def14a
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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Filed by the Registrant þ |
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Filed by a Party other than the Registrant o |
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Check
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the appropriate box: |
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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þ
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to § 240.14a-12 |
COMCAST CORPORATION
(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):
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þ |
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No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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(1) |
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Title of each class of securities to which transaction applies: |
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(2) |
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Aggregate number of securities to which transaction applies: |
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(3) |
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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): |
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(4) |
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Proposed maximum aggregate value of transaction: |
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(5) |
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Total fee paid: |
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Fee paid previously with preliminary materials: |
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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. |
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(1 |
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Amount Previously Paid: |
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Form, Schedule or Registration Statement No.: |
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Filing Party: |
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Date Filed: |
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Notice of 2006 Annual Meeting of Shareholders of Comcast
Corporation
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Date:
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May 18, 2006 |
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Time:
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Doors open: |
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8:00 a.m. Eastern Time |
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Meeting begins: |
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9:00 a.m. Eastern Time |
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Place:
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Wachovia Complex
3601 South Broad Street
Philadelphia, Pennsylvania 19148 |
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Purposes:
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Elect directors |
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Ratify the appointment of our independent
auditors |
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Approve our employee stock purchase plan, as
amended and restated |
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Approve our restricted stock plan, as amended
and restated |
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Approve our 2006 cash bonus plan |
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Vote on five shareholder proposals |
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Conduct other business if properly raised |
All shareholders are cordially invited to attend the meeting.
Travel directions can be found on page 54 of the attached
proxy statement. At the meeting you will hear a report on our
business and have a chance to meet our directors and executive
officers. Our 2005 Annual Report is enclosed.
Only shareholders of record on March 10, 2006 may vote at
the meeting. Attendance at the meeting is limited to
shareholders and one guest.
Your vote is important. Please vote your shares promptly. To
vote your shares, you can use the Internet or call the toll-free
telephone number as described in the proxy statement and on your
proxy card, or complete, sign, date and return your proxy
card.
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ARTHUR R. BLOCK |
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Secretary |
March 24, 2006
TABLE OF CONTENTS
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A-1 |
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B-1 |
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C-1 |
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i
PROXY STATEMENT
GENERAL INFORMATION
Holders of record of our Class A and Class B common
stock at the close of business on March 10, 2006 may vote
at the annual meeting. Holders of our Class A Special
common stock are not entitled to vote at the meeting. This proxy
statement is being sent to holders of Class A Special
common stock for informational purposes only. This proxy
statement and the enclosed proxy card are being mailed to our
shareholders beginning on or about March 31, 2006.
You may vote in person at the meeting or by proxy. We recommend
that you vote by proxy even if you plan to attend the meeting.
You can always change your vote at the meeting.
Our Board of Directors is asking for your proxy. Giving us your
proxy means you authorize us to vote your shares at the meeting
in the manner you direct. You may vote for all, some or none of
our director candidates. You may also vote for or against the
other proposals, or abstain from voting.
If you are a registered shareholder (meaning your name is
included on the securityholder file maintained by our transfer
agent, Computershare Trust Company, N.A., whether you hold your
shares in book-entry through Computershare or in certificated
form), you can vote by proxy in any of the following ways:
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Via the Internet: Go to www.investorvote.com/cmc and
follow the instructions outlined on the secure Internet site. |
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By telephone: Call toll free
1-800-652-8683 and
follow the instructions provided on the recorded message. |
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In writing: Complete, sign, date and return your proxy
card in the enclosed envelope. |
If you vote via the Internet or by telephone, your vote must be
received by 5:00 p.m. Eastern Time on May 17, 2006.
If you give us your signed proxy but do not specify how to vote,
we will vote your shares in favor of the director candidates,
the ratification of the appointment of our independent auditors,
the approval of each of our 2002 Employee Stock Purchase Plan,
as amended and restated, our 2002 Restricted Stock Plan, as
amended and restated, and our 2006 Cash Bonus Plan, and against
the five shareholder proposals.
If your shares are held in the name of your bank, brokerage firm
or other nominee, you will receive instructions from them that
you must follow in order to have your shares voted.
If your shares are held in the Comcast Corporation
Retirement-Investment Plan, your shares will be voted as you
specify on your proxy card. If you hold shares in the Comcast
Corporation Retirement-Investment Plan and do not return your
proxy card or do not specify how to vote your shares on your
proxy card, the plan trustee will vote your shares in the same
proportion on each matter as it votes shares
held in this plan for which voting directions were received.
To allow sufficient time for voting by the plan trustee, your
voting instructions must be received by May 15, 2006.
We are not aware of any matters to be presented other than those
described in this proxy statement. If any matters not described
in this proxy statement are properly presented at the meeting,
the proxies will use their own judgment to determine how to vote
your shares. If the meeting is postponed or adjourned, the
proxies will vote your shares on the new meeting date in
accordance with your previous instructions, unless you have
revoked your proxy.
If you are a registered shareholder, you may revoke your proxy
before it is voted by:
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Submitting a new proxy with a later date, including a proxy
given via the Internet or by telephone; |
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Notifying our Secretary in writing before the meeting at the
address given on page 3 of this proxy statement; or |
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Voting in person at the meeting. |
If your shares are held in the name of your bank, brokerage firm
or other nominee, you should follow the instructions received
from them, or contact your broker, in order to change your vote.
Attendance at the meeting is limited to shareholders and one
guest. For safety and security reasons, video and audio
recording devices and other electronic devices will not be
allowed in the meeting. All meeting attendees may be asked to
present a valid, government-issued photo identification, such as
a drivers license or passport, before entering the
meeting, and attendees will be subject to security inspections.
For registered shareholders, an admission ticket is attached to
your proxy card. Please bring the admission ticket with you to
the meeting. Shareholders who do not present an admission ticket
at the meeting will be admitted only upon verification of
ownership.
If your shares are held in the name of your bank, brokerage firm
or other nominee, you must bring to the meeting an account
statement or letter from the nominee indicating that you
beneficially owned the shares on March 10, 2006, the record
date for voting. You may receive an admission ticket in
advance by sending a written request with proof of ownership,
such as a recent bank or brokerage statement, to Comcast
Corporation, in care of Computershare, Client Administration,
250 Royall Street, Canton, Massachusetts 02021.
We are pleased to offer an audio webcast of the annual meeting.
If you choose to listen to the audio webcast, you may do so at
the time of the meeting via a link on our website at
www.cmcsa.com or www.cmcsk.com.
The Chairman of our Board has broad authority to conduct the
annual meeting in an orderly manner. This authority includes
establishing rules for shareholders who wish to address the
meeting. Copies of these rules will be available at the meeting.
The Chairman may also exercise broad discretion in recognizing
shareholders who wish to speak and in determining the extent of
discussion on each item of business. The Chairman may also rely
on applicable law regarding disruptions or disorderly conduct to
ensure that the meeting is conducted in a manner that is fair to
all shareholders.
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Additional Information on the Annual Meeting |
If you have questions or would like more information about the
annual meeting, you can contact us in any of the following ways:
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Via the Internet: Go to our website, www.cmcsa.com or
www.cmcsk.com, and click on 2006 Annual Meeting of
Shareholders to find meeting logistics, vote your proxy or
access additional shareholder information. |
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By telephone: Call toll free 1-866-281-2100. |
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By writing to the following address:
Arthur R. Block
Secretary
Comcast Corporation
1500 Market Street
Philadelphia, Pennsylvania 19102-2148 |
Our Board has provided a process for shareholders to communicate
with its members. Shareholders and other interested parties who
wish to communicate with our directors may address their
correspondence to the Board, to a particular director, to the
non-employee directors or to any other group of directors or
committee of the Board, in care of Arthur R. Block, Secretary,
Comcast Corporation, at the address given above. You may also
send an e-mail in care
of the Chair of the Audit Committee of the Board by using the
following e-mail
address:
audit committee chairman@comcast.com.
Our Board has adopted corporate governance guidelines. These
guidelines address items such as the standards, qualifications
and responsibilities of our directors and director candidates,
and corporate governance policies and standards applicable to us
in general. In addition, we have a code of ethics and business
conduct that applies to all our employees, including our
executive officers and directors. Both the code and the
guidelines are posted under the Governance section
of our website at www.cmcsa.com or www.cmcsk.com. Amendments to
our code will also be posted on this section of our website. The
charters of each of the Boards Governance and Directors
Nominating, Audit and Compensation Committees are also posted on
our website. More information on our Board and its committees
can be found beginning on page 10 of this proxy statement.
VOTING SECURITIES AND PRINCIPAL HOLDERS
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Outstanding Shares and Voting Rights |
At the close of business on March 10, 2006, the record
date, we had outstanding 1,364,085,706 shares of
Class A common stock, 9,444,375 shares of Class B
common stock and 750,133,750 shares of Class A Special
common stock.
On each matter to be voted upon, the Class A common stock
and Class B common stock will vote together. As of the
record date, each holder of Class A common stock is
entitled to 0.2077 votes per share and each holder of
Class B common stock is entitled to 15 votes per share.
Holders of Class A Special common stock are not entitled to
vote at the meeting.
In order to carry on the business of the annual meeting, we must
have a quorum. This means that for each matter presented,
shareholders entitled to cast a majority of the votes that
shareholders are entitled to cast on that matter must be
represented at the meeting, either in person or by proxy. If the
meeting is adjourned for one or more periods aggregating at
least 15 days due to the absence of a quorum,
3
shareholders who are entitled to vote and who attend the
adjourned meeting, even though they do not constitute a quorum
as described above, will constitute a quorum for the purpose of
acting on any matter described in this proxy statement.
The director candidates who receive the most votes will be
elected to fill the available seats on our Board. Approval of
the other proposals requires the favorable vote of a majority of
the votes cast. Only votes for or against a proposal count.
Shares represented at the meeting by a proxy reflecting
abstentions or broker non-votes will count for quorum purposes
if the shareholder has authorized a vote on any substantive
matter; such shares will not count for voting purposes on those
matters on which there was an abstention or non-vote. Broker
non-votes occur on a matter when a bank, brokerage firm or other
nominee is not permitted to vote on that matter without
instruction from the owner of the shares and no instruction is
given. Absent instructions from you, your broker may not vote
your shares on the adoption of our 2002 Employee Stock Purchase
Plan, as amended and restated (Proposal 3), our 2002
Restricted Stock Plan, as amended and restated
(Proposal 4), our 2006 Cash Bonus Plan (Proposal 5)
and the five shareholder proposals.
Mr. Brian L. Roberts, our Chairman and CEO, beneficially
owns all of the outstanding Class B common stock and has
indicated that he will vote all of these shares in favor of the
director candidates, the ratification of the appointment of our
independent auditors, the approval of each of our 2002 Employee
Stock Purchase Plan, as amended and restated, our 2002
Restricted Stock Plan, as amended and restated, and our 2006
Cash Bonus Plan, and against the five shareholder proposals.
This table sets forth information as of February 28, 2006
about persons we know to beneficially own more than five percent
of any class of our voting common stock.
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Amount Beneficially |
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Percent of |
Title of Voting Class |
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Name and Address of Beneficial Owner |
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Owned |
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Class |
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Class A common stock |
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Dodge & Cox |
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102,042,397 |
(1) |
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7.5% |
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555 California Street, 40th Floor |
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San Francisco, CA 94104 |
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Microsoft Corporation |
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100,623,717 |
(2) |
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7.4% |
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One Microsoft Way |
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Redmond, WA 98053 |
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Barclays plc |
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98,815,985 |
(3) |
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7.25% |
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54 Lombard Street |
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London, England EC3P 3AH |
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Class B common stock |
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Brian L. Roberts |
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9,444,375 |
(4) |
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100% |
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1500 Market Street |
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Philadelphia, PA 19102-2148 |
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(1) |
This information is based upon a filing with the Securities and
Exchange Commission dated February 3, 2006 made by
Dodge & Cox setting forth information as of
December 31, 2005. |
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(2) |
This information is based upon a filing with the Securities and
Exchange Commission dated November 25, 2002 made by
Microsoft setting forth information as of November 18, 2002. |
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(3) |
This information is based upon a filing with the Securities and
Exchange Commission dated January 31, 2006 made by Barclays
setting forth information as of December 31, 2005. Shares
listed as beneficially owned by Barclays are owned by the
following entities: Barclays Global Investors, N.A., Barclays
Global Fund Advisors, Barclays Global Investors, Ltd. and
Barclays Global Investors Japan Trust and Banking Company
Limited. |
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(4) |
Includes 9,039,663 shares of Class B common stock
owned by a limited liability company of which Mr. Brian L.
Roberts is the managing member and 404,712 shares of
Class B common stock owned by certain family trusts. The
shares of Class B common stock beneficially owned by
Mr. Brian L. Roberts represent
331/3
% of the combined voting power of the two classes of our
voting common stock, which percentage is generally non-dilutable
pursuant to the terms of our Articles of Incorporation. Under
our Articles of Incorporation, each share of Class B common
stock is convertible, at the shareholders option, into one
share of Class A common stock or Class A Special
common stock. For information regarding Mr. Brian L.
Roberts beneficial ownership of Class A common stock,
see footnote (13) under Security Ownership of
Directors and Executive Officers below. |
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Security Ownership of Directors and Executive
Officers |
This table sets forth information as of February 28, 2006
about the amount of common stock beneficially owned by our
current directors, the executive officers named in the Summary
Compensation Table below and our directors and executive
officers as a group.
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Amount Beneficially Owned(1) | |
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Percent of Class | |
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Class A | |
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Class A | |
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Name of Beneficial Owner |
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Class A(2) | |
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Special(3) | |
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Class B | |
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Class A(2) | |
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Special(3) | |
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Class B | |
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John R. Alchin
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18,603 |
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888,910 |
(4) |
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* |
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* |
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6,750 |
(5) |
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55,332 |
(5) |
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* |
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* |
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S. Decker Anstrom
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22,500 |
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16,000 |
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* |
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* |
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3,685 |
(5) |
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* |
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2,773 |
(6) |
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* |
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Kenneth J. Bacon
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30,300 |
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* |
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3,685 |
(5) |
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* |
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Sheldon M. Bonovitz
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35,925 |
(7) |
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174,454 |
(8) |
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* |
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* |
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3,685 |
(5) |
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38,968 |
(5) |
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* |
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* |
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Edward D. Breen
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3,750 |
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* |
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3,685 |
(5) |
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* |
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655 |
(6) |
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* |
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Julian A. Brodsky
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203,207 |
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2,298,551 |
(9) |
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* |
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* |
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1,553,785 |
(5) |
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* |
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Stephen B. Burke
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457,359 |
(10) |
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3,693,536 |
(11) |
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* |
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* |
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David L. Cohen
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323,891 |
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291,888 |
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* |
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* |
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|
|
15,000 |
(5) |
|
|
5,000 |
(5) |
|
|
|
|
|
|
* |
|
|
|
* |
|
|
|
|
|
Joseph J. Collins
|
|
|
77,375 |
|
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
3,685 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
840 |
(6) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
J. Michael Cook
|
|
|
30,675 |
(12) |
|
|
2,300 |
|
|
|
|
|
|
|
* |
|
|
|
* |
|
|
|
|
|
|
|
|
3,685 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
2,773 |
(6) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
Jeffrey A. Honickman
|
|
|
27,000 |
|
|
|
6,760 |
|
|
|
|
|
|
|
* |
|
|
|
* |
|
|
|
|
|
|
|
|
3,755 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
238 |
(6) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
Brian L. Roberts
|
|
|
726,620 |
(13) |
|
|
15,236,720 |
(14) |
|
|
9,444,375 |
(15) |
|
|
* |
|
|
|
2.0% |
|
|
|
100% (15) |
|
Ralph J. Roberts
|
|
|
457,575 |
|
|
|
5,310,792 |
(16) |
|
|
|
|
|
|
* |
|
|
|
* |
|
|
|
|
|
|
|
|
282,231 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
Dr. Judith Rodin
|
|
|
22,500 |
|
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
3,685 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
2,773 |
(6) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
Lawrence S. Smith
|
|
|
21,435 |
(17) |
|
|
588,186 |
(18) |
|
|
|
|
|
|
* |
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
53,440 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount Beneficially Owned(1) | |
|
Percent of Class | |
|
|
| |
|
| |
|
|
|
|
Class A | |
|
|
|
|
|
Class A | |
|
|
Name of Beneficial Owner |
|
Class A(2) | |
|
Special(3) | |
|
Class B | |
|
Class A(2) | |
|
Special(3) | |
|
Class B | |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
Michael I. Sovern
|
|
|
34,889 |
|
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
|
|
|
3,685 |
(5) |
|
|
|
|
|
|
|
|
|
|
* |
|
|
|
|
|
|
|
|
|
All directors and executive
|
|
|
3,002,625 |
|
|
|
31,643,881 |
|
|
|
9,444,375 |
|
|
|
* |
|
|
|
4.1% |
|
|
|
100% |
|
|
officers as a group
|
|
|
(7)(10)(12)(13) |
|
|
|
(4)(8)(9)(11) |
|
|
|
(15) |
|
|
|
|
|
|
|
|
|
|
|
(15) |
|
|
(18 persons)
|
|
|
(17)(19)(20) |
|
|
|
(14)(16)(18) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19)(21) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
Less than one percent of the applicable class. |
|
|
|
|
(1) |
Beneficial ownership as reported in the above table has been
determined in accordance with
Rule 13d-3 of the
Securities and Exchange Act of 1934. |
|
|
(2) |
Includes beneficial ownership of shares of Class A common
stock for which the following persons hold options exercisable
on or within 60 days of February 28, 2006:
Mr. Anstrom, 22,500 shares; Mr. Bacon,
22,500 shares; Mr. Bonovitz, 22,500 shares;
Mr. Breen, 3,750 shares; Mr. Brodsky,
78,750 shares; Mr. Burke, 348,750 shares;
Mr. Cohen, 296,250 shares; Mr. Collins,
9,375 shares; Mr. Cook, 28,088 shares;
Mr. Brian L. Roberts, 671,250 shares; Mr. Ralph
J. Roberts, 446,250 shares; Dr. Rodin,
22,500 shares; Mr. Sovern, 28,089 shares; and all
directors and executive officers as a group,
2,152,052 shares. Also includes beneficial ownership of
shares of Class A common stock underlying restricted stock
units held by the following persons that vest on or within
60 days of February 28, 2006: Mr. Alchin,
16,800 shares; Mr. Burke, 13,500 shares;
Mr. Cohen, 26,400 shares; Mr. Brian L. Roberts,
41,250 shares; Mr. Ralph J. Roberts,
11,325 shares; Mr. Smith, 18,900 shares; and all
directors and executive officers as a group, 137,025 shares. |
|
|
(3) |
Includes beneficial ownership of shares of Class A Special
common stock for which the following persons hold options
exercisable on or within 60 days of February 28, 2006:
Mr. Alchin, 653,250 shares; Mr. Anstrom,
14,400 shares; Mr. Bonovitz, 5,400 shares;
Mr. Brodsky, 1,186,495 shares; Mr. Burke,
3,536,400 shares; Mr. Cohen, 278,250 shares;
Mr. Brian L. Roberts, 12,343,877 shares;
Mr. Ralph J. Roberts, 3,409,277 shares;
Mr. Smith, 452,853 shares; and all directors and
executive officers as a group, 23,262,487 shares. |
|
|
(4) |
Includes 29 shares of Class A Special common stock
owned in our Retirement-Investment Plan. |
|
|
(5) |
Represents share equivalents that will be paid at a future date
in cash and/or in stock at the individuals election
pursuant to an election made under our deferred compensation
plans. |
|
|
(6) |
Represents share equivalents that will be paid at a future date
in stock under our deferred compensation plans. |
|
|
(7) |
Includes 6,425 shares of Class A common stock owned by
his wife, 104 shares held by him as trustee for a
testamentary trust, as to all of which shares he disclaims
beneficial ownership, and 3,877 shares owned by family
partnerships. |
|
|
(8) |
Includes 3,050 shares of Class A Special common stock
owned by his wife, 40,000 shares held by him as a trustee
of grantor retained annuity trusts, 10,476 shares owned by
a charitable foundation of which his wife is a trustee, as to
all of which shares he disclaims beneficial ownership, and
112,528 shares owned by family partnerships. |
|
|
(9) |
Includes 301,433 shares of Class A Special common
stock owned in two separate grantor retained annuity trusts and
345,303 shares owned in an irrevocable trust, as to which
shares he disclaims beneficial ownership. |
|
|
(10) |
Includes 3,034 shares of Class A common stock owned in
our Retirement-Investment Plan. |
|
(11) |
Includes 23,072 shares of Class A Special common stock
owned in our Retirement-Investment Plan. |
|
(12) |
Includes 1,617 shares of Class A common stock owned by
his wife, as to which shares he disclaims beneficial ownership. |
6
|
|
(13) |
Includes 3,515 shares of Class A common stock owned in
our Retirement-Investment Plan. Also includes 1,356 shares
owned by his wife, as to which shares he disclaims beneficial
ownership. Does not include shares of Class A common stock
issuable upon conversion of Class B common stock
beneficially owned by Mr. Brian L. Roberts. If
Mr. Brian L. Roberts were to convert the Class B
common stock that he beneficially owns into Class A common
stock, Mr. Brian L. Roberts would beneficially own
10,170,995 shares of Class A common stock,
representing less than 1% of the Class A common stock. |
|
(14) |
Includes 41,132 shares of Class A Special common stock
owned in our Retirement-Investment Plan. Also includes
2,712 shares owned by his wife, 160 shares owned by
his daughter and 115,830 shares owned by a family
charitable foundation, as to all of which shares he disclaims
beneficial ownership. Also includes 2,408,638 shares owned
by a limited liability company of which Mr. Brian L.
