COX COMMUNICATIONS INC /DE/, DEF 14A, 1998-03-23

COX COMMUNICATIONS INC /DE/
DEF 14A, 1998-03-23
CABLE & OTHER PAY TELEVISION SERVICES

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<PAGE>

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14a-6(e)(2))

[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

COX COMMUNICATIONS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

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

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

$500 per each party to the controversy pursuant to Exhange Act rule
14a-6(i)(3).

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):

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

(4) Proposed maximum aggregate value of transaction:

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

(5) Total fee paid:

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

[_] Fee paid previously with preliminary materials.

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

(1) Amount Previously Paid:

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

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(3) Filing Party:

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(4) Date Filed:

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Notes:
<PAGE>

LOGO
[LOGO OF COX COMMUNICATIONS APPEARS HERE]

To the Stockholders of
Cox Communications, Inc.

You are invited to attend the Annual Meeting of Stockholders of Cox
Communications, Inc. to be held at Corporate Headquarters, 1400 Lake Hearn
Drive, NE, Atlanta, Georgia 30319, on Friday, April 24, 1998, at 9:00 a.m.,
local time.

Information concerning matters to be considered and acted upon at the
meeting is set forth in the accompanying Notice of Annual Meeting of
Stockholders and Proxy Statement.

Please read the enclosed Notice of Annual Meeting and Proxy Statement so you
will be informed about the business to come before the meeting. Your vote is
important, regardless of the number of shares you own. On behalf of the Board
of Directors, I urge you to mark, sign and return the enclosed proxy card as
soon as possible, even if you plan to attend the Annual Meeting. You may, of
course, revoke your proxy by notice in writing to the Corporate Secretary at
any time before the proxy is voted.

Sincerely,

LOGO
/s/ James O. Robbins
James O. Robbins
President and Chief Executive
Officer

Atlanta, Georgia
March 23, 1998

<PAGE>

COX COMMUNICATIONS, INC.
1400 LAKE HEARN DRIVE, NE
ATLANTA, GEORGIA 30319
(404) 843-5000

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 24, 1998

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

To the Stockholders of Cox Communications, Inc.

The Annual Meeting of the holders of Class A Common Stock and Class C Common
Stock of Cox Communications, Inc. (the "Company") will be held at Corporate
Headquarters, 1400 Lake Hearn Drive, NE, Atlanta, Georgia on Friday, April 24,
1998, at 9:00 a.m., local time, for the following purposes:

1. To elect a Board of Directors of seven members to serve until the 1999
Annual Meeting of Stockholders or until their successors are duly elected
and qualified;

2. To ratify the appointment by the Board of Directors of Deloitte & Touche
LLP, independent certified public accountants, as the Company's
independent auditors for the year ending December 31, 1998;

3. To approve the Cox Communications, Inc. Annual Incentive Plan; and

4. To transact such other business as may properly come before the meeting
or any adjournment thereof.

The Board of Directors has fixed March 10, 1998 as the record date for the
Annual Meeting with respect to this solicitation. Only holders of record of
Class A Common Stock and Class C Common Stock at the close of business on that
date are entitled to notice of and to vote at the Annual Meeting or any
adjournments thereof as set forth in the Proxy Statement.

The Company's summary Annual Report to stockholders and Form 10-K for the
year ended December 31, 1997 are enclosed herewith.

By Order of the Board of Directors,

LOGO
/s/ Andrew A. Merdek
Andrew A. Merdek
Corporate Secretary

Atlanta, Georgia
March 23, 1998

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, PLEASE SIGN, DATE
AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE PAID ENVELOPE AS
PROMPTLY AS POSSIBLE. A PROXY MAY BE REVOKED BY A STOCKHOLDER ANY TIME PRIOR
TO ITS USE AS SPECIFIED IN THE ENCLOSED PROXY STATEMENT.
<PAGE>

COX COMMUNICATIONS, INC.
1400 LAKE HEARN DRIVE, NE
ATLANTA, GEORGIA 30319
(404) 843-5000

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

PROXY STATEMENT

1998 ANNUAL MEETING OF STOCKHOLDERS

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

SOLICITATION OF PROXIES

The Board of Directors of Cox Communications, Inc. (the "Company") is
furnishing this Proxy Statement in connection with its solicitation of proxies
for use at the Company's 1998 Annual Meeting of Stockholders, to be held on
April 24, 1998, at 9:00 a.m., local time, at Corporate Headquarters, 1400 Lake
Hearn Drive, NE, Atlanta, Georgia 30319, and at any adjournment thereof. Each
valid proxy received in time will be voted at the meeting and, if a choice is
specified, it will be voted in accordance with such specification. A proxy may
be revoked by notice in writing to the Corporate Secretary at the address set
forth above at any time before the proxy is voted.

This Proxy Statement and the proxies solicited hereby are being first sent
for delivery to stockholders of the Company on or about March 23, 1998. The
cost of solicitation of proxies, including the reimbursement to banks and
brokers for reasonable expenses for sending proxy materials to their
principals, will be borne by the Company.

The shares of Class A Common Stock and Class C Common Stock represented by
valid proxies received by the Company in time for the Annual Meeting will be
voted as specified in such proxies. Executed but unvoted proxies will be
voted:

(1) FOR the election of the Board of Directors' nominees for directors;

(2) FOR the ratification of the appointment of Deloitte & Touche LLP,
independent certified public accountants, as the Company's independent
auditors for the year ending December 31, 1998; and

(3) FOR the approval of the Cox Communications, Inc. Annual Incentive Plan.

If any other matters properly come before the Annual Meeting, the persons
named on such proxies will, unless the stockholder otherwise specifies in the
proxy, vote upon such matters in accordance with their best judgment.

VOTING SECURITIES

The Company has two classes of outstanding voting securities, Class A Common
Stock, $1.00 par value per share (the "Class A Common Stock"), and Class C
Common Stock, $1.00 par value per share (the "Class C Common Stock"). As of
March 10, 1998, there were outstanding 257,452,514 shares of Class A Common
Stock and 13,798,896 shares of Class C Common Stock. Only holders of record of
shares of Class A Common Stock or shares of Class C Common Stock at the close
of business on March 10, 1998, which the Company's Board of Directors has
fixed as the record date, are entitled to vote at the meeting.

The Class A Common Stock and Class C Common Stock will vote together as a
single class, with each share of Class A Common Stock being entitled to one
vote, and each share of Class C Common Stock being entitled to ten votes. The
presence in person or by proxy of holders of a majority of the issued and
outstanding

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<PAGE>

shares of Class A Common Stock and Class C Common Stock entitled to vote at
the Annual Meeting will constitute a quorum. The affirmative vote of a
majority of the voting power of the Class A Common Stock and Class C Common
Stock, voting together as a single class, present at the Annual Meeting in
person or by proxy, and entitled to vote, is required for the election of
directors, the ratification of appointment of independent auditors and the
approval of the Annual Incentive Plan.

Shares as to which a stockholder abstains are considered shares entitled to
vote on the applicable proposal and are included in determining whether such
proposal is approved (i.e., an abstention would have the effect of a vote
against the applicable proposal). On the other hand, broker non-votes are not
considered shares entitled to vote on the applicable proposal and are not
included in determining whether such proposal is approved. A broker non-vote
occurs when the nominee of a beneficial owner with the power to vote on at
least one matter does not vote on another matter because the nominee does not
have discretionary voting power and has not received instructions from the
beneficial owner with respect to such matter. Accordingly, broker non-votes
have no effect on the outcome of a vote on the applicable proposal.

Stockholders will not have appraisal rights with respect to any of the
proposals to be voted upon at the Annual Meeting.

As of March 10, 1998, Cox Enterprises, Inc., a Delaware corporation ("CEI"),
through wholly-owned subsidiaries, held approximately 82.8% of the combined
voting power of the Class A Common Stock and Class C Common Stock.
Accordingly, CEI will have sufficient voting power to elect all members of the
Board of Directors, to ratify the appointment of independent auditors, to
approve the Annual Incentive Plan and to control substantially all other
actions that may come before the Annual Meeting.

ELECTION OF DIRECTORS
(PROPOSAL NO. 1)

At the meeting, seven directors are to be elected to hold office until the
1999 Annual Meeting of Stockholders or until their respective successors have
been elected and qualified. All of the nominees currently are directors of the
Company.

The seven directors nominated for election at the 1998 Annual Meeting of
Stockholders are: James C. Kennedy; Janet Morrison Clarke; John R. Dillon;
David E. Easterly; Robert F. Erburu; James O. Robbins; and Andrew J. Young
(collectively, the "Nominees"). The persons named as proxies intend (unless
authority is withheld) to vote for the election of all of the Nominees as
directors.

The Board of Directors knows of no reason why any Nominee for director would
be unable to serve as director. If at the time of the Annual Meeting any of
the Nominees are unable or unwilling to serve as a director of the Company,
the persons named in the proxy intend to vote for such substitutes as may be
nominated by the Board of Directors.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE
NOMINEES.

The following information regarding the Nominees, their principal
occupations, employment history, and directorships in certain companies is as
reported by the respective Nominees.

James C. Kennedy, 50, has served as Chairman of the Board of Directors and
Chief Executive Officer of CEI since January 1988, and prior to that time was
CEI's President and Chief Operating Officer. Mr. Kennedy was elected the
Chairman of the Board of Directors of the Company in May 1994. Mr. Kennedy
joined CEI in 1972, and initially worked with CEI's Atlanta Newspapers. Mr.
Kennedy is a director of Cox Radio, Inc., a publicly traded, indirect
majority-owned subsidiary of CEI ("Cox Radio"), National Service Industries,
Inc., Flagler Systems, Inc. and an advisory director of Chase Bank of Texas,
N.A. Mr. Kennedy holds a B.A. from the University of Denver.

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<PAGE>

James O. Robbins, 55, has served as President of the Company since September
1985, and as President and Chief Executive Officer since May 1994. Mr. Robbins
was elected a director of the Company in May 1994. Mr. Robbins joined the
Company in September 1983 and has served as Vice President, Cox Cable New York
City and as Senior Vice President, Operations of the Company. Prior to joining
the Company, he held management and executive positions with Viacom
Communications, Inc. and Continental Cablevision. Mr. Robbins is a member of
the Executive Committee of the National Cable Television Association. Mr.
Robbins holds a B.A. from the University of Pennsylvania and an M.B.A. from
Harvard Business School. Mr. Robbins serves as a director of Teleport
Communications Group Inc., TeleWest Communications plc and NCR Corporation and
as a Representative on the Partnership Board of Sprint Spectrum Holding
Company, L.P., the general partner of Sprint Spectrum, L.P.

