provided that the Modified Target and Applicable Percent for purposes of
this Paragraph 8 shall be determined in accordance with Exhibit A.
(c) Awards with Dates of Grant Before July 1, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of the Award is
before July 1, 1996.
(i) Payment of Cash Bonus Award. The Cash Bonus
Award shall be paid to a Grantee at the following times if the following
conditions are satisfied:
(v) 15 percent of the Award
shall be paid on or before
March 15, 1997 if the
Target is met for the 1996
Plan Year and the Grantee
is an active employee of
the Company or a Subsidiary
continuously from the Date
of Grant to December 31,
1996.
(w) 30 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1997 Basic
Award") shall be paid on or
before March 15, 1998 if
the Target is met for the
1997 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 1997;
provided, however, that if
a Modified Target is met
for the 1997 Plan Year, the
Applicable Percent of the
1997 Award shall be paid.
(x) 45 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1998 Basic
Award") shall be paid on or
before March 15, 1999 if
the Target is met for the
1998 Plan Year and the
Grantee is an active
employee of the Company or
a
-8-
<PAGE>
Subsidiary continuously
from the Date of Grant to
December 31, 1998;
provided, however, that if
a Modified Target is met
for the 1998 Plan Year, the
Applicable Percent of the
1998 Award shall be paid.
(y) 60 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1999 Basic
Award") shall be paid on or
before March 15, 2000 if
the Target is met for the
1999 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 1999;
provided, however, that if
a Modified Target is met
for the 1999 Plan Year, the
Applicable Percent of the
1999 Award shall be paid.
(z) 75 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "2000 Basic
Award") shall be paid on or
before March 15, 2001 if
the Target is met for the
2000 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 2000;
provided, however, that if
a Modified Target is met
for the 2000 Plan Year, the
Applicable Percent of the
2000 Award shall be paid.
(ii) Payment of Supplemental Cash Bonus Award.
If the Grantee is an active employee of the Company or a Subsidiary continuously
from the Date of Grant to December 31, 2000, the Grantee shall be paid an
additional portion of the Cash Bonus Award on or before March 15, 2001. Such
additional portion of the Cash Bonus Award shall be equal to the sum of the
following amounts, provided that the amount determined under any of (v), (w),
(x), (y) or (z) below shall not be less than zero.
(v) 5 percent of the Award if
the Target was met for the
1996 Plan Year or, if a
Modified Target was met for
the 1996 Plan Year, the
Applicable Percent of 5
percent of the Award.
(w) 10 percent of the Award
(less the amount described
in Paragraph 8(c)(ii)(v))
(the "1997 Supplemental
Award") if the Target was
met for the 1997 Plan
-9-
<PAGE>
Year or, if a Modified
Target was met for the 1997
Plan Year, the Applicable
Percent of the 1997
Supplemental Award.
(x) 15 percent of the Award
(less the sum of the
amounts described in
Paragraphs 8(c)(ii)(v) and
(w)) (the "1998
Supplemental Award") if the
Target was met for the 1998
Plan Year or, if a Modified
Target was met for the 1998
Plan Year, the Applicable
Percent of the 1998
Supplemental Award.
(y) 20 percent of the Award
(less the sum of the
amounts described in
Paragraphs 8(c)(ii)(v), (w)
and (x)) (the "1999
Supplemental Award") if the
Target was met for the 1999
Plan Year or, if a Modified
Target was met for the 1999
Plan Year, the Applicable
Percent of the 1999
Supplemental Award.
(z) 25 percent of the Award
(less the sum of the
amounts described in
Paragraphs 8(c)(ii)(v),
(w), (x) and (y)) (the
"2000 Supplemental Award")
if the Target was met for
the 2000 Plan Year or, if a
Modified Target was met for
the 2000 Plan Year, the
Applicable Percent of the
2000 Supplemental Award.
(d) Awards With Dates of Grant After June 30, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of an Award is after
June 30, 1996.
(i) For the first Plan Year in the Award Period,
the Annual Amount at Risk for such Plan Year shall be paid on or before March 15
next following such Plan Year if the Target is met for such Plan Year and the
Grantee is an active employee of the Company or a Subsidiary continuously from
the Date of Grant to December 31 of such Plan Year; provided, however, that if a
Modified Target is met for such Plan Year, the Applicable Percent of the Annual
Amount at Risk for such Plan Year shall be paid.
(ii) For each succeeding Plan Year in the Award
Period, the Cumulative Annual Amount at Risk (less any portion of the Award
previously paid to the Grantee) (the "Succeeding Plan Year Basic Award") shall
be paid on or before March 15 next following such Plan Year if the Target is met
for such Plan Year and the Grantee is an active
-10-
<PAGE>
employee of the Company or a Subsidiary continuously from the Date of Grant to
December 31 of such Plan Year; provided, however, that if a Modified Target is
met for such succeeding Plan Year, the Applicable Percent of the Succeeding Plan
Year Basic Award shall be paid.
(iii) If the Grantee is an active employee of
the Company or a Subsidiary continuously from the Date of Grant to December 31
of the last Plan Year in the Award Period, the Grantee shall be paid an
additional portion of the Cash Bonus Award on or before March 15 of the next
succeeding calendar year, determined as the sum of the following amounts:
(x) A percentage of the Award
if the Target was met for
the first Plan Year in the
Award Period, or, if a
Modified Target was met for
the first Plan Year in the
Award Period, the
Applicable Percent of such
amount.
(y) A percentage of the Award
(less the sum of the
amounts described in
Paragraph 8(d)(iii)(x) and
this Paragraph 8(d)(iii)(y)
for all preceding Plan
Years) (the "Supplemental
Award") if the Target was
met for a succeeding Plan
Year in the Award Period,
or if a Modified Target was
met for such succeeding
Plan Year, the Applicable
Percent of the Supplemental
Award, provided that the
applicable amount for any
Plan Year shall not be less
than zero.
(z) The portion of the Award
assigned to each Plan Year
pursuant to this Paragraph
8(d)(iii) shall be equal to
the product of (i) the Last
Year Amount at Risk times
(ii) the quotient obtained
by dividing the Cumulative
Annual Amount at Risk for
such Plan Year by the Total
Annual Amounts at Risk.
9. CABLE DIVISION TARGET AND CASH BONUS
(a) Amount of Cash Bonus Award. The amount of an
Award to Eligible Employees of the Cable Division shall be determined by the
Committee.
(b) Target. The Target for Eligible Employees of the
Cable Division shall be met for each Plan Year beginning after the Base Year if
Consolidated Operating Cash Flow for the Cable Division equals or exceeds the
Compounded Annual Growth Rate for such
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<PAGE>
Plan Year, where "r" equals 10 percent (0.10); provided that the Modified Target
and Applicable Percent for purposes of this Paragraph 9 shall be determined in
accordance with Exhibit A.
(c) Awards with Dates of Grant Before July 1, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of the Award is
before July 1, 1996.
(i) Payment of Cash Bonus Award. The Cash Bonus
Award shall be paid to a Grantee at the following times if the following
conditions are satisfied:
(v) 15 percent of the Award
shall be paid on or before
March 15, 1997 if the
Target is met for the 1996
Plan Year and the Grantee
is an active employee of
the Company or a Subsidiary
continuously from the Date
of Grant to December 31,
1996.