Roberts is the managing member, and 122,163 shares owned by
certain non-grantor family trusts, but does not include shares
of Class A Special common stock issuable upon conversion of
Class B common stock beneficially owned by Mr. Brian
L. Roberts. If Mr. Brian L. Roberts were to convert the
Class B common stock that he beneficially owns into
Class A Special common stock, Mr. Brian L. Roberts
would beneficially own 24,681,095 shares of Class A
Special common stock, representing approximately 3.2% of the
Class A Special common stock. |
|
(15) |
See note (4) under Principal Shareholders. |
|
(16) |
Includes 185,564 shares of Class A Special common
stock owned by a family partnership, the general partner of
which is controlled by Mr. Ralph J. Roberts. |
|
(17) |
Includes 1,294 shares of Class A common stock owned in
an individual retirement account. |
|
(18) |
Includes 10,000 shares of Class A Special common stock
owned by a family charitable foundation, as to which shares he
disclaims beneficial ownership. |
|
(19) |
Includes share equivalents that will be paid at a future date in
cash and/or in stock at the individuals election pursuant
to an election made under our deferred compensation plans. |
|
(20) |
Includes share equivalents that will be paid at a future date in
stock under our deferred compensation plans. |
|
(21) |
Includes 3,188 shares of Class A Special common stock
owned by the children of an executive officer, other than those
named above, as to which shares beneficial ownership is
disclaimed. |
|
|
|
Section 16(a) Beneficial Ownership Reporting
Compliance |
Our directors and executive officers file reports with the
Securities and Exchange Commission indicating the number of
shares of any class of our equity securities they owned when
they became a director or executive officer and, after that,
changes in their ownership of our equity securities. They must
also provide us with copies of these reports. These reports are
required by Section 16(a) of the Securities Exchange Act of
1934. We have reviewed copies of the reports we received and
written representations from the individuals required to file
the reports. Based on our review of the copies of the reports,
and written representations received from the reporting persons,
we believe that all filings required to be made by the reporting
persons of Comcast for the period January 1, 2005 through
December 31, 2005 were made on a timely basis, except as
follows: restricted share units with respect to shares of
Class A common stock granted to Mr. Lawrence J. Salva,
our Chief Accounting Officer, on April 29, 2005 were
inadvertently not reported in a timely manner. This transaction
was subsequently reported on a Form 4. In addition, the
May 25, 2004 settlement of performance shares by
Mr. C. Michael Armstrong, a former director, was
inadvertently not reported in a timely manner. This transaction
has also been subsequently reported on a Form 4.
7
PROPOSAL 1: ELECTION OF
DIRECTORS
Our Boards Governance and Directors Nominating Committee
has recommended and nominated the director candidates named
below, all of whom currently serve as our directors. All of our
directors are elected for one-year terms.
If a director nominee becomes unavailable before the annual
meeting, your proxy authorizes the people named as proxies to
vote for a replacement nominee if the Governance and Directors
Nominating Committee names one.
Our Board has determined that each of our non-employee
directors, other than Mr. Bonovitz, is independent in
accordance with the director independence definition specified
in our corporate governance guidelines, which are posted under
the Governance section of our website, www.cmcsa.com
or www.cmcsk.com, and in accordance with applicable Nasdaq
rules. Following the annual meeting, if all director nominees
are elected to serve as our directors, independent directors
will constitute two-thirds of our Board. In making its
independence determinations, our Board considered the following
relationships.
|
|
|
|
|
Mr. Anstrom is an executive officer of Landmark
Communications, Inc., subsidiaries of which provide cable
networks that are distributed by us. Under applicable Nasdaq
rules, Mr. Anstrom qualifies as independent since the
amount of programming fees we pay for such cable networks falls
within Nasdaq prescribed limits. In each of 2003, 2004 and 2005
the amounts we paid to Landmark and its subsidiaries did not
exceed the greater of five percent of Landmarks
consolidated gross revenues for that year or $200,000. In
considering Mr. Anstroms independence under our
corporate governance guidelines, our Board also determined that
the Landmark business relationship is on customary
arms-length terms and is not material to us. In addition,
our Board determined that Mr. Anstrom has no material
conflicts of interest as a result of Landmarks businesses,
and that he has no significant personal or other business
relationships with us or any of our executive officers or other
employees. Additional information regarding
Mr. Anstroms relationship with us can be found under
Certain Transactions on page 14 of this proxy
statement. |
|
|
|
Mr. Bonovitz is Chairman and Chief Executive Officer of
Duane Morris LLP, a law firm that we had retained for legal
services prior to 2003. Under applicable Nasdaq rules,
Mr. Bonovitz qualifies as independent notwithstanding this
past business relationship. However, our Board has determined
that Mr. Bonovitz does not meet the independence definition
in our corporate governance guidelines because of his personal
relationships with the Roberts family. |
|
|
|
Mr. Breen is Chairman of the Board and Chief Executive
Officer of Tyco International Ltd., a company with which we
engage in ordinary course commercial transactions. Under
applicable Nasdaq rules, Mr. Breen qualifies as independent
since the amount of fees we paid to Tyco and the amount of fees
Tyco paid to us in respect of such commercial arrangements fall
within Nasdaq prescribed limits. In each of 2003, 2004 and 2005
the amounts we paid to Tyco and the amounts Tyco paid to us did
not exceed the greater of five percent of the recipient
companys consolidated gross revenues for that year or
$200,000. In considering Mr. Breens independence |
8
|
|
|
|
|
under our corporate governance guidelines, our Board also
determined that the Tyco business relationship is on customary
arms-length terms and is not material to us. |
OUR BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR THE ELECTION OF EACH OF THE NOMINEES FOR
DIRECTOR.
Set forth below is information about each of the nominees for
director.
Brian L. Roberts, 46, has served as a director and as our
President and Chief Executive Officer since November 2002 and
Chairman of the Board since May 2004. Prior to November 2002,
Mr. Roberts served as a director and President of our
predecessor for more than five years. He is a son of
Mr. Ralph J. Roberts. Mr. Roberts is also a director
of Comcast Holdings Corporation, one of our wholly owned
subsidiaries, and The Bank of New York Company, Inc. and is the
Chairman of the board of directors of the National Cable and
Telecommunications Association.
Ralph J. Roberts, 86, has served as a director and Chair of the
Executive and Finance Committee of the Board since November
2002. Prior to November 2002, Mr. Roberts served as a
director and Chairman of the Board of our predecessor for more
than five years. He is the father of Mr. Brian L. Roberts.
S. Decker Anstrom, 55, has served as a director since
November 2002. Prior to November 2002, Mr. Anstrom served
as a director of our predecessor since 2001. Mr. Anstrom
was President and Chief Executive Officer of The Weather Channel
from 1999 to 2001. In 2002, Mr. Anstrom became a director
and President and Chief Operating Officer of Landmark
Communications, Inc., a privately held multimedia company, the
assets of which include The Weather Channel. He is currently a
director of the National Cable and Telecommunications
Association.
Kenneth J. Bacon, 51, has served as a director since November
2002. Mr. Bacon has served as the Executive Vice President
of Housing and Community Development at Fannie Mae since July
2005. Prior to this, he was the interim Executive Vice President
of Housing and Community Development from January 2005 to July
2005 and Senior Vice President of Multifamily Investment at
Fannie Mae since 2000. Mr. Bacon is currently a director of
the Fannie Mae Foundation and the National Equity Fund.
Mr. Bacon is a member of the Executive Leadership Council,
Real Estate Roundtable and the Urban Land Institute.
Sheldon M. Bonovitz, 68, has served as a director since November
2002. Prior to November 2002, he served as a director of our
predecessor for more than five years. Mr. Bonovitz has been
a partner with the law firm of Duane Morris LLP for more than
five years and is currently Chairman and Chief Executive Officer
of that firm. Mr. Bonovitz is also a director of eResearch
Technology, Inc. In addition, he is a trustee of the
Dolfinger-McMahon Charitable Trust and the Christian R. and Mary
F. Lindbach Foundation, and he serves on the Board of Trustees
of The Curtis Institute of Music and the Philadelphia Museum of
Art. Mr. Bonovitz is married to a first cousin of
Mr. Brian L. Roberts.
Edward D. Breen, 50, has served as a director since June 2005.
Mr. Breen has been Chairman and Chief Executive Officer of
Tyco International Ltd. since July 2002. From January 2002 to
July 2002 Mr. Breen was President and Chief Operating
Officer of Motorola, Inc., from January 2001 to January 2002 he
was Executive Vice President and President of Motorolas
Networks Sector, and from January 2000 to January 2001 he was
Executive Vice President and President of Motorolas
Broadband Communications Sector. Mr. Breen is a director of
Tyco International Ltd.
Julian A. Brodsky, 72, has served as a director since November
2002. From November 2002 to April 2004 he served as our Vice
Chairman and since May 2004 he has served as our non-executive
Vice Chairman. Prior to November 2002, he served as a director
and Vice Chairman of our predecessor for more than five years.
In addition, he is a director of Amdocs Limited and RBB Fund,
Inc.
Joseph J. Collins, 61, has served as a director since October
2004. Mr. Collins currently serves as the Chairman of
Aegis, LLC. He had been Chairman and Chief Executive Officer of
AOL Time Warner Interactive Video from August 2001 until
December 2003. From 1989 to August 2001, Mr. Collins served
as Chairman and Chief Executive Officer of Time Warner Cable.
9
J. Michael Cook, 63, has served as a director since
November 2002. From 2001 until 2002, Mr. Cook served as a
director of AT&T Corp. Mr. Cook is a director of Eli
Lilly and Company, International Flavors & Fragrances,
Inc. and The Dow Chemical Company. Mr. Cook is also a
member of the Advisory Board of the Securities
Regulation Institute, Chairman Emeritus of the Board of
Catalyst, Chairman of the Accountability Advisory Panel to the
Comptroller General of the United States, a member of the
Advisory Council of the Public Company Accounting Oversight
Board (PCAOB) and a member of the Advisory Board of the
Graduate School of the University of Florida.
Jeffrey A. Honickman, 49, has served as a director since
December 2005. He has been the Chief Executive Officer of
Pepsi-Cola and National Brand Beverages, Ltd., a bottling and
distribution company, which includes among its affiliates
Pepsi-Cola Bottling Company of New York and Canada Dry Bottling
Companies from New York to Virginia, for more than five years.
He currently serves on the Board of Directors of the Cadbury
Schweppes Americas Beverages Bottlers Association and the
Pepsi-Cola Bottlers Association, where he served as Chairman
from 1999 to 2001. Mr. Honickman is currently Chairman of
the Board of Trustees of Germantown Academy, and also serves on
the Board of Governors of St. Josephs University Academy
of Food Marketing, the Board of Trustees of the National Museum
of American Jewish History and the Deans Advisory Council
of the Drexel University College of Business and Administration.
Dr. Judith Rodin, 61, has served as a director since
November 2002. She is President of the Rockefeller Foundation.
Dr. Rodin had previously been President of the University
of Pennsylvania, as well as a professor of psychology and of
medicine and psychiatry at the University of Pennsylvania, from
1994 until 2004. She is currently a director of Aetna, Inc., AMR
Corporation, Citigroup and Electronic Data Systems Corporation,
and also serves as a trustee of 43 of the mutual funds managed
by The BlackRock Funds.
Michael I. Sovern, 74, has served as a director since November
2002. Prior to November 2002, he served as a director of
AT&T Corp. for more than five years. Mr. Sovern is
Chairman of Sothebys Holdings, Inc. He is President
Emeritus and Chancellor Kent Professor of Law at Columbia
University, where he served as President for more than five
years. He is President and a director of The Shubert Foundation
and a director of The Shubert Organization. He is currently a
director of Sequa Corp. and Sothebys Holdings, Inc.
Mr. Sovern is also Chairman of the Japan Society and
Chairman of the American Academy in Rome.
About our Board and its Committees
|
|
|
The Board |
|
We are governed by a Board of Directors and various committees
of the Board that meet throughout the year. During 2005, there
were eight meetings of our Board and a total of 26 committee
meetings. Each director attended more than 75% of the aggregate
of all Board and committee meetings on which he or she served.
Our independent directors have the opportunity to meet in an
executive session following each regularly scheduled Board
meeting. During 2005, our independent directors held three
executive sessions in which only the independent directors
participated. Following the annual meeting, if all director
nominees are elected to serve as our directors, we will have
eight independent directors. As described in greater detail
below, we also have a Presiding Director, currently
Dr. Rodin, who presides at the executive sessions that our
independent directors hold. We encourage our directors to attend
the annual meeting of shareholders. Each of our directors
attended the 2005 annual meeting. |
10
|
|
|
Presiding Director |
|
In accordance with our corporate governance guidelines, our
Board has a Presiding Director position, which is currently
filled by Dr. Rodin. The Presiding Director: |
|
|
|
|
|
|
|
|
|
presides over executive sessions of our independent directors; |
|
|
|
|
discusses with our independent directors the need for an
executive session prior to each regularly scheduled Board
meeting, as well as the agenda items for any such meeting
(including those of interest to our independent directors); |
|
|
|
|
communicates periodically with our independent directors,
following discussions with management and otherwise, on topics
of importance to our independent directors; |
|
|
|
|
reviews and approves the process for the annual self-assessment
of our directors and our Board as a whole; and |
|
|
|
|
organizes and delivers the annual Board evaluation of the
performance of our Chief Executive Officer. |
|
|
|
|
|
The role of Presiding Director rotates (between annual meetings
of shareholders) among the Chairs of the Compensation, Audit and
Governance and Directors Nominating Committees. Mr. Cook is
scheduled to become our Presiding Director following our 2006
annual meeting. |
|
Committees of our Board |
|
Our Board has four principal committees. The following describes
for each committee its current membership, the number of
meetings held during 2005 and its mission. |
|
Executive and Finance
Committee |
|
Sheldon M. Bonovitz, Julian A. Brodsky, J. Michael Cook and
Ralph J. Roberts (Chair).
This committee met five times in 2005. The Executive and
Finance Committee acts for the directors in the intervals
between Board meetings with respect to any matters delegated to
it by our Board. |
|
Audit Committee |
|
Joseph J. Collins, J. Michael Cook (Chair), Jeffrey A. Honickman
and Dr. Judith Rodin. Each member of the committee is
independent as defined under Nasdaq rules. A copy of this
committees charter is posted under the
Governance section of our website at www.cmcsa.com
or www.cmcsk.com. |
|
|
|
This committee met nine times in 2005. The Audit Committee is
responsible for the oversight and evaluation of: |
|
|
|
|
|
|
|
|
|
the qualifications, independence and performance of our
independent auditors; |
|
|
|
|
the performance of our internal audit function; and |
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the quality and integrity of our financial statements and the
effectiveness of our internal control over financial reporting. |
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The Audit Committee is also responsible for preparing the Audit
Committee report required by the rules of the Securities and
Exchange Commission, and this report is included beginning on
page 15 of this proxy statement. |
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Our Board has concluded that one member of the Audit Committee,
J. Michael Cook, qualifies as an audit committee financial
expert. |
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Compensation Committee |
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S. Decker Anstrom, Joseph J. Collins, Dr. Judith Rodin
(Chair) and Michael I. Sovern. Each member of the committee is
independent as defined under Nasdaq rules. A copy of this
committees charter is posted under the
Governance section of our website at www.cmcsa.com
or www.cmcsk.com. |
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This committee met seven times in 2005. The Compensation
Committee reviews and approves our compensation and benefit
programs, ensures the competitiveness of these programs and
oversees and sets compensation for our senior executives. Also,
together with the Governance and Directors Nominating Committee,
it oversees succession planning for our senior management
(including our Chief Executive Officer). The Compensation
Committee is also responsible for preparing the Compensation
Committee report required by the rules of the Securities and
Exchange Commission, and this report is included beginning on
page 48 of this proxy statement. |
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Governance and Directors
Nominating Committee |
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S. Decker Anstrom (Chair), Kenneth J. Bacon, Edward D. Breen, J.
Michael Cook, Jeffrey A. Honickman and Michael I. Sovern. Each
member of the committee is independent as defined under Nasdaq
rules. A copy of this committees charter is posted under
the Governance section of our website at
www.cmcsa.com or www.cmcsk.com. |
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This committee met five times in 2005. The Governance and
Directors Nominating Committee exercises general oversight with
respect to the governance of our Board, as well as corporate
governance matters involving us and our directors and executive
officers. It also is responsible for periodically leading
reviews and evaluations of the performance, size and
responsibilities of our Board and its committees and, together
with the Compensation Committee, oversees succession planning
for our senior management (including our Chief Executive
Officer). |
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The Governance and Directors Nominating Committee also
identifies and recommends director nominees. In assessing
candidates, whether recommended by the committee or by
shareholders, the committee considers an individuals
professional knowledge, business, financial and management
expertise, industry knowledge and entrepreneurial background and
experience. The committee also considers diversity, applicable
independence requirements and the current composition of our
Board. |
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The Governance and Directors Nominating Committee will consider
director candidates nominated by shareholders. In order for a
shareholder to make a nomination, the shareholder must provide a
notice along with the additional information required by our
by-laws in the
following time periods. For election of directors at an annual
meeting called for a date between April 18, 2007 and
June 18, 2007, we must receive written notice on or after
January 18, 2007 and on or before February 20, 2007.
For election |
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of directors at any other meeting, we must receive written
notice by the close of business on the tenth day following the
day we mailed notice of, or announced publicly, the date of the
meeting, whichever occurs first. You can obtain a copy of the
full text of the relevant by-law provision by writing to Arthur
R. Block, Secretary, Comcast Corporation, at the address given
on page 3 of this proxy statement. A copy of our by-laws
has also been filed with the Securities and Exchange Commission
as an exhibit to our Annual Report on
Form 10-K filed on
February 22, 2006. |
Director Emeritus Program
Our Board also has instituted a Director Emeritus program to
avail itself of the counsel of retiring directors who have made
and can continue to make a unique contribution to the
deliberations of the Board. Our Board may, at its discretion,
designate a retiring director as Director Emeritus. Each
designation shall be for a period of one year and may be renewed
in the Boards discretion. C. Michael Armstrong, a former
member of the Board who retired at last years annual
meeting, is currently our only Director Emeritus. His term will
expire at this years annual meeting. A Director Emeritus
may provide advisory services as requested from time to time and
may be invited to attend meetings of our Board, but shall not
vote or be counted for quorum purposes or have any of the duties
or obligations imposed on a director or officer of Comcast under
applicable law or otherwise be considered a director. A Director
Emeritus shall be entitled to benefits and protections in
accordance with Article 7 of our by-laws (Limitation of
Directors Liability and Indemnification of Directors,
Officers and Other Persons), but shall receive no compensation
other than reimbursement for expenses incurred in the capacity
of Director Emeritus.
Director Compensation
Board and Committee Fees and Equity Awards
Directors who are our employees do not receive any fees for
their services as directors. Each non-employee director receives
an annual retainer of $50,000 and $2,500 for each Board meeting
or other meeting attended in his or her capacity as director or
for any other business conducted on our behalf, $2,500 for each
Audit, Compensation or Governance and Directors Nominating
Committee meeting attended and $1,000 for each Executive and
Finance Committee meeting attended. The Chair of the Audit
Committee receives an additional annual retainer of $20,000 and
the Chairs of the Compensation and Governance and Directors
Nominating Committees receive an additional annual retainer of
$10,000. Other members of the Audit Committee receive an
additional annual retainer of $10,000 and other members of the
Compensation and Governance and Directors Nominating Committees
receive an additional annual retainer of $5,000. Members of the
Executive and Finance Committee receive an additional annual
retainer of $2,500. The Chair of this committee is entitled to
receive an additional annual retainer of $5,000. The current
Chair of this committee, Mr. Ralph J. Roberts, however,
receives no compensation with respect to this position since he
is one of our employees. Fees received by a director may be
deferred in whole or in part under our 2002 and 2005 Deferred
Compensation Plans. Up to one-half of the Board annual retainer
may be received, at the election of the non-employee director,
in shares of Class A common stock.
Non-employee directors are reimbursed for travel expenses for
meetings attended. Non-employee directors, like all our active
employees, are provided with Comcast cable and high-speed data
services at no cost (if available in the area in which they
live).
Each non-employee director is granted annually, on or about
November 20, shares of Class A common stock having a
fair market value on the date of grant of $100,000. These shares
will be fully vested on the grant date. It is the practice of
our Board to review non-employee director compensation on an
annual basis.
13
A description of our agreement with Mr. Brodsky can be
found under Agreements with Executive Officers and
Directors beginning on page 38 of this proxy statement.
Director Ownership Policies
Effective January 2006, our non-employee director stock
ownership policy was amended to increase the number of shares
our non-employee directors are required to hold from four to
five times his or her annual cash retainer. Each non-employee
director will have a period of five years to reach this
ownership requirement. For purposes of this policy,
ownership is defined to include stock owned directly
or indirectly by the director and shares underlying deferred
stock units under our Deferred Stock Option Plan. In addition,
60% of each of the following types of ownership also counts: the
market value of the directors stock fund under our
deferred compensation plan, deferred shares under our restricted
stock plan and the difference between the market price and
exercise price of vested stock options. Our non-employee
director ownership policy is posted under the
Governance section of our website at www.cmcsa.com
or www.cmcsk.com. All non-employee directors are currently in
compliance with our ownership policy.
Certain Transactions
Mr. Anstrom, one of our directors, is President and Chief
Operating Officer of Landmark Communications, Inc., the parent
company of The Weather Channel. In 2005, we paid $20,050,890 in
programming fees for carriage of The Weather Channel and
Weatherscan Local under customary arms-length affiliation
agreements. Mr. Anstrom was not directly involved in the
negotiation of these agreements.