Janet Morrison Clarke, 45, has served as a director of the Company since
March 1995. Ms. Clarke is the Managing Director--Global Database Marketing of
Citibank. Prior to joining Citibank in June, 1997, Ms. Clarke was Senior Vice
President of Information Technology Sector of R.R. Donnelley & Sons Company,
which she joined in 1978 as a Sales Representative. She also served as
Manager, National Accounts; Vice President and Director of the OEM Sales
Division; and Senior Vice President of Manufacturing for R.R. Donnelley and
Director of 77 Capital Corporation, R.R. Donnelley's venture capital fund. Ms.
Clarke earned a bachelor's degree from Princeton University and completed the
Advanced Management Program at the Harvard Business School.

John R. Dillon, 56, was elected a director of the Company in May 1994. Mr.
Dillon became managing director of Cravey, Green and Wahlen in January 1997.
Mr. Dillon served as Senior Vice President and Chief Financial Officer of CEI
from May 1990 until his retirement on December 31, 1996, and he continues to
serve as a consultant to CEI. He was Vice President and Chief Financial
Officer of CEI from September 1985 through May 1990. Mr. Dillon joined CEI in
1982, and prior to that time, was President of Fuqua National, a privately
held energy, communications and investment firm in Atlanta. He was previously
with Scientific-Atlanta as Treasurer and General Manager of its cable
television division. Mr. Dillon serves on the Board of Directors and
Compensation Committee of Teleport Communications Group Inc. Mr. Dillon holds
a B.S.E.E. from Georgia Institute of Technology and an M.B.A. from Harvard
Business School.

David E. Easterly, 55, has served as President and Chief Operating Officer
of CEI since October 1994 and was President of Cox Newspapers, Inc. ("Cox
Newspapers"), a subsidiary of CEI, from May 1986 through October 1994. Mr.
Easterly was elected a director of the Company in May 1994. Mr. Easterly
joined CEI in 1970 at the Dayton Daily News, transferring to Atlanta in 1981
as Vice President of Operations for Cox Newspapers. He was named Publisher of
The Atlanta Journal/Constitution in April 1984. Mr. Easterly is a member of
the Board of Directors of the Associated Press and of Mutual Insurance
Company, Ltd. Mr. Easterly also serves as a director of CEI and of Cox Radio.
Mr. Easterly holds a B.A. from Austin College.

Robert F. Erburu, 67, has served as a director of the Company since March
1995. Mr. Erburu is Chairman of the Board (Retired) of Times Mirror. He has
served as a director of Times Mirror since 1968 and served as Chairman of the
Board from 1986 to December 31, 1995. From 1981 through May 1, 1995, Mr.
Erburu served as Chief Executive Officer of Times Mirror. Mr. Erburu graduated
from the University of Southern California with a B.A. degree in Journalism
and holds a J.D. degree from Harvard Law School. He is also a director of
Tejon Ranch Company and Marsh & McLennan Companies, Inc. Mr. Erburu is
Chairman of the Board of Trustees of the Huntington Library, Art Collections
and Botanical Gardens and of the J. Paul Getty Trust. He is a director of the
National Gallery of Art, as well as trustee of The Ahmanson Foundation, and
several other charitable foundations. He is a director of the Council on
Foreign Relations and the Tomas Rivera Center. In addition, he is a member of
the Business Council.

Andrew J. Young, 65, has served as a director since March 1995. Mr. Young
has served as Co-Chairman of Good Works International L.L.P. since January
1997, was Vice Chairman of Law Companies Group, Inc., an engineering and
environmental consulting company from February 1993 to January 1997 and was
Chairman of one of its subsidiaries, Law International, Inc. from 1989 to
February 1993. From 1981 to 1989, Mr. Young was Mayor of Atlanta, Georgia, and
prior thereto served as U.S. Ambassador to the United Nations under

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<PAGE>

President Jimmy Carter and as a member of the U.S. House of Representatives.
Mr. Young was Co-Chairman of the Atlanta Committee for the Olympic Games for
the 1996 Summer Olympics. Mr. Young is a member of the Boards of Directors of
Delta Airlines, Thomas Nelson Publishing Company and Host Marriott
Corporation. Mr. Young holds degrees from Howard University and Hartford
Theological Seminary.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The following table provides information as of March 10, 1998, with respect
to the shares of Class A Common Stock and Class C Common Stock beneficially
owned by each person known by the Company to own more than 5% of any class of
the outstanding voting securities of the Company.

<TABLE>
<CAPTION>
PERCENT OF
VOTE OF ALL
CLASS A CLASS C CLASSES OF
NAME OF COMMON PERCENT COMMON PERCENT COMMON
BENEFICIAL OWNER STOCK OF CLASS STOCK OF CLASS STOCK
- ----------------- ----------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C>
Cox Enterprises, Inc. (a) (b)
(c)........................... 189,595,588 73.6% 13,798,896 100.0% 82.8%
</TABLE>
- --------
(a) The business address for CEI is 1400 Lake Hearn Drive, N.E., Atlanta,
Georgia 30319.
(b) Of the shares of Common Stock of the Company that are beneficially owned
by CEI, 177,105,323 shares of Class A Common Stock and 12,848,235 shares
of Class C Common Stock are held of record by Cox Holdings, Inc. The
remaining 12,490,265 shares of Class A Common Stock and 950,661 shares of
Class C Common Stock beneficially owned by CEI are held of record by Cox
DNS, Inc. All of the outstanding capital stock of Cox Holdings, Inc. is
beneficially owned by CEI. All of the outstanding capital stock of Cox
DNS, Inc. is beneficially owned by Cox Investment Company, Inc., and all
of the outstanding capital stock of Cox Investment Company, Inc. is
beneficially owned by CEI. The beneficial ownership of the outstanding
capital stock of CEI is described in footnote (c) below.
(c) There are 202,448,312 shares of Common Stock of CEI outstanding, with
respect to which (i) Barbara Cox Anthony, as trustee of the Anne Cox
Chambers Atlanta Trust, exercises beneficial ownership over 58,316,422
shares (28.8%), (ii) Anne Cox Chambers, as trustee of the Barbara Cox
Anthony Atlanta Trust, exercises beneficial ownership over 58,316,422
shares (28.8%), (iii) Barbara Cox Anthony, Anne Cox Chambers and Marion H.
Allen, III, as trustees of the Dayton Cox Trust A, exercise beneficial
ownership over 82,745,685 shares (40.9%), and (iv) 244 individuals and
trusts exercise beneficial ownership over the remaining 3,069,783 shares
(1.5%). Thus, Barbara Cox Anthony and Anne Cox Chambers, who are sisters,
together exercise sole or shared beneficial ownership over 199,378,529
shares (98.5%) of Common Stock of CEI. In addition, Garner Anthony, the
husband of Barbara Cox Anthony, holds beneficially and of record 14,578
shares of Common Stock of CEI. Barbara Cox Anthony disclaims beneficial
ownership of such shares. Barbara Cox Anthony and Anne Cox Chambers are
the mother and aunt, respectively, of James C. Kennedy, the Chairman of
the Board of Directors and Chief Executive Officer of CEI and the Chairman
of the Board of Directors of the Company.

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<PAGE>

SECURITY OWNERSHIP OF MANAGEMENT

"Beneficial ownership" of the Class A Common Stock of the Company and the
Common Stock of CEI, by the Company's directors and the Named Executive
Officers, and by all directors and executive officers as a group at March 10,
1998, is shown in the following table. None of such persons, individually or
in the aggregate, owns 1% or more of the Common Stock of the Company or CEI.

<TABLE>
<CAPTION>
NUMBER OF SHARES OF
COX CLASS A COMMON NUMBER OF SHARES OF CEI
NAME OF BENEFICIAL OWNER STOCK OWNED COMMON STOCK OWNED
------------------------ ------------------- -----------------------
<S> <C> <C>
Margaret A. Bellville........... 48,000(a) 0
Ajit M. Dalvi................... 141,252(b) 7,299
John R. Dillon.................. 1,502 33,877
David E. Easterly............... 2,000 135,323
Jimmy W. Hayes.................. 121,600(c) 4,415
James C. Kennedy................ 34,200 0(d)
James O. Robbins................ 630,245(e) 30,404
David M. Woodrow................ 121,816(f) 3,108
Janet Morrison Clarke........... 2,395 0
Robert F. Erburu................ 167,566 0
Andrew J. Young................. 4,395 0
All directors and executive
officers as a group
(16 persons, including those
named above)................... 1,518,035(g) 222,534
</TABLE>
- --------
(a) Includes 48,000 shares subject to stock options that are exercisable
within 60 days.

(b) Includes 114,010 shares subject to stock options that are exercisable
within 60 days.

(d) Mr. Kennedy owns of record no shares of Common Stock of CEI. Sarah K.
Kennedy, Mr. Kennedy's wife and trustee of the Kennedy Trusts, exercises
beneficial ownership over an aggregate of 7,380 shares of Common Stock of
CEI. In addition, as described above, Barbara Cox Anthony and Anne Cox
Chambers, the mother and aunt, respectively, of Mr. Kennedy, together
exercise sole or shared beneficial ownership over 199,378,529 shares of
Common Stock of CEI. Also, Mr. Kennedy's children are the beneficiaries of
a trust, of which Marion H. Allen, III is the sole trustee, that
beneficially owns 5,385 shares. Mr. Kennedy disclaims beneficial ownership
of all such shares.

(e) Includes 523,000 shares subject to stock options that are exercisable
within 60 days.

(f) Includes 102,640 shares subject to stock options that are exercisable
within 60 days.

(g) Includes 1,105,802 shares subject to stock options that are exercisable
within 60 days.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company's executive officers
and directors, and persons who own more than 10% of the Company's Class A
Common Stock to file reports of ownership and changes in ownership of the
Company's Class A Common Stock with the Securities and Exchange Commission and
the New York Stock Exchange. Based solely on a review of copies of such
reports and written representations from the reporting persons, the Company
believes that from January 1997 through the date of this Proxy Statement its
executive officers, directors and greater than ten percent stockholders filed
on a timely basis all reports due under Section 16(a) of the Exchange Act.

BOARD OF DIRECTORS AND COMMITTEES

The Board of Directors had four regular meetings and approved one action by
unanimous written consent in 1997. During 1997, the Executive Committee met
twice and approved actions by unanimous written consent four times. The
current members of the Executive Committee are Messrs. Kennedy (Chair),
Easterly, Erburu and Robbins.