(w) 30 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1997 Basic
Award") shall be paid on or
before March 15, 1998 if
the Target is met for the
1997 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 1997;
provided, however, that if
a Modified Target is met
for the 1997 Plan Year, the
Applicable Percent of the
1997 Award shall be paid.
(x) 45 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1998 Basic
Award") shall be paid on or
before March 15, 1999 if
the Target is met for the
1998 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 1998;
provided, however, that if
a Modified Target is met
for the 1998 Plan Year, the
Applicable Percent of the
1998 Award shall be paid.
(y) 60 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "1999 Basic
Award") shall be paid on or
before March 15, 2000 if
the Target is met for the
1999 Plan Year and the
Grantee is an active
employee of the Company or
a
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<PAGE>
Subsidiary continuously
from the Date of Grant to
December 31, 1999;
provided, however, that if
a Modified Target is met
for the 1999 Plan Year, the
Applicable Percent of the
1999 Award shall be paid.
(z) 75 percent of the Award
(less any portion of the
Award previously paid to
Grantee) (the "2000 Basic
Award") shall be paid on or
before March 15, 2001 if
the Target is met for the
2000 Plan Year and the
Grantee is an active
employee of the Company or
a Subsidiary continuously
from the Date of Grant to
December 31, 2000;
provided, however, that if
a Modified Target is met
for the 2000 Plan Year, the
Applicable Percent of the
2000 Award shall be paid.
(ii) Payment of Supplemental Cash Bonus Award.
If the Grantee is an active employee of the Company or a Subsidiary continuously
from the Date of Grant to December 31, 2000, the Grantee shall be paid an
additional portion of the Cash Bonus Award on or before March 15, 2001. Such
additional portion of the Cash Bonus Award shall be equal to the sum of the
following amounts, provided that the amount determined under any of (v), (w),
(x), (y) or (z) below shall not be less than zero.
(v) 5 percent of the Award if
the Target was met for the
1996 Plan Year or, if a
Modified Target was met for
the 1996 Plan Year, the
Applicable Percent of 5
percent of the Award.
(w) 10 percent of the Award
(less the amount described
in Paragraph 9(c)(ii)(v))
(the "1997 Supplemental
Award") if the Target was
met for the 1997 Plan Year
or, if a Modified Target
was met for the 1997 Plan
Year, the Applicable
Percent of the 1997
Supplemental Award.
(x) 15 percent of the Award
(less the sum of the
amounts described in
Paragraphs 9(c)(ii)(v) and
(w)) (the "1998
Supplemental Award") if the
Target was met for the 1998
Plan Year or, if a Modified
Target was met for the 1998
Plan Year, the Applicable
Percent of the 1998
Supplemental Award.
-13-
<PAGE>
(y) 20 percent of the Award
(less the sum of the
amounts described in
Paragraphs 9(c)(ii)(v), (w)
and (x)) (the "1999
Supplemental Award") if the
Target was met for the 1999
Plan Year or, if a Modified
Target was met for the 1999
Plan Year, the Applicable
Percent of the 1999
Supplemental Award.
(z) 25 percent of the Award
(less the sum of the
amounts described in
Paragraphs 9(c)(ii)(v),
(w), (x) and (y)) (the
"2000 Supplemental Award")
if the Target was met for
the 2000 Plan Year or, if a
Modified Target was met for
the 2000 Plan Year, the
Applicable Percent of the
2000 Supplemental Award.
(d) Awards With Dates of Grant After June 30, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of an Award is after
June 30, 1996.
(i) For the first Plan Year in the Award Period,
the Annual Amount at Risk for such Plan Year shall be paid on or before March 15
next following such Plan Year if the Target is met for such Plan Year and the
Grantee is an active employee of the Company or a Subsidiary continuously from
the Date of Grant to December 31 of such Plan Year; provided, however, that if a
Modified Target is met for such Plan Year, the Applicable Percent of the Annual
Amount at Risk for such Plan Year shall be paid.
(ii) For each succeeding Plan Year in the Award
Period, the Cumulative Annual Amount at Risk (less any portion of the Award
previously paid to the Grantee) (the "Succeeding Plan Year Basic Award") shall
be paid on or before March 15 next following such Plan Year if the Target is met
for such Plan Year and the Grantee is an active employee of the Company or a
Subsidiary continuously from the Date of Grant to December 31 of such Plan Year;
provided, however, that if a Modified Target is met for such succeeding Plan
Year, the Applicable Percent of the Succeeding Plan Year Basic Award shall be
paid.
(iii) If the Grantee is an active employee of
the Company or a Subsidiary continuously from the Date of Grant to December 31
of the last Plan Year in the Award Period, the Grantee shall be paid an
additional portion of the Cash Bonus Award on or before March 15 of the next
succeeding calendar year, determined as the sum of the following amounts:
(x) A percentage of the Award if the
Target was met for the first
Plan Year in the Award Period,
or, if a
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<PAGE>
Modified Target was met for the
first Plan Year in the Award
Period, the Applicable Percent
of such amount.
(y) A percentage of the Award (less
the sum of the amounts described
in Paragraph 9(d)(iii)(x) and
this Paragraph 9(d)(iii)(y) for
all preceding Plan Years) (the
"Supplemental Award") if the
Target was met for a succeeding
Plan Year in the Award Period,
or if a Modified Target was met
for such succeeding Plan Year,
the Applicable Percent of the
Supplemental Award, provided
that the applicable amount for
any Plan Year shall not be less
than zero.
(z) The portion of the Award
assigned to each Plan Year
pursuant to this Paragraph
9(d)(iii) shall be equal to the
product of (i) the Last Year
Amount at Risk times (ii) the
quotient obtained by dividing
the Cumulative Annual Amount at
Risk for such Plan Year by the
Total Annual Amounts at Risk.
10. CELLULAR DIVISION TARGET AND CASH BONUS
(a) Amount of Cash Bonus Award. The amount of an
Award to Eligible Employees of the Cellular Division shall be determined by the
Committee.
(b) Target. The Target for Eligible Employees of the
Cellular Division shall be met for each Plan Year beginning after the Base Year
if Consolidated Operating Cash Flow for the Cellular Division equals or exceeds
the Compounded Annual Growth Rate for such Plan Year, where "r" equals 15
percent (0.15); provided that the Modified Target and Applicable Percent for
purposes of this Paragraph 10 shall be determined in accordance with Exhibit A.
(c) Awards with Dates of Grant Before July 1, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of an Award is
before July 1, 1996.
(i) Payment of Cash Bonus Award - Performance
Target Condition. Half of the Cash Bonus Award (hereinafter, the "Cellular
Performance Award") shall be subject to service and performance conditions. If
the Grantee is an active employee of the Company or a Subsidiary continuously
from the Date of Grant to December 31, 2000, the Grantee shall be paid all or
part of the Cellular Performance Award on or before March 15, 2001.
-15-
<PAGE>
The Cellular Performance Award shall be equal to the sum of the following
amounts, provided that the amount determined under any of (v), (w), (x), (y) or
(z) below shall not be less than zero.
(v) 20 percent of the Cellular
Performance Award if the
Target was met for the 1996
Plan Year or, if a Modified
Target was met for the 1996
Plan Year, the Applicable
Percent of 20 percent of
the Cellular Performance
Award.
(w) 40 percent of the Cellular
Performance Award (less the
amount described in
Paragraph 10(c)(i)(v)) (the
"1997 Cellular Performance
Award") if the Target was
met for the 1997 Plan Year
or, if a Modified Target
was met for the 1997 Plan
Year, the Applicable
Percent of the 1997
Cellular Performance Award.
(x) 60 percent of the Cellular
Performance Award (less the
sum of the amounts
described in Paragraphs
10(c)(i)(v) and (w)) (the
"1998 Cellular Performance
Award") if the Target was
met for the 1998 Plan Year
or, if a Modified Target
was met for the 1998 Plan
Year, the Applicable
Percent of the 1998
Cellular Performance Award.
(y) 80 percent of the Cellular
Performance Award (less the
amounts described in
Paragraphs 10(c)(i)(v), (w)
and (x)) (the "1999
Cellular Performance
Award") if the Target was
met for the 1999 Plan Year
or, if a Modified Target
was met for the 1999 Plan
Year, the Applicable
Percent of the 1999
Cellular Performance Award.
(z) 100 percent of the Cellular
Performance Award (less the
amounts described in
Paragraphs 10(c)(i)(v),
(w), (x) and (y)) (the
"2000 Cellular Performance
Award") if the Target was
met for the 2000 Plan Year
or, if a Modified Target
was met for the 2000 Plan
Year, the Applicable
Percent of the 2000
Cellular Performance Award.