Debra G. Brodsky, a daughter of Mr. Brodsky, our
non-executive Vice Chairman and one of our directors, is one of
our employees. In 2005, she received $178,440 in annual salary
and bonus. She also participates in our employee benefit and
equity incentive plans on the same basis as other similarly
situated employees.
14
PROPOSAL 2: RATIFICATION OF
THE APPOINTMENT
OF OUR INDEPENDENT AUDITORS
The Audit Committee has appointed Deloitte & Touche LLP
to serve as our independent auditors for the fiscal year ending
December 31, 2006. We are asking you to ratify this
appointment, although your ratification is not required. A
representative of Deloitte & Touche LLP will be present
at the meeting, will have the opportunity to make a statement
and will be available to respond to appropriate questions.
OUR BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR RATIFICATION OF THE APPOINTMENT OF
DELOITTE & TOUCHE LLP AS OUR INDEPENDENT AUDITORS.
Set forth below are the fees paid or accrued for the services of
Deloitte & Touche LLP, the member firms of Deloitte
Touche Tohmatsu and their respective affiliates in 2005 and 2004.
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2005 | |
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2004 | |
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Audit fees
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4.4 |
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5.3 |
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Audit-related fees
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1.0 |
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0.5 |
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Tax fees
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0.6 |
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0.7 |
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All other fees
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$ |
6.0 |
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6.5 |
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Audit fees consist of services rendered to us and our
subsidiaries for the audits of our annual financial statements,
audit of our annual management assessment of the effectiveness
of internal control over financial reporting (as required by
Section 404 of the Sarbanes-Oxley Act of 2002), reviews of
our quarterly financial statements, and audit services provided
in connection with other statutory or regulatory filings. The
decrease in audit fees in 2005 compared to 2004 is primarily due
to higher costs associated with the initial audit of internal
controls over financial reporting in 2004.
Audit-related fees in 2005 consist primarily of audits
associated with pending acquisitions and dispositions and
attestation services related to contractual and regulatory
compliance. Audit-related fees in 2004 consist almost entirely
of employee benefit plan audits and attestation services related
to contractual and regulatory compliance.
Tax fees consist of domestic and foreign tax compliance
services, including tax examination assistance, expatriate
administration and tax preparation; and international tax
planning and advice. In both 2005 and 2004, tax fees included
$10,000 or less for tax planning and advice.
All other fees consist of permissible non-audit services, if any.
Pre-Approval Policy of Audit Committee of Services Performed
by Independent Auditors
The Audit Committees policy requires that the committee
pre-approve audit and non-audit services performed by the
independent auditors to assure that the services do not impair
the auditors independence. Unless a type of service has
received general pre-approval, it requires separate pre-approval
by the Audit Committee. Even if a service has received general
pre-approval, if the fee associated with the service exceeds
$250,000 in a single engagement or series of related
engagements, or relates to tax planning and advice, it requires
separate pre-approval. The Audit Committee has delegated its
pre-approval authority to its Chair acting with one additional
member.
Report of the Audit Committee
The Audit Committee is comprised solely of independent directors
meeting the requirements of applicable Securities and Exchange
Commission and Nasdaq rules. The key responsibilities of our
committee are set forth in our charter, which was adopted by us
and approved by the Board, and is posted under the
Governance section of Comcasts website at
www.cmcsa.com or www.cmcsk.com.
15
We serve in an oversight capacity and are not intended to be
part of Comcasts operational or managerial decision-making
process. Comcasts management is responsible for the
preparation, integrity and fair presentation of information in
the consolidated financial statements, the financial reporting
process and internal control over financial reporting. The
independent auditors are responsible for auditing the
consolidated financial statements and internal control over
financial reporting. Our principal purpose is to monitor these
processes.
In this context, we met and held discussions with management and
the independent auditors. Management represented to us that
Comcasts consolidated financial statements were prepared
in accordance with generally accepted accounting principles
applied on a consistent basis, and we have reviewed and
discussed the quarterly and annual earnings press releases and
consolidated financial statements with management and the
independent auditors. We also discussed with the independent
auditors matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit
Committees), as amended, and
Rule 2-07
(Communication with Audit Committees) of
Regulation S-X.
We discussed with the independent auditors the auditors
independence from Comcast and its management, including the
matters, if any, in the written disclosures required by
Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees). We also considered whether
the independent auditors provision of audit and non-audit
services to Comcast is compatible with maintaining the
auditors independence.
We discussed with Comcasts internal and independent
auditors the overall scope and plans for their respective
audits. We met with the internal and independent auditors, with
and without management present, to discuss the results of their
examinations, the evaluations of Comcasts internal
controls, and the overall quality and integrity of
Comcasts financial reporting.
Based on the reviews and discussions referred to above, we have
recommended to the Board, and the Board has approved, that the
audited financial statements be included in Comcasts
Annual Report on
Form 10-K for the
year ended December 31, 2005, for filing with the
Securities and Exchange Commission.
We have appointed Deloitte & Touche LLP as
Comcasts independent auditors for 2006.
Members of the Audit Committee
J. Michael Cook (Chair)
Joseph J. Collins
Jeffrey A. Honickman (member since January 23, 2006)
Dr. Judith Rodin
16
PROPOSAL 3: TO APPROVE OUR
2002 EMPLOYEE STOCK PURCHASE PLAN,
AS AMENDED AND RESTATED
Our 2002 Employee Stock Purchase Plan was ratified by our Board
on November 20, 2002 and approved by our shareholders on
May 7, 2003. The Employee Stock Purchase Plan is intended
to meet the requirements of Section 423 of the Internal
Revenue Code of 1986 (referred to as the Code). Due
to the participation of our employees in this plan, the current
authorized share pool under the plan is nearly exhausted. As a
result, on December 14, 2005, the Compensation Committee of
our Board approved an amendment to the 2002 Employee Stock
Purchase Plan to increase the number of shares available for
issuance under this plan from 4,250,000 to 10,250,000.
Our Board is asking shareholders to approve the plan as so
amended and restated in order to satisfy certain requirements
under the Code so that certain tax benefits will be available to
our employees. If the plan, as amended and restated, is not
approved, we will make the proposed additional
6,000,000 shares available for issuance under this plan,
but employees who purchase such shares under the plan will not
be eligible to receive favorable tax treatment with respect to
such shares.
Description of our 2002 Employee Stock Purchase Plan
The following is a summary of the material features of this
plan, as amended and restated. The following summary does not
purport to be complete and is qualified in its entirety by
reference to the terms of our 2002 Employee Stock Purchase Plan,
which is attached to this proxy statement as Appendix A.
Eligibility. Our full-time employees and full-time
employees of our participating subsidiaries are eligible to
participate in the plan if the employee has been continuously
employed for at least 90 days as of the first day of an
offering period. A part-time employee is eligible to participate
in the stock purchase plan if he or she has been continuously
employed for at least one year as of the first day of an
offering period. Any eligible employee who, after purchasing
shares under the plan, would own five percent or more of our
stock (by vote or value) is not eligible to purchase additional
shares under the plan. Approximately 62,000 employees, including
our executive officers other than Messrs. Brian L. and
Ralph J. Roberts, are currently eligible to participate in the
stock purchase plan.
Shares Subject to the Plan. In the aggregate
10,250,000 shares of Class A common stock, and with
respect to prior offering periods, Class A Special common
stock, are available for purchase under the plan, subject to
adjustment in the event of certain corporate events. As of
December 31, 2005, of this aggregate amount,
3,126,276 shares of Class A common stock and
650,745 shares of Class A Special common stock had
been issued under the plan. Shares deliverable under the plan
may consist of either treasury shares or shares originally
issued for such purpose. As of March 10, 2006, the fair
market value of a share of Class A common stock and
Class A Special common stock was $26.25 and $26.20,
respectively.
Administration. The stock purchase plan is administered
by the Compensation Committee. Our Board and the committee have
the authority to interpret the stock purchase plan, prescribe,
amend and rescind rules and regulations relating to it and make
all other determinations deemed necessary or advisable in
administering the plan.
Adjustments. In the event that shares are exchanged for a
different number or kind of shares of the company through
merger, recapitalization, stock dividend, stock split or other
similar capital adjustments, the Board or the committee will
make such adjustments as it deems appropriate. The Board or the
committees determination will be binding for all purposes
of the plan.
Participation in the Plan. The plan enables eligible
employees to purchase shares during certain offering periods,
which generally encompass a calendar quarter. To become a
participant in the stock purchase plan, an eligible employee
must file an election form with the committee in accordance with
the terms and conditions set forth in the plan. On his or her
election form, the participant will designate the percentage of
eligible compensation (which can be no more than 10% with
respect to each offering period) he or she would like to have
credited to his or her account under the plan. No participant
can have more
17
than $10,000 deducted from his or her compensation in a calendar
year. At the end of each offering period, amounts credited to
this account will be used to purchase whole shares. Shares so
purchased will be credited to a brokerage account established by
us. The purchase price per share will be 85% of the lesser of
the fair market value per share on the first and last days of
the offering period.
During an offering period, payroll deductions may not be
changed. A participant may discontinue his or her participation
in the plan by providing a termination form at any time before
the end of an offering period. All amounts then credited to such
participants account shall be paid as soon as practicable
following receipt of the participants termination form,
and no further payroll deductions will be made with respect to
the participant. Upon termination of employment, all amounts
credited to a participants account will be delivered to
the participant or his or her successor in interest (in the case
of death). No interest will be paid with respect to payroll
deductions made or amounts credited to any account under the
stock purchase plan.
Transferability. An employees rights under the plan
may not be transferred or assigned to any other person during
the employees lifetime. After shares have been issued
under the plan and credited to an employees brokerage
account under the plan, such shares may be assigned or
transferred in the same manner as any other shares.
Amendment or Termination. Our Board or the committee has
the right to amend, modify or terminate the stock purchase plan
at any time without notice, provided that, upon any termination,
all shares or unapplied payroll deductions will be distributed
to participants, and provided further, that no amendment will
affect the right of a participant to receive his or her
proportionate interest in the shares or unapplied payroll
deductions. Shareholder approval will be obtained for a plan
amendment if it is determined to be required by or advisable
under applicable law or regulation.
New Plan Benefits. Because benefits under the stock
purchase plan depend on employees elections to participate
in the plan and the fair market value of the shares at various
future dates, it is not possible to determine future benefits
that will be received by executive officers and other employees
under the plan. Non-employee directors are not eligible to
participate in the plan. Under the terms of the plan, an
eligible employee who participates in the plan may not purchase
shares in any calendar year with a maximum fair market value
exceeding $10,000.
Federal Income Taxation
The following discussion is a summary of the material
U.S. federal income tax consequences of participation in
the plan (if shareholder approval is obtained).
Under the Code, a participant will not realize income at the
time the offering period commences or when the shares purchased
under the stock purchase plan are transferred to him or her. If
a participant disposes of such shares after two years from the
date the offering of such shares commences and after one year
from the date of the transfer of such shares to him or her, the
participant will be required to include in income, as
compensation for the year in which such disposition occurs, an
amount equal to the lesser of (1) the excess of the fair
market value of such shares at the time of the disposition over
the purchase price, or (2) the excess of the fair market
value of the shares at the commencement of the offering period
over the purchase price at such time. The participants
basis in the shares disposed of will be increased by an amount
equal to the amount so includable in his or her income as
compensation, and any gain or loss computed with reference to
such adjusted basis that is recognized at the time of the
disposition should be treated as long-term capital gain or loss.
In such event, we will not be entitled to any tax deduction.
If a participant disposes of shares purchased under the stock
purchase plan within such two-year or one-year period, the
employee will be required to include in income, as compensation
for the year in which such disposition occurs, an amount equal
to the excess of the fair market value of such shares on the
date of purchase over the purchase price. The employees
basis in such shares disposed of will be increased by an amount
equal to the amount includable in his or her income as
compensation, and any gain or loss computed with reference to
such adjusted basis that is recognized at the time of
disposition will be a
18
capital gain or loss, either short-term or long-term, depending
on the holding period for such shares. In the event of a
disposition within such two-year or one-year period, we will be
entitled to a deduction equal to the amount that the participant
is required to include in income as a result of such disposition.
OUR BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR APPROVAL OF OUR 2002 EMPLOYEE STOCK PURCHASE
PLAN, AS AMENDED AND RESTATED.
PROPOSAL 4: TO APPROVE OUR
2002 RESTRICTED STOCK PLAN,
AS AMENDED AND RESTATED
Our 2002 Restricted Stock Plan was ratified by our Board on
November 20, 2002 and approved by our shareholders on each
of May 7, 2003, May 26, 2004 and June 1, 2005. We
have used a substantial portion of the current authorized share
pool under the plan for existing awards. As a result of this,
and for the additional reason described in the following
paragraph, on December 14, 2005, the Compensation Committee
of our Board approved an amendment to the 2002 Restricted Stock
Plan to increase the number of shares available for issuance
under this plan from 15,000,000 to 35,000,000, subject to
shareholder approval.
Beginning in 2004, we changed our long-term equity compensation
philosophy with respect to our key employees from generally only
granting stock options to granting a combination of stock
options and restricted stock units. In 2004 we granted a mix of
equity awards consisting of approximately 75% stock options and
25% restricted stock units, by value, and in 2005 we moved to a
program of 50% stock options and 50% restricted stock units, by
value. Beginning last year, we also changed our long-term equity
compensation philosophy with respect to our non-employee
directors. Non-employee directors currently receive annual stock
awards. Prior to 2005, they received annual grants of stock
options. As a result of these changes in our compensation
philosophy, additional shares are needed under the 2002
Restricted Stock Plan in order to continue to implement our
long-term equity programs and goals. In accordance with
applicable Nasdaq rules, our Board is asking shareholders to
approve the plan as so amended and restated.
If the plan, as amended and restated, is not approved, we will
not be able to make the proposed additional
20,000,000 shares available for issuance under this plan,
but the plan will otherwise remain in effect.
Description of our 2002 Restricted Stock Plan
The following is a summary of the material features of this
plan, as amended and restated. The following summary does not
purport to be complete and is qualified in its entirety by
reference to the terms of our 2002 Restricted Stock Plan, which
is attached to this proxy statement as Appendix B.
Types of Awards; Eligibility. Awards of restricted stock
and restricted stock units may be granted under the plan. Awards
of restricted stock are shares of common stock that are awarded
subject to such restrictions on transfer as the Compensation
Committee or Board may establish. Awards of restricted stock
units are units valued by reference to shares of common stock
that entitle a participant to receive, upon the settlement of
the unit, one share for each unit. Our employees and employees
of our participating subsidiaries, as well as our non-employee
directors, are eligible to receive awards under the plan. The
number of employees currently eligible to participate in the
plan is approximately 7,300 and there are currently nine
non-employee directors.
Shares Subject to the Plan. The aggregate maximum number
of shares that may be issued pursuant to awards under the plan
is 35,000,000 shares of Class A common stock, or, with
respect to awards granted before our acquisition of the AT&T
Broadband business as to which restrictions upon shares have not
lapsed, Class A Special common stock, subject to adjustment
in the event of certain corporate events. As of
December 31, 2005, of this aggregate amount,
6,369,006 shares of Class A common stock and
6,705,653 shares of Class A Special common stock had
been issued or reserved for issuance upon vesting of outstanding
awards. Shares issued under the plan may be either treasury
shares or shares originally
19
issued for this purpose. Rights to receive shares forfeited
pursuant to the terms of an award will be available again for
grant under the plan. No individual may be awarded more than
1,000,000 restricted shares or restricted stock units in any
calendar year. As of March 10, 2006, the fair market value
of a share of Class A common stock and Class A Special
common stock was $26.25 and $26.20, respectively.
Term of the Plan. No awards may be granted under the plan
after February 26, 2013.
Administration. The plan is administered by the
Compensation Committee. This committee has authority to
determine who is eligible to participate in the plan, select
individuals to whom awards will be granted, interpret the plan
and prescribe and amend rules and regulations relating to the
plan. The committee may delegate to one of our officers or a
committee of two or more of our officers its discretion under
the plan to make grants of awards to any eligible employee other
than an individual who, at the time of grant, has a base salary
of $500,000 or more, holds a position with us of Senior Vice
President or higher or is subject to the short-swing profit
recapture rules of the Securities Exchange Act of 1934. Our
Board is responsible for administering any awards granted to
non-employee directors.
Terms of Awards. The committee determines the terms and
conditions of each award granted to employee participants,
including the restrictions applicable to shares underlying
awards of restricted stock and the dates these restrictions
lapse and the award vests, as well as the vesting and settlement
terms applicable to restricted stock units. When an award vests,
we will deliver to the recipient a certificate for the number of
shares without any legend or restrictions (except as necessary
to comply with applicable state and federal securities laws).
The committee may condition the vesting of, or lapse of
restrictions with respect to, any award of restricted shares or
restricted stock units upon the satisfaction of performance
targets or goals as described below. The committee is authorized
to establish company-wide, division-wide or individual goals,
which may be quantitative performance standards or qualitative
performance standards. The quantitative performance standards
include financial measurements such as income, expense,
operating cash flow, numbers of customers of or subscribers for
various services and products offered by us or one of our
divisions, customer service measurements and other objective
financial or service-based standards relevant to our business as
may be established by the committee. The qualitative performance
standards may include, but are not limited to, customer
satisfaction, management effectiveness, workforce diversity and
other qualitative performance standards relevant to our
business. For each calendar year, annual performance goals will
be established by the committee by no later than the
90th day of the year. Performance goals that are not annual
will be established within the first quarter of the start of the
applicable performance period. After the close of the calendar
year, the committee will also determine whether the performance
goals have been satisfied. Presently, only our named executive
officers have been granted performance-based awards.
In addition, the committee may condition the vesting of, or
lapse of restrictions with respect to, an award based on the
satisfaction of performance standards as it may determine to be
appropriate, whether or not previously designated as a
performance standard.
The terms and conditions of each award of restricted stock units
granted to a non-employee director will be determined under our
2002 Non-Employee Director Compensation Plan, which is
administered by our Board and which was filed as an exhibit to
our Annual Report on
Form 10-K for
2004. Our 2002 Non-Employee Director Compensation Plan currently
provides that, as of November 20, 2005 and each November
thereafter, our Board will grant an award of restricted stock
units to each non-employee director having a fair market value
of $100,000 on the date of grant. Non-employee directors who
commence service after November 20 will also be eligible to
receive awards of restricted stock units upon commencement of
service with us. These awards will have a fair market value
ranging from $25,000 to $100,000 on the date of grant, depending
on the date the non-employee director commences service with us.
Each award of restricted stock units will be fully vested on the
grant date.
Termination of Employment. Except as otherwise provided
in an applicable award or employment agreement, upon termination
of employment, all awards that are then still subject to
restrictions or that
20
have not vested will be forfeited. With respect to any award,
the committee may, in its sole discretion, waive restrictions or
vesting conditions in whole or in part or accelerate vesting.
For a discussion of the treatment of restricted stock units held
by our named executive officers upon a termination of their
employment, see Agreements with Executive Officers and
Directors beginning on page 38 of this proxy
statement.
Deferral. Each recipient of an award who qualifies under
the terms of the plan has the right to defer the receipt,
subject to re-deferral, of any or all of the shares subject to
an award under the terms and conditions as determined by the
committee and the plan. Upon making an appropriate election, a
portion of the deferred awards may be paid out in cash.
Withholding. Unless otherwise determined by the
committee, tax liabilities incurred in connection with the grant
of an award or its vesting or lapse of restrictions or
settlement will be satisfied by our withholding a portion of the
shares subject to the award that have a fair market value
approximately equal to the minimum amount of taxes required to
be withheld by us under applicable law. Subject to certain
conditions specified in the plan, a recipient of an award may
elect to have taxes withheld in excess of the minimum amount
required to be withheld or may satisfy his or her tax
withholding in cash.
Adjustments. The aggregate number of shares under the
plan, the class of shares as to which awards may be granted and
the number of shares covered by each outstanding award are
subject to adjustment in the event of a stock dividend,
recapitalization or certain other corporate transactions.
Terminating Events. In the event of our liquidation or a
transaction or series of transactions in which an unaffiliated
third party acquires share ownership such that this party has
the ability to direct the management of the company, as
determined by our Board in its sole discretion, the committee
may provide that upon consummation of such an event, any
outstanding awards will vest in full or in part or that all
restricted stock or restricted stock units that have been
previously deferred will be transferred to the recipient.
Amendment or Termination. The plan may be amended by our
Board or the committee and may be terminated by our Board at any
time. No award will be affected by any amendment or termination
without the written consent of the recipient of the award.
New Plan Benefits. Future grants of awards of restricted
stock or restricted stock units, if any, that will be made to
eligible employees with respect to those shares that are subject
to shareholder approval are subject to the discretion of the
committee and, therefore, are not determinable at this time. The
following table reflects awards of restricted stock units
granted in 2005.
2002 Restricted Stock Plan
|
|
|
|
|
|
|
|
Number of Shares |
Name and Position |
|
Underlying Units |
|
|
|
Brian L. Roberts
|
|
|
165,000 |
|
|
Chairman of the Board and CEO |
|
|
|
|
Stephen B. Burke
|
|
|
90,000 |
|
|
Executive Vice President; Chief Operating Officer and President,
Comcast Cable |
|
|
|
|
Ralph J. Roberts
|
|
|
75,500 |
|
|
Chairman of the Executive and Finance Committee of the Board |
|
|
|
|
Lawrence S. Smith
|
|
|
76,000 |
|
|
Executive Vice President; Co-Chief Financial Officer |
|
|
|
|
David L. Cohen
|
|
|
163,000 |
|
|
Executive Vice President |
|
|
|
|
John R. Alchin
|
|
|
67,000 |
|
|
Executive Vice President; Co-Chief Financial Officer and
Treasurer |
|
|
|
|
All executive officers as a group
|
|
|
715,500 |
|
All non-employee directors as a group
|
|
|
33,235 |
|
Company employees other than executive officers, as a group
|
|
|
3,275,948 |
|
21
Federal Income Taxation
The following discussion is a summary of the material
U.S. federal income tax consequences of restricted stock
and restricted stock units granted under the plan.