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<PAGE>

The Board of Directors also has an Audit Committee and a Compensation
Committee. The Audit Committee approves the selection of the independent
auditors for the Company, reviews the scope and results of the annual audit,
approves the services to be performed by the independent auditors, reviews the
independence of the auditors, reviews the performance and fees of the
independent auditors, reviews the adequacy of the system of internal
accounting controls, reviews the scope and results of internal auditing
procedures and reviews the activities of the Company's Risk Committee, a
Board-created committee composed of senior financial managers which oversees
financial risk management. In addition, the Audit Committee has special
meetings to review related party transactions. The Audit Committee met twice
in 1997. The current members of the Audit Committee are Ms. Clarke (Chair),
Mr. Erburu and Mr. Young.

The Compensation Committee adopts and oversees the administration of
compensation plans for executive officers and senior management of the
Company, determines awards granted to executive officers under such plans, and
reviews the reasonableness of such compensation. The Compensation Committee
met twice in 1997 and approved one action by unanimous written consent. The
current members of the Compensation Committee are Mr. Erburu (Chair), Ms.
Clarke and Mr. Young.

During 1997, each director attended at least 75% of the total number of
meetings of the Board of Directors and meetings of the committees on which
such director served.

COMPENSATION OF DIRECTORS

The directors of the Company who are not affiliates of the Company, Janet
Morrison Clarke, Robert F. Erburu and Andrew J. Young, are reimbursed for
expenses and paid an annual fee of $30,000. The annual fee is paid as follows:
(a) one-half in shares of Class A Common Stock pursuant to the Cox
Communications, Inc. Restricted Stock Plan for Non-Employee Directors (the
"Directors' Restricted Stock Plan") plus (b) one-half in cash. In addition,
the non-affiliate directors receive a meeting fee of $1,000 for every board
meeting and committee meeting attended. The directors of the Company who are
affiliates of the Company do not receive any compensation for serving on the
Company's board.

Pursuant to the Directors' Restricted Stock Plan, directors who are not
employees of the Company or any of its subsidiaries or affiliates receive 50%
of any annual Board retainer fee in the form of Class A Common Stock, subject
to certain restrictions and forfeitures prior to the expiration of the period
ending five years after the date of the grant of the award or, if earlier, the
date of death or disability in certain circumstances. The maximum number of
shares of Class A Common Stock that may be granted pursuant to restricted
stock awards under the Directors' Restricted Stock Plan is 50,000.

EXECUTIVE OFFICERS

The executive officers of the Company who are not directors of the Company
are set forth below. Executive officers of the Company are elected to serve
until they resign or are removed, or are otherwise disqualified to serve, or
until their successors are elected and qualified.

Alex B. Best, 57, has served as Senior Vice President, Engineering since
January 1989. Mr. Best joined the Company as Vice President, Engineering in
April 1986, following 20 years with Scientific-Atlanta's cable television
business. Mr. Best holds a B.S.E.E. and an M.S.E.E. from the Georgia Institute
of Technology.

Ajit M. Dalvi, 55, has served as Senior Vice President, Programming and
Strategy since October 1996. Prior to that he served as Senior Vice President,
Marketing and Programming since April 1987. Mr. Dalvi joined the Company in
February 1982 as Director, Marketing, and later served as Vice President,
Marketing Planning and Development and Vice President, Marketing and
Programming. Prior to joining the Company, Mr. Dalvi held a series of
marketing positions with Coca-Cola USA. Mr. Dalvi holds a B.A. from Bombay
University and an M.B.A. from the Indian Institute of Management, an affiliate
of Harvard Business School.

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<PAGE>

John M. Dyer, 44, has served as Vice President, Accounting and Financial
Planning since April 1997. Mr. Dyer joined CEI in 1977 as an internal auditor
and moved to the former Cox Cable Communications, Inc. in 1980 as a financial
analyst, later serving as Manager of Capital Asset Planning, and Director of
Operations before being recruited by Times Mirror Cable as a Regional Vice
President of Operations, later serving as Vice President of Operations. Mr.
Dyer rejoined the Company as Vice President of Financial Planning and Analysis
when Cox acquired Times Mirror in 1995. Mr. Dyer holds a B.B.A. in accounting
from West Georgia College, and an M.B.A. from Georgia State University.

Jimmy W. Hayes, 45, has served as Senior Vice President, Finance and Chief
Financial Officer of the Company since January 1992. Mr. Hayes joined CEI in
1980 as Accounting Manager, was promoted to Assistant Controller in May 1981,
and Controller in January 1982. Mr. Hayes was named Vice President, Finance of
the Company in September 1989. Prior to joining CEI, Mr. Hayes was an Audit
Manager with Price Waterhouse & Company. Mr. Hayes serves on the Board of
Directors of Teleport Communications Group Inc. Mr. Hayes holds a B.A. and an
M.A.C.C. from the University of Georgia.

David M. Woodrow, 52, has served as Senior Vice President, Broadband
Services since April 1994. Mr. Woodrow joined the Company in 1982 as Director,
Business Development, and was promoted to Western Regional Manager in July
1984, to Vice President and General Manager of Cox Cable Santa Barbara, Inc.
in September 1985, and Senior Vice President, Operations in August 1989. Prior
to joining the Company, Mr. Woodrow was employed by the Technology Components
Group of Exxon Enterprises and Pitney Bowes, Inc. Mr. Woodrow serves on the
Board of Directors of Teleport Communications Group Inc. and At Home
Corporation, and is a director of the Cellular Telephone Industry Association.
Mr. Woodrow holds a B.S. and an M.S. from Purdue University, and an M.B.A.
from the University of Connecticut.

Claus F. Kroeger, 46, has served as Vice President, Operations since October
1994. Mr. Kroeger joined the Company in 1976 as a manager trainee. He has held
various positions in the field and served as Director of Operations and
Director of Business Development of the Company. From 1990 to 1994, he served
as Vice President and General Manager of Cox Cable Middle Georgia. Mr. Kroeger
holds a B.A. from the University of Alabama and an M.S. in telecommunications
from the University of Colorado.

James A. Hatcher, 46, Vice President, Legal and Regulatory Affairs since
January 1995, was named Vice President and General Counsel of the Company in
1992. He joined the Company in 1979 and held various positions, including
Secretary and General Counsel for the Company and CEI prior to 1992. Mr.
Hatcher holds a B.A. from Furman University and a J.D. from the South Carolina
School of Law.

Margaret A. Bellville, 44, has served as Vice President, Operations since
August 1995. From 1993 to 1995, she served as Senior Vice President of Century
Communications. From 1986 to 1993 she served as Vice President of Contel
Celluler. Ms. Bellville holds a B.A. from the State University of New York at
Binghamton.

Jayson R. Juraska, 49, has served as Vice President, Operations since
January 1997. He joined the Company in 1983 as Corporate Business Manager,
Development Division and subsequently served as Director of Finance and
Administration for the Company's Eastern Division and Vice President and
General Manager for the Company's Greater Hartford system before becoming Vice
President and General Manager for New England operations in 1995. Mr. Juraska
holds a B.A. from the University of Pennsylvania and an M.B.A. from the
Wharton School of Business.

7
<PAGE>

EXECUTIVE COMPENSATION

The following table sets forth certain information for the years ended
December 31, 1995, 1996, and 1997, respectively, concerning the cash and non-
cash compensation earned by or awarded to the Chief Executive Officer and the
four most highly compensated executive officers of the Company whose combined
salary and bonus exceeded $100,000 in such periods who were executive officers
as of December 31, 1997 (the "Named Executive Officers"):

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------- ---------------------------------
AWARDS PAYOUTS
------------------------- -------
RESTRICTED SECURITIES
NAME AND PRINCIPAL STOCK UNDERLYING LTIP ALL OTHER
POSITION YEAR SALARY BONUS AWARDS(A)(B) OPTIONS(C) PAYOUTS COMPENSATION(D)
------------------ ---- -------- -------- ------------ ---------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
James O. Robbins 1997 $642,000 $ -- (e) $ 353,100(e) 103,000 -- $6,000
President and Chief 1996 600,000 -- (f) 346,744(f) 170,000 -- 6,000
Executive Officer 1995 527,500 227,000 1,395,725(g) 283,269 -- 6,000
Ajit M. Dalvi 1997 $325,000 $ 95,000 $ 500,000(h) 21,000 -- (h) $6,000
Senior Vice President, 1996 295,000 110,580 121,804(i) 19,000 -- 6,000
Programming and
Strategy 1995 265,000 98,000 249,000 74,010 -- 6,000
Jimmy W. Hayes 1997 $290,000 $115,000 -- 21,000 -- $6,000
Senior Vice President, 1996 270,000 100,510 -- 18,000 -- 6,000
Finance and Chief 1995 210,000 151,000 228,855 66,597 -- 6,000
Financial Officer
Margaret A. Bellville 1997 $265,000 $ 90,000 -- 20,000 -- $6,000
Vice President 1996 210,000 75,415 -- 15,000 -- 6,000
Operations 1995 69,910(j) 25,780 -- 13,000 -- 2,077

David M. Woodrow 1997 $260,000 $ 47,500(k) $ 172,538(k) 19,000 -- $6,000
Senior Vice President 1996 245,000 86,485 -- 17,500 -- 6,000
Broadband Services 1995 205,000 78,000 211,950 66,140 -- 6,000
</TABLE>
- --------
(a) The aggregate number of restricted shares held by each Named Executive
Officer and the aggregate value of such restricted shares, based on the
closing price of Class A Common Stock as of December 31, 1997 ($40.0625).
<TABLE>
<CAPTION>
NUMBER VALUE AT
NAME OF SHARES 12/31/97
---- --------- ----------
<S> <C> <C>
Mr. Robbins............................................. 23,584 $ 944,834
Mr. Dalvi............................................... 26,496 $1,061,496
Mr. Hayes............................................... -- $ --
Ms. Bellville........................................... -- $ --
Mr. Woodrow............................................. 4,300 $ 172,269
</TABLE>

(b) 1995 restricted stock awards represent units awarded in 1992 under the Cox
Enterprises Unit Appreciation Plan (the "UAP") which were converted to an
equivalent award of restricted stock. These shares of restricted stock
vested on January 1, 1997. The value of the awards as stated above is
based on the closing price of Class A Common Stock on April 24, 1995, the
date of grant, which was $15.00. The number of shares of restricted stock
awarded to each Named Executive Officer in 1995 is as follows: Mr. Robbins
81,915 shares; Mr. Dalvi 16,640 shares; Mr. Hayes 15,257 shares; Mr.
Woodrow 14,130; and Ms. Bellville 0 shares.
(c) 1995 option awards include units awarded in 1994 under the UAP which were
converted to an equivalent award of options for Class A Common Stock.