(ii) Payment of Cash Bonus Award - Service
Condition. Half of the Cash Bonus Award (hereinafter, the "Cellular Service
Award") shall be subject to service
-16-
<PAGE>
conditions, and shall be paid to a Grantee at the following times if the
following conditions are satisfied:
(v) 20 percent of the Cellular
Service Award shall be paid
on or before February 29,
1996.
(w) 20 percent of the Cellular
Service Award shall be paid
on or before February 28,
1998 if the Grantee is an
active employee of the
Company or a Subsidiary
continuously from the Date
of Grant to December 31,
1997.
(x) 20 percent of the Cellular
Service Award shall be paid
on or before February 28,
1999 if the Grantee is an
active employee of the
Company or a Subsidiary
continuously from the Date
of Grant to December 31,
1998.
(y) 20 percent of the Cellular
Service Award shall be paid
on or before February 29,
2000 if the Grantee is an
active employee of the
Company or a Subsidiary
continuously from the Date
of Grant to December 31,
1999.
(z) 20 percent of the Cellular
Service Award shall be paid
on or before February 28,
2001 if the Grantee is an
active employee of the
Company or a Subsidiary
continuously from the Date
of Grant to December 31,
2000.
(d) Awards With Dates of Grant After June 30, 1996.
Except as otherwise determined by the Committee and provided in the terms of an
Award, the following rules shall apply if the Date of Grant of an Award is after
June 30, 1996.
(i) Payment of Cash Bonus Award - Performance
Target. Half of the Cash Bonus Award (hereinafter, the "Cellular Performance
Award") shall be subject to service and performance conditions. If the Grantee
is an active employee of the Company or a Subsidiary continuously from the Date
of Grant to December 31 of the last Plan Year in the Award Period, the Grantee
shall be paid all or part of the Cellular Performance Award on or before March
15 of the next succeeding calendar year. The Cellular Performance Award shall be
equal to the sum of the following amounts:
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<PAGE>
(x) A percentage of the Award
if the Target was met for
the first Plan Year in the
Award Period, or, if a
Modified Target was met for
the first Plan Year in the
Award Period, the
Applicable Percent of such
amount.
(y) A percentage of the Award
(less the sum of the
amounts described in
Paragraph 10(d)(i)(x) and
this Paragraph 10(d)(i)(y)
for all preceding Plan
Years) (the "Performance
Award Amount") if the
Target was met for a
succeeding Plan Year in the
Award Period, or if a
Modified Target was met for
such succeeding Plan Year,
the Applicable Percent of
such Performance Award
Amount, provided that the
applicable amount for any
Plan Year shall not be less
than zero.
(z) The portion of the Award
assigned to each Plan Year
pursuant to this Paragraph
10(d)(i) shall be equal to
the "Cumulative Cellular
Performance Award." For
purposes of this Paragraph
10(d)(i), the term
"Cumulative Cellular
Performance Award" means
the product of the Cellular
Performance Award times a
fraction, the numerator of
which is the value "n"
assigned to such Plan Year
pursuant to Paragraph 2(v),
and the denominator of
which is the total number
of Plan Years in the Award
Period.
(ii) Payment of Cash Bonus Award - Service
Condition. Half of the Cash Bonus Award (hereinafter, the "Cellular Service
Award") shall be subject to service conditions, and shall be paid to a Grantee
at the following times if the following conditions are satisfied, provided that
no payment of a Cellular Service Award shall be made unless the Grantee shall
have delivered to the Company a duly executed employment agreement in form and
substance satisfactory to the Company:
(w) A percentage of the
Cellular Service Award
shall be paid as soon as
reasonably practicable
following the Date of
Grant.
(x) A percentage of the
Cellular Service Award
shall be paid on or before
the last day of February of
the third Plan Year in the
Award Period, if any, if
the Grantee is an active
employee of the Company or
a
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<PAGE>
Subsidiary continuously
from the Date of Grant to
December 31 of the second
Plan Year in the Award
Period.
(y) A percentage of the
Cellular Service Award
shall be paid on or before
the last day of February of
each succeeding Plan Year
in the Award Period, if
any, if the Grantee is an
active employee of the
Company or a Subsidiary
continuously from the Date
of Grant to December 31 of
the Plan Year preceding
such succeeding Plan Year
in the Award Period.
(z) The percentage of the
Cellular Service Award
assigned to each Plan Year
pursuant to this Paragraph
10(d)(ii) shall be equal to
the quotient obtained by
dividing the Cellular
Service Award by the number
of Plan Years in the Award
Period.
11. TAXES
The Company shall withhold the amount of any federal,
state, local or other tax, charge or assessment attributable to the grant of any
Award or lapse of restrictions under any Award as it may deem necessary or
appropriate, in its sole discretion.
12. TERMINATING EVENTS
The Committee shall give Grantees at least thirty
(30) days' notice (or, if not practicable, such shorter notice as may be
reasonably practicable) prior to the anticipated date of the consummation of a
Terminating Event. The Committee may, in its discretion, provide in such notice
that upon the consummation of such Terminating Event, any remaining conditions
to payment of a Grantee's Award shall be waived, in whole or in part.
13. AMENDMENT AND TERMINATION
The Plan may be terminated by the Board or the
Committee at any time. The Plan may be amended by the Board or the Committee at
any time. No Award shall be affected by any such termination or amendment
without the written consent of the Grantee.
14. EFFECTIVE DATE
The effective date of this amendment and restatement
of the Plan is June 21, 1999, the date on which it was adopted by the Committee.
To the extent provided by the Committee, the rules of the Plan, as amended and
restated, shall apply to the determination of
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<PAGE>
payments to be made pursuant to the Plan on and after the effective date of this
amendment and restatement of the Plan.
15. GOVERNING LAW
The Plan and all determinations made and actions
taken pursuant to the Plan shall be governed in accordance with Pennsylvania
law.
Executed this 21st day of June, 1999.
COMCAST CORPORATION
BY: /s/ Stanley Wang
ATTEST: /s/ Arthur Block
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<PAGE>
EXHIBIT A
Applicable Percents and Modified Targets
Achievement Range Percent Vested
----------------- --------------
100% 100%
95 - 99% 95%
90 - 94% 90%
85 - 89% 80%
80 - 84% 70%
75 - 79% 50%
70 - 74% 30%
less than 70% 0%
-21-
COMCAST CORPORATION
1996 EXECUTIVE CASH BONUS PLAN
(as amended December 15, 1998)
1. PURPOSE
The purpose of the Plan is to provide, subject to shareholder
approval and approval by the Committee (as defined below), performance-based
cash bonus compensation for certain employees of Comcast Corporation, a
Pennsylvania corporation (the "Company") in accordance with a formula that is
based on the financial success of the Company as part of an integrated
compensation program which is intended to assist the Company in motivating and
retaining employees of superior ability, industry and loyalty.
2. DEFINITIONS
The following words and phrases as used herein shall have the
following meanings, unless a different meaning is plainly required by the
context:
"Board of Directors" shall mean the Board of Directors of the
Company.
"Cash Flow" shall mean the operating income before
depreciation and amortization for the Company and those of its affiliates which
are included with the Company in its consolidated financial statements as
prepared by the Company in accordance with generally accepted accounting
principles.
"Committee" shall mean the Subcommittee on Performance-Based
Compensation of the Compensation Committee of the Board of Directors.
"Company" shall mean Comcast Corporation, a Pennsylvania
corporation, and any successor thereto.
"First Tier Goal" shall mean the performance goal, measured in
terms of level of Cash Flow, as established by the Committee for each Plan Year.