Restricted Stock. Generally, the grant of an award of
restricted stock that is subject to restrictions on transfer and
a substantial risk of forfeiture is not a taxable event. The
recipient of the award will recognize ordinary compensation
income in each year in which restrictions on the award lapse and
the award vests in an amount equal to the fair market value of
the shares of common stock received. An award of restricted
stock that is fully vested on the grant date generally will be
taxable to the recipient on such date. A recipients basis
for determining gain or loss on a subsequent disposition of
these shares of common stock will be the amount the recipient
must include in income when the restrictions lapse or when the
award was granted, if not subject to restrictions. Any gain or
loss recognized on a disposition of the shares of common stock
generally will be short-term or long-term capital gain or loss,
depending on the length of time the recipient holds the shares.
If a recipient of an award of restricted stock properly makes an
election pursuant to Section 83(b) of the Code, he or she
will recognize ordinary compensation income equal to the fair
market value of the shares of common stock at the time the
shares are awarded, without taking into account the effect of
the restrictions on the award. The recipients basis for
determining gain or loss on a subsequent disposition of shares
will be the amount the recipient so included in income. Any gain
or loss recognized on a disposition of shares of common stock
that were subject to the Section 83(b) election will be
short-term or long-term capital gain or loss, depending on the
length of time since the date of the award. If, however, the
recipient forfeits an award upon a termination of employment
prior to the time the restrictions lapse, he or she will
generally not be entitled to deduct any loss upon such
forfeiture even though the recipient may have been required to
include an amount in income by virtue of the Section 83(b)
election.
Restricted Stock Units. Generally, the grant of an award
of restricted stock units is not a taxable event. The recipient
of the award will recognize ordinary compensation income in each
year in which the units are settled in an amount equal to the
fair market value of the shares of common stock received. A
recipients basis for determining gain or loss on a
subsequent disposition of these shares of common stock will be
the amount the recipient must include in income when the units
vest and are settled. Any gain or loss recognized on a
disposition of the shares of common stock generally will be
short-term or long-term capital gain or loss, depending on the
length of time the recipient holds the shares.
A recipient who makes a proper election to defer the receipt of
shares received in settlement of an award of restricted stock or
to defer the settlement of restricted stock units will not
recognize income with respect to the shares or units until the
end of the deferral period. At the end of the deferral period,
the recipient will recognize ordinary compensation income equal
to the fair market value of the shares of common stock issued at
that time.
Subject to Section 162(m) of the Code and our satisfaction
of applicable reporting requirements, at the time income is
recognized by the recipient of an award of restricted stock or
restricted stock units, we will be entitled to a corresponding
deduction.
OUR BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR APPROVAL OF OUR 2002 RESTRICTED STOCK PLAN, AS
AMENDED AND RESTATED.
PROPOSAL 5: TO APPROVE OUR
2006 CASH BONUS PLAN
Our 2006 Cash Bonus Plan was approved by the Compensation
Committee of our Board on March 21, 2006. The purpose of
the plan is to provide performance-based cash incentive
compensation to certain of our management employees. The 2006
plan was adopted to be a successor plan to our 2002 Executive
Cash Bonus Plan, 2002 Supplemental Cash Bonus Plan and 2004
Management Achievement Plan. The 2002 Executive Cash Bonus Plan
and 2002 Supplemental Cash Bonus Plan, taken together, are the
plans under which our management employees are currently awarded
annual incentive compensation.
22
If shareholders approve the 2006 Cash Bonus Plan, no further
bonuses will be paid under any of the other bonus plans listed
above. The committee adopted the 2006 plan in order to minimize
the administrative burdens associated with maintaining more than
one annual bonus plan, as well as to facilitate its development
of a more uniform approach to incentive compensation.
Section 162(m) of the Code requires that plans such as the
2006 Cash Bonus Plan be approved by shareholders in order to
have amounts paid under the plan treated as qualified
performance-based compensation. As qualified performance-based
compensation, amounts payable under the plan will then be
deductible by us for federal income tax purposes. If the plan is
not approved, we will pay bonuses with respect to 2006 to our
management employees under our existing bonus plans and will not
pay any bonuses under this plan.
Description of our 2006 Cash Bonus Plan
The following is a summary of the material features of this
plan. The following summary does not purport to be complete and
is qualified in its entirety by reference to the terms of our
2006 Cash Bonus Plan, which is attached to this proxy statement
as Appendix C.
Types of Awards; Eligibility. The 2006 Cash Bonus Plan
provides for the payment of annual cash bonuses to management
employees of the company and its subsidiaries.
Amount Subject to the Plan. Target awards under the plan
are expressed as a percentage of an eligible employees
base salary. The maximum amount payable to any employee under
the plan with respect to any calendar year cannot exceed
$12 million.
Term of the Plan. No awards will be made under this plan
with respect to any calendar year beginning after
December 31, 2015. Awards granted after December 31,
2010 that are based on the satisfaction of quantitative
performance goals will be conditioned on the reapproval of the
plan by our shareholders.
Administration. The 2006 Cash Bonus Plan is administered
by the Compensation Committee. This committee has the authority
to select employees to participate in the plan, set applicable
performance goals, determine whether the performance goals have
been satisfied, interpret the plan and prescribe and amend rules
and regulations relating to the plan. The committee may delegate
to one of our officers or a committee of two or more of our
officers its discretion under the plan to grant awards to any
eligible employee other than an individual who, at the time of
grant, has a base salary of $500,000 or more, holds a position
with us of Senior Vice President or higher or is subject to the
short-swing profit recapture rules of the Securities Exchange
Act of 1934.
Terms of Awards; Performance Goals. The committee will
determine the terms and conditions of each award under the plan.
No bonus will be payable to a participant under the plan until
the committee certifies that the performance goals associated
with the bonus have been satisfied. Bonuses are paid as soon as
practicable following the end of each applicable calendar year.
The committee may establish company-wide, division-wide or
individual goals for each calendar year, which may be
quantitative performance standards or qualitative performance
standards. The quantitative performance standards may include,
but are not limited to, financial measurements such as income,
expense, operating cash flow, capital spending, numbers of
customers of, or subscribers for, various services and products
offered by us or one of our divisions, quantitative customer
service measurements and other objective financial or
service-based standards relative to our business as may be
established by the committee. The qualitative performance
standards may include, but are not limited to, qualitative
customer service, management effectiveness, workforce diversity
and other qualitative performance standards relevant to our
business.
For each calendar year, the performance goals will be
established by the committee by not later than the 90th day
of the year. The committee will also determine whether the
performance goals have been satisfied and the amount of bonuses
paid under the plan. The committee has the ability to reduce or
23
eliminate a bonus payable to a plan participant if it determines
that it is in our best interests. In addition, the committee may
pay such additional amounts based on the satisfaction of
performance standards as it may deem appropriate, whether or not
previously designated as a performance standard.
Withholding. All bonus payments will be subject to
withholding of applicable federal, state, local or other taxes.
Terminating Events. In the event of a liquidation of the
company or a transaction or series of transactions that results
in a change of control (as determined by our board), the
committee will give 30 days notice to plan participants
prior to the anticipated date of any such occurrence. The
committee may, in its discretion, provide in this notice that
upon the completion of this event, any remaining conditions to
the payment of a bonus under the plan will be waived in whole or
in part.
Amendment or Termination. We may amend or terminate the
plan at any time. No bonus award granted under the plan will be
affected by any such termination or amendment without the
written consent of the participant.
New Plan Benefits. Future grants of awards under the
plan, if any, that will be made to employees eligible to
participate in the plan are subject to the discretion of the
committee and, therefore, are not determinable at this time. The
following table reflects the aggregate targets that have been
established with respect to bonuses granted under the existing
2002 Executive Cash Bonus Plan and 2002 Supplemental Cash Bonus
Plan with respect to calendar year 2006 (which may be treated as
granted under this plan, if the plan is approved by
shareholders).
2006 Cash Bonus Plan
|
|
|
|
|
|
Name and Position |
|
% of Base Salary |
|
|
|
Brian L. Roberts
|
|
|
300 |
|
|
Chairman of the Board and CEO |
|
|
|
|
Stephen B. Burke
|
|
|
300 |
|
|
Executive Vice President; Chief Operating Officer and President,
Comcast Cable |
|
|
|
|
Ralph J. Roberts
|
|
|
125 |
|
|
Chairman of the Executive and Finance Committee of the Board |
|
|
|
|
Lawrence S. Smith
|
|
|
125 |
|
|
Executive Vice President; Co-Chief Financial Officer |
|
|
|
|
David L. Cohen
|
|
|
125 |
|
|
Executive Vice President |
|
|
|
|
John R. Alchin
|
|
|
125 |
|
|
Executive Vice President; Co-Chief Financial Officer and
Treasurer |
|
|
|
|
All executive officers as a group
|
|
|
100-300 |
|
All non-employee directors as a group
|
|
|
|
|
Company employees other than executive officers, as a group
|
|
|
2.5-100 |
|
OUR BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR APPROVAL OF THE 2006 CASH BONUS PLAN.
24
SHAREHOLDER PROPOSALS
We received the following five shareholder proposals. The
proponent of each proposal has represented to us that the
proponent has continuously held at least $2,000 in market value
of Class A common stock for at least one year and will
continue to hold these securities through the date of the annual
meeting.
For each of the shareholder proposals, other than adding a brief
title for the proposal, we have included the proposal and
shareholders supporting statement exactly as we received
it. Following each proposal, we explain why our Board recommends
a vote AGAINST the proposal. Mr. Brian L. Roberts,
as beneficial owner of all the outstanding shares of
Class B common stock, has indicated that he intends to vote
all of these shares against each of the five shareholder
proposals.
PROPOSAL 6: TO PREVENT THE
ISSUANCE OF NEW STOCK OPTIONS
The following proposal and supporting statement were submitted
by Mrs. Evelyn Y. Davis, Watergate Office Building, 2600
Virginia Ave. N.W., Suite 215, Washington, DC 20037, who
has advised us that she holds 160 shares of our common
stock.
|
|
|
RESOLVED: That the Board of Directors take the necessary
steps so that NO future NEW stock options are awarded to ANYONE,
nor that any current stock options are repriced or renewed
(unless there was a contract to do so on some). |
|
|
REASONS: Stock options awards have gone out of hand in
recent years, and some analysts MIGHT inflate earnings
estimates, because earnings affect stock prices and stock
options. |
|
|
There are other ways to reward executives and other
employees, including giving them actual STOCK instead of options. |
|
|
Recent scandals involving CERTAIN financial institutions have
pointed out how analysts CAN manipulate earnings estimates and
stock prices. |
|
|
If you AGREE, please vote YOUR proxy FOR this
resolution. |
Company Response to Shareholder Proposal
Our Board believes that we should have the ability to grant
stock options to our employees and directors, as one form of
long-term compensation. Stock options can be used as an
effective tool to align employee, director and shareholder
interests and to motivate and incentivize employees. Completely
eliminating stock options as an element of long-term
compensation would be inconsistent with compensation practices
followed by comparable companies and could place us at a
disadvantage in retaining, motivating and recruiting employees.
Under Nasdaq rules, we are required to submit our stock option
plans to shareholders for approval. In 2003, our shareholders
approved our 2003 Stock Option Plan by 86% of the votes cast.
Shareholder approval is also required for any amendment that
would allow us to reduce the exercise price of an option (other
than in a case where our capital structure is changed). Our
stock option plans are administered by the Compensation
Committee of our Board, which consists entirely of independent
directors. When granting stock options and other equity awards,
this committee reviews the practices of comparable companies as
well as consults with an independent compensation consultant.
We consistently assess our compensation philosophy and the most
effective ways to compensate our employees and directors.
Starting in 2004, we moved to granting a mix of 25% restricted
stock units and 75% stock options (by value) for key employees.
In 2005, we revised this program to provide for a mix of 50%
restricted stock units and options (by value) and adopted a
stock award program for non-employee directors, in lieu of
options. Currently, outstanding stock options and shares
available for future grants of options under our equity plans
represent 7.5% of our common stock on a fully diluted basis. We
intend to continue monitoring our stock-based compensation
programs and to make appropriate changes to such programs when
necessary.
25
This proposal would severely limit our flexibility to design a
balanced compensation package in a marketplace where incentives
such as stock options are prevalent. Because we must compete to
attract and retain highly qualified employees, our Board
believes the proposal, if implemented, could significantly
impede our ability to achieve results for the benefit of all of
our shareholders.
FOR THESE REASONS, OUR BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE AGAINST THIS PROPOSAL.
PROPOSAL 7: TO REQUIRE THAT
THE CHAIRMAN OF THE BOARD
NOT BE AN EMPLOYEE
The following proposal and supporting statement were submitted
by Mr. Richard A. Dee, 115 East 89th Street, New York,
NY 10128, who has advised us that he holds 100 shares of
our common stock.
Stockholders hereby request that the Comcast Board of
Directors adopt promptly a resolution requiring that the
Chairman of the Board serve in that capacity only and have no
management duties, titles, or responsibilities.
When someone acts, for example, both as a
corporations Chairman and its CEO, a vital separation of
power and responsibility is eliminatedand the owners of
the corporation, its stockholders, are deprived not only of a
crucial protection against conflicts of interest, they are
deprived of a clear and direct channel of communication with the
corporation.
What stockholder-damaging conflicts of interest can be
more serious than those that so often occur when overseers are
allowed to oversee and supervise themselves? When a
corporations Chairman is also its CEO, such conflicts can
and do happen.
At Enron, WorldCom, Tyco, and other legends of
mismanagement and corruption, the Chairmen also served as
CEOs. Their dual roles helped those individuals immensely
to achieve virtually total control of the companies.
Clearly, when a Chairman runs a company, the information
received by directors and others may or may not be accurate. If
a CEO wants to cover up corporate improprieties, how difficult
is it to convince subordinates to go along? If they disagree, to
whom do they complain? The Chairman?
As banker, investment banker, and a concerned and
outspoken stockholder, my experience with corporate Chairmen,
Presidents, CEOs, CFOs, counsels, and directors has
been considerable. And I do not come lately to Corporate
Governance. The term was new in 1979 when I originated and
sponsored the first such proposal ever voted uponat
3M Company, calling upon the company to reconstitute its
board so that a majority of its directors would be
non-management Outside Directors.
Few individual stockholders know enough about companies to
question their activities, and institutional investors, many of
whom know little if any more, all too frequently are too busy
currying favor with managements to have the guts to question
themand by doing so risk loss of access to the very
profitable Inside Information Superhighway. That
combination of stockholders has proven a recipe for disasters.
Stockholders must continue to expect the unexpected unless
and until they help cause company boards to be composed of
substantial majorities of independent and objective outside
directors who are particularly well-qualified to serve their
interestsand until those directors select as
Chairmen those who are independent of managements.
While individual stockholders are responsible only to
themselves, institutional stockholders are responsible to
millions of investors. All too often they have betrayed not only
their moral obligations, but their duties as fiduciaries.
Efforts to improve Corporate Governance have increasingly
been embodied in shareholder proposals such as
thisproposals that have been opposed widely by
institutional stockholders. It is time for those
26
whose financial futures are in the hands of money managers to
inform them that they expect them to recognize their duties and
to fulfil their legal obligationsthere is no higher
priority. Voting in favor of this proposal will help.
Please vote FOR this proposal.
Company Response to Shareholder Proposal
Our Board believes that we and our shareholders are best served
by having Brian L. Roberts serve as Chairman and CEO. Our Board
also believes that Board independence and oversight of
management are effectively maintained through the Boards
current composition, committee structure and composition, and
policy of having executive sessions of only independent,
non-employee directors that are led by our Presiding Director
(the identity of whom rotates among the Chairs of the
Compensation, Audit and Governance and Directors Nominating
Committees). Furthermore, having one individual perform the role
of Chairman and Chief Executive Officer is both consistent with
the practice of many major companies and not restricted or
prohibited by current laws (including the
Sarbanes-Oxley Act of
2002 and recently promulgated SEC regulations).
Only three of the 12 members of our Board of Directors are
currently our employees, and all of our Board committees, other
than the Executive and Finance Committee, consist entirely of
independent, non-employee directors. Therefore, there are ample
outside directors to offer critical review of management plans.
Furthermore, in accordance with our corporate governance
guidelines, Mr. Roberts has his performance evaluated
annually by our independent directors in an executive session.
Our directors, including the Chairman of the Board, are also
bound by fiduciary obligations under law to act in a manner that
they believe to be in our best interests and the best interests
of our shareholders. Separating the offices of Chairman of the
Board and Chief Executive Officer would not serve to augment or
diminish the fiduciary duties of any of our officers.
Rather, our Board believes that Mr. Roberts, in his
capacities as Chairman and CEO, serves as a bridge between the
Board and management and provides critical leadership for
carrying out our strategic initiatives and confronting our
challenges.
Our Board believes that the adoption of a policy requiring the
election of a non-management Chairman of the Board would not
enhance its independence or performance, and is not in the best
interests of our shareholders.
FOR THESE REASONS, OUR BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE AGAINST THIS PROPOSAL.
PROPOSAL 8: TO LIMIT
COMPENSATION FOR MANAGEMENT
The following proposal and supporting statement were submitted
by Robert D. Morse, 212 Highland Ave., Moorestown, NJ
08057-2717, who has advised us that he holds 1,105 shares
of our common stock.
PROPOSAL
I propose that the Directors eliminate all remuneration for any
one of Management in an amount above $500,000.00 per year,
eliminating possible severance pay and funds placed yearly in a
retirement account. This excludes minor perks and necessary
insurance, and required Social Security payments.
REASONING:
It is possible for a person to enjoy a profitable and enjoyable
life with the proposed amount, and even to underwrite their own
retirement plan. The Proxy is required to publish remuneration
of only five upper Management personnel. YOUR
assets are being constantly diverted for Managements gain.
Most asset gains are the result of a good product or service,
produced by the workers, successful advertising, and
27
acceptance by the public market. Just being in a Management
position does not materially affect these results, as companies
seldom founder due to a changeover.
EXPLANATION:
The Directors are the group responsible for the need of this
Proposal, as they determine remuneration, and under
Plurality voting rules, cannot be defeated for
election, even if only one vote For is received
each, for the number of nominees presented. It is suggested that
shareowners look deeper into why they are denied the Right
of Dissent; but ONLY in the Vote for Directors column.
This is unconstitutional! The choice of Against was
removed about Year 1975. You are asked to take the closer look
to be knowledgeable for your voting decisions, as Management
usually nominates Directors.
NOTE: Ford Motor Company agreed to return Against
three years ago, showing the American Way spirit as
a fine U.S. Corporation.
The Coca Cola Company eliminated SARs, severance
packages, and options awards as far back as 1998. The above
actions are commendable.
Company Response to Shareholder Proposal
Our Board believes that adoption of this proposal would severely
limit our ability to attract, motivate and retain senior
executives. We must be able to offer integrated compensation
programs that pay competitively and consistently with comparable
companies, align executive compensation with shareholder
interests and tie compensation to both individual and company
performance.
The Compensation Committee, which consists entirely of
independent directors, as defined under Nasdaq rules, recognizes
its responsibility to recommend executive compensation decisions
that are in our and our shareholders best interests. This
committee and our Board devote significant time and effort to
assess the performance of our Chief Executive Officer and our
other senior executives and consider, among other things, our
goals and objectives, performance and relative shareholder
return, the value of similar incentive awards to senior
executives at comparable companies, awards made to our senior
executives in prior years and our obligations under existing
employment agreements. The report of the Compensation Committee
included on page 48 of this proxy statement further
explains the philosophy and methodology of our compensation
policies for senior executives. Our Board believes that it is
ultimately in our shareholders best interest that this
process not be subject to the limitations reflected in this
proposal.
FOR THESE REASONS, OUR BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE AGAINST THIS PROPOSAL.
PROPOSAL 9: TO ADOPT A
RECAPITALIZATION PLAN
The following proposal and supporting statement were submitted
by the Communications Workers of America Members Relief
Fund, 501 Third Street, N.W., Washington, D.C. 20001-2797,
which has advised us that it holds Comcast common stock with a
market value in excess of $2,000.
RESOLVED: The shareholders request that the Board of Directors
take the steps that may be necessary to adopt a recapitalization
plan that would provide for all of the Companys
outstanding stock to have one vote per share.
SUPPORTING STATEMENT
Comcasts capital structure gives Brian Roberts a
disproportionate and nondilutable percentage of shareholder
votes. He had one third of the votes at the 2005 Annual Meeting
as the beneficial owner of all of Comcasts
9.44 million shares of Class B common stock, which has
15 votes per share.
In contrast, Comcasts 1.36 billion shares of
Class A common stock have two-thirds of the aggregate
voting power. For 2005, Mr. Roberts one-third
percentage was maintained by reducing the voting power of each
Class A share to just 0.282 votes.
28
We believe this disproportionate voting power presents a
significant danger to Comcast shareholders. As Louis Lowenstein
has observed, dual-class voting stocks eliminate checks or
balances, except for fiduciary duty rules that reach only the
most egregious sorts of behavior. [1989 Columbia Law
Review 979, 1008] They allow corporate control to be
seized or retained by corporate officers or insiders, and
power without accountability may eventually be abused.