<PAGE>

(d) Reflects amounts contributed pursuant to the Cox Communications, Inc.
Savings and Investment Plan (the "401(k) Plan") and amounts credited under
the Cox Communications, Inc. Executive Savings Plus Restoration Plan (the
"Restoration Plan").
(e) Subject to the approval by the stockholders of the Company of the Cox
Communications, Inc. Annual Incentive Plan (the "AIP"), Mr. Robbins will
be awarded a bonus for 1997 of $353,100 under the AIP, which will be
payable in the form of a restricted stock award to be granted on the date
such stockholder approval is obtained. See --Approval of the Annual
Incentive Plan. The number of shares of restricted stock to be issued to
Mr. Robbins will be equal to the dollar value of his bonus determined
under the AIP divided by the closing price of Class A Common Stock on the
date the award is granted, with any fractional shares being paid out in
cash. These shares of restricted stock vest five years from the date of
grant, provided Mr. Robbins remains employed by the Company as of such
date.
(f) Mr. Robbins elected to forgo his 1996 bonus in exchange for an award of
15,584 shares of restricted stock made on January 1, 1997. The value of
this award shown above is based on the closing price of Class A Common
Stock on the trading date next following the date of grant, or $22.25.
These shares of restricted stock vest on January 1, 2002, provided Mr.
Robbins remains employed by the Company as of such date.
(g) In addition to the value of Mr. Robbins' UAP awards converted to a
restricted stock award made on April 24, 1995(see footnote (b) above),
this amount reflects the value of 8,000 shares of restricted stock awarded
to Mr. Robbins on January 23, 1996, based on the closing price of Class A
Common Stock on such date, or $20.875. This award was made as a bonus for
Mr. Robbins' performance in 1995. These shares of restricted stock vest on
January 23, 2001, provided Mr. Robbins remains employed by the Company as
of such date.
(h) Represents 13,675 shares of restricted stock awarded to Mr. Dalvi on
December 16, 1997 as the partial payout of long term incentives awarded to
him in 1993 in connection with the Company's investment in Discovery
Communications, Inc. See--Reward and Incentive Program for Ajit Dalvi. The
value of this restricted stock award shown above is based on the closing
price of Class A Common Stock on the date of grant, or $36.562. These
shares of restricted stock vest on January 1, 2000, provided Mr. Dalvi
remains employed by the Company as of such date.
(i) Mr. Dalvi received an award of 12,821 shares of restricted stock on
January 1, 1996 in exchange for his agreement with the Company to cancel
the Company's obligation to pay him $250,000 of deferred compensation, 50%
of which was vested, pursuant to the Executive Incentive Agreement, dated
as of January 2, 1991, between Mr. Dalvi and CEI. The value of this award
indicated is net of the consideration paid by Mr. Dalvi in the form of
this foregone vested deferred compensation. Without taking into account
Mr. Dalvi's consideration for the restricted stock award, the value of the
award as of the date of grant is $246,804, which is based on the closing
price of the Class A Common Stock on the trading day next following the
date of grant, or $19.25. Mr. Dalvi's restricted stock award vests on
January 1, 2001, provided he remains employed by the Company as of such
date.
(j) Reflects compensation earned from Ms. Bellville's date of hire, August 21,
1995, through December 31, 1995.
(k) Represents 1,300 shares of restricted stock awarded to Mr. Woodrow on
January 1, 1998 as part of his annual bonus for 1997 and an additional
3,000 shares of restricted stock awarded to Mr. Woodrow as a special bonus
for 1997 to reward his efforts in connection with the Company's investment
in @Home. The aggregate value of these awards shown above is based on the
closing price of Class A Common Stock on the trading date following the
date of grant, or $40.125. These shares of restricted stock vest on
January 1, 2003, provided he remains employed by the Company as of such
date.

Long-Term Incentives

The LTIP. In general, long-term incentives are provided to Named Executive
Officers pursuant to awards under the Cox Communications, Inc. Long-Term
Incentive Plan (the "LTIP"). The LTIP provides for various forms of equity-
based incentive compensation with respect to Class A Common Stock, including
stock options, stock appreciation rights, stock bonuses, restricted stock
awards, performance units and phantom stock and awards consisting of
combinations of such incentives. The LTIP is administered by the Compensation
Committee

9
<PAGE>

of the Company which has the discretion to determine the type of awards to
grant, when, if and to whom awards are granted, the number of shares covered
by each award and the terms and conditions of each award. The Compensation
Committee has delegated to a management committee the administration of grants
to eligible individuals who are not "insiders" for purposes of reporting
obligations under Section 16 of the Securities Exchange Act of 1934 (the
"Exchange Act"). See "Security Ownership of Management."

The following table discloses for the five Named Executive Officers
information regarding options granted pursuant to the LTIP during the fiscal
year ended December 31, 1997:

OPTION GRANTS IN 1997

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
PERCENT OF VALUE AT ASSUMED
NUMBER OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS EXERCISE PRICE APPRECIATION
UNDERLYING GRANTED TO PRICE FOR OPTION TERM(B)
OPTIONS EMPLOYEES PER EXPIRATION ---------------------
NAME GRANTED(A) IN 1997 SHARE DATE 5% 10%
- ---- ---------- ---------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
James O. Robbins........ 103,000 15.49% $22.6250 1/1/2007 $1,465,560 $3,714,018
Ajit M. Dalvi........... 21,000 3.16 22.6250 1/1/2007 298,804 757,227
Jimmy W. Hayes.......... 21,000 3.16 22.6250 1/1/2007 298,804 757,227
Margaret A. Bellville... 20,000 3.01 22.6250 1/1/2007 284,575 721,168
David M. Woodrow........ 19,000 2.86 22.6250 1/1/2007 270,346 685,110
</TABLE>
- --------
(a) Stock options become exercisable over a five year period, with 60%
becoming exercisable three years from the date of grant and an additional
20% becoming exercisable each year thereafter. In addition, all options
will become immediately and fully exercisable if, no sooner than six
months after the date of grant of the options, the stock price achieves,
and maintains for a period of 10 consecutive trading days, a level equal
to or greater than 140% of the option exercise price.
(b) The dollar amount under the columns are the 5% and 10% rates of
appreciation prescribed by the Securities and Exchange Commission. The 5%
and 10% rates of appreciation would result in per share prices of $36.854
and $58.683, respectively. The Company expresses no opinion regarding
whether this level of appreciation will be realized and expressly
disclaims any representation to that effect.

The following table sets forth information related to the number and value
of options held at December 31, 1997 by the Named Executive Officers, none of
whom exercised options in 1997.

1997 YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT DECEMBER 31, 1997 DECEMBER 31, 1997
---------------------------- ----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE(A)
- ---- ---------------- --------------- ----------- ----------------
<S> <C> <C> <C> <C>
James O. Robbins........ 556,269 0 $11,587,286 $ 0
Ajit M. Dalvi........... 114,010 0 2,438,268 0
Jimmy W. Hayes.......... 105,597 0 2,247,996 0
Margaret A. Bellville... 48,000 0 890,757 0
David M. Woodrow........ 102,640 0 2,193,007 0
</TABLE>
- --------
(a) The exercisable/unexercisable value represents the number of the
exercisable/unexercisable options times the difference between the closing
price, on December 31, 1997 ($40.0625) and the exercise price of $16.975
for all 1995 options (except that Ms. Bellville's were granted at an
exercise price of $20.437), $20.937 for all 1996 options, and $22.625 for
all 1997 options.

10
<PAGE>

Reward and Incentive Program for Ajit Dalvi. The Company has established a
special reward and incentive program for Ajit Dalvi designed to reward Mr.
Dalvi's continuing efforts in creating significant shareholder value for the
Company through his efforts in enhancing the Company's investment in Discovery
Communications, Inc. ("DCI"). The program was initially established pursuant
to a February 23, 1993 agreement with Mr. Dalvi that awarded to Mr. Dalvi two
types of awards: (1) a phantom equity investment in DCI in an initial amount
of $100,000 (the "1993 Equity Award") under which Mr. Dalvi would be entitled
to a payout of the initial phantom equity investment plus appreciation thereon
determined as of the end of the appreciation period for the award; and (2) an
appreciation award based on an initial phantom equity investment in DCI of
$200,000 (the "1993 Appreciation Award") under which Mr. Dalvi would be
entitled to a payout based only on the appreciation on the phantom equity
investment determined as of the end of the appreciation period for the award.
The effective date of each of these awards was December 31, 1991. The 1993
Equity Award and the 1993 Appreciation Award were scheduled to be paid out at
the end of the appreciation period ending on December 31, 1997 and were
subject to a maximum aggregate payment amount of $1 million.

On December 16, 1997, the Compensation Committee of the Board of Directors
amended the initial award agreement with respect to the 1993 Equity Award and
1993 Appreciation Award to provide that a portion of the payout of the awards
be made in the form of a restricted stock award and that the remainder of the
payout be reinvested in DCI in the form of a $500,000 phantom equity
investment in DCI (the "1997 Equity Award") under which Mr. Dalvi would be
entitled to a payout of this reinvested phantom equity investment plus
appreciation thereon determined as of the end of the appreciation period for
the award. As of December 16, 1997, 13,675 shares of restricted stock of Class
A Common Stock were granted to Mr. Dalvi pursuant to this amendment. See--
Summary Compensation Table. The effective date of the 1997 Equity Award is
December 31, 1997. In general, the 1997 Equity Award is scheduled to be paid
out following the end of the appreciation period ending on December 31, 1999,
provided Mr. Dalvi remains in the continuous employment of the Company
throughout the appreciation period. The 1997 Equity Award will vest on January
1, 2000. The 1997 Equity Award is subject to a maximum payment of $1.5
million.

Also, by action taken on December 16, 1997, the Compensation Committee
approved a new agreement with Mr. Dalvi that awards to him two separate
appreciation awards. The first such appreciation award is based on an initial
phantom equity investment in DCI of $200,000 (the "1996 Appreciation Award")
under which Mr. Dalvi would be entitled to a payout based only on appreciation
on the phantom equity investment determined as of the end of the appreciation
period for that Award. The effective date of the 1996 Appreciation Award is
January 1, 1996. In general, the 1996 Appreciation Award is scheduled to be
paid out following the end of the appreciation period ending on December 31,
2000, provided Mr. Dalvi remains in the continuous employment of the Company
and its subsidiaries throughout the appreciation period. The second such
appreciation award is based on an initial phantom equity investment in DCI of
$200,000 (the "1998 Appreciation Award") under which Mr. Dalvi would be
entitled to a payout based only on the appreciation on the phantom equity
investment determined as of the end of the appreciation period for the award.
The effective date of the 1998 Appreciation Award is January 1, 1998. In
general, the 1998 Appreciation Award is scheduled to be paid out following the
end of the appreciation period ending on December 31, 2002, provided Mr. Dalvi
remains in the continuous employment of the Company and its subsidiaries
throughout the appreciation period.