The First Tier Goal is the performance measure which, if achieved, permits
payment to each Participant of 662/3% of the Participant's Target Bonus. The
Committee shall in all events establish the First Tier Goal for each Plan Year
no later than 90 days after the first day of the Plan Year or, if sooner, within
the first 25% of the Plan Year. The First Tier Goal shall be established at the
discretion of the Committee, provided, however, that the Committee must
determine that, as of the date the First Tier Goal is established, it is
substantially uncertain whether the level of Cash Flow required to meet the
First Tier Goal will be achieved.
-1-
<PAGE>
"Participant" shall mean those persons eligible to participate
in the Plan in accordance with Section 3.
"Plan" shall mean the 1996 Comcast Corporation Executive Cash
Bonus Plan.
"Plan Year" shall mean the calendar year, except that the
first Plan Year shall be the period from July 1, 1996 through December 31, 1996.
"Second Tier Goal" shall mean the performance goal, measured
in terms of level of Cash Flow, as established by the Committee for each Plan
Year. The Second Tier Goal is the performance measure which, if achieved,
permits payment to each Participant of 100% of the Participant's Target Bonus.
The Committee shall establish the Second Tier Goal for each Plan Year at the
same time that it establishes the First Tier Goal for such Plan Year. The Second
Tier Goal shall be a level of Cash Flow chosen at the discretion of the
Committee that is higher than the level of Cash Flow chosen for the Plan Year as
the First Tier Goal.
"Target Bonus" shall mean, with respect to any Participant for
any Plan Year, the sum of (a) the Target Percentage of the Participant's base
salary and any guaranteed bonus (other than any bonus awarded on account of the
termination as of December 31, 1993, of the Company's discretionary cash bonus
plan) as of the first day of the Plan Year and (b) the amount, if any, of such
Participant's Target Bonus for any prior Plan Year which was not earned due to
failure to meet the First Tier Goal or the Second Tier Goal; provided, however,
that in no event shall any Participant's Target Bonus for any Plan Year exceed
$3,000,000.
"Target Percentage" shall mean, with respect to any
Participant for any Plan Year, a percentage, not to exceed 150%, established by
the Committee with respect to such Participant and such Plan Year. If no other
percentage is selected by the Committee, the Target Percentage shall be 50%.
3. PARTICIPATION
The Participants in the Plan shall be Brian L. Roberts,
Lawrence S. Smith, John R. Alchin, Stanley Wang, and such other key executives
as may be designated by the Committee to participate in the Plan from time to
time.
4. TERM OF PLAN
Subject to approval of the Plan by the Committee and the
shareholders of the Company, the Plan shall be in effect as of July 1, 1996 and
shall continue until all amounts required to be paid with respect to all Plan
Years up through and including the Plan Year ending December 31, 2003 are paid
by the Company, unless sooner terminated by the Board of Directors.
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<PAGE>
5. BONUS ENTITLEMENT
Each Participant shall be entitled to receive a bonus in
accordance with the provisions of Section 6 of the Plan only after certification
by the Committee that the performance goals set forth in Section 6 have been
satisfied. The bonus payment under the Plan shall be paid to each Participant as
soon as practicable following the close of the Plan Year with respect to which
the bonus is to be paid. Notwithstanding anything contained herein to the
contrary, no bonus shall be payable under the Plan without the prior disclosure
of the terms of the Plan to the shareholders of the Company and the approval of
the Plan by such shareholders.
6. AMOUNT OF PERFORMANCE-BASED COMPENSATION
BONUS
(a) Each Participant in the Plan shall be entitled to a bonus
with respect to a Plan Year which is equal to 662/3% of the Participant's Target
Bonus if the Company's Cash Flow for the Plan Year is at least equal to the
First Tier Goal, and 100% of the Target Bonus if the Company's Cash Flow for the
Plan Year is at least equal to the Second Tier Goal. If the level of Cash Flow
for the Plan Year is higher than the First Tier Goal and lower than the Second
Tier Goal, the bonus with respect to such Plan Year shall be such percentage of
the Participant's Target Bonus in excess of 662/3% as is determined by prorating
the difference between 100% and 662/3% according to the level of Cash Flow in
excess of the First Tier Goal divided by the difference between the levels of
Cash Flow represented by the Second Tier Goal and the First Tier Goal. If the
level of Cash Flow for a Plan Year is below the First Tier Goal established with
respect to such Plan Year, no bonus shall be payable under the Plan for that
Plan Year.
(b) In the event any payment of a bonus otherwise payable
under the Plan occurs more than two months after the close of the Plan Year with
respect to which the bonus is paid because the required disclosure of the terms
of the Plan to the shareholders of the Company and the approval of the Plan by
such shareholders delays such bonus payment, the amount of the bonus otherwise
payable shall be increased by the amount such bonus payment would earn if it
were invested in an investment bearing a 7% annual rate of return, compounded
daily, or such other reasonable rate of interest as may be determined by the
Committee, during the period from the close of the Plan Year with respect to
which such bonus is paid and the date the bonus is actually paid.
(c) Notwithstanding anything contained herein to the contrary,
in the event there is a significant acquisition or disposition of any assets,
business division, company or other business operations of the Company that is
reasonably expected to have an effect on Cash Flow as otherwise determined under
the terms of the Plan, the First Tier Goal and the Second Tier Goal shall be
adjusted to take into account the impact of such acquisition or disposition by
increasing or decreasing such goals in the same proportion as Cash Flow of the
Company would have been affected for the prior Plan Year on a pro forma basis
had such an acquisition or disposition occurred on the same date during the
prior Plan Year (except in the case of the first
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Plan Year the adjustment shall be made by reference to the effect such an
acquisition or disposition on the same date during the prior calendar year would
have had on Cash Flow for the period commencing July 1, 1995 and ending December
31, 1995). Such adjustment shall be based upon the historical equivalent of Cash
Flow of the assets so acquired or disposed of for the prior Plan Year, as shown
by such records as are available to the Company, as further adjusted to reflect
any aspects of the transaction that should be taken into account to ensure
comparability between amounts in the prior Plan Year and the current Plan Year.
(d) Notwithstanding the determination of the amount of a
Participant's bonus payable with respect to any Plan Year under Section 6(a),
the Committee shall have the discretion to reduce or eliminate the bonus
otherwise payable to a Participant if it determines that such a reduction or
elimination of the bonus is in the best interests of the Company.
7. COMMITTEE
(a) Powers. The Committee shall have the power and
duty to do all things necessary or convenient to effect the intent and purposes
of the Plan and not inconsistent with any of the provisions hereof, whether or
not such powers and duties are specifically set forth herein, and, by way of
amplification and not limitation of the foregoing, the Committee shall have the
power to:
(i) provide rules and regulations for the
management, operation and administration of the Plan, and, from time to time, to
amend or supplement such rules and regulations;
(ii) construe the Plan, which construction, as
long as made in good faith, shall be final and conclusive upon all parties
hereto; and
(iii) correct any defect, supply any omission,
or reconcile any inconsistency in the Plan in such manner and to such extent as
it shall deem expedient to carry the same into effect, and it shall be the sole
and final judge of when such action shall be appropriate.
The resolution of any questions with respect to payments and
entitlements pursuant to the provisions of the Plan shall be determined by the
Committee, and all such determinations shall be final and conclusive.
(b) Indemnity. No member of the Committee shall be
directly or indirectly responsible or under any liability by reason of any
action or default by him as a member of the Committee, or the exercise of or
failure to exercise any power or discretion as such member. No member of the
Committee shall be liable in any way for the acts or defaults of any other
member of the Committee, or any of its advisors, agents or representatives. The
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Company shall indemnify and save harmless each member of the Committee against
any and all expenses and liabilities arising out of his own membership on the
Committee.
(c) Compensation and Expenses. Members of the
Committee shall receive no separate compensation for services other than
compensation for their services as members of the Board of Directors, which
compensation can include compensation for services at any committee meeting
attended in their capacity as members of the Board of Directors. Members of the
Committee shall be entitled to receive their reasonable expenses incurred in
administering the Plan. Any such expenses, as well as extraordinary expenses
authorized by the Company, shall be paid by the Company.