[Whats Wrong With Wall Street 193 (1988)]
The danger of such disproportionate voting power is illustrated,
in our view, by the charges of fraud that have been brought
against top executives at Adelphia Communications and Hollinger
International. Like Comcast, each of those media companies had a
capital structure that gave disproportionate voting power to one
or more insiders. We believe those capital structures were a
factor that contributed to the alleged frauds by reducing
accountability.
Comcasts current capital structure has other
disadvantages. It could hinder acquisitions of companies that
are governed on the one share-one vote principle. It may also
inhibit efforts to raise additional capital, because some
persons, like Nell Minow, the editor of The Corporate Library,
would never buy or recommend non-voting or limited voting
stock. (USA Today, May 17, 2004)
With a market capitalization in excess of $59 billion,
Comcast may be the largest public company with disparate voting
rights. In our view, this large capitalization magnifies the
danger to investors that arises from Comcasts capital
structure, which gives Mr. Roberts one-third of the votes
with stock that represents less than 1 percent of the
Companys total market value.
At the 2005 Annual Meeting, this proposal won more then
34 percent of the votes that were cast for and against. If
all of the Class B shares were voted against, and
abstentions are excluded, it appears that the proposal won a
solid 57.5 percent majority of the votes that Class A
shareholders cast.
Raytheon, Readers Digest, Church & Dwight, Fairchild
Semiconductor, and other companies have recently eliminated
stocks with disparate voting rights in order to provide each
share of their common stock with a single vote. We believe
Comcast should also take this step in order to better align the
voting power of shareholders with their economic interests in
the Company.
Company Response to Shareholder Proposal
Our dual voting class structure has existed since we went public
in 1972. Prior to our acquisition of AT&T Corp.s
broadband business in November 2002, Mr. Brian L. Roberts
beneficially owned Comcast stock representing approximately 87%
of the combined voting power of all Comcast stock. In connection
with that transaction, Mr. Roberts agreed to reduce his
voting interest to a
331/3
% nondilutable interest. At the AT&T Corp.
shareholders meeting relating to the AT&T Broadband
transaction, the AT&T shareholders not only approved the
AT&T Broadband transaction as a whole but also separately
approved the governance terms of that transaction, which
approval was a condition to completing the AT&T Broadband
transaction. In fact, approximately 92% of the AT&T
shareholders voting on the governance proposal voted to approve
it.
Our Board believes that our historical success is owed in large
part to the respected and stable leadership provided by
Messrs. Ralph J. Roberts and Brian L. Roberts. Through
their leadership and focus on long-term growth, we have a proven
track record for creating shareholder value and building a
strong and innovative company. In 2005 we had the fifth straight
year of double-digit Operating Cash Flow (as defined in our 2005
Annual Report to shareholders) growth as well as significant
growth in new product offerings. We have also enjoyed long-term
growth in our stock value. Our shares have outperformed the
S&P 500 by a margin of almost 2 to 1 since we went public in
1972. Our Board believes that Messrs. Roberts have been,
and will continue to be, crucial to the long-term success of our
business and position of financial strength.
Our Board also believes that our history of being able to
successfully raise capital for acquisitions and our other
business needs provides evidence that the dual voting class
structure does not impair our ability to raise additional
capital or acquire other companies.
29
Finally, under Pennsylvania law and our Articles of
Incorporation, no recapitalization that affects the voting
rights of our Class B common stock can be effected without
the separate approval of Mr. Roberts, as beneficial owner
of our Class B common stock.
FOR THESE REASONS, OUR BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE AGAINST THIS PROPOSAL.
PROPOSAL 10: TO ESTABLISH A
MAJORITY VOTE SHAREHOLDER COMMITTEE
The following proposal and supporting statement were submitted
by the American Federation of Labor and Congress of Industrial
Organizations, 815 Sixteenth Street, N.W., Washington, DC 20006,
which has advised us that it holds 1,379 shares of our
Class A voting common stock.
Resolved: The stockholders of Comcast Corporation (the
Company) urge the Company to take the following
steps if a proposal submitted by a shareholder for a vote
pursuant to
Rule 14a-8 of the
Securities and Exchange Commission receives a majority of the
Class A votes cast (the Proposal), and the
Board of Directors (the Board) does not take the
action requested in the Proposal within 180 days of the
meeting at which the vote was obtained, then:
|
|
a) |
The Board shall constitute a Majority Vote Shareholder
Committee (the Committee) composed of the
proponent of the Proposal and other shareholders that indicate
to the Company an interest in participating in the Committee; |
|
b) |
The purpose of the Committee will be to communicate with the
Board regarding the subject matter of the Proposal; the
Committee will not be authorized to act on behalf of the Board
or to compel the Board to take action, and will not interfere
with the Boards authority to manage the business and
affairs of the Company; and |
|
c) |
The independent members of the Board shall meet with the
Committee no fewer than two times between the date on which the
Committee is constituted and the next annual meeting of
shareholders. |
The Board may abolish the Committee if (i) the Board takes
the action requested in the Proposal; or (ii) the
Proposals proponent notifies the Board that it does not
object to the abolition of the Committee.
Supporting Statement
We believe that Comcasts corporate governance would
benefit from more formal and unmediated stockholder input. In
recent years, a majority of Class A shareholders have voted
to urge our Company to reform its corporate governance practices.
At the 2005 annual shareholders meeting, a majority of
Class A shareholders voted for a proposal to eliminate the
companys poison pill unless the plan is approved by
shareholders. Yet Comcasts Board has not acted to adopt
this proposal.
Similarly in 2004 and 2005, more Class A shareholders voted
For than Against a shareholder proposal
urging the elimination of Comcasts dual class stock
structure. Despite these votes, the Board has not acted to adopt
this measure.
The purpose of this proposal is to create a mechanism by which
shareholders can communicate with their representatives, the
Board of Directors. This proposal does not aim to supplant the
Boards decision-making power, but to improve that
decision-making by ensuring that shareholders viewpoints
are fully presented to the independent directors.
We urge shareholders to vote FOR this proposal.
Company Response to Shareholder Proposal
Our Board is firmly committed to both ensuring effective
corporate governance and maximizing shareholder value. Important
to both is having procedures in place for our shareholders to
communicate
30
with us so that we can carefully consider their perspectives. We
currently have a wide array of methods of communications
available to our shareholders to ensure that they have access to
our directors. Shareholders who wish to communicate with one or
more of our directors may send communication to a particular
director, to the non-employee directors or to any other group of
directors or committee of our Board by mail or, in some cases,
e-mail. Shareholders
can find information on all these modes of communication on
page 3 of this proxy statement as well as on our website.
Any director receiving communications from shareholders through
these channels may meet with shareholders to discuss such
communications, and our shareholders are of course free to meet
with each other to discuss any matters they deem appropriate.
Furthermore, our Boards Governance and Directors
Nominating Committee, which consists entirely of independent
directors, as defined under Nasdaq rules, is responsible for
analyzing corporate governance issues and making recommendations
to the full Board. Each year, the Governance and Directors
Nominating Committee and our full Board review the issues raised
in shareholder proposals considered at that years annual
meeting of shareholders and, after careful consideration and
taking into account a variety of perspectives, decide whether
implementation of such proposals would be in our best interests
and the best interests of all of our shareholders.
Creation of a formal shareholder committee would merely add
another process that duplicates those already provided by us.
FOR THESE REASONS, OUR BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE AGAINST THIS PROPOSAL.
31
EXECUTIVE COMPENSATION
Summary Compensation Table
This table sets forth certain information regarding the annual
and long-term compensation we paid to or for our Chairman and
CEO and each of our other executive officers named in the table
(the named executive officers) for each of our last
three fiscal years.
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Long-Term |
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Compensation |
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|
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Annual Compensation |
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Awards(4) |
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|
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Number of |
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|
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Restricted |
|
Securities |
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|
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Other Annual |
|
Stock |
|
Underlying |
|
All Other |
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|
|
|
Salary |
|
Bonus |
|
Compensation |
|
Awards |
|
Options |
|
Compensation |
Name and Principal Position(1) |
|
Year |
|
($) |
|
($)(2) |
|
($)(3) |
|
($)(5) |
|
(#) |
|
($)(6) |
|
|
|
|
|
|
|
|
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|
|
|
|
|
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Brian L. Roberts
|
|
|
2005 |
|
|
|
2,368,250 |
|
|
|
7,714,500 |
|
|
|
398,059 |
|
|
|
5,608,350 |
(a) |
|
|
425,000 |
(7) |
|
|
2,321,530 |
|
|
Chairman of the |
|
|
2004 |
|
|
|
2,101,000 |
|
|
|
6,684,300 |
|
|
|
389,899 |
|
|
|
3,286,800 |
(c) |
|
|
800,000 |
(7) |
|
|
266,913 |
|
|
Board and CEO |
|
|
2003 |
|
|
|
2,001,000 |
|
|
|
6,000,000 |
|
|
|
365,618 |
|
|
|
|
|
|
|
950,100 |
(7) |
|
|
255,981 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,252 |
(8) |
|
|
|
|
|
Stephen B. Burke
|
|
|
2005 |
|
|
|
1,566,385 |
|
|
|
6,171,600 |
|
|
|
150,572 |
|
|
|
3,059,100 |
(a) |
|
|
232,500 |
(7) |
|
|
1,427,492 |
|
|
Executive Vice President, |
|
|
2004 |
|
|
|
1,226,230 |
|
|
|
4,331,969 |
|
|
|
1,204 |
|
|
|
10,548,000 |
(d) |
|
|
400,000 |
(7) |
|
|
1,057,276 |
|
|
Chief Operating Officer |
|
|
2003 |
|
|
|
1,167,886 |
|
|
|
5,166,886 |
|
|
|
554 |
|
|
|
|
|
|
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500,100 |
(7) |
|
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488,165 |
|
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and President, Comcast Cable |
|
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Ralph J. Roberts
|
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2005 |
|
|
|
1,765,000 |
|
|
|
2,250,864 |
|
|
|
4,983,378 |
|
|
|
2,566,245 |
(a) |
|
|
195,000 |
(7) |
|
|
6,908,470 |
|
|
Chair of the Executive |
|
|
2004 |
|
|
|
1,681,000 |
|
|
|
1,782,480 |
|
|
|
4,204,635 |
|
|
|
14,436,133 |
(e) |
|
|
500,000 |
(7) |
|
|
5,796,202 |
|
|
and Finance Committee of the Board |
|
|
2003 |
|
|
|
1,601,000 |
|
|
|
1,600,000 |
|
|
|
3,590,770 |
|
|
|
|
|
|
|
650,100 |
(7) |
|
|
4,867,132 |
|
|
Lawrence S. Smith
|
|
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2005 |
|
|
|
1,163,750 |
|
|
|
1,563,100 |
|
|
|
72,318 |
|
|
|
2,583,240 |
(a) |
|
|
200,000 |
(7) |
|
|
601,468 |
|
|
Executive Vice President |
|
|
2004 |
|
|
|
1,092,475 |
|
|
|
1,158,055 |
|
|
|
3,958 |
|
|
|
1,494,000 |
(c) |
|
|
375,000 |
(7) |
|
|
473,827 |
|
|
and Co-Chief Financial Officer |
|
|
2003 |
|
|
|
1,040,500 |
|
|
|
1,039,500 |
|
|
|
1,914 |
|
|
|
|
|
|
|
450,100 |
(7) |
|
|
344,844 |
|
|
David L. Cohen
|
|
|
2005 |
|
|
|
1,089,354 |
|
|
|
1,531,200 |
|
|
|
3,238 |
|
|
|
4,926,150 |
(b) |
|
|
425,000 |
(7) |
|
|
109,417 |
|
|
Executive Vice President |
|
|
2004 |
|
|
|
1,009,000 |
|
|
|
1,069,488 |
|
|
|
2,605 |
|
|
|
2,988,000 |
(c) |
|
|
375,000 |
(7) |
|
|
61,534 |
|
|
|
|
|
2003 |
|
|
|
961,000 |
|
|
|
960,000 |
|
|
|
2,175 |
|
|
|
|
|
|
|
400,100 |
(7) |
|
|
28,908 |
|
|
John R. Alchin
|
|
|
2005 |
|
|
|
984,531 |
|
|
|
1,307,900 |
|
|
|
6,148 |
|
|
|
2,277,330 |
(a) |
|
|
173,000 |
(7) |
|
|
620,118 |
|
|
Executive Vice President, |
|
|
2004 |
|
|
|
927,100 |
|
|
|
982,592 |
|
|
|
26,161 |
|
|
|
1,344,600 |
(c) |
|
|
325,000 |
(7) |
|
|
429,524 |
|
|
Co-Chief Financial Officer and Treasurer |
|
|
2003 |
|
|
|
883,000 |
|
|
|
882,000 |
|
|
|
105,157 |
|
|
|
|
|
|
|
400,100 |
(7) |
|
|
336,020 |
|
|
|
(1) |
Includes our Chairman and CEO and the five other most highly
compensated individuals who were our executive officers at the
end of 2005, each as measured by salary and bonus. |
|
(2) |
The amounts in this column include bonuses earned by the named
executive officers under our 2002 Executive Cash Bonus Plan and
2002 Supplemental Cash Bonus Plan. Also included in this column
is a one-time bonus of $3,032,000 paid to Mr. Burke in 2004
at the time he entered into an amended and restated employment
agreement with us. |
|
(3) |
This column includes: (a) the aggregate amount of payments
made to cover certain tax liabilities, calculated assuming the
highest individual income tax bracket (in 2005, Mr. Brian
L. Roberts, $138,826; Mr. Burke, $1,730; Mr. Ralph J.
Roberts, $4,847,231; Mr. Smith, $1,771; Mr. Cohen,
$3,238; and Mr. Alchin, $6,148; in 2004, Mr. Brian L.
Roberts, $257,141; Mr. Burke, $1,204; Mr. Ralph J.
Roberts, $4,108,727; Mr. Smith, $3,958; Mr. Cohen,
$2,605; and Mr. Alchin, $26,161; and in 2003,
Mr. Brian L. Roberts, $254,020; Mr. Burke, $554;
Mr. Ralph J. Roberts, $3,497,995; Mr. Smith, $1,914;
Mr. Cohen, $2,175; and Mr. Alchin, $105,157);
(b) amounts on account of personal use of company aircraft
in 2005, 2004 and 2003, determined as the extent to which the
value of such use, calculated on an incremental cost basis,
exceeds the amount paid to us by the executive for such use
pursuant to company policy, generally based on the associated
taxable value (in 2005, Mr. Brian L. Roberts, $211,562;
Mr. Burke, $144,222; Mr. Ralph J. Roberts, $97,096;
and Mr. Smith, $67,547; in 2004, Mr. Brian L. Roberts,
$90,933 and Mr. Ralph J. Roberts, $58,703; and in 2003, |
32
|
|
|
Mr. Brian L. Roberts, $73,712 and Mr. Ralph J.
Roberts, $59,509); (c) amounts on account of personal use
of company-provided administrative support (in 2005,
Messrs. Brian L. Roberts and Ralph J. Roberts, each
$39,051; in 2004, Messrs. Brian L. Roberts and Ralph J.
Roberts, each $37,205; and in 2003, Messrs. Brian L.
Roberts and Ralph J. Roberts, each $33,266); and
(d) amounts with respect to other incidental personal
benefits. The use of company aircraft is required by company
policy for security reasons with respect to personal and
business travel by Messrs. Brian L. Roberts, Ralph J.
Roberts and, beginning in 2005, Burke. In 2005, each of
Messrs. Cohen and Alchin, and in 2004 and 2003, each of
Messrs. Burke, Smith, Cohen and Alchin, received, after
payment to us in accordance with company policy, personal
benefits in an amount less than $50,000 (the minimum amount
required for disclosure under the rules of the Securities and
Exchange Commission). In 2005, 2004, and 2003, respectively,
pursuant to the companys policy regarding management
perquisites, the named executive officers paid the company the
following amounts for items that otherwise would have been
personal benefits: Mr. Brian L. Roberts, $285,041, $174,279
and $171,429; Mr. Burke, $88,092, $82,329 and $75,458;
Mr. Ralph J. Roberts, $59,538, $18,771 and $10,287;
Mr. Smith, $46,326, $23,430 and $28,407; Mr. Cohen,
$16,643, $7,382 and $13,816; and Mr. Alchin, $14,738, $0
and $11,273. |
|
|
(4) |
Does not include amounts payable to certain of the named
executive officers in connection with the cancellation of QVC
stock options as a result of the sale of our interest in QVC on
September 17, 2003 (see note 8 below). These amounts
were previously reported in our 2004 proxy statement. |
|
(5) |
(a) On March 14, 2005, we granted the following awards
of restricted stock units with respect to Class A common
stock: Mr. Brian L. Roberts, 165,000 restricted stock
units; Mr. Burke, 90,000 restricted stock units;
Mr. Ralph J. Roberts, 75,500 restricted stock units;
Mr. Smith, 76,000 restricted stock units; and
Mr. Alchin, 67,000 restricted stock units. The per share
value of the Class A common stock on the date of grant was
$33.99. 15% of the shares subject to each award vested on
March 14, 2006, 15% vest on each of March 14, 2007,
2008 and 2009 and 40% vest on March 14, 2010. |
|
|
|
(b) On March 14, 2005, we granted Mr. Cohen an
award of restricted stock units with respect to
76,000 shares of Class A common stock. The per share
value of the Class A common stock on the date of grant was
$33.99. 15% of the shares subject to this award vested on
March 14, 2006, 15% vest on each of March 14, 2007,
2008 and 2009 and 40% vest on March 14, 2010. |
|
|
On November 11, 2005, in connection with his entering into
a new employment agreement with us, we granted Mr. Cohen an
award of restricted stock units with respect to
87,000 shares of Class A common stock. The per share
value of the Class A common stock on the date of grant was
$26.93. 15% of the shares subject to this award vest on each of
January 2, 2007 and November 11, 2007, 2008 and 2009
and 40% vest on November 11, 2010. |
|
|
(c) On March 9, 2004, we granted the following awards
of restricted stock units with respect to Class A common
stock: Mr. Brian L. Roberts, 110,000 restricted stock
units; Mr. Smith, 50,000 restricted stock units;
Mr. Cohen, 100,000 restricted stock units; and
Mr. Alchin, 45,000 restricted stock units. The per share
value of the Class A common stock on the date of grant was
$29.88. 15% of the shares subject to each award vested on each
of March 9, 2005 and 2006, 15% vest on each of
March 9, 2007 and 2008 and 40% vest on March 9, 2009. |
|
|
(d) On January 12, 2004, we granted Mr. Burke an
award of 300,000 restricted shares of Class A common stock.
100,000 of these shares vested on January 2, 2005 and
50,000 on January 2, 2006 and 50,000 vest on each of
January 2, 2007, 2008 and 2009. The per share value of the
Class A common stock on the date of grant was $35.16. |
|
|
(e) On January 30, 2004, we granted Mr. Ralph J.
Roberts an award of 423,347 restricted shares of Class A
common stock. This award was granted in exchange for
Mr. Roberts waiving our obligation to pay certain
past and all future split-dollar life insurance premiums under
the terms of his employment agreement and split-dollar life
insurance policies and had a fair market value on the date of
grant equal to the net present value of these obligations.
One-third of these shares vested on each |
33
|
|
|
of January 2, 2005 and 2006 and one-third vests on
January 2, 2007. The per share value of the Class A
common stock on the date of grant was $34.10. |
|
|
The aggregate number of shares and value with respect to the
named executive officers on December 31, 2005 for
restricted stock holdings were: Mr. Brian L. Roberts,
258,500 shares of Class A common stock ($6,700,320);
Mr. Burke, 290,000 shares of Class A common stock
($7,516,800); Mr. Ralph J. Roberts, 357,731 shares of
Class A common stock ($9,272,388); Mr. Smith,
118,500 shares of Class A common stock ($3,071,520);
Mr. Cohen, 248,000 shares of Class A common stock
($6,428,160) and 5,000 shares of Class A Special
common stock ($128,450); and Mr. Alchin,
105,250 shares of Class A common stock ($2,728,080).
Holders of restricted shares and restricted stock units do not
have any voting rights with respect to these shares. The dollar
values are based on the closing price of our Class A common
stock ($25.92) and Class A Special common stock ($25.69) on
December 30, 2005. |
|
|
(6) |
This column includes (with respect to amounts applicable to
2005): (a) payments to certain named executive officers to
reimburse them for amounts attributable to the term life
insurance portion of certain split-dollar life insurance
policies (Mr. Brian L. Roberts, $1,818; Mr. Ralph J.
Roberts, $3,319,936; Mr. Smith, $2,325; and
Mr. Alchin, $2,136); (b) payments to cover premiums
attributable to term life insurance policies (Mr. Brian L.
Roberts, $189,099); (c) contributions to our
Retirement-Investment Plan in the amount of $12,600 for each of
the named executive officers; (d) the contribution to our
deferred compensation plan in the amount of $2,000,000
(Mr. Brian L. Roberts); (e) payments to certain named
executive officers to cover the premiums attributable to our
executive long-term disability plan (Mr. Brian L. Roberts,
$4,104; Mr. Smith, $1,658; and Mr. Alchin, $5,938);
and (f) the dollar value of interest earned on deferred
compensation in excess of 120% of the long-term applicable
federal rate (the current rate on deferred compensation is 12%)
(Mr. Brian L. Roberts, $113,909; Mr. Burke,
$1,414,892; Mr. Ralph J. Roberts, $3,575,934;
Mr. Smith, $584,885; Mr. Cohen, $96,817; and
Mr. Alchin, $599,444). |
|
(7) |
Represents the number of shares of Class A common stock
issuable upon the exercise of options. |
|
(8) |
Represents the number of shares of QVC common stock that were
issuable upon the exercise of options granted to certain named
executive officers by the compensation committee of the QVC
board of directors pursuant to the QVC stock option and stock
appreciation rights plan. As a result of the sale of our
interest in QVC, all options to purchase QVC common stock held
by our employees were cancelled in exchange for a cash payment
(or deferred cash payment plus interest) from us equal to the
difference between the value of the consideration we received in
the sale for each share of QVC we owned and the exercise price
of the option. |
34
Stock Option Grants
This table contains information concerning grants of employee
stock options we made to the named executive officers during
2005. No stock appreciation rights were granted during 2005 to
the named executive officers.