Both the 1996 Appreciation Award and the 1998 Appreciation Award will vest
during the applicable appreciation period in accordance with the following
vesting schedule: 20 percent will become vested as of the date one year after
the effective date of the award, 75 percent will become vested as of the date
three years after the effective date, 90 percent will become vested as of the
date four years after the effective date and Mr. Dalvi will be fully vested in
each award on the date five years after the effective date of its grant. Each
of the 1996 Appreciation Award and the 1998 Appreciation Award is subject to a
maximum payment amount of $500,000.

In the event Mr. Dalvi's employment terminates before the end of the
appreciation period for the 1997 Equity Award, the 1996 Appreciation Award or
the 1998 Appreciation Award by reason of death or disability, his interest in
such awards will become fully vested and the value of his awards will be paid
to him or his estate.

11
<PAGE>

In the event his employment terminates for other reasons prior to the end of
the appreciation period for his 1997 Equity Award, the 1996 Appreciation Award
or the 1998 Appreciation Award, the value of the vested portion of such Awards
will be paid to him. Upon a showing satisfactory to the Company of Mr. Dalvi's
financial hardship prior to the end of the appreciation period for the 1997
Equity Award, the 1996 Appreciation Award or the 1998 Appreciation Award, the
Company may determine to distribute the value of the vested portion of such
Awards to Mr. Dalvi in a lump sum cash payment.

In general, the payment of the 1997 Equity Award, the 1996 Appreciation
Award and the 1998 Appreciation Award will be made in the form of cash, shares
of common stock of the Company or any combination thereof as the Company in
its sole discretion determines. If award is paid in cash, it may be made
either in the form of a lump sum or in five or less equal annual installments
as determined by the Company in its sole discretion.

The 1997 Equity Award and 1996 and 1998 Appreciation Awards granted to Mr.
Dalvi in fiscal year 1997 are summarized in the following chart:

LONG-TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
ESTIMATED
FUTURE PAYOUTS
PERFORMANCE OR UNDER NON-STOCK
OTHER PERIOD UNTIL PRICE BASED PLANS
NAME AWARD MATURATION OR PAYOUT -----------------
- ---- ----------------------- -------------------- MAXIMUM($)
<S> <C> <C> <C>
Ajit Dalvi...... 1997 Equity Award 2 years 1,500,000
1996 Appreciation Award 5 years 500,000
1998 Appreciation Award 5 years 500,000
</TABLE>

Retirement Plans

Cox Communications, Inc. Pension Plan. The Cox Communications, Inc. Pension
Plan (the "Pension Plan") is a tax-qualified defined benefit pension plan. The
Pension Plan covers all eligible employees of the Company and any of its
affiliates who have adopted the Pension Plan (including the Named Executive
Officers). The Pension Plan is funded through a tax-exempt trust, into which
contributions are made as necessary based on an actuarial funding analysis.

The Pension Plan provides for the payment of benefits upon retirement, early
retirement, death, disability and termination of employment. Participants
become vested in their benefits under the Pension Plan after completing five
years of vesting service. The Pension Plan benefit is determined under a
formula based on a participant's compensation and years of benefit accrual
service. Participants may elect from several optional forms of benefit
distribution, although special rules restrict the choices of married
participants without spousal consent.

Cox Executive Supplemental Plan. The Cox Executive Supplemental Plan (the
"CESP") is a non-qualified defined pension plan providing supplemental
retirement benefits to certain CEI management employees and those of certain
of its affiliates (including the Named Executive Officers). The CESP is
administered by the Management Committee of CEI whose members are appointed by
the CEI Board of Directors. The Management Committee of CEI designates
management employees to participate in the CESP.

The CESP monthly benefit formula, payable at normal retirement, is 2.5% of a
participant's average compensation, as calculated in the CESP multiplied by
the participant's years of benefit accrual service credited under the CESP.
The normal retirement benefit will not exceed 50% of a participant's average
compensation at retirement. Benefits payable with respect to early retirement
are reduced to reflect an earlier commencement date. Special disability,
termination of employment and death benefits also are provided. All benefits
payable under the CESP are reduced by benefits payable to the participant
under the Pension Plan. Participants may elect among several forms of benefit
distributions.

12
<PAGE>

The CESP is not funded currently by CEI. All payments of benefits are made
from the general funds of CEI.

The following table provides estimates of annual retirement income benefits
payable to certain executives under the Pension Plan and the CESP:

PENSION PLAN AND CESP TABLE

<TABLE>
<CAPTION>
YEARS OF SERVICE
FINAL AVERAGE ----------------------------------------------------------------
COMPENSATION (5 YEARS) 5 10 15 20 OR MORE
- ---------------------- ------- -------- -------- ----------
<S> <C> <C> <C> <C>
$150,000 $18,750 $ 37,500 $ 56,250 $ 75,000
250,000 31,235 62,500 93,750 125,000
350,000 43,750 87,500 131,250 175,000
450,000 56,250 112,500 168,750 225,000
550,000 68,750 137,500 206,250 275,000
650,000 81,250 162,500 243,750 352,000
750,000 93,750 187,500 281,250 375,000
</TABLE>

The Named Executive Officers have been credited with the following years of
service: Mr. Robbins, 14 years; Mr. Dalvi 15 years; Mr. Hayes, 17 years; Mr.
Woodrow, 15 years; and Ms. Bellville, 2 years. The Pension Plan and the CESP
define "compensation" generally to include all remuneration to an employee for
services rendered, including base pay, bonuses, special forms of pay and
certain employee deferrals. Certain forms of additional compensation,
including severance, moving expenses, extraordinary bonuses, long-term
incentive compensation and contributions to employee benefit plans, are
excluded from the definition of compensation. The Pension Plan credits
compensation only up to the limit of covered compensation under Section
401(a)(17) of the Code; the CESP does not impose this limit on covered
compensation. The definition of "covered compensation" under the Pension Plan
and the CESP, in the aggregate, is not substantially different from the amount
reflected in the Annual Compensation column of the Summary Compensation Table
set forth above. The estimates of annual retirement benefits reflected in such
table are based on payment in the form of a straight-life annuity and are
determined after offsetting benefits payable from Social Security as provided
under the terms of the Pension Plan and the CESP.

Compensation Committee Interlocks and Insider Participation

The Compensation Committee consists of Robert F. Erburu (Chair), Janet
Morrison Clarke and Andrew J. Young, all of whom are independent directors of
the Company.

13
<PAGE>

Performance Graph

The following graph compares, for the period beginning on February 1, 1995,
the date the Company's stock first became publicly traded on the New York
Stock Exchange, and ending on December 31, 1997, the cumulative total return
of the Company's Class A Common Stock to the cumulative total returns on
Standard & Poor's 500 Stock Index and Standard & Poor's Broadcast Media Index.
The comparison assumes $100 was invested on February 1, 1995 in the Company's
Class A Common Stock and in each of the foregoing indices and that all
dividends were reinvested.

COX S&P 500 S&P BROADCAST
------ ------- -------------
<S> <C> <C> <C>
2/1/95 100.00 100.00 100.00
Jun-95 102.65 117.17 119.87
Dec-95 103.31 134.10 133.22
Jun-96 114.57 147.64 121.87
Dec-96 121.85 164.89 109.20
Jun-97 126.46 198.87 123.74
Dec-97 211.10 219.90 179.59

</TABLE>

14
<PAGE>

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

COMPENSATION POLICIES

The Compensation Committee ("Committee") administers compensation for
executive officers. The Committee believes it serves the stockholders well by
administering executive pay programs that are competitive with cable industry
standards, variable with annual performance, and focused on stockholder value.

In developing compensation plans and reviewing compensation levels, the
Committee reviews competitive compensation data provided in the Towers Perrin
Annual Media Industry Survey: Cable Industry Segment. This survey is based
upon an examination of total compensation levels at thirteen companies with
which the Company competes for talent in the marketplace. Where necessary,
survey information is supplemented by proxy statement analysis. All the
companies included in the S&P Broadcast Media Index shown in the Performance
Graph are used in this competitive review.

EXECUTIVE OFFICERS' COMPENSATION

The total compensation of executive officers consists of three components:
1) base salary; 2) annual incentive compensation; and 3) long-term incentive
awards. The philosophy of the Committee is that a substantial portion of total
compensation should be at risk based on the financial and operational
performance of the Company. The at-risk components of total compensation are
progressively greater for higher level positions.

BASE SALARY

Base salary is designed to provide meaningful levels of compensation to
executives, while helping the Company manage its fixed costs. Salaries for top
executives are determined annually, and are based on job scope and
responsibilities; length of service; corporate, unit, and individual
performance; competitive rates for similar positions as indicated by the
Towers Perrin Media Industry Survey; and subjective factors. In general,
executive base salaries are targeted to the 75th percentile of the competitive
data. The 1997 base salaries for the Named Executive Officers were
approximately at the targeted 75th percentile of the competitive data.

ANNUAL INCENTIVE COMPENSATION

Short-term incentives for 1997 were provided for executive officers under
the "Annual Incentive Program." Participation in the Annual Incentive Program
is limited to a group of senior managers, including the Named Executive
Officers other than Mr. Robbins, who have a material impact on Company
performance. Awards earned under the Program are contingent upon employment
with the Company through the end of the year, except for payments made in the
event of death, retirement, disability, or in the event of a change in
control. Subject to the approval of the stockholders of the Company, short-
term incentives will be provided to Mr. Robbins under the Cox Communications,
Inc. Annual Incentive Plan (the "AIP"). See--Chief Executive Officer
Compensation.

Payouts under the Annual Incentive Program for 1997 were calculated under a
formula based on (a) annual base salary; (b) a specific percentage of base
salary, which increases for higher level positions commensurate with the
greater percentage of compensation at risk for those with greater
responsibilities; and (c) actual performance in the area of operating cash
flow. In addition, the Committee's judgment as to the participant's
contribution to results during the year is considered, and a discretionary
award in the form of restricted stock may be made.

Awards under the Annual Incentive Program are based on the achievement of
goals relating to performance in the fiscal year. Objective performance goals
are set to represent a range of performance, with the level of the associated
incentive award varying with different levels of performance achievement. The
"minimum" goal is set to reflect the minimum acceptable levels of performance
which will warrant payment of incentive awards. The "maximum" goal reflects an
ambitious level of performance which would only be attainable in an
outstanding year.