(d) Participant Information. The Company shall
furnish to the Committee in writing all information the Company deems
appropriate for the Committee to exercise its powers and duties in
administration of the Plan. Such information shall be conclusive for all
purposes of the Plan and the Committee shall be entitled to rely thereon without
any investigation thereof; provided, however, that the Committee may correct any
errors discovered in any such information.
(e) Inspection of Documents. The Committee shall make
available to each Participant, for examination at the principal office of the
Company (or at such other location as may be determined by the Committee), a
copy of the Plan and such of its records, or copies thereof, as may pertain to
any benefits of such Participant under the Plan.
8. EFFECTIVE DATE, TERMINATION AND AMENDMENT
(a) Effective Date of Participation in Plan. Subject
to shareholder and Committee approval of the Plan, participation in this Plan
shall be effective as of July 1, 1996 and shall continue thereafter until the
Plan is terminated.
(b) Amendment and Termination of the Plan. The Plan
may be terminated or revoked by the Company at any time and amended by the
Company from time to time, provided that neither the termination, revocation or
amendment of the Plan may, without the written approval of the Participant,
reduce the amount of a bonus payment that is due, but has not yet been paid, and
provided further that no changes that would increase the amount of bonuses
determined under provisions of the Plan shall be effective without approval by
the Committee and without disclosure to and approval by the shareholders of the
Company in a separate vote prior to payment of such bonuses. In addition, the
Plan may be modified or amended by the Committee, as it deems appropriate, in
order to comply with any rules, regulations or other guidance promulgated by the
Internal Revenue Service with respect to applicable provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), as they relate to the exemption
for "performance-based compensation" under the limitations on the deductibility
of compensation imposed under Code Section 162(m).
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9. MISCELLANEOUS PROVISIONS
(a) Unsecured Creditor Status. A Participant entitled
to a bonus payment hereunder, shall rely solely upon the unsecured promise of
the Company, as set forth herein, for the payment thereof, and nothing herein
contained shall be construed to give to or vest in a Participant or any other
person now or at any time in the future, any right, title, interest, or claim in
or to any specific asset, fund, reserve, account, insurance or annuity policy or
contract, or other property of any kind whatever owned by the Company, or in
which the Company may have any right, title, or interest, nor or at any time in
the future.
(b) Other Company Plans. It is agreed and understood
that any benefits under this Plan are in addition to any and all benefits to
which a Participant may otherwise be entitled under any other contract,
arrangement, or voluntary pension, profit sharing or other compensation plan of
the Company, whether funded or unfunded, and that this Plan shall not affect or
impair the rights or obligations of the Company or a Participant under any other
such contract, arrangement, or voluntary pension, profit sharing or other
compensation plan.
(c) Separability. If any term or condition of the
Plan shall be invalid or unenforceable to any extent or in any application, then
the remainder of the Plan, with the exception of such invalid or unenforceable
provision, shall not be affected thereby, and shall continue in effect and
application to its fullest extent.
(d) Continued Employment. Neither the establishment
of the Plan, any provisions of the Plan, nor any action of the Committee shall
be held or construed to confer upon any Participant the right to a continuation
of employment by the Company. The Company reserves the right to dismiss any
employee (including a Participant), or otherwise deal with any employee
(including a Participant) to the same extent as though the Plan had not been
adopted.
(e) Incapacity. If the Committee determines that a
Participant is unable to care for his affairs because of illness or accident,
any benefit due such Participant under the Plan may be paid to his spouse,
child, parent, or any other person deemed by the Committee to have incurred
expense for such Participant (including a duly appointed guardian, committee, or
other legal representative), and any such payment shall be a complete discharge
of the Company's obligation hereunder.
(g) Jurisdiction. The Plan shall be construed,
administered, and enforced according to the laws of the Commonwealth of
Pennsylvania, except to the extent that such laws are preempted by the Federal
laws of the United States of America.
(h) Withholding. The Participant shall make
appropriate arrangements with the Company for satisfaction of any federal, state
or local income tax withholding requirements and Social Security or other tax
requirements applicable to the accrual or payment
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of benefits under the Plan. If no other arrangements are made, the Company may
provide, at its discretion, for any withholding and tax payments as may be
required.
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COMCAST CORPORATION
1997 DEFERRED STOCK OPTION PLAN
(As Amended and Restated, Effective June 21, 1999)
1. ESTABLISHMENT OF PLAN
COMCAST CORPORATION, a Pennsylvania corporation, hereby amends and
restates the Comcast Corporation 1997 Deferred Stock Option Plan (the "Plan"),
effective June 21, 1999. The Plan was initially adopted effective September 16,
1997. The Plan is unfunded and is maintained primarily for the purpose of
providing a select group of management or highly compensated employees the
opportunity to defer the receipt of Shares and corresponding recognition of
compensation income upon the exercise of Options.
2. DEFINITIONS
2.1 " A Stock" means the Company's Class A Common Stock, par
value, $1.00, including a fractional share.
2.2 "Account" means the bookkeeping accounts established
pursuant to Paragraph 5.1 and maintained by the Administrator in the names of
the respective Participants, to which Deferred Stock Units, dividend equivalents
and earnings on dividend equivalents shall be credited, and from which all
amounts distributed under the Plan shall be debited.
2.3 "Active Participant"means:
2.3.1 Each Participant who is in active service as an
Outside Director;
2.3.2 Each Participant who is actively employed by a
Participating Company as an Eligible Employee; and
2.3.3 A Permitted Transferee of an individual described
in Paragraph 2.3.1 or 2.3.2, if applicable.
2.4 "Administrator" means the Committee.
2.5 "Affiliate" means, with respect to any Person, any other
Person that, directly or indirectly, is in control of, is controlled by, or is
under common control with, such
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Person. For purposes of this definition, the term "control," including its
correlative terms "controlled by" and "under common control with," mean, with
respect to any Person, the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise.
2.6 "Annual Rate of Pay" means, as of any date, an employee's
annualized base pay rate. An employee's Annual Rate of Pay shall not include
sales commissions or other similar payments or awards.
2.7 "Board" means the Board of Directors of the Company, or the
Executive Committee of the Board of Directors of the Company.
2.8 "Change of Control" means any transaction or series of
transactions as a result of which any Person who was a Third Party immediately
before such transaction or series of transactions directly or indirectly owns
then-outstanding securities of the Company having more than 50 percent of the
voting power for the election of directors of the Company.
2.9 "Comcast Option Plan or Plans" means the Comcast
Corporation 1986 Non-Qualified Stock Option Plan, the Comcast Corporation 1987
Stock Option Plan, or the Comcast Corporation 1996 Stock Option Plan, or any
other incentive or non-qualified stock option plan subsequently adopted by the
Company or an Affiliate.
2.10 "Comcast Plan" means any restricted stock, stock bonus,
stock option or other compensation plan, program or arrangement established or
maintained by the Company or an Affiliate, including, but not limited to this
Plan, the Comcast Corporation 1990 Restricted Stock Plan and the Comcast Option
Plans.
2.11 "Committee" means the Subcommittee on Performance Based
Compensation of the Compensation Committee of the Board of Directors of the
Company.
2.12 "Company" means Comcast Corporation, a Pennsylvania
corporation, including any successor thereto by merger, consolidation,
acquisition of all or substantially all the assets thereof, or otherwise.
2.13 "Date of Grant" means the date as of which an Option is
granted.
2.14 "Deceased Participant" means:
2.14.1 A Participant whose employment, or, in the
case of a Participant who was an Outside
Director, a Participant whose service as an
Outside Director, is terminated by death;
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2.14.2 A Participant who dies following termination
of active service; or
2.14.3 A Permitted Transferee of an individual
described in Paragraph 2.14.1 or 2.14.2, if
applicable.