Stock Option Grants in 2005
|
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|
|
|
|
|
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|
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|
|
|
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|
Individual Grants(1) |
|
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|
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% of |
|
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|
|
|
|
Total |
|
|
|
|
Number of |
|
Options |
|
|
|
|
Securities |
|
Granted |
|
|
|
|
Underlying |
|
to |
|
|
|
|
Options |
|
Employees |
|
Exercise Price |
|
Expiration |
|
Grant Date Present |
Name |
|
Granted (#)(2) |
|
in 2005 |
|
($/Sh) |
|
Dates |
|
Value ($)(3) |
|
|
|
|
|
|
|
|
|
|
|
Brian L. Roberts
|
|
|
425,000 |
|
|
|
4.1 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
5,678,000 |
|
Stephen B. Burke
|
|
|
232,500 |
|
|
|
2.3 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
3,106,200 |
|
Ralph J. Roberts
|
|
|
195,000 |
|
|
|
1.9 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
2,605,200 |
|
Lawrence S. Smith
|
|
|
200,000 |
|
|
|
1.9 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
2,672,000 |
|
David L. Cohen
|
|
|
200,000 |
|
|
|
1.9 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
2,672,000 |
|
|
|
|
225,000 |
|
|
|
2.2 |
% |
|
|
26.93 |
|
|
|
11/11/15 |
|
|
|
2,414,250 |
|
John R. Alchin
|
|
|
173,000 |
|
|
|
1.7 |
% |
|
|
33.99 |
|
|
|
03/14/15 |
|
|
|
2,311,280 |
|
|
|
(1) |
Options are for the purchase of shares of Class A common
stock and were granted on March 14, 2005 and
November 11, 2005 under our stock option plans. All options
granted in 2005 have exercise prices equal to the fair market
value of the underlying shares on the date of grant. Options
granted in 2005 become exercisable at the rate of 30% of the
shares covered thereby on the second anniversary of the date of
grant, another 15% on each of the third, fourth and fifth
anniversaries of the date of grant, another 5% on each of the
sixth through ninth anniversaries of the date of grant and 5%
six months prior to the tenth anniversary of the date of grant. |
|
(2) |
Does not include certain options to purchase Class A
Special common stock granted to Messrs. Smith and Alchin
prior to 2005 which were amended at the time we entered into new
employment agreements with them to, among other things, increase
the exercise price of the options and to provide for full term
exercisability upon termination of employment (other than a
voluntary or for cause termination). |
|
(3) |
These amounts represent the estimated present value of options
at the date of grant calculated using the Black-Scholes
option-pricing model, based upon the following assumptions used
in developing the grant valuations: an expected volatility of
approximately 27.0%; an expected term to exercise of seven
years; an interest rate of approximately 4.4% in the case of the
March 2005 grants and 4.6% in the case of the November 2005
grant; and no dividend yield. The actual value of these options,
if any, realized by an executive officer will depend on the
extent to which the market value of the Class A common
stock exceeds the exercise price of the option on the date the
option is exercised. Consequently, there is no assurance that
the value realized by a named executive officer will be at or
near the value estimated above. These amounts should not be used
to predict share performance. |
35
Stock Option Exercises and Holdings
This table contains information related to options to purchase
shares of Class A Special common stock exercised during
2005 by the named executive officers and the number and value of
options to purchase Class A Special common stock and
Class A common stock held at December 31, 2005 by such
individuals.
Aggregated Option Exercises in 2005
and Option Values at December 31, 2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Securities |
|
Value of Unexercised |
|
|
|
|
|
|
Underlying Unexercised |
|
In-the-Money |
|
|
Shares |
|
|
|
Options at |
|
Options at |
|
|
Acquired |
|
|
|
December 31, 2005 (#) |
|
December 31, 2005 ($) |
|
|
on Exercise |
|
Value |
|
|
|
|
Name |
|
(#) |
|
Realized ($) |
|
Exercisable |
|
Unexercisable |
|
Exercisable |
|
Unexercisable |
|
|
|
|
|
|
|
|
|
|
|
|
|
Brian L. Roberts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
|
|
|
$ |
|
|
|
|
12,341,173 |
|
|
|
452,704 |
|
|
$ |
26,376,765 |
|
|
$ |
3,938,625 |
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
287,500 |
|
|
|
1,887,500 |
|
|
$ |
|
|
|
$ |
|
|
Stephen B. Burke
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
|
|
|
$ |
|
|
|
|
3,536,400 |
|
|
|
534,750 |
|
|
$ |
6,111,651 |
|
|
$ |
2,977,833 |
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
152,500 |
|
|
|
980,000 |
|
|
$ |
|
|
|
$ |
|
|
Ralph J. Roberts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
|
|
|
$ |
|
|
|
|
3,406,573 |
|
|
|
2,704 |
|
|
$ |
11,570,708 |
|
|
$ |
|
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
197,500 |
|
|
|
1,147,500 |
|
|
$ |
|
|
|
$ |
|
|
Lawrence S.
Smith(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
150,000 |
|
|
$ |
3,381,531 |
|
|
|
550,254 |
(2) |
|
|
1,602,250 |
|
|
$ |
4,720,141 |
|
|
$ |
787,725 |
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
1,025,000 |
|
|
$ |
|
|
|
$ |
|
|
David L. Cohen
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
|
|
|
$ |
|
|
|
|
278,250 |
|
|
|
331,750 |
|
|
$ |
514,763 |
|
|
$ |
613,738 |
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
122,500 |
|
|
|
1,077,500 |
|
|
$ |
|
|
|
$ |
|
|
John R.
Alchin(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Special common stock
|
|
|
63,960 |
|
|
$ |
1,501,781 |
|
|
|
653,250 |
|
|
|
1,206,750 |
|
|
$ |
6,104,625 |
|
|
$ |
656,438 |
|
|
Class A common stock
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
898,000 |
|
|
$ |
|
|
|
$ |
|
|
|
|
(1) |
The exercisability schedule of certain options held by
Messrs. Smith and Alchin was amended when we entered into
new employment agreements with them. |
|
(2) |
Includes 97,401 shares underlying options that were
transferred by Mr. Smith to members of his family. |
This table summarizes our equity plan information as of
December 31, 2005. This table does not include any shares
that may be issued pursuant to the proposed additional shares
under each of our 2002 Employee Stock Purchase Plan and 2002
Restricted Stock Plan that are the subject of Proposals 3
and 4 of this proxy statement.
Equity Compensation Plan Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) |
|
|
|
|
|
|
Number of Securities |
|
|
|
|
|
|
Remaining Available |
|
|
(a) |
|
(b) |
|
for Future Issuance |
|
|
Number of Securities |
|
Weighted-Average |
|
Under Equity |
|
|
to Be Issued upon |
|
Exercise Price of |
|
Compensation Plans |
|
|
Exercise of |
|
Outstanding |
|
Excluding Securities |
|
|
Outstanding Options, |
|
Options, Warrants |
|
Reflected in |
Plan Category |
|
Warrants and Rights |
|
and Rights |
|
Column (a) |
|
|
|
|
|
|
|
Equity compensation plans approved by security
holders(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common stock
|
|
|
86,684,527 |
|
|
$ |
37.09 |
|
|
|
45,096,147 |
|
|
Class A Special common stock
|
|
|
51,502,781 |
|
|
$ |
31.35 |
|
|
|
|
|
Equity compensation plans not approved by security holders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total(2)
|
|
|
138,187,308 |
|
|
|
|
|
|
|
45,096,147 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36
|
|
(1) |
Includes the following plans: the Comcast Corporation 1987 Stock
Option Plan, the Comcast Corporation 2002 Stock Option Plan, the
Comcast Corporation 2002 Restricted Stock Plan, the Comcast
Corporation 2002 Employee Stock Purchase Plan and the Comcast
Corporation 2003 Stock Option Plan. |
|
(2) |
Includes stock options assumed in connection with our
acquisition of the AT&T Broadband business in November 2002,
which were granted under the AT&T Broadband Corp. Adjustment
Plan. As of December 31, 2005, these assumed stock options
were outstanding with respect to 38,117,402 shares of
Class A common stock and had a weighted average exercise
price of $45.52 per share. |
Pension Plan
Under our Supplemental Executive Retirement Plan, adopted
July 31, 1989, supplemental retirement, death and
disability benefits may be paid to or in respect of certain of
our and our affiliated companies senior executives, as
selected by our Board. Mr. Ralph J. Roberts (who is
credited with 30 years of service, the maximum credited
service allowed under the Supplemental Executive Retirement
Plan) is the only current named executive officer selected by
our Board to participate in the Supplemental Executive
Retirement Plan. The Supplemental Executive Retirement Plan
contemplates the payment of various percentages of a
participants final average compensation (as actuarially
reduced, in certain circumstances, and as defined below) if the
participant: (i) elects to retire early (after the later of
the participants 55th birthday or 20 years of
service with us); (ii) retires at age 65 or after;
(iii) suffers a permanent disability that renders the
participant incapable of employment in the same or a similar
occupation; or (iv) dies. A participant may elect a
reduction in lifetime benefits in exchange for the continuation
of payments to a surviving spouse or his designated beneficiary.
This table shows the annual single life annuity retirement
benefit that Mr. Ralph J. Roberts would receive based on
remuneration covered by, and years of service credited under,
the Supplemental Executive Retirement Plan if he had retired on
January 1, 2006 at age 65 (or older). The benefits
shown below are subject to reduction for Social Security
benefits.
Pension Plan Table
|
|
|
|
|
Final Average |
|
Years of Service |
Compensation(1) |
|
30 or More(2) |
|
|
|
$2,700,000
|
|
$ |
1,620,000 |
|
2,900,000
|
|
|
1,740,000 |
|
3,100,000
|
|
|
1,860,000 |
|
3,300,000
|
|
|
1,980,000 |
|
3,500,000
|
|
|
2,100,000 |
|
|
|
(1) |
Final average compensation equals one-fifth of the total
compensation for the five years preceding termination of
employment. Compensation includes salary, bonus (including any
deferred bonus) and any other supplementary remuneration, but
excludes payments made to participants for split-dollar life
insurance premium bonuses and payments made to offset tax
liabilities incurred related to these bonuses. In the case of
Mr. Ralph J. Roberts, final average compensation may, under
some circumstances, be increased as described below in
Agreements with Executive Officers and
DirectorsCompensation Agreement with Mr. Ralph J.
RobertsElection to Become a Consultant. |
|
(2) |
This column represents the maximum annual benefit payable under
the Supplemental Executive Retirement Plan. |
37
Agreements with Executive Officers and Directors
|
|
|
Employment Agreement with Mr. Brian L. Roberts |
In 2005, we entered into a new employment agreement with
Mr. Brian L. Roberts, our Chairman and CEO. The following
is a description of the material terms of this agreement.
Term. The term of the employment agreement is from
June 1, 2005 through June 30, 2009.
Base Salary. Mr. Roberts will receive an annual base
salary of $2,500,000. This amount will be reviewed for increase
for each subsequent calendar year in the term of the agreement.
If so adjusted, Mr. Roberts salary may not be
reduced, except pursuant to an overall plan to reduce the
compensation of all our senior executive officers.
Bonus; Stock Awards. Mr. Roberts is eligible to
receive an annual performance bonus, payable in cash, of a
percentage of his base salary for the applicable year.
Mr. Roberts agreement provides that, for 2005, his
target bonus opportunity under our Executive Cash Bonus Plan was
135% of base salary. Mr. Roberts is also eligible to
participate in our Supplemental Cash Bonus Plan and had a target
bonus opportunity under that plan, for 2005, of 165% of his base
salary. For subsequent years during the term of the agreement,
Mr. Roberts bonus opportunity under each of these
plans, expressed as a percentage of base salary, will be
established by the Compensation Committee; however, the
agreement provides that the sum of the applicable percentages
will not be less than 300%.
The agreement also provides that Mr. Roberts is eligible to
participate in our stock option and restricted stock plans on
the same basis as our other senior officers. Awards under these
plans are determined by the Compensation Committee, taking into
account Mr. Roberts positions, duties and
performance.
Deferred Compensation. Mr. Roberts may cause the
payment of all or a portion of the compensation payable to him
to be deferred in accordance with and subject to our deferred
compensation plans. In addition, the agreement entitles
Mr. Roberts to an annual company contribution to our
deferred compensation plans, in accordance with the following
schedule:
|
|
|
|
|
Year |
|
Amount |
|
|
|
2005
|
|
$ |
2,000,000 |
|
2006
|
|
$ |
2,100,000 |
|
2007
|
|
$ |
2,205,000 |
|
2008
|
|
$ |
2,315,250 |
|
2009
|
|
$ |
2,431,012 |
|
Perquisites. The agreement provides for Mr. Roberts
to continue to receive those perquisites and fringe benefits in
effect at the time of the agreement under our current plans and
policies, including our aviation policy (as described in
footnote 3 to the Summary Compensation Table on
page 32 of this proxy statement).
Termination. The employment agreement will terminate upon
the death of Mr. Roberts, at our option upon his disability
or for cause, upon a vote of not less than three-fourths of the
entire membership of our Board. If his employment is terminated
by reason of his death or disability, we must continue to pay
his annual base salary on a monthly basis, and his target
bonuses on an annual basis, for five years to him or, upon his
death, to his estate or to his spouse for so long as she is
living and thereafter to her estate. In addition, upon
Mr. Roberts death, we have agreed to provide health
plan benefits to Mr. Roberts spouse during her
lifetime and, upon his disability, we will continue to provide
the company deferred compensation credits on the schedule set
forth above for so long as he is living. If we terminate his
employment without cause or he terminates it with good reason,
Mr. Roberts is entitled to payment of base salary (based on
the highest annual base salary he received during the term) and
health and welfare benefits for a period through the later of
the end of the term and twenty-four months after termination. He
is also entitled to the payment of his annual cash bonuses
(based on his highest participation levels
38
during the term) for a period through the later of the end of
the term and twelve months after termination. If
Mr. Roberts dies after a termination without cause or with
good reason and before June 30, 2009, his surviving spouse
(or her estate) will instead be entitled to receive the death
benefits described above and we will continue to provide the
company deferred compensation credits on the schedule set forth
above.
Noncompetition and Confidentiality. Mr. Roberts has
agreed not to compete with us during his employment and, in the
event his employment terminates other than by the company
without cause or by him with good reason, for one year after
termination of his employment. If we have not renewed the
agreement and Mr. Roberts terminates his employment after
the end of the initial term of the agreement (other than for
good reason), we may elect to have the noncompetition provision
apply in exchange for providing him one years base salary
and bonus and a deferred compensation credit. He is also
required to maintain the confidentiality of our information and
not to use such information except for our benefit.
Mr. Roberts has also agreed not to solicit our employees or
customers for one year after termination of his employment.
Term and Split-Dollar Life Insurance Agreements with
Mr. Roberts. We have entered into various agreements,
including the employment agreement, with Mr. Roberts that
obligate us to provide him with term, universal and split-dollar
life insurance policies, aggregating $223 million in face
value. The split-dollar policy is currently fully paid, however,
we pay additional compensation to Mr. Roberts that has the
effect of offsetting taxable income he would otherwise recognize
annually in connection with this policy. Mr. Roberts pays
income tax on this additional compensation. With respect to the
term and/or universal life insurance policies, we pay the
premiums on these policies as well as an income tax
gross-up payment on
account thereof. These insurance-related agreements do not
terminate upon the termination of Mr. Roberts
employment with us.
Change of Control Provisions. Under the agreement, if our
Board determines that it is appropriate to accelerate the
vesting of options and/or restricted stock units in connection
with a change of control transaction, we will provide notice to
Mr. Roberts of this decision at least ten business days
before the anticipated closing date of the change of control
transaction. If so determined, all options and restricted stock
units held by Mr. Roberts will become fully vested. Until
the day before the date of a change of control, he will be able
to exercise all such options. If the change of control is not
consummated, the options will be treated as not having been
exercised. In addition, if Mr. Roberts employment is
terminated on or after the occurrence of a change of control,
this termination will be treated as a termination without cause
under the agreement entitling him to the benefits described
above.
|
|
|
Employment Agreement with Mr. Burke |
In 2005, we entered into a new employment agreement with
Mr. Stephen B. Burke, our Executive Vice President, Chief
Operating Officer and President of Comcast Cable. The following
is a description of the material terms of this agreement.
Term. The term of the agreement is from November 1,
2005 through December 31, 2010.
Base Salary. The agreement provides for an annual base
salary of $2,000,000 through December 31, 2006. This amount
will be reviewed for increase for each subsequent calendar year
in the term of the agreement. If so adjusted,
Mr. Burkes salary may not be reduced, except pursuant
to an overall plan to reduce the compensation of all our senior
executive officers.
Bonus; Stock Awards. Mr. Burke is eligible to
receive an annual performance bonus, payable in cash, of a
percentage of his base salary for the applicable year.
Mr. Burkes agreement provides that, for 2005, his
bonus opportunity under our Executive Cash Bonus Plan was 135%
of base salary. Mr. Burke is also eligible to participate
in our Supplemental Cash Bonus Plan and had a target bonus
opportunity under that plan, for 2005, of 165% of his base
salary. For subsequent years during the term of the agreement,
Mr. Burke will be entitled to continue to participate in
these plans and the agreement provides that the
39
sum of the applicable target bonus percentages will not be less
than 300% if all performance targets under the plans are
achieved.
The agreement also provides that Mr. Burke is eligible to
participate in our stock option and restricted stock plans on
the same basis as our other senior officers. Awards under these
plans are determined by the Compensation Committee, taking into
account Mr. Burkes positions, duties and
performance.
Deferred Compensation. Mr. Burke may cause the
payment of all or a portion of the compensation payable to him
to be deferred in accordance with and subject to our deferred
compensation plans. In addition, the agreement entitles
Mr. Burke to an annual company contribution to our deferred
compensation plans, in accordance with the following schedule:
|
|
|
|
|
Year |
|
Amount |
|
|
|
2006
|
|
$ |
1,680,000 |
|
2007
|
|
$ |
1,764,000 |
|
2008
|
|
$ |
1,852,200 |
|
2009
|
|
$ |
1,944,800 |
|
2010
|
|
$ |
2,042,050 |
|
Termination. If we terminate Mr. Burkes
employment without cause, he is entitled to receive his then
current base salary and all insurance, medical or other similar
benefits for a period of twenty-four months from the date of
termination. He is also entitled to receive one years
target annual bonus and continued vesting of his stock options
and restricted shares for one year following termination. If
Mr. Burke terminates his employment for good reason, he
will receive the same benefits as he would have if we had
terminated his employment without cause. If his employment
terminates due to his death or disability, he will receive three
months of base salary, full vesting of his restricted stock
units and stock options and his options will remain exercisable
for the balance of their remaining terms. If he resigns, he is
entitled only to his base salary for days actually worked.
Noncompetition and Confidentiality. Mr. Burke has
agreed not to compete with us during his employment and, in the
event his employment terminates other than by the company
without cause or by him with good reason, for one year after
termination of his employment. If we have not renewed the
agreement and Mr. Burke terminates his employment after the
end of the initial term of the agreement (other than for good
reason), we may elect to have the noncompetition provisions
apply in exchange for providing him one years base salary
and bonus. The agreement also requires him to maintain the
confidentiality of our information and not to use such
information, except for our benefit, at all times during and
after his employment with us.
Change of Control Provisions. Under the agreement, if our
Board determines that it is appropriate to accelerate the
vesting of options in connection with a change of control
transaction, we will provide notice to Mr. Burke of this
decision at least ten business days before the anticipated
closing date of the change of control transaction. If so
determined, all options held by Mr. Burke will become
immediately exercisable in full. Until the day before the date
of a change of control, he will be able to exercise all such
options. If the change of control is not consummated, the
options will be treated as not having been exercised.
|
|
|
Compensation Agreement with Mr. Ralph J. Roberts |
We have entered into a compensation agreement with
Mr. Ralph J. Roberts, the founder of Comcast and Chairman
of the Executive and Finance Committee of our Board. The
following is a description of the material terms of this
agreement, as amended.
Term; Position. The term of the compensation agreement is
from August 31, 1998 to December 31, 2007. The
compensation agreement provides that Mr. Roberts will serve
as Chairman of the Executive and Finance Committee of our Board
until such time as he may elect to change his status to that of
a non-executive consultant, and that until he makes such
election he will continue to devote substantially all of his
working time to us.
40
If Mr. Roberts elects to become a non-executive consultant,
he will devote such time as is necessary to perform the
functions we reasonably request. In addition, for a period of
five years following any termination of the service period of
the compensation agreement, Mr. Roberts will perform such
reasonable ceremonial functions as we may request and will
promote our interests and goodwill as we may reasonably request.
Base Salary. The compensation agreement provides that
Mr. Roberts will receive an annual base salary of
$1,600,000, as adjusted (but not reduced, except pursuant to an
overall plan to reduce the compensation of all our senior
executive officers) in order to reflect the greater of increases
in the consumer price index subsequent to 1997 and the average
percentage increase in the base compensation of our five
employees (other than Mr. Roberts) with the highest base
compensation during the preceding year.