15
<PAGE>

LONG-TERM INCENTIVE COMPENSATION

Long-term incentives generally are provided through the issuance of non-
qualified stock options for the Company's Class A Common Stock under the LTIP.
A stock option permits the holder to buy Company stock at a specific price
during a specific period of time. If the price of Company stock rises, the
option increases in value. The intent of such awards is to provide the
recipient with an incentive to perform at levels that will result in better
Company performance and enhanced stock value. In general, stock option awards
are issued annually with an exercise price equal to the market price of the
Company's Class A Common Stock at the time of award.

All options issued in 1995, 1996 and 1997 have a ten-year term. To encourage
continued employment with the Company, these options were designed to vest
over a five-year period, with 60% becoming exercisable three years after the
date of grant and an additional 20% becoming exercisable each year thereafter,
except that, if the stock price achieved, and maintained for a period of ten
consecutive trading days, a level equal to or greater than 140 percent of the
price on the grant date, vesting would accelerate and these options would
become fully exercisable. Due to the performance of the Company's stock price
during 1997, all options issued in 1995, 1996 and 1997 have vested.

To ensure that executive officers and key management employees retain
significant holdings in the Company, the Committee encourages them to own
Company stock with a value equal to one to three times their base salary,
depending upon their position. For purposes of these guidelines, an employee's
holdings include the Company's Class A Common Stock (excluding restricted
stock and shares subject to unexercised options) and Cox Enterprises, Inc.'s
common stock received as prior UAP awards.

CHIEF EXECUTIVE OFFICER COMPENSATION

The executive compensation policy described above is applied in establishing
Mr. Robbins' compensation each year, except that subject to the approval of
the stockholders of the Company, Mr. Robbins' annual bonus will be determined
in accordance with the terms of the AIP. Under the AIP, the amount of Mr.
Robbins annual bonus for fiscal year 1997 will depend on the percentage of the
Operating Cash Flow Budget (as defined in the AIP) achieved by the Company for
the fiscal year in accordance with pre-established performance goals
determined by the Committee. The AIP is designed so that awards payable
thereunder will be deductible by the Company under Section 162(m) of the Code
as "performance-based compensation." See--Approval of Annual Incentive Plan.
Except for the AIP, Mr. Robbins' participated in the same executive
compensation plans available to the Company's other executive officers.

In 1997, Mr. Robbins had a base salary of $642,000. On the basis of the
Company's performance versus established goals, the Committee has determined
that Mr. Robbins' has earned a bonus under the AIP for fiscal year 1997 of
$353,100. Subject to the approval of the AIP by the stockholders of the
Company, this bonus will be paid to Mr. Robbins in the form of an award of
restricted stock to be granted on the date such approval is obtained. The
number of shares of stock issued under the restricted stock award will be
determined by dividing $353,100 by the closing price of Class A Common Stock
on the date of grant, with any fractional shares being paid in cash. Mr.
Robbins' interest in this restricted stock award will not vest until five
years from the date of grant, provided he remains employed by the Company as
of such date. Effective January 1, 1997, Mr. Robbins was also granted long-
term incentive awards under the LTIP in the form of options for 103,000 shares
of Class A Common Stock.

16
<PAGE>

Tax Deductibility Considerations

Section 162(m) of the Internal Revenue Code limits the deductibility of
compensation in excess of $1 million paid to the executive officers named in
this proxy statement, unless certain requirements are met. It is the present
intention of the Compensation Committee of the Company to preserve the
deductibility of compensation under Section 162(m) to the extent the Committee
believes that doing so would be consistent with the best interests of
stockholders. As such, long-term incentive compensation awards, particularly
stock option awards, are designed to meet the requirements for deductibility
under Section 162(m) as are bonus payments under the AIP.

Robert F. Erburu (Chair)
Janet Morrison Clarke
Andrew J. Young

CERTAIN TRANSACTIONS

CEI performs day-to-day cash management services for the Company, with
settlements of debit or credit balances between the Company and CEI occurring
periodically at market interest rates. The amounts due to CEI are generally
due on demand and represent the net of various transactions. The amounts due
to CEI as of January 31, 1998 were approximately $29.4 million. CEI provides
certain other management services to the Company, including legal, corporate
secretarial, tax, cash management, internal audit, risk management, employee
benefit (including pension plan) administration and other support services.
The Company was allocated expenses for the year ended December 31, 1997 of
approximately $2.8 million related to these services. The Company pays rent
and certain other occupancy costs to CEI for its home office facilities.
Related rent and occupancy expense for the year ended December 31, 1997 was
approximately $3.8 million. Allocated expenses are based on CEI's estimate of
expenses relative to the services provided to other subsidiaries of CEI. Rent
and occupancy expense is allocated based on occupied space. Management
believes that these allocations were made on a reasonable basis. However, the
allocations are not necessarily indicative of the level of expenses that might
have been incurred had the Company operated on a stand-alone basis. Management
has not made a study or any attempt to obtain quotes from third parties to
determine what the cost of obtaining such services from third parties would
have been. The fees and expenses to be paid by the Company to CEI are subject
to change.

The Company pays fees to certain entities in which it has an ownership
interest in exchange for cable television programming. Programming fees paid
to such affiliates for the year ended December 31, 1997 were approximately
$30.2 million.

The Company's accounts will be included in the consolidated federal income
tax return of CEI so long as such consolidation is advantageous to both CEI
and the Company, and is permitted under applicable laws and regulations. The
Company has entered into a tax sharing agreement with CEI to, among other
things, provide that current federal (and, if applicable, state) income tax
expenses and benefits are allocated on a separate return basis to the Company
based on the current year tax effects of the inclusion of its income, expenses
and credits in the consolidated income tax returns of CEI (or, if applicable,
based on separate state income tax returns).

CEI and the Company, through subsidiaries, have formed a partnership (the
"Cox Pioneer Partnership") to own the two companies' joint interest in a
personal communications services ("PCS") system in the Los Angeles-San Diego
major trading area ("MTA"). Cox Pioneer Partnership is owned approximately 78%
by the Company and approximately 22% by CEI. The Company and CEI will make
capital contributions to Cox Pioneer Partnership in proportion to their
percentage interests. In December 1996, pursuant to previous agreements, Cox
Pioneer Partnership and Sprint Spectrum Holding Company L.P. (a partnership of
the Company, Tele-Communications, Inc., Comcast Corporation and Sprint
Corporation) formed Cox

17
<PAGE>

Communications PCS, L.P. ("PioneerCo") to operate the PCS system in the Los
Angeles-San Diego MTA. PioneerCo is currently owned 49% by Sprint Spectrum
Holding Company L.P. as limited partner and 51% by Cox Pioneer Partnership as
general partner. In March 1997, upon approval from the FCC, the Company
transferred the PCS license for the Los Angeles-San Diego MTA to PioneerCo and
PioneerCo assumed the related obligation to the FCC of $251.9 million. The
December 1996 formation of PioneerCo and the March 1997 transfer of the
license and obligation resulted in the Company recording $36.5 million as a
capital contribution from CEI.

In February 1998, Cox Pioneer Partnership exercised its right under the
PioneerCo partnership agreement to sell a portion of its interest in PioneerCo
to Sprint Spectrum Holding Company L.P. Upon the consummation of this sale,
which will occur following the receipt of required regulatory approvals,
PioneerCo will be owned 59.2% by Sprint Spectrum Holding Company L.P. as
general partner and limited partner and 40.8% by Cox Pioneer Partnership as
general partner. The net proceeds of the sale will be allocated between the
Company and CEI in accordance with the partnership agreement of Cox Pioneer
Partnership.

The Company has agreed to enter into a series of local joint ventures with
Cox Interactive Media, Inc. ("CIM"), an indirect, wholly-owned subsidiary of
CEI, to develop, operate and promote advertising supported local Internet
content or "City Sites" in the markets where the Company operates cable
television systems featuring high speed Internet access. The Company is a 49%
equity holder in the joint ventures, has committed to contribute approximately
$5.14 million in the aggregate and has agreed to certain non-compete
provisions. CIM is a 51% equity holder in the joint ventures and is
responsible for day to day operations of the joint ventures.

SELECTION OF INDEPENDENT AUDITORS
(PROPOSAL NO. 2)

The Board of Directors has selected the firm of Deloitte & Touche LLP,
independent certified public accountants, as independent auditors of the
Company for the year ending December 31, 1998. Deloitte & Touche LLP has
audited the financial statements of the Company since the fiscal year ending
December 31, 1995. Deloitte & Touche LLP (or its predecessors) has audited the
financial statements of CEI for many years.

Ratification of this appointment shall be effective upon receiving the
affirmative vote of the holders of a majority of the voting power of the
Company's Class A Common Stock and Class C Common Stock present or represented
by proxy and entitled to vote at the Annual Meeting.

A representative of Deloitte & Touche LLP will be present at the Annual
Meeting, will be offered the opportunity to make a statement if he desires to
do so, and will be available to respond to appropriate questions. In the event
the appointment is not ratified, the Board of Directors will consider the
appointment of other independent auditors.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSAL.

APPROVAL OF THE
ANNUAL INCENTIVE PLAN
(PROPOSAL NO. 3)

The Compensation Committee of the Board of Directors (the "Committee") has,
subject to the approval by the stockholders of the Company at the 1998 Annual
Meeting, adopted the Cox Communications, Inc. Annual Incentive Plan (the
"AIP") on March 24, 1997, Amendment Number One to the AIP on December 16, 1997
and Amendment Number Two to the AIP on March 12, 1998 (See Exhibit A to this
Proxy Statement). The

18
<PAGE>

purpose of the AIP is to encourage and to reward the performance of certain
senior management employees of
the Company, to encourage the continued employment and dedication of such
employees and to afford such employees the opportunity to participate in the
financial success of the Company. The AIP is designed and is to be
administered so that awards payable thereunder will be deductible by the
Company under Section 162(m) of the Code as "performance-based compensation"
within the meaning of that Code Section.

If approved by the stockholders, the AIP will be administered by the
Committee which will have the discretionary authority to interpret the
provisions of the Plan, including all decisions on eligibility to participate,
the establishment of payment targets and the amount of awards payable under
the terms of the Plan. The Committee will have the sole discretionary
authority to reduce or eliminate the amount of an award otherwise payable to a
participant under the terms of the Plan. The decisions of the Committee will
be final and binding on all parties.

If approved by the stockholders, the employees eligible to participate in
the AIP for any Plan Year will be James O. Robbins and any other senior
management employee of the Company that is designated by the Committee as a
participant for that Plan Year. As of the date of this Proxy Statement,
approximately 25 persons are in the class of employees eligible for selection
for Plan participation. The Plan Year under the AIP is the calendar year. For
Plan Year 1997, the only participant in the AIP will be Mr. Robbins.