2.15 "Deferred Stock Units" mean the number of hypothetical
Shares determined as the excess of (1) the number of Option Shares over (2) the
number of Other Available Shares having a Fair Market Value as of the date of
exercise of an Option equal to the exercise price for such Option Shares, as to
which an Outside Director, Former Outside Director, Eligible Employee, Former
Eligible Employee or Successor-in-Interest provides to the Company evidence of
ownership of sufficient Shares to pay the exercise price for such Option Shares;
provided, however, that if the Option is for A Stock, the Deferred Stock Units
shall be credited to the Participant's Account as Deferred A Stock Units, and if
the Option is for K Stock, the Deferred Stock Units shall be credited to the
Participant's Account as Deferred K Stock Units.
2.16 "Disabled Participant" means:
2.16.1 A Participant whose employment or, in the
case of a Participant who is an Outside
Director, a Participant whose service as an
Outside Director, is terminated by reason of
disability;
2.16.2 A Participant who becomes disabled (as
determined by the Committee) following
termination of active service;
2.16.3 The duly-appointed legal guardian of an
individual described in Paragraph 2.16.1 or
2.16.2 acting on behalf of such individual;
or
2.16.4 A Permitted Transferee of an individual
described in Paragraph 2.16.1 or 2.16.2, if
applicable.
2.17 "Election" means a written election on a form provided by
the Administrator, filed with the Administrator in accordance with Article 3,
pursuant to which an Outside Director, Former Outside Director, Eligible
Employee, Former Eligible Employee, Successor-in-Interest or Permitted
Transferee:
2.17.1 Elects, within the time or times specified
in Article 3, to defer the receipt of Shares
pursuant to the exercise of all or part of
an Option; and
2.17.2 Designates the time that such Shares and any
dividend equivalents shall be distributed.
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2.18 "Eligible Employee" means:
2.18.1 Each employee of a Participating Company
whose Annual Rate of Pay is $125,000 or more
as of both (1) the date on which an Election
is filed with the Administrator and (2) the
first day of the Plan Year in which such
Election is filed;
2.18.2 Each employee of a Participating Company who
has a title at or above the level of vice
president, whose Annual Rate of Pay is
$100,000 or more as of both (1) the date on
which an Election is filed with the
Administrator and (2) the first day of the
Plan Year in which such Election is filed;
2.18.3 Each New Key Employee; and
2.18.4 Each other employee of a Participating
Company who is designated by the Committee,
in its discretion, as an Eligible Employee.
2.19 "Fair Market Value."
2.19.1 If Shares are listed on a stock exchange,
Fair Market Value shall be determined based
on the last reported sale price of a Share
on the principal exchange on which Shares
are listed on the last trading day prior to
the date of determination.
2.19.2 If Shares are not so listed, but trades of
Shares are reported on the Nasdaq National
Market, the last quoted sale price of a
share on the Nasdaq National Market on the
last trading day prior to the date of
determination.
2.19.3 If Shares are not so listed nor trades of
Shares so reported, Fair Market Value shall
be determined by the Committee in good
faith.
2.20 "Former Eligible Employee" means an individual who has
ceased to be actively employed by a Participating Company for any reason but
who, immediately preceding his termination of employment, was an Eligible
Employee.
2.21 "Former Outside Director" means an individual who has
ceased to be a member of the Board, or the board of directors of Jones
Intercable, Inc., as applicable, but who, immediately preceding his cessation of
service as a member of such board of directors, was an Outside Director.
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2.22 "Immediate Family" means an Outside Director's, Former
Outside Director's, Eligible Employee's or Former Eligible Employee's spouse and
lineal descendants, any trust all beneficiaries of which are any of such persons
and any partnership all partners of which are any of such persons.
2.23 "K Stock" means the Company's Class A Special Common
Stock, par value, $1.00, including a fractional share.
2.24 "New Key Employee" means:
2.24.1 Each employee of a Participating Company
hired on or after the effective date of the
Plan whose Annual Rate of Pay on his date of
hire is $125,000 or more;
2.24.2 Each employee of a Participating Company
hired on or after June 21, 1999 who has a
title at or above the level of vice
president and whose Annual Rate of Pay on
his date of hire is $100,000 or more; and
2.24.3 Each employee of a Participating Company who
first becomes an Eligible Employee as a
result of the amendment of the Plan
effective June 21, 1999.
2.25 "Normal Retirement" means:
2.25.1 For a Participant who is an employee of a
Participating Company immediately preceding
his termination of employment, a termination
of employment that is treated by the
Participating Company as a retirement under
its employment policies and practices as in
effect from time to time; and
2.25.2 For a Participant who is an Outside Director
immediately preceding his termination of
service, his normal retirement from the
Board or the board of directors of Jones
Intercable, Inc., as applicable.
2.26 "Other Available Shares" means, as of any date, the
excess, if any of:
2.26.1 The total number of Shares owned by a
Person; over
2.26.2 The sum of:
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2.26.2.1 The number of Shares owned by such
Person for less than six months;
plus
2.26.2.2 The number of Shares owned by such
Person that has, within the
preceding six months, been the
subject of a withholding
certification under any Comcast
Plan; plus
2.26.2.3 The number of Shares owned by such
Person that has, within the
preceding six months, been received
in exchange for Shares surrendered
as payment, in full or in part, of
the exercise price for an option to
purchase any securities of the
Company or an Affiliate under any
Comcast Plan, but only to the
extent of the number of Shares
surrendered; plus
2.26.2.4 The number of Shares owned by such
Person as to which evidence of
ownership has, within the preceding
six months, been provided to the
Company in connection with the
crediting of Deferred Stock Units
to such Person's Account.
For purposes of this Paragraph 2.26, a Share that is subject to a deferral
election pursuant to this Plan or another Comcast Plan shall not be treated as
owned by a Person until all conditions to the delivery of such Share have
lapsed. The number of Other Available Shares shall be determined separately for
Shares of A Stock and Shares of K Stock.
2.27 "Option" means a non-qualified stock option to purchase
Shares granted pursuant to a Comcast Option Plan; provided that each Option with
a different Date of Grant shall be considered a separate Option.
2.28 "Option Shares" mean the Shares that are subject to the
portion of an Option as to which an Election is in effect, as adjusted to
reflect a Share Withholding Election.
2.29 "Outside Director" means a member of the Board, or a
member of the board of directors of Jones Intercable, Inc., who is not an
employee of a Participating Company.
2.30 "Parent Company" means all corporations that, at the time
in question, are parent corporations of the Company within the meaning of
section 424(e) of the Code.
2.31 "Participant" means each Outside Director, Former Outside
Director, Eligible Employee, Former Eligible Employee, Successor-in-Interest or
Permitted Transferee that
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has made an Election and that has an undistributed amount credited to an Account
under the Plan.
2.32 "Participating Company" means the Company and each of the
Parent Companies and Subsidiary Companies.
2.33 "Permitted Transferee" means a member of the Immediate
Family of an Outside Director, Former Outside Director, Eligible Employee or
Former Eligible Employee to whom the right to exercise an Option has been
transferred pursuant to a Comcast Option Plan.
2.34 "Person" means an individual, a corporation, a
partnership, an association, a trust or any other entity or organization.
2.35 "Plan" means the Comcast Corporation 1997 Deferred Stock
Option Plan, as set forth herein, and as may be amended from time to time.
2.36 "Plan Year" means the calendar year.
2.37 "Prime Rate" means the annual rate of interest identified
by PNC Bank as its prime rate as of the first day of each calendar year.
2.38 "Retired Participant" means a Participant who has
terminated employment pursuant to a Normal Retirement.
2.39 "Roberts Family." Each of the following is a member of the
Roberts Family:
2.39.1 Brian L. Roberts;
2.39.2 A lineal descendant of Brian L. Roberts; or
2.39.3 A trust established for the benefit of any of
Brian L. Roberts and/or a lineal descendant or
descendants of Brian L. Roberts.