Bonus. So long as he continues to serve as one of our
executive officers, Mr. Roberts will be eligible to receive
annual bonuses of up to 50% of his base salary in accordance
with our Executive Cash Bonus Plan, based on performance targets
established by the Compensation Committee. Mr. Roberts is
also eligible to participate in our Supplemental Cash Bonus Plan.
Split-Dollar Life Insurance. The compensation agreement
requires that we continue to provide and maintain the
split-dollar life insurance provided to Mr. Roberts under a
previous agreement and to provide additional survivorship
split-dollar life insurance to Mr. Roberts and his spouse.
Such split-dollar life insurance includes certain split-dollar
life insurance provided to replace the potential benefits
represented by a prior terminated discretionary bonus plan with
respect to the appreciation through March 15, 1994 in the
options for Class A Special common stock previously awarded
to Mr. Roberts, taking into account our financial position
and the tax deductibility of any such payments. Under the
compensation agreement and the terms of the split-dollar life
insurance arrangements, we are obligated to pay the whole-life
portion of the annual premiums for certain single-life and
joint-and-survivor life insurance policies for Mr. Roberts,
and upon payment of the policies at the death of
Mr. Roberts or of the survivor of Mr. Roberts and his
spouse, as applicable, we recover all of the cumulative premiums
previously paid by us for the whole-life portion of such
policies. In 2004, Mr. Roberts waived our obligation to pay
certain past and all future premium payments under the
compensation agreement and the split-dollar life insurance
policies in exchange for a restricted share award.
Supplemental Death Benefit. Upon the death of
Mr. Roberts, the compensation agreement requires us to pay
a supplemental death benefit to a beneficiary designated by
Mr. Roberts. The compensation agreement substituted this
death benefit for two bonus arrangements of comparable value
included in a prior agreement that were based on appreciation of
Class A common stock from the date of grant of options to
purchase Class B common stock to the date of exercise. We
must pay the death benefit within six months from the date of
Mr. Roberts death. Under the terms of the
compensation agreement, Mr. Roberts requested that we
invest portions of the death benefit in certain investments
identified by Mr. Roberts. We have complied with
Mr. Roberts request, and the amount of the death
benefit has been adjusted to reflect the increase or decrease in
value of any such investments. As of December 31, 2005, the
amount of the death benefit was approximately $39.3 million.
Termination. The compensation agreement will terminate
upon Mr. Roberts death, at our option upon his
disability or for cause, upon a vote of not less than two-thirds
of the entire membership of our Board. If his employment is
terminated by reason of his death or disability, we must
continue to pay his annual base salary on a monthly basis for
five years to him or, upon his death, to his designated
beneficiary. Upon Mr. Roberts death, we have agreed
to provide health plan benefits to Mr. Roberts spouse
during her lifetime. In addition, the death benefit described
above will continue to be payable in accordance with its terms
and all of his outstanding stock options will vest fully and
remain exercisable for their remaining terms. If we terminate
his employment in violation of the compensation agreement (which
would include a discharge without cause), he will remain
entitled to substantially all of the benefits under the
compensation agreement (e.g., salary, annual bonus and
health plan benefits) for the original remaining term of the
agreement.
41
Noncompetition and Confidentiality. Mr. Roberts has
agreed not to compete with us during his employment and for five
years after termination of his employment. The compensation
agreement also requires him to maintain the confidentiality of
our information and not to use such information, except for our
benefit, at all times during his employment and after
termination of his employment. Breach by Mr. Roberts of any
of these obligations constitutes cause for termination of the
compensation agreement.
Change of Control Provisions. Prior to any change of
control, we must establish and fund a grantor trust, the amounts
in which will be subject to claims of our creditors in the case
of our bankruptcy, for the purpose of paying all deferred
compensation, nonqualified retirement benefits and split-dollar
life insurance premiums and bonuses for Mr. Roberts then
applicable. Upon the occurrence of a change of control, such
trust must become irrevocable, and we must continue to make
payments into such trust to maintain sufficient amounts to fund
all benefits subject to the trust. While our acquisition of the
AT&T Broadband business in November 2002 was a change of
control under the compensation agreement, Mr. Roberts
elected to waive his right to have us fund the trust at that
time; however, Mr. Roberts may exercise this right at any
time by providing notice to us. In addition, if
Mr. Roberts employment is terminated on or after the
occurrence of a change of control, this termination cannot be
treated as a termination for cause under the agreement.
Election to Become a Consultant. Mr. Roberts may at
any time, upon 30 days notice to us, elect to change
his position from an executive to a consultant. In such event,
he will continue to receive all of the compensation provided
under the compensation agreement, other than the bonus to which
he would otherwise be entitled under our Executive Cash Bonus
Plan. If he elects to become a consultant,
Mr. Roberts entitlement to retirement benefits under
our Supplemental Executive Retirement Plan will be adjusted
annually to reflect 150% of his base salary as a consultant, but
his benefits under such plan will not in any event exceed the
bonus he could have received under the compensation agreement
had he continued to work as an executive.
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Employment Agreements with Messrs. Smith and Alchin |
In 2005, we entered into new employment agreements with each of
Mr. Lawrence S. Smith, our Executive Vice President and
Co-Chief Financial Officer, and Mr. John R. Alchin, our
Executive Vice President, Co-Chief Financial Officer and
Treasurer. The following is a description of the material terms
of these agreements.
Term. The term of the agreements is from October 1,
2005 through December 31, 2008.
Base Salary. The agreements with Messrs. Smith and
Alchin provide for an annual base salary of $1,225,000 and
$1,025,000, respectively, through December 31, 2006. In
each case, this amount will be reviewed for increase for each
subsequent calendar year in the term of the agreement. If so
adjusted, base salary may not be reduced, except pursuant to an
overall plan to reduce the compensation of all our senior
executive officers.
Bonus; Stock Awards. Each of the executives is eligible
to receive an annual performance bonus, payable in cash, of a
percentage of his base salary for the applicable year. Each of
the executives agreements provides that, for 2005, his
respective bonus opportunity under our Executive Cash Bonus Plan
was 75% of base salary. Each of the executives is also eligible
to participate in our Supplemental Cash Bonus Plan and each had
a target bonus opportunity under that plan, for 2005, of 50% of
his base salary. For subsequent years during the term of the
agreements, each executive will be entitled to continue to
participate in each of these plans and each agreement provides
that the sum of the applicable target bonus percentages will not
be less than 125% if all performance targets under the plans are
achieved. We have also agreed to pay to Mr. Smith
additional cash bonuses of $119,400 on each of January 2,
2009 and October 26, 2012 and to Mr. Alchin $109,450
on each of these same days.
The agreement also provides that each executive continues to be
eligible to participate in our stock option and restricted stock
plans on the same basis as our other senior officers. Awards
under these plans are determined by the Compensation Committee,
taking into account each executives position, duties and
42
performance. Certain options held by the executives were
adjusted in connection with their entering into these employment
agreements. Pursuant to the agreements, either the exercise
price and the exercisability periods were increased or a
specified date on which the options will be exercisable was set.
Termination. If we terminate the executives
employment without cause, he is entitled to receive his then
current base salary for a period of twenty-four months from the
date of termination. He is also entitled to receive one
years target annual bonus and continued vesting of his
restricted shares for one year following termination. Certain
options held by the executive will vest in full upon termination
and remain exercisable through or at the end of their original
terms. Each executive will also be able to participate in our
health plans until age 65 or, if he is not eligible to
participate, we will reimburse him on an after-tax basis for the
incremental cost of obtaining other coverage. We will also
provide an office and secretarial services through age 65
and credit his deferred compensation account balances with the
employee rate through the end of the fifth calendar year
following the year of his termination. If either executive
terminates his employment for good reason, he will receive the
same benefits as he would have if we had terminated his
employment without cause. If the executives employment
terminates due to his death or disability, he will receive three
months of base salary, full vesting of his restricted stock
units and stock options and his options will remain exercisable
for the balance of their remaining terms. If the executive
resigns, he is entitled only to his base salary for days
actually worked.
Election to Change Status. Each of Messrs. Smith and
Alchin may, following 2006 in the case of Mr. Smith and
following 2007 in the case of Mr. Alchin, elect to change
his status to a part-time non-executive employee. If the
executive makes this election, he will receive 30% of his base
salary, bonus and broad-based equity grants for the remainder of
the original term of the agreement. He will also be able to
participate in our health plans until age 65, or, if he is
not eligible to participate, we will reimburse him on an
after-tax basis for the incremental cost of obtaining other
coverage. We will also provide an office and secretarial
services through age 65 and credit his deferred
compensation account balances with the employee rate through the
end of the fifth calendar year following the year of his
termination. If either executive makes this election, we will
have the ability to terminate his employment in lieu of allowing
him to work part-time and he shall be entitled to receive the
health, office and deferred compensation benefits described
above. Upon such termination, certain options held by the
executive will vest in full and remain exercisable through or at
the end of their original exercisable terms. If this termination
is before June 30, 2007, in the case of Mr. Smith, and
June 30, 2008, in the case of Mr. Alchin, he will be
entitled to receive the vesting of all restricted stock through
this date.
Noncompetition and Confidentiality. Under each of the
agreements, the executive has agreed not to compete with us
during his employment and, in the event his employment
terminates other than by the company without cause or by him
with good reason, for one year after termination of his
employment. If we have not renewed the agreement and either
Mr. Smith or Mr. Alchin terminates his employment
after the end of the initial term of the agreement (other than
for good reason), we may elect to have the noncompetition
provisions apply in exchange for providing him one years
base salary and bonus. If we elect to terminate either
executives employment after he provides us notice that he
has elected to change status, then the noncompetition provisions
will apply in exchange for providing the executive one
years base salary and bonus (less any amount actually paid
to him in account of base salary or bonus for the year in which
termination occurs). The agreements also require each executive
to maintain the confidentiality of our information and not to
use such information, except for our benefit, at all times
during and after his employment with us.
Change of Control Provisions. Under each of the
agreements, if our Board determines that it is appropriate to
accelerate the vesting of options in connection with a change of
control transaction, we will provide notice to the executives of
this decision at least ten business days before the anticipated
closing date of the change of control transaction. If so
determined, all options held by the executives will become
immediately exercisable in full. Until the day before the date
of a change of control, the executives will be able to exercise
all such options. If the change of control is not consummated,
the options will be treated as not having been exercised.
43
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Employment Agreement with Mr. Cohen |
In 2005, we entered into a new employment agreement with
Mr. David L. Cohen, one of our Executive Vice Presidents.
The following is a description of the material terms of this
agreement.
Term. The term of the agreement is from October 1,
2005 through December 31, 2010.
Base Salary. The agreement provides for an annual base
salary of $1,200,000 through December 31, 2006. This amount
will be reviewed for increase for each subsequent calendar year
in the term of the agreement. If so adjusted,
Mr. Cohens salary may not be reduced, except pursuant
to an overall plan to reduce the compensation of all our senior
executive officers.
Bonus; Stock Awards. Mr. Cohen is eligible to
receive an annual performance bonus, payable in cash, of a
percentage of his base salary for the applicable year.
Mr. Cohens agreement provides that, for 2005, his
bonus opportunity under our Executive Cash Bonus Plan was 75% of
base salary. Mr. Cohen is also eligible to participate in
our Supplemental Cash Bonus Plan and had a target bonus
opportunity under that plan, for 2005, of 50% of his base
salary. For subsequent years during the term of the agreement,
Mr. Cohen will be entitled to continue to participate in
these plans and the agreement provides that the sum of the
applicable target bonus percentages will not be less than 125%
if all performance targets under the plans are achieved.
The terms of the agreement required us to grant Mr. Cohen
options to purchase 225,000 shares of Class A
common stock. With respect to 112,500 shares, 40% will vest
on the second anniversary of the date of grant and 20% will vest
on each of the third to fifth anniversaries of the date of
grant. With respect to the other 112,500 shares, 20% will
vest on the second anniversary of the date of grant, 10% will
vest on each of the third to ninth anniversaries of the date of
grant, and 10% will vest on the nine year and six-month
anniversary of the date of grant. We were also obligated to
grant him an award of 87,000 restricted stock units. 15% of the
award will vest on each of the first through fourth
anniversaries of the date of the grant and 40% will vest on the
fifth anniversary of the date of grant.
Deferred Compensation. Mr. Cohen may cause the
payment of all or a portion of the compensation payable to him
to be deferred in accordance with and subject to our deferred
compensation plans. In addition, the agreement entitles
Mr. Cohen to an annual company contribution to our deferred
compensation plans, in accordance with the following schedule:
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|
|
|
|
Year |
|
Amount |
|
|
|
2006
|
|
$ |
750,000 |
|
2007
|
|
$ |
787,500 |
|
2008
|
|
$ |
826,875 |
|
2009
|
|
$ |
868,219 |
|
2010
|
|
$ |
911,630 |
|
Termination. If we terminate Mr. Cohens
employment without cause, he is entitled to receive his then
current base salary and all insurance, medical or other similar
benefits for a period of twenty-four months from the date of
termination. He is also entitled to receive one years
target annual bonus and continued vesting of his restricted
shares and stock options for one year following termination. If
Mr. Cohen terminates his employment for good reason, he
will receive the same benefits as he would have if we had
terminated his employment without cause. If his employment
terminates due to his death or disability, he will receive three
months of base salary, full vesting of his restricted stock
units and stock options and his options will remain exercisable
for the balance of their remaining terms.
Noncompetition and Confidentiality. Mr. Cohen has
agreed not to compete with us during his employment and, in the
event his employment terminates other than by the company
without cause or by him with good reason, for one year after
termination of his employment. If we have not renewed the
agreement and Mr. Cohen terminates his employment after the
end of the initial term of the agreement (other than for good
reason), we may elect to have the non-competition provisions
apply in exchange for
44
providing him one years base salary and bonus. The
agreement also requires Mr. Cohen to maintain the
confidentiality of our information and not to use such
information, except for our benefit, at all times during or
after his employment with us.
Change of Control Provisions. Under the agreement, if our
Board determines that it is appropriate to accelerate the
vesting of options in connection with a change of control
transaction, we will provide notice to Mr. Cohen of this
decision at least ten business days before the anticipated
closing date of the change of control transaction. If so
determined, all options held by Mr. Cohen will become
immediately exercisable in full. Until the day before the date
of a change of control, he will be able to exercise all such
options. If the change of control is not consummated, the
options will be treated as not having been exercised.
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Employment Agreement with Mr. Brodsky |
We have entered into an employment agreement with
Mr. Julian A. Brodsky, our non-executive Vice Chairman. The
following is a description of the material terms of this
agreement, as amended.
Term. The term of the employment agreement is from
May 1, 2002 through April 30, 2009.
Positions and Duties. From May 1, 2002 to
April 30, 2004, Mr. Brodsky was one of our executive
employees. From May 1, 2004 to April 30, 2009,
Mr. Brodsky will be one of our non-executive employees.
During the time that he is a non-executive employee, he will
devote such time as is necessary for the performance of his
duties, as we reasonably request.
Base Salary. The employment agreement provides that from
May 1, 2004 through April 30, 2009, Mr. Brodsky
will receive an annual base salary of $600,000.
Bonus. Mr. Brodsky is no longer entitled to
participate in our annual cash bonus plans.
SERP; Post-Retirement Programs; Split-Dollar Life Insurance
Arrangements. Mr. Brodsky is entitled to participate in
our Supplemental Executive Retirement Plan; for purposes of this
plan, his employment was deemed to terminate on April 30,
2004. At the end of the term, Mr. Brodsky will be eligible
to participate in our post-retirement benefits plan for a number
of years based upon his years of service with us. Upon
termination of these post-retirement benefits, we will provide
Mr. Brodsky and his spouse, for the remainder of their
lives, with a medical plan to supplement Medicare and will
reimburse Mr. Brodsky and his spouse for amounts not paid
or reimbursed by their health care plans so as to provide them
with health care benefits equivalent to those available to our
employees. We currently maintain two split-dollar life insurance
arrangements for Mr. Brodsky under which we have no further
obligation to pay any company portion of the applicable premiums.
Termination of Employment. If Mr. Brodskys
employment is terminated due to his death, all outstanding stock
options will vest and become exercisable for the remainder of
their original terms, we will continue to pay to his surviving
spouse his then current annual base salary for five years or, if
earlier, until the date of her death, and we will provide health
care benefits until the date of her death. If his employment is
terminated due to disability, we will continue to pay his then
current annual base salary for five years or, if earlier, until
April 30, 2009, certain benefits (free cable and high-speed
data, parking at our corporate office and sports arenas and cell
phone and service) will continue through this period, all
outstanding stock options will vest and become exercisable for
the remainder of their original terms and Mr. Brodsky will
be entitled to participate in our post-retirement benefits plan
based upon years of service with us. If Mr. Brodsky dies
while receiving these benefits, we will provide benefits to his
spouse as described above under termination due to death.
If we terminate Mr. Brodskys employment without
cause, Mr. Brodsky will be entitled to receive, for the
remainder of the term, monthly payments of base salary (based on
the highest annual base salary Mr. Brodsky received prior
to his termination), amounts that would otherwise have been
payable under our Executive Cash Bonus Plan and health care
benefits or, at his option, we will make available private
health insurance, and the other benefits described above. In
addition, all outstanding stock options will vest
45
and become exercisable for the remainder of their original
terms, and Mr. Brodsky will be reimbursed for the cost of
obtaining office space and secretarial support for the remainder
of the term comparable to what he had been provided as an
employee. At the end of the term, he will be entitled to
participate in our post-retirement benefits plan. If
Mr. Brodsky dies while receiving these benefits, we will
provide benefits to his spouse as described above under
termination due to death.
If Mr. Brodsky retires, all outstanding stock options will
vest and become exercisable for the remainder of their original
terms, Mr. Brodsky will be entitled to participate in our
post-retirement benefits plan based upon years of service with
us, and he will continue to receive the other benefits described
above through the remainder of the term. Upon termination of
Mr. Brodskys employment at the end of the term, all
outstanding stock options will vest and become exercisable for
the remainder of their original terms.
Under a separate agreement, Mr. Brodsky was also entitled
to a $30,000 payment each year for 15 years commencing on
May 1, 2004, the date he became one of our non-executive
employees. Pursuant to the terms of his employment agreement, he
received a lump sum payout of $326,800 in 2004, which was the
present value of these annual payment obligations. This benefit
reduced the benefits to which Mr. Brodsky was otherwise
entitled to under our Supplemental Executive Retirement Plan
with respect to 2004.
Noncompetition and Confidentiality. Under the employment
agreement, Mr. Brodsky has agreed not to compete with us
during his employment and for two years after termination of his
employment for any reason other than a termination without
cause. The employment agreement also requires him to maintain
the confidentiality of our information and not to use such
information, except for our benefit, at all times during his
employment and after termination of his employment.
Change of Control Provisions. Prior to any change of
control, we must establish and fund a grantor trust, the amounts
in which will be subject to claims of our creditors in the case
of our bankruptcy, for the purpose of paying all deferred
compensation, nonqualified retirement benefits and split-dollar
life insurance premiums and bonuses for Mr. Brodsky then
applicable. Upon the occurrence of a change of control, such
trust must become irrevocable, and we must continue to make
payments into such trust to maintain sufficient amounts to fund
all benefits subject to the trust. While our acquisition of the
AT&T Broadband business in November 2002 was a change of
control under the agreement, Mr. Brodsky elected to waive
his right to have us fund the trust at that time; however,
Mr. Brodsky may exercise this right at any time by
providing notice to us.
46
Stock Performance Graph
The following graph compares the yearly percentage change in the
cumulative total shareholder return on our Class A common
stock and Class A Special common stock during the five
years ended December 31, 2005 with the cumulative total
return on the Standard & Poors 500 Stock Index
and with a selected peer group consisting of us and other
companies engaged in the cable, telecommunications and media
industries. This peer group consists of Cablevision Systems
Corporation (Class A), Time Warner Inc., The DirecTV Group
Inc. and Echostar Communications Corp. The comparison assumes
$100 was invested on December 31, 2000 in our Class A
common stock and Class A Special common stock and in each
of the foregoing indices and assumes the reinvestment of
dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
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|
|
|
|
|
|
|
|
|
|
2001 |
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(in dollars) |
Comcast Class A
|
|
|
87 |
|
|
|
57 |
|
|
|
79 |
|
|
|
81 |
|
|
|
63 |
|
Comcast Class A Special
|
|
|
86 |
|
|
|
54 |
|
|
|
75 |
|
|
|
79 |
|
|
|
62 |
|
S&P 500 Stock Index
|
|
|
88 |
|
|
|
69 |
|
|
|
88 |
|
|
|
98 |
|
|
|
103 |
|
Peer Group Index
|
|
|
90 |
|
|
|
41 |
|
|
|
57 |
|
|
|
60 |
|
|
|
51 |
|
47
Report of the Compensation Committee
The Compensation Committee is responsible for approving the
nature and amount of compensation to be paid to, and the
employment agreements with, Comcasts executive officers,
establishing and evaluating performance-based criteria and goals
related to compensation, administering Comcasts cash bonus
and equity-based plans, making grants of awards under these
plans, determining the balance of short- and long-term
compensation to be awarded under these plans with respect to any
particular year and determining and overseeing Comcasts
compensation and benefits policies generally. Our members are
independent directors (as defined under Nasdaq
rules), non-employee directors (as defined in
Rule 16b-3
promulgated under Section 16 of the Securities and Exchange
Act of 1934) and outside directors (as defined in
Section 162(m) of the Internal Revenue Code of 1986). We
use the services of an independent compensation consultant to
assist us in carrying out our responsibilities and duties.
Compensation Policy. We seek to offer those types of
compensation that will serve to attract, motivate and retain
highly qualified executive officers and key employees in an
effort to enhance Comcasts success and shareholder value.