If the AIP is approved by the stockholders, for the 1997 Plan Year, the
amount of the award payable to a participant under the AIP will be based on
the percentage of the Operating Cash Flow Budget achieved by the Company in
accordance with preestablished performance goals determined by the Committee.
Under the AIP, the "Operating Cash Flow Budget" means the targeted level of
Operating Cash Flow established by the Board of Directors for the Company and
ratified by the Committee for use in determining the amount of awards payable
under the AIP. "Operating Cash Flow" means the operating income of the Company
and its subsidiaries increased by amortization and depreciation. The Operating
Cash Flow achieved for any Plan Year will be determined by the Company's
independent auditors in accordance with generally accepted accounting
principles.

In March 1997, the Committee established a schedule of Operating Cash Flow
Budget Percentages and corresponding Earned Target Percentages to be used to
calculate the amount of the award payable to Mr. Robbins, the sole participant
for the 1997 Plan Year, assuming that the AIP is approved by the stockholders.
The amount of the award payable to the participant will be equal to the
participant's Target Bonus multiplied by the participant's Earned Target
Percentage for the Plan Year. The Earned Target Percentage for the 1997 Plan
Year will be determined from the schedule based on the Operating Cash Flow
Budget Percentage achieved by the Company for the 1997 Plan Year. For the 1997
Plan Year, Mr. Robbins' "Target Bonus" will be equal to 40 percent of the rate
of the participant's base compensation in effect as of January 1, 1997,
assuming that the AIP is approved by the stockholders.

For each Plan Year beginning on or after January 1, 1998, the amount of the
award payable to a participant under the AIP will be based on the percentage
of the Operating Cash Flow Budget and the percentage of the Revenue Budget
achieved by the Company in accordance with preestablished performance goals
determined by the Committee. Under the AIP, the "Revenue Budget" means the
targeted level of Revenue established by the Board of Directors for the
Company and ratified by the Committee for use in determining the amount of
awards payable under the AIP. "Revenue" means the gross amount of billings to
customers for telecommunications services and other income. The Revenue
achieved for any Plan Year will be determined by the Company's independent
auditors in accordance with generally accepted accounting principles.

No later than March 31 of each Plan Year beginning on or after January 1,
1998, the Committee will establish for each participant a matrix of Operating
Cash Flow Budget Percentages, Revenue Budget Percentages and Earned Target
Percentages (the "Incentive Compensation Matrix") to be used to calculate the
amount of the award payable to the participant for the Plan Year. The amount
of the award payable to the participant will

19
<PAGE>

be equal to the participant's Target Bonus multiplied by the participant's
Earned Target Percentage for the Plan Year. The Earned Target Percentage for
the Plan Year will be determined from the Incentive Compensation Matrix based
on the Operating Cash Flow Percentage and Revenue Budget Percentage achieved
by the Company for the Plan Year. For each Plan Year beginning on or after
January 1, 1998, a participant's "Target Bonus" will be equal to 50 percent of
the rate of the participant's base compensation in effect as of the January 1
of the Plan Year.

If a participant terminates employment or dies during a Plan Year, then the
participant or the participant's beneficiary will be entitled to a pro rata
share of the award otherwise payable under the Annual Incentive Plan, based on
the number of days the participant was employed during the Plan Year.

At the sole discretion of the Committee, awards payable under the AIP will
be distributed either: (1) in a lump sum cash payment; (2) in the form of
shares of common stock of the Company, which shares may be subject to
restrictions determined by the Committee that impose a risk of forfeiture; or
(3) some combination of cash and common stock. In the event any distribution
is made in the form of common stock, the value of the common stock so issued
may not exceed the total amount of the distribution to be made under the Plan,
and the value of any fractional shares will be paid in cash. Distributions for
any Plan Year under the AIP will be made within a reasonably practicable
period of time after the end of the Plan Year; provided, that no award will
become payable to a participant for any Plan Year until the Committee has
certified in writing that the terms and conditions underlying the payment of
the award have been satisfied.

The Committee has the right to amend or terminate the AIP at any time;
provided that no such amendment may retroactively reduce the amount of an
award already accrued to the benefit of any participant prior to the effective
date of the amendment or the termination of the Plan.

The following chart shows the benefits to be provided to Mr. Robbins, the
sole participant under the AIP for the 1997 Plan Year. However, no awards
shall be payable under the AIP unless and until the Plan is approved by the
stockholders at the 1998 Annual Meeting.

NEW PLAN BENEFITS

<TABLE>
<S> <C>
NAME AND POSITION ANNUAL INCENTIVE PLAN
----------------- DOLLAR VALUE ($)
---------------------
James O. Robbins $353,100
President and Chief
Executive Officer
</TABLE>

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
ANNUAL INCENTIVE PLAN.

OTHER MATTERS

Management does not know of any other matters to be considered at the Annual
Meeting. If any other matters do properly come before the meeting, persons
named in the accompanying form of proxy intend to vote thereon in accordance
with their best judgment, and the discretionary authority to do so is included
in the Proxy.

ANNUAL REPORT ON FORM 10-K

The Company's Annual Report on Form 10-K, as filed with the Securities and
Exchange Commission, is being delivered to stockholders with this Proxy
Statement.

20
<PAGE>

SUBMISSION OF STOCKHOLDER PROPOSALS

It is anticipated that the 1999 Annual Meeting of Stockholders of the
Company will be held in April 1999. Any stockholders who intend to present
proposals at the 1999 Annual Meeting of Stockholders, and who wish to have
such proposal included in the Company's Proxy Statement for the 1999 Annual
Meeting, must ensure that such proposals are received by the Corporate
Secretary of the Company not later than November 24, 1998. Such proposals must
meet the requirements set forth in the rules and regulations of the Securities
and Exchange Commission in order to be eligible for inclusion in the Company's
1999 proxy materials.

By Order of the Board of Directors

/s/ Andrew A. Merdek
Andrew A. Merdek
Corporate Secretary
Atlanta, Georgia
March 23, 1998

21
<PAGE>

EXHIBIT A

COX COMMUNICATIONS, INC.
ANNUAL INCENTIVE PLAN

This Plan is adopted, effective as of January 1, 1997, on behalf of Cox
Communications, Inc. ("Cox") for the benefit of designated senior management
employees of Cox.

WHEREAS, Cox desires to encourage and to reward certain senior management
employees' performance, to encourage such employees' continued employment and
dedication and to afford such employees the opportunity to participate in the
financial success of Cox.

NOW, THEREFORE, the Committee, as defined below, establishes this Annual
Incentive Plan on behalf of Cox under the following terms:

1. DEFINITIONS

For purposes of this Plan, the following terms shall have the meanings set
forth below:

(a) "Award" means the amount of cash bonus payable under the Plan to a
Participant with respect to a Plan Year.

(b) "Board" means the Board of Directors of Cox.

(d) "Earned Target Percentage" means the percentage of the Target Bonus
that is earned and payable to a Participant under the provisions of the
Plan with respect to a Plan Year, which is based on the Operating Cash Flow
Budget Percentage achieved by Cox for the Plan Year.

(e) "Operating Cash Flow" means the operating income of Cox and its
subsidiary businesses increased by amortization and depreciation. Operating
Cash Flow with respect to any Plan Year shall be calculated by Cox's
independent auditors, in accordance with generally accepted accounting
principles.

(f) "Operating Cash Flow Budget" means the targeted level of Operating
Cash Flow established by the Board and ratified by the Committee with
respect to a Plan Year that will be used under the Plan to determine the
amount of an Award payable to the Participants for that Plan Year.

(g) "Operating Cash Flow Budget Percentage" means the percentage of the
Operating Cash Flow Budget achieved with respect to a Plan Year.

(h) "Participant" means James O. Robbins or any other senior management
employee of Cox designated as a Participant by the Committee.

(i) "Plan" means the Cox Communications, Inc. Annual Incentive Plan, as
amended from time to time.

(j) "Plan Year" means the calendar year.

(k) "Target Bonus" means, for any Plan Year, an amount of cash bonus
equal to 40 percent of the rate of a Participant's base compensation in
effect as of January 1 of such Plan Year.

2. ADMINISTRATION

The Plan shall be administered by the Committee, which shall have the
discretionary authority to interpret the provisions of the Plan, including all
decisions on eligibility to participate, the establishment of payment targets
and the amount of Awards payable under the Plan. The intention of Cox and the
Committee is to administer the Plan in compliance with Section 162(m) of the
Internal Revenue Code (the "Code") so that Awards paid under the Plan will be
treated as performance-based compensation, as that term is defined in
Code Section 162(m)(4)(C). The decisions of the Committee shall be final and
binding on all parties.

A-1
<PAGE>

3. ESTABLISHMENT OF EARNED TARGET PERCENTAGE

With respect to each Plan Year, the Committee shall establish a schedule of
Operating Cash Flow Budget Percentages and corresponding Earned Target
Percentages, which schedule is to be used to calculate the amount of the
Awards payable to any Participants. This schedule shall determine the Earned
Target Percentage based directly on the level of Operating Cash Flow Budget
Percentage achieved for a Plan Year. The Operating Cash Flow Budget Percentage
schedule for each Plan Year shall be established in writing by the Committee
no later than March 31 of such Plan Year.

4. CALCULATION OF AWARD

(a) With respect to each Plan Year, the amount of an Award payable to any
Participant will be calculated by multiplying the Participant's Target Bonus
by the Earned Target Percentage for such Plan Year.

(b) If a Participant either terminates employment, including on account of
retirement or disability, or dies during a Plan Year, then the Participant, or
the Participant's beneficiary, shall be entitled to receive a pro rata share
of the Award otherwise payable thereto with respect to the Plan Year. The
amount of the pro rata Award payable under this Paragraph 4(b) shall be
determined by multiplying the Award otherwise payable under the Plan by a
fraction, the numerator of which is the number of days during the Plan Year
that the Participant was employed preceding the date of termination or death
and the denominator of which is 365.

(c) Notwithstanding any provisions of the Plan to the contrary, the
Committee reserves the right, in its sole discretion, to reduce or eliminate
the amount of an Award otherwise payable to a Participant with respect to a
Plan Year.

5. DISTRIBUTIONS

(a) Distribution of each Award shall be made by Cox in a lump sum cash
payment and shall occur within a reasonably practicable period of time after
the end of the Plan Year in which the Participant has earned the Award;
provided, that no Award shall become payable to a Participant with respect to
any Plan Year until the Committee has certified in writing that the terms and
conditions underlying the payment of such Award have been satisfied. If a
Participant entitled to the payment of an Award under the Plan dies prior to
the distribution of such Award, the distribution shall be made to the
Participant's beneficiary, as designated under the Plan, within the same time
period in which the Award otherwise would have been paid to the Participant.