2.40 "Share" or "Shares" means for all purposes of the Plan, a
share or shares of A Stock or K Stock, or such other securities issued by the
Company as may be subject to adjustment in the event that Shares are changed
into or exchanged for a different number or kind of shares of stock or other
securities of the Company, whether through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split-up or other
substitution of securities of the Company. In such event, the Committee shall
make appropriate equitable anti-dilution adjustments to the number and class of
Deferred Stock Units credited to Participants' Accounts. The Committee's
adjustment shall be effective and binding for all purposes of the Plan.
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2.41 "Share Withholding Election" means a written election on a
form provided by the Administrator, filed with the Administrator in accordance
with the rules applicable to the filing of Elections under Article 3, pursuant
to which an Eligible Employee, Former Eligible Employee, Successor-in-Interest
or Permitted Transferee elects to have the number of Shares deferred pursuant to
the exercise of all or part of an Option and credited under the Plan as Deferred
Stock Units adjusted so that Deferred Stock Units that would, but for a Share
Withholding Election, be credited to an Account under the Plan, shall be deemed
distributed pursuant to the Plan to satisfy applicable withholding tax
liabilities, as described in Paragraph 10.2. With respect to Options that become
subject to an Election after June 21, 1999, a Share Withholding Election must be
filed not later than the applicable deadline for filing an Election under
Article 3. With respect to Options that are subject to an Election on June 21,
1999, a Share Withholding Election must be filed on or before February 26, 1999.
2.42 "Subsidiary Companies" means:
2.42.1 all corporations that, at the time in
question, are subsidiary corporations of the
Company within the meaning of section 424(f)
of the Code; and
2.42.2 Jones Intercable, Inc. and all corporations
that, at the time in question, are
subsidiary corporations of Jones Intercable,
Inc. within the meaning of section 424(f) of
the Code.
2.43 "Successor-in-Interest" means the estate or beneficiary of
a deceased Former Outside Director, a deceased Former Eligible Employee or
another deceased Participant, to whom the right to exercise an Option or the
right to payment under the Plan shall have passed, as applicable.
2.44 "Terminating Event" means any of the following events:
2.44.1 The liquidation of the Company; or
2.44.2 A Change of Control.
2.45 "Third Party" means any Person, together with such
Person's Affiliates, provided that the term "Third Party" shall not include the
Company, an Affiliate of the Company or any member or members of the Roberts
Family.
3. DEFERRAL ELECTIONS
3.1 Elections. Each Outside Director, Former Outside Director,
Eligible Employee, Former Eligible Employee, Successor-in-Interest and Permitted
Transferee who is the grantee or transferee of an Option, shall have the right
to make an Election to defer the receipt of
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Shares upon exercise of all or part of such Option by filing an Election at the
time and in the manner described in this Article 3.
3.2 Filing of Elections. An Election to defer the receipt of
Shares upon exercise of all or part of an Option shall be made on the form
provided by the Administrator for this purpose. No such Election shall be
effective unless it is filed with the Administrator on or before the date that
is both (i) six (6) months prior to the exercise of such Option and (ii) in the
calendar year preceding the calendar year in which such Option is exercised,
provided that an Election filed with the Administrator on or before December 31,
1997 shall be effective with respect to the exercise of any Option after
December 31, 1997.
3.3 Options to which Elections May Apply. A separate Election
may be made for each Option, or a portion of such Option, with respect to which
an Outside Director, Former Outside Director, Eligible Employee, Former Eligible
Employee, Successor-in-Interest or Permitted Transferee desires to defer receipt
of Shares upon exercise of all or a portion of such Option, but the failure of
such a Person to make an Election with respect to an Option shall not affect
such Person's right to make an Election for any other Option.
3.4 Election of Distribution Date.
3.4.1 Each Participant who elects to defer the
receipt of Shares shall, on the Election,
also elect the distribution date for such
Shares; provided, however, that, subject to
acceleration pursuant to Paragraph 3.4.3,
Paragraph 3.4.4 or Paragraph 3.5, no
distribution may be made earlier than
January 2nd of the third calendar year
beginning after the date of the Election nor
later than January 2nd of the eleventh
calendar year beginning after the date of
the Election. The designation of the time
for distribution of benefits under the Plan
may vary with each separate Election.
Subject to acceleration pursuant to
Paragraph 3.4.3, Paragraph 3.4.4 or
Paragraph 3.5, no distribution of the
amounts deferred by a Participant for any
Plan Year shall be made before the
distribution date designated by the
Participant on the most recently filed
Election with respect to such deferred
amounts.
3.4.2 Each Active Participant who has previously
elected to receive a distribution of part or
all of his or her Account, or who, pursuant
to this Paragraph 3.4.2 has elected to defer
the distribution date for Shares for an
additional period from the
originally-elected distribution date, may
elect to defer the time of payment of such
amount for a minimum of two and a maximum of
ten additional years from the
previously-elected distribution date, by
filing an Election with the Administrator on
or before the close of business
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on June 30 of the Plan Year preceding the
Plan Year in which the distribution would
otherwise be made.
3.4.3 A Deceased Participant's
Successor-in-Interest or the Permitted
Transferee of a Deceased Participant, if
applicable, may elect to:
3.4.3.1 Defer the time of payment of the
Deceased Participant's Account for a
minimum of two additional years from
the date payment would otherwise be
made (provided that if an Election
is made pursuant to this Paragraph
3.4.3.1, the Deceased Participant's
Account shall be distributed in full
on or before the fifth anniversary
of the Deceased Participant's
death); or
3.4.3.2 Accelerate the time of payment of
such amount from the date payment
would otherwise be made to January
2nd of the calendar year beginning
after the Deceased Participant's
death.
An Election pursuant to this Paragraph 3.4.3
must be filed with the Administrator on or
before the close of business on (i) the June
30 following the Participant's death on or
before May 1 of a calendar year, (ii) the
60th day following the Participant's death
after May 1 and before November 2 of a
calendar year or (iii) the December 31
following the Participant's death after
November 1 of a calendar year. One and only
one Election shall be permitted pursuant to
this Paragraph 3.4.3 with respect to a
Deceased Participant's Account.
3.4.4 A Disabled Participant, or the Permitted
Transferee of a Disabled Participant, if
applicable, may elect to accelerate the time
of payment of the Disabled Participant's
Account from the date payment would
otherwise be made to January 2nd of the
calendar year beginning after the
Participant became disabled. An Election
pursuant to this Paragraph 3.4.4 must be
filed with the Administrator on or before
the close of business on the later of (i)
the June 30 following the date the
Participant becomes a Disabled Participant
if the Participant becomes a Disabled
Participant on or before May 1 of a calendar
year, (ii) the 60th day following the date
the Participant becomes a Disabled
Participant if the Participant becomes a
Disabled Participant after May 1 and before
November 2 of a calendar year or (iii) the
December 31 following the date the
Participant becomes a Disabled Participant
if the
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<PAGE>
Participant becomes a Disabled Participant
after November 1 of a calendar year.
3.4.5 A Retired Participant, or the Permitted
Transferee of a Retired
Participant, if applicable, may elect to
defer the time of payment of the Retired
Participant's Account for a minimum of two
additional years from the date payment would
otherwise be made (provided that if an
Election is made pursuant to this Paragraph
3.4.5, the Retired Participant's Account
shall be distributed in full on or before
the fifth anniversary of the Retired
Participant's Normal Retirement). An
Election pursuant to this Paragraph 3.4.5
must be filed with the Administrator on or
before the close of business on the later of
(i) the June 30 following the Participant's
Normal Retirement on or before May 1 of a
calendar year, (ii) the 60th day following
the Participant's Normal Retirement after
May 1 and before November 2 of a calendar
year or (iii) the December 31 following the
Participant's Normal Retirement after
November 1 of a calendar year.