(b) Notwithstanding any provisions of the Plan to the contrary, no Award
shall be payable to a Participant with respect to the Plan Year commencing on
January 1, 1997 unless and until the Plan is approved by the majority vote of
the shareholders of Cox voting with respect to the approval of the Plan in
accordance with applicable Federal securities laws.

6. DESIGNATION OF BENEFICIARIES

Each Participant may designate in writing and deliver to Cox the name and
address of the person or persons to whom an Award remaining payable under this
Plan shall be paid in the event of the Participant's death. If the Participant
has failed to make and deliver such a designation to Cox, or if no person so
designated survives the Participant, then Cox shall pay such an Award to the
Participant's lawful spouse, if then living, or, if not then living, equally
to the Participant's then living children, or, if none survive the
Participant, to the Participant's estate.

7. LIMITATION ON CLAIM FOR BENEFITS

Participants shall look solely to Cox for satisfaction of a claim for an
Award under this Plan. In no event shall the Board or any director, officer,
employee, or agent of Cox, including members of the Committee, be liable in
its, his or her individual capacity to any person whomsoever for the payment
of a benefit under this Plan. All payments under this Plan shall be made from
Cox's general assets, and no person under any

A-2
<PAGE>

circumstances whatsoever shall have a claim for a benefit or payment under
this Plan which is superior in any manner whatsoever to an unsecured claim for
a payment by a general creditor of Cox.

8. WITHHOLDING ON BENEFIT PAYMENTS

Notwithstanding any other provisions of the Plan, Cox shall be entitled to
withhold from each Award paid under this Plan such amounts as are required by
applicable state or Federal law or the order of any court.

9. NO ALIENATION, ASSIGNMENT OR OTHER RIGHTS

Neither the Participant nor the person(s) designated as the Participant's
beneficiaries shall have any right whatsoever to alienate, commute, anticipate
or assign (either at law or in equity) all or any portion of any Award payable
under this Plan.

10. GOVERNING LAW

This Plan shall be interpreted under the laws of the State of Georgia, to
the extent not preempted by Federal law.

11. SAVINGS CLAUSE

If any provision of this Plan is held invalid or unenforceable, it will not
affect the other provisions. The Plan will remain in effect as though the
invalid or unenforceable provisions were omitted.

12. AMENDMENT AND TERMINATION

The Committee reserves the right to amend or terminate this Plan at any
time; provided, that no such amendment or termination shall retroactively
reduce the amount of an Award already accrued to the benefit of any
Participant prior to the effective date of the amendment or the termination of
the Plan.

AMENDMENT NUMBER ONE
TO THE
COX COMMUNICATIONS, INC.
ANNUAL INCENTIVE PLAN

Pursuant to the authority of the Compensation Committee of the Board of
Directors of Cox Communications, Inc. to amend the Cox Communications, Inc.
Annual Incentive Plan (the "Plan"), in accordance with the provisions of
Section 12 thereof, the Plan hereby is amended as follows:

Section 5(a) of the Plan shall be amended by deleting the same in its
entirety and by substituting therefor the following:

"(a) At the sole discretion of the Committee, distribution of each Award
shall be made by Cox either (1) in a lump sum cash payment, (2) in the form
of shares of common stock of Cox, which shares may be subject to certain
restrictions upon issue that impose a risk of forfeiture or (3) some
combination of cash and common stock; provided, that the issuance of shares
of common stock may be made only to the extent permissible under applicable
securities laws. In the event any distribution is made in the form of
Cox common stock, the value of the common stock so issued may not exceed
the total amount of the distribution to be made under this Plan, and the
value of any fractional shares of common stock shall be distributed in
cash. The Committee, acting in its sole discretion, may determine the terms
and conditions of

A-3
<PAGE>

restrictions, if any, that shall be applied to the common stock issued
hereunder. Any distribution made under this Plan shall occur within a
reasonably practicable period of time after the end of the Plan Year in
which the Participant has earned the Award; provided, that no Award shall
become payable to a Participant with respect to any Plan Year until the
Committee has certified in writing that the terms and conditions underlying
the payment of such Award have been satisfied. If a Participant entitled to
the payment of an Award under the Plan dies prior to the distribution of
such Award, the distribution shall be made to the Participant's
beneficiary, as designated under the Plan, within the same time period in
which the Award otherwise would have been paid to the Participant."

This Amendment Number One shall be effective as of January 1, 1997.

AMENDMENT NUMBER TWO
TO THE
COX COMMUNICATIONS, INC.
ANNUAL INCENTIVE PLAN

Section 1(d) of the Plan shall be amended by deleting the same in its
entirety and by substituting therefor the following:

"(d) "Earned Target Percentage" means the percentage of the Target Bonus
that is earned and payable to a Participant under the provisions of the
Plan with respect to a Plan Year, which is based on the Operating Cash Flow
Budget Percentage achieved by Cox for the Plan Year and, for any Plan Year
beginning on or after January 1, 1998, the Revenue Budget Percentage
achieved by Cox for the Plan Year."

New Section 1(k) shall be added to the Plan as follows:

"(k) "Revenue" means the gross amount of billings to customers for
telecommunications services and other income. Revenue with respect to any
Plan Year shall be calculated by Cox's independent auditors, in accordance
with generally accepted accounting principles."

New Section 1(l) shall be added to the Plan as follows:

"(l) "Revenue Budget" means the targeted level of Revenue established by
the Board and ratified by the Committee with respect to a Plan Year that
will be used under the Plan to determine the amount of an Award payable to
the Participants for that Plan Year."

New Section 1(m) shall be added to the Plan as follows:

"(m) "Revenue Budget Percentage" means the percentage of the Revenue
Budget achieved with respect to a Plan Year."

A-4
<PAGE>

Section 1(k) shall be amended by redesignating such Section as Section 1(n)
and by deleting the same in its entirety and by substituting therefor the
following:

"(k) "Target Bonus" means for the Plan Year beginning January 1, 1997, an
amount of cash bonus equal to 40 percent of the rate of a Participant's
base compensation in effect as of January 1, 1997, and for any Plan Year
beginning on or after January 1, 1998, an amount of cash bonus equal to 50
percent of the rate of a Participant's base compensation in effect as of
January 1 of such Plan Year."

Section 3 of the Plan shall be amended by deleting the same in its entirety
and by substituting therefor the following:

"(a) With respect to the Plan Year beginning on January 1, 1997, the
Committee shall establish a schedule of Operating Cash Flow Budget
Percentages and corresponding Earned Target Percentages, which schedule is
to be used to calculate the amount of the Award payable to a Participant
for such Plan Year. This schedule shall determine the Participant's Earned
Target Percentage for such Plan Year based directly on the level of
Operating Cash Flow Budget Percentage achieved for such Plan Year. The
Operating Cash Flow Budget Percentage schedule for such Plan Year shall be
established in writing by the Committee no later than March 31, 1997.

(b) With respect to each Plan Year beginning on or after January 1, 1998,
the Committee shall establish a matrix of Operating Cash Flow Budget
Percentages, Revenue Budget Percentages and Earned Target Percentages (the
"Incentive Compensation Matrix"), which Incentive Compensation Matrix is to
be used to calculate the amount of the Award payable to a Participant for
the Plan Year. The Incentive Compensation Matrix shall determine the
Participant's Earned Target Percentage for the Plan Year based directly on
the level of Operating Cash Flow Budget Percentage and Revenue Budget
Percentage achieved for the Plan Year. The Incentive Compensation Matrix
for each Plan Year shall be established in writing by the Committee no
later than March 31 of such Plan Year."

Section 5(b) of the Plan shall be amended by adding thereto the following
new sentence:

"The Committee reserves the right to precondition the payment of an Award
with respect to any Plan Year beginning on or after January 1, 1998 on the
prior approval of a majority vote of the shareholders of Cox."

This Amendment Number Two shall be effective as of January 1, 1998.

A-5
<PAGE>

P R O X Y

[LOGO OF COX COMMUNICATIONS APPEARS HERE]

Proxy Solicited on Behalf of the Board of Directors of Cox Communications, Inc.
for Annual Meeting on April 24, 1998

The UNDERSIGNED hereby appoints James O. Robbins, Andrew A. Merdek and
Jimmy W. Hayes, or any of them, and any substitute or substitutes, to be the
attorneys and proxies of the undersigned at the Annual Meeting of Stockholders
of Cox Communications, Inc. ("Cox") to be held at 9:00 a.m. local time on
Friday, April 24, 1998, at Corporate Headquarters at 1400 Lake Hearn Drive, NE,
Atlanta, Georgia, or at any adjournment thereof, and to vote at such meeting the
shares of stock of Cox the undersigned held of record on the books of Cox on
March 10, 1998, the record date for the meeting. The undersigned hereby revokes
any previous proxies with respect to the matters covered by this proxy.

(change of address/comments)

Election of Directors, Nominees:
--------------------------
James C. Kennedy, Janet Morrison Clarke,
--------------------------
John R. Dillon, David E. Easterly,
Robert F. Erburu,
--------------------------
James O. Robbins, Andrew J. Young.
--------------------------

Independent Auditors: (if you have written in the
Deloitte & Touche LLP above space, please mark the
corresponding box on the
reverse side of this card)

You are encouraged to specify your choices by marking the appropriate
boxes, SEE REVERSE SIDE, but you need not mark any boxes if you wish to
vote in accordance with the Board of Directors' recommendations. The
proxies cannot vote your shares unless you sign and return this card.

------------
SEE REVERSE
SIDE
------------

<PAGE>

- -------------------------------------------------------------------------------
Please mark your 5249
[X] votes as in this
example.

This proxy when properly executed will be voted in the manner directed
herein. If no direction is made, this proxy will be voted FOR proposals 1,2 and
3.
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The Board of Directors recommends a vote FOR proposals 1,2 and 3. --------
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FOR WITHHELD
1. Election of Directors. [_] [_]
(see reverse)

For, except vote withheld from the following nominee(s):

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FOR AGAINST ABSTAIN
2. Ratification of
appointment of [_] [_] [_]
independent
auditors.

3. Approval of
Annual [_] [_] [_]
Incentive Plan

4. In the discretion of the Change of Address/
proxies named herein, the Comments on [_]
proxies are authorized Reverse Side
to vote upon other matters
as are properly brought
before the meeting. I plan to attend
the meeting. [_]

All as more particularly described in the Proxy Statement relating to such
meeting, receipt of which is hereby acknowledged.

Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.

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

- ----------------------------------
SIGNATURE(S) DATE

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FOLD AND DETACH HERE

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