3.5 Effect of Terminating Event. The Company shall give
Participants at least thirty (30) days' notice (or, if not practicable, such
shorter notice as may be reasonably practicable) prior to the anticipated date
of the consummation of a Terminating Event. The Company may, in its discretion,
provide in such notice that notwithstanding any other provision of the Plan or
the terms of any Election, upon the consummation of a Terminating Event, the
Account balance of each Participant shall be distributed in full and any
outstanding Elections shall be revoked.
4. FORM OF DISTRIBUTION
4.1 Form of Distribution. Deferred Stock Units credited to an
Account shall be distributed in the form of shares of A Stock and/or K Stock, as
applicable. Dividend equivalents shall be distributed in a lump sum in cash.
5. BOOK ACCOUNTS
5.1 Account. An Account shall be established for each Outside
Director, Former Outside Director, Eligible Employee, Former Eligible Employee,
Successor-in-Interest or Permitted Transferee when such Person becomes a
Participant. Deferred Stock Units shall be credited to the Account as of the
date of exercise of an Option as to which an Election is in effect.
5.2 Crediting of Dividend Equivalents. The Account of each
Participant shall be credited with dividend equivalents at the same rate per
Deferred Stock Unit as are actually
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<PAGE>
paid per Share. Earnings shall be credited with respect to dividend equivalents
credited to Accounts and credited with interest annually at the Prime Rate.
5.3 Status of Deferred Amounts. Regardless of whether or not
the Company is a Participant's employer, all Deferred Stock Units and dividend
equivalents under this Plan shall continue for all purposes to be a part of the
general funds of the Company.
5.4 Participants' Status as General Creditors. Regardless of
whether or not the Company is a Participant's employer, an Account shall at all
times represent the general obligation of the Company. The Participant shall be
a general creditor of the Company with respect to this obligation, and shall not
have a secured or preferred position with respect to his or her Accounts.
Nothing contained herein shall be deemed to create an escrow, trust, custodial
account or fiduciary relationship of any kind. Nothing contained herein shall be
construed to eliminate any priority or preferred position of a Participant in a
bankruptcy matter with respect to claims for wages.
6. NON-ASSIGNABILITY, ETC.
6.1 Non-assignability. The right of each Participant in or to
any Account, benefit or payment hereunder shall not be subject in any manner to
attachment or other legal process for the debts of such Participant; and no
Account, benefit or payment shall be subject to anticipation, alienation, sale,
transfer, assignment or encumbrance.
6.2 Designation of Beneficiaries. Each Participant shall have
the right to designate one or more beneficiaries to receive distributions in the
event of the Participant's death by filing with the Administrator a beneficiary
designation on the form provided by the Administrator for such purpose. The
designation of beneficiary or beneficiaries may be changed by a Participant at
any time prior to his or her death by the delivery to the Administrator of a new
beneficiary designation form. If no beneficiary shall have been designated, or
if no designated beneficiary shall survive the Participant, the Participant's
estate shall be deemed to be the beneficiary.
7. INTERPRETATION
7.1 Authority of Committee. The Committee shall have full and
exclusive authority to construe, interpret and administer this Plan and the
Committee's construction and interpretation thereof shall be binding and
conclusive on all persons for all purposes.
7.2 Claims Procedure. The Committee shall administer a
reasonable claims procedure with respect to the Plan in accordance with
Department of Labor Regulation section 2560.503-1, or any successor provision.
-12-
<PAGE>
8. AMENDMENT OR TERMINATION
8.1 Amendment or Termination. The Company, by action of the
Board or by action of the Committee, reserves the right at any time, or from
time to time, to amend or modify this Plan. The Company, by action of the Board,
reserves the right to terminate this Plan at any time.
9. MISCELLANEOUS PROVISIONS
9.1 No Right to Continued Employment. Nothing contained herein
shall be construed as conferring upon any Participant the right to remain in the
employment of a Participating Company as an executive or in any other capacity.
9.2 Governing Law. This Plan shall be interpreted under the
laws of the Commonwealth of Pennsylvania.
9.3 Expiration of Options. Notwithstanding any provision of the
Plan or an Election, no Election shall be effective with respect to an Option
that has expired. In addition, no provision of the Plan or an Election shall be
construed to extend the expiration date of any Option.
10. WITHHOLDING OF TAXES ON EXERCISE OF OPTION
10.1 In General. Whenever the Company proposes or is required to
credit Deferred Stock Units to an Account in connection with the exercise of an
Option, the Company shall have the right to require the optionee to remit to the
Company an amount sufficient to satisfy any federal, state and local withholding
tax requirements prior to the date on which Deferred Stock Units shall be deemed
credited to the Account, or take any action whatever that it deems necessary to
protect its interests with respect to tax liabilities. The Company's obligation
to credit Deferred Stock Units to an Account on the exercise of an Option
subject to an Election shall be conditioned on the optionee's compliance, to the
Company's satisfaction, with any withholding requirement. Except as otherwise
provided in Paragraph 10.2, the Company shall satisfy all applicable withholding
tax requirements by withholding tax from other compensation payable by the
Company to the optionee, or by the optionee's delivery of cash or other property
acceptable to the Company having a value equal to the applicable withholding
tax.
10.2 Share Withholding Election. With respect to any Option
subject to an Election, an Eligible Employee, Former Eligible Employee,
Successor-in-Interest or Permitted Transferee may elect to have the number of
Option Shares determined such that Shares subject to such Option are withheld by
the Company to the extent necessary to satisfy any withholding tax liabilities
incurred in connection with the exercise of such Option. The number of Shares
subject to an Option to be withheld pursuant to such a Share Withholding
Election shall have a Fair Market Value approximately equal to the sum of (i)
the minimum amount of withholding taxes
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<PAGE>
required to be withheld by the Company under applicable law, plus (ii) either
(a) the minimum amount of withholding taxes arising because of the recognition
of income (and consequent non- deferral of income) with respect to such withheld
Shares or (b) the amount of withholding taxes arising because of the recognition
of income (and consequent non-deferral of income) with respect to such withheld
Shares, calculated at the highest applicable marginal tax rates; as indicated on
the Share Withholding Election. Notwithstanding any other provision of the Plan
or the terms of any Election, the number of Deferred Stock Units credited to
Participants' Accounts shall be adjusted appropriately to reflect the
withholding of Shares pursuant to such Share Withholding Elections.
11. EFFECTIVE DATE
The effective date of the Plan this amendment and restatement
of the Plan shall be June 21, 1999.
IN WITNESS WHEREOF, COMCAST CORPORATION has caused this Plan to be
executed by its officers thereunto duly authorized, and its corporate seal to be
affixed hereto, as of the 21st day of June, 1999.
COMCAST CORPORATION
BY: /s/ Stanley Wang
ATTEST: /s/ Arthur Block
-14-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
condensed consolidated statement of operations and condensed consolidated
balance sheet and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000022301
<NAME> COMCAST CORPORATION
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 2,194
<SECURITIES> 5,736
<RECEIVABLES> 548
<ALLOWANCES> (129)
<INVENTORY> 384
<CURRENT-ASSETS> 8,972
<PP&E> 4,669
<DEPRECIATION> (1,520)
<TOTAL-ASSETS> 21,885
<CURRENT-LIABILITIES> 4,686
<BONDS> 7,004
555
32
<COMMON> 749
<OTHER-SE> 5,406
<TOTAL-LIABILITY-AND-EQUITY> 21,885
<SALES> 2,853
<TOTAL-REVENUES> 2,853
<CGS> 761
<TOTAL-COSTS> (2,516)
<OTHER-EXPENSES> (126)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (255)
<INCOME-PRETAX> 1,639<F1>
<INCOME-TAX> (724)
<INCOME-CONTINUING> 915
<DISCONTINUED> (20)
<EXTRAORDINARY> (3)
<CHANGES> 0
<NET-INCOME> 905
<EPS-BASIC> 1.20
<EPS-DILUTED> 1.11
<FN>
<F1>Loss before income tax expense and other items excludes the effect of
minority interests, net of tax, of $12.8.
</FN>
</TABLE>