In addition, our compensation policies are designed to align the
interests of management with Comcasts shareholders. In
order to do so, we consider a range of short- and long-term and
cash and non-cash compensation elements. We believe this serves
the goals of compensating Comcasts executive officers
competitively on a current basis, tying a significant portion of
the executives compensation to company performance and
allowing the executive officers and key employees to gain an
ownership stake in Comcast commensurate with their relative
levels of seniority and responsibility. Each year, we perform a
review of the executive compensation programs, compensation
philosophy and committee mission and performance. In addition,
each year we review the nature and amounts of all elements of
the executive officers compensation, both separately and
in the aggregate, to ensure that the total amount of
compensation is competitive with respect to Comcasts peer
companies and there is an appropriate balance between
compensation that is tied to the short- and long-term
performance of the company.
2005 Review of Compensation. In 2005, Comcast entered
into new employment agreements with each of the named executive
officers, other than Mr. Ralph J. Roberts. In this
connection, with the assistance of an independent compensation
consultant, we evaluated the annual and long-term compensation
of each of Messrs. Brian L. Roberts, Burke, Smith, Cohen
and Alchin. In determining compensation levels, we applied the
same principles to all of these individuals. We sought to
provide total direct compensation (total cash
compensation, equity incentive awards and retirement benefits)
that is within the competitive range of our peer groups
described below. We evaluated both the aggregate amount of, and
the individual components within, total direct compensation when
making our determinations. With the assistance of the
compensation consultant, we also reviewed the terms of
employment agreements of similarly situated executives at other
peer group companies. As part of our assessment, we also took
into account the following factors: the executives length
of service with Comcast, their contributions to Comcast during
this period, their individual performance measured against
quantitative and qualitative objectives, including the executive
officers individual responsibility and role with respect
to overall corporate policy making, management and
administration, the importance of retaining these executives and
the performance of Comcast measured by the achievement of
quantitative goals. We also reviewed each element of the
executive officers compensation for internal consistency.
In approving compensation levels, we were mindful of the fact
that, unlike certain of Comcasts competitive peer group
companies, Comcast generally does not offer pension plan or
supplemental executive retirement plan benefits. We have sought
to use both the companys deferred compensation program and
equity award grants as a way of providing selected employees,
including the executive officers, with longer-term compensation.
Use of Competitive Market Data. We believe that
Comcasts competitors for executive talent are comprised of
a broader range of companies than those with which Comcast is
compared for stock performance purposes. Thus, the groups of
companies with which we compare senior management compensation
levels consist of a broader group than the companies included in
the peer group index in the stock performance graph above. The
compensation peer groups include companies in the
entertainment/media industry (including The Walt Disney Company,
Time Warner Inc. and Viacom Inc.), the
48
telecommunications industry (including AT&T Inc., BellSouth
Corporation and Verizon Communications Inc.), as well as
companies having comparable revenues and total capitalizations.
The determination of the peer groups to be used for compensation
purposes was made in consultation with our compensation
consultant. For 2005, our general goal was to provide the
executive officers with total aggregate compensation that was
around the 75th percentile of total compensation for
executives with comparable positions within the peer groups
identified above. In determining the compensation levels for the
executives, we weighted more heavily the compensation earned by
similarly situated executives in the entertainment/media peer
group, as both we and our consultant increasingly view this
group as the most relevant comparator group.
Executive Compensation Program. Comcasts executive
compensation program includes the following key components,
which are more fully described below: base salary,
performance-based annual cash bonuses and long-term equity
compensation in the form of stock options and restricted stock
units. In addition, executive officers are eligible to
participate in Comcasts deferred compensation plans,
receive certain personal benefits in accordance with the
companys management perquisite policy and participate in
Comcasts employee benefit plans generally available to all
employees. In 2005, with the assistance of our compensation
consultant, we sought to achieve a mix of the key elements of
compensation noted above to properly compensate and motivate the
executives on both a short- and longer-term basis.
Base Salary. In establishing base salary levels for 2005,
we considered individual job responsibilities, duties and
performance, and market data on base salary levels at peer group
companies. We determined that an increase in base salary for
each named executive officer was appropriate given his
individual performance, Comcasts level of achievement of
the performance goals under its annual bonus plans and the
increased duties and responsibilities placed on each of the
officers as a result of Comcasts continued growth.
Bonuses. Annual cash bonuses for executive officers were
granted under Comcasts 2002 Executive Cash Bonus Plan (the
Executive Plan) and 2002 Supplemental Cash Bonus
Plan (the Supplemental Plan), each of which was
recommended by, and designed in consultation with, our
compensation consultant and previously approved by shareholders.
The target bonus for each of the named executive officers under
these plans is based on our assessment of the optimal mix of
base salary and annual short-term bonus cash compensation and is
made with the assistance of our compensation consultant
analyzing market data on short-term bonuses at peer group
companies. In 2005, the target bonus for Mr. Brian L.
Roberts under the Executive Plan, expressed as a percentage of
base salary, was 135%, and the target bonus for the other named
executive officers ranged from 75 to 135% of base salary. The
target bonus for Mr. Brian L. Roberts under the
Supplemental Plan was 165% of base salary, and the target bonus
for the other named executive officers ranged from 50 to 165% of
base salary.
Under the Executive Plan, each executive designated by us was
eligible to earn an annual bonus of up to 150% of the sum of his
or her base salary and any unearned bonus from any prior plan
year, but not more than a total of $3 million, based on
quantitative annual cash flow performance targets we established
in advance. In 2005, we established two separate increase in
cash flow targets under this plan. If Comcast achieved the first
target, an executive would receive two-thirds of his target
bonus amount and if Comcast achieved the second
(higher) target, an executive would receive 100% of the
target amount. Comcast achieved greater than 100% of these cash
flow targets in 2005, which resulted in bonuses equal to the
target amounts being paid to the named executive officers under
this plan.
Under the Supplemental Plan, each executive designated by us was
eligible to earn an annual bonus of a percentage of his or her
base salary, but no more than $5 million, based on annual
quantitative and qualitative (such as work force diversity and
customer satisfaction) performance targets we established in
advance. Under this plan, we set varying qualitative and
quantitative targets to measure performance and did so based on
the positions and responsibilities of eligible employees. In
2005, we determined that the most significant metric to measure
company performance as it relates to the named executive
officers was increase in cash flow and set cash flow targets
under this plan with higher thresholds than those under the
Executive Plan. Each executive was eligible to receive a bonus
equal to 80 to 120% of target, depending on
49
the cash flow achieved. Comcast achieved greater than 100% of
this cash flow target in 2005. Under the terms of the plan, this
would have resulted in bonuses of 115.2% of the target amounts
being paid to the named executive officers. However, after
receiving a recommendation from management to reduce bonus
amounts under this plan and having reviewed all elements of
compensation earned or awarded in 2005, and the level of bonuses
provided to other members of management, we decided to exercise
our discretion under the plan to reduce bonus amounts to 105.2%
of the target amount for each of the named executive officers.
Equity-Based Incentive Compensation. Comcasts
equity-based incentive compensation had historically been in the
form of stock options. In 2004, after discussion with our
compensation consultant, we decided to redesign Comcasts
long-term equity compensation program to include grants of
restricted stock units since we determined that the use of
restricted stock units would further promote our goal of
employee retention, as well as deliver better value to our
employees, including our executive officers. Given
Comcasts long history of possessing an entrepreneurial
culture and its focus on continued growth, we determined that a
mixture of equity awards that was weighted with 75% of the value
derived from the grant of stock options and 25% of the value
derived from the grant of restricted stock units would be the
optimal mix for Comcast and its executive officers and other
employees. In consultation with this same consultant, we further
revised our equity program in 2005 to provide a mixture of 50%
restricted stock units and 50% stock options (by value). This
mix continues to support Comcasts culture of
entrepreneurship and its focus on shareholder value creation,
while providing a stronger retention vehicle for key executives
through the increased use of restricted stock units. We believe
that reliance upon long-term equity compensation is advantageous
to Comcast because this type of compensation fosters a long-term
commitment by the recipients and motivates the recipients to
seek to improve the long-term market performance of
Comcasts stock. In general, total equity award grants were
based on a proportional relationship to the expected cash
compensation of each executive officer, taking into account
prior equity grants and grants made at the same time to other
executives, as well as the value of equity-based compensation
awarded to comparable executives at peer companies.
We seek to achieve the long-term objectives of equity
compensation in part by extending the vesting period for options
over a longer time period than is the case with many other
companies. For example, with respect to the options granted to
Mr. Brian L. Roberts and the other executive officers
during 2005, one-half of each individuals options vests
over five years and one-half vests over a period of nine years
and six months. Restricted stock units and restricted shares
granted during 2005 to the named executive officers generally
vest 15% on each of the first four anniversaries of the date of
grant and 40% on the fifth anniversary. We believe that these
longer time-frame vesting schedules will focus the executives
over the longer term on the creation of shareholder value.
Deferred Compensation Plans. Comcast maintains deferred
compensation plans that allow certain of its employees,
including executive officers, to defer the receipt of cash
compensation and restricted stock units. These plans are not
funded plans. Other than deferred compensation and 401(k) plans,
Comcast does not currently offer any pension or retirement plan
benefits to the named executive officers, other than a
supplemental retirement plan benefit to Mr. Ralph J.
Roberts.
Executive Perquisites and Other Benefits. Comcasts
policy on the provision of executive perquisites with respect to
Messrs. Brian L. Roberts, Ralph J. Roberts and Burke is to
allow each of them to receive perquisites up to a maximum
taxable value of $50,000. If the executive receives benefits
that would otherwise be considered perquisites in excess of this
amount (generally calculated based on the associated tax value),
he is required to pay Comcast the amount of such excess. With
respect to the other named executive officers, they are
generally required to pay Comcast for the full taxable value of
any benefits that would be considered perquisites, other than
the provision of parking at Comcasts headquarters. In
addition, Comcast pays, or reimburses, premiums on life and
executive long-term disability insurance policies for all named
executive officers who participate in these plans and provides a
tax gross-up with
respect to certain of these payments.
50
Compensation of Mr. Brian L. Roberts. Mr. Brian
L. Roberts compensation for approximately the first half
of 2005 was determined under the terms of his prior compensation
agreement with us. As described above, we entered into a new
employment agreement with Mr. Roberts in 2005 and engaged
the services of a compensation consultant in connection with
this. In advising us on the terms and conditions of
Mr. Roberts new agreement, we and our consultant
considered the terms of Mr. Roberts then current
agreement, Mr. Roberts integral role to the company
and its shareholders, the performance of the company both during
Mr. Roberts tenure and over the past year and the
compensation levels of chief executive officers at peer group
companies. This consultant evaluated and found the terms of
Mr. Roberts agreement to be appropriate and within
the competitive range of Comcasts target peer markets and
supported the adoption of his contract.
Mr. Roberts compensation in 2005 consisted of the
salary and benefits as determined under his employment agreement
and short-term incentive compensation consisting of awards under
the Executive Plan and Supplemental Plan described above as well
as an additional discretionary bonus under the Supplemental Plan
in an amount equal to the difference between the amount that
would have been payable to Mr. Roberts under the Executive
Plan (based on his target bonus and the achievement of the
targets under this plan) and the amount that was actually paid
to him, as a result of the individual limit under this plan. In
addition, Mr. Roberts received long-term incentive
compensation consisting of a grant of options under
Comcasts stock option plans to purchase a total of
425,000 shares of Class A common stock and a grant of
165,000 restricted stock units with respect to Class A
common stock. In determining whether to increase
Mr. Roberts base salary and in setting the other
elements of his compensation, we took also into account the
financial performance of Comcast, Mr. Roberts
individual performance over the past year, including his strong
and consistent management of Comcast, and our goal to provide
total compensation to Mr. Roberts which is relative to
executives with comparable positions at peer group companies.
With respect to Mr. Roberts short-term incentive
awards, we set target bonuses based on the achievement of a
specific quantitative performance measure (increase in cash
flow) under both the Executive Plan and the Supplemental Plan.
In determining Mr. Roberts total long-term
incentives, we reviewed Mr. Roberts prior years
grants and his total anticipated other compensation for 2005 as
well as a recommendation from management to consider reducing
equity grants for senior executives with respect to 2005, and
determined that for 2005 we would reduce the grant date value of
Mr. Roberts awards by approximately 10% (as compared
to 2004).
Executive Ownership Policies. We have executive ownership
policies for members of our senior management, including our
executive officers. Under the current guidelines we have
established, our Chief Executive Officer is required to own
Comcast stock in an amount equal to at least five times his base
salary. The other named executive officers are required to own
Comcast stock in amounts ranging from three to four times base
salary. These policies are designed to increase the
executives ownership stakes in Comcast and to align their
interests with the interests of Comcast shareholders.
Ownership for purposes of this policy is defined to
include stock owned directly or indirectly by the executive
officer, shares underlying deferred stock units under
Comcasts Deferred Stock Option Plan and shares credited to
the executive under our employee stock purchase plan (which must
be held for 180 days from the date credited). In addition,
60% of each of the following types of ownership also counts: the
market value of the executives stock fund under our
deferred compensation plan, shares owned under our 401(k) plan,
deferred shares under our restricted stock plan and the
difference between the market price and exercise price of vested
stock options.
Effect of Internal Revenue Code Section 162(m).
Section 162(m) of the Internal Revenue Code of 1986, as
amended, provides generally that compensation in excess of
$1 million paid to each of the chief executive officer and
the other four most highly compensated executive officers of a
public company (determined as of the last day of the
companys tax year) will not be deductible for federal
income tax purposes, unless the compensation meets the Internal
Revenue Codes definition of performance-based.
We conduct an ongoing review of Comcasts compensation
practices for purposes of obtaining the maximum continued
deductibility of compensation paid consistent with
Comcasts existing commitments and ongoing competitive
needs. While the tax impact of any compensation arrangement is
one factor to be
51
considered, such impact is evaluated in light of our and
Comcasts overall compensation philosophy. From time to
time, we have awarded and may award compensation which is not
fully deductible if we determine that such award is consistent
with this philosophy and is in the best interests of Comcast and
its shareholders.
Members of the Compensation Committee
Dr. Judith Rodin (Chair)
S. Decker Anstrom
Joseph J. Collins
Michael I. Sovern
SHAREHOLDER PROPOSALS FOR NEXT YEAR
Any shareholder proposals intended to be presented at our annual
meeting of shareholders in 2007 called for a date between
April 18, 2007 and June 18, 2007 and considered for
inclusion in our proxy materials must be received by
November 28, 2006. Any shareholder proposals should be
directed to Arthur R. Block, Secretary, at our address listed on
page 3 of this proxy statement. However, shareholders who
wish to nominate directors for election must comply with the
procedures described under About our Board and its
Committees beginning on page 10 of this proxy
statement.
Any shareholder proposals intended to be presented at our annual
meeting of shareholders in 2007 and not included in our proxy
materials must comply with the advance notice provision in
Section 2.09 of our by-laws. In the case of an annual
meeting called for a date between April 18, 2007 and
June 18, 2007, we must receive notice of the proposal on or
after February 20, 2007 and on or before March 19,
2007. In the case of an annual meeting called for any other
date, we must receive notice of the proposal by the close of
business on the tenth day following the day we mailed notice of,
or announced publicly, the date of the meeting, whichever occurs
first. If notice is not received by March 19, 2007, the
shareholder proposals will be deemed untimely.
Shareholder proposals failing to comply with the procedures of
Rule 14a-8 of the
proxy solicitation rules will be excluded. All shareholder
proposals should be directed to Arthur R. Block, Secretary, at
our address listed on page 3 of this proxy statement.
SOLICITATION OF PROXIES
We will pay the cost of this proxy solicitation. In addition to
soliciting proxies by mail, we expect that a number of our
employees will solicit shareholders for the same type of proxy,
personally and by telephone. None of these employees will
receive any additional or special compensation for doing this.
We have retained D.F. King & Co., Inc. to assist in the
solicitation of proxies for a fee of $22,000 plus reasonable
out-of-pocket costs and
expenses. We will, on request, reimburse banks, brokerage firms
and other nominees for their expenses in sending proxy materials
to their customers who are beneficial owners of our common stock
and obtaining their voting instructions.
Electronic Access and Delivery
Shareholders can access the Notice of Annual Meeting, this proxy
statement and our 2005 Annual Report via our website at
www.cmcsa.com or www.cmcsk.com. For future shareholder meetings,
registered shareholders may receive future annual reports and
proxy statements electronically. To sign up for electronic
delivery, go to www.computershare.com/us/sc/cmcs. You may also
sign up when you vote by Internet at www.investorvote.com/cmc
and follow the prompts. Once you sign up, you will no longer
receive a printed copy of the annual report or the proxy
statement, unless you request one. Each year you will receive an
e-mail explaining how to access the annual report and the proxy
statement online as well as how to vote your shares online. You
may suspend electronic delivery of the annual report and the
proxy statement at any time by contacting Computershare.
52
IMPORTANT NOTICE REGARDING DELIVERY OF SHAREHOLDER
DOCUMENTS
Under the Securities and Exchange Commission rules, delivery of
one proxy statement and annual report to two or more investors
sharing the same mailing address is permitted, under certain
conditions. This procedure, called householding, is
available if all of the following criteria are met:
(1) You have the same address as
other securityholders registered on our books;
(2) You have the same last name as
the other securityholders; and
(3) Your address is a residential
address or post office box.
If you meet this criteria, you are eligible for householding and
the following terms apply. If you are not eligible, please
disregard this notice.
For Registered Shareholders
Only one proxy statement and annual report will be delivered to
the shared mailing address. You will, however, still receive
separate mailings of important and personal information, as well
as a separate proxy card.
What do I need to do to receive just one set of annual
disclosure materials?
You do not have to do anything. Unless Computershare is notified
otherwise within 60 days of the mailing of this notice,
your consent is implied and only one set of materials will be
sent to your household. This consent is considered perpetual,
which means you will continue to receive a single proxy
statement/annual report in the future unless you notify us
otherwise.
What if I want to continue to receive multiple sets of
materials?
If you would like to continue to receive a separate set of
materials for yourself, call or write Computershare at
1-888-883-8903 or P.O. Box 43091, Providence, Rhode Island
02940-3091. A separate set of materials will be sent to you
promptly.
What if I consent to have one set of materials mailed now,
but change my mind later?
Call or write Computershare to turn off the householding
instructions for yourself. You will then be sent a separate
proxy statement and annual report within 30 days of receipt
of your instruction.
The reason I receive multiple sets of materials is because
some of the stock belongs to my children. What happens when they
move out and no longer live in my household?
When there is an address change for one of the members of the
household, materials will be sent directly to the shareholder at
his or her new address.
ANNUAL REPORT ON
FORM 10-K
WE WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED BY THIS
PROXY STATEMENT, UPON THE WRITTEN REQUEST OF SUCH PERSON, A COPY
OF OUR ANNUAL REPORT ON
FORM 10-K, AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR OUR MOST
RECENT FISCAL YEAR. SUCH WRITTEN REQUESTS SHOULD BE DIRECTED TO
INVESTOR RELATIONS AT OUR ADDRESS SET FORTH ON
PAGE 3 OF THIS PROXY STATEMENT.
53
DIRECTIONS TO THE WACHOVIA COMPLEX
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From New Jersey via the Walt Whitman Bridge
Take Broad Street exit. At the bottom of the ramp, make a
left on to Broad Street and follow the signs to the Sports
Complex. The Wachovia Complex will be on your left. |
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From Interstate 76/Schuylkill Expressway
From I-76 Eastbound, follow the signs for South Jersey, Walt
Whitman Bridge and Sports Complex. Take the Broad Street Exit.
At the bottom of the exit ramp, make a right on to Broad Street.
The Wachovia Complex will be on your left. |
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From Interstate 476/Blue Route
Take I-476 South to the end. Follow signs for I-95 North,
Philadelphia. Take I-95 North to Broad Street exit. The Wachovia
Complex will be on your right. |
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From Interstate 95
From I-95 Northbound or Southbound, take the Broad Street
exit. The Wachovia Complex will be on your right. |
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Public Transportation
SEPTA (Southeastern Pennsylvania Transportation Authority).
Take the Broad Street (Orange) line South to the Pattison Ave.
stop (last stop). When you exit the subway, the Wachovia Complex
will be immediately to the south and east. |
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Parking Information
There is ample free parking available in the Wachovia
Complex. Shareholders should use the main entrance to the
Wachovia Complex which is located on Broad Street at 3601 South
Broad Street. The gate attendant will direct you to the parking
area and building. |
54
Appendix A
COMCAST CORPORATION
2002 EMPLOYEE STOCK PURCHASE PLAN
(As Amended and Restated, Effective December 14,
2005)
1. Purpose.
COMCAST CORPORATION, a Pennsylvania corporation, hereby amends
and restates the Comcast Corporation 2002 Employee Stock
Purchase Plan (the Plan), effective
December 14, 2005. The Plan is intended to encourage and
facilitate the purchase of shares of common stock of Comcast
Corporation by Eligible Employees of the Company and any
Participating Companies, thereby providing such Eligible
Employees with a personal stake in the Company and a long-range
inducement to remain in the employ of the Company and
Participating Companies. It is the intention of the Company that
the Plan qualify as an employee stock purchase plan
within the meaning of section 423 of the Code.
2. Definitions.
(a) Account means a bookkeeping account
established by the Committee on behalf of a Participant to hold
Payroll Deductions.
(b) Affiliate means, with respect to any
Person, any other Person that, directly or indirectly, is in
control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, the term
control, including its correlative terms
controlled by and under common control
with, mean, with respect to any Person, the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or
otherwise.
(c) Board means the Board of Directors
of the Company.
(d) Brokerage Account means the
brokerage account established under the Plan by the Company for
each Participant, to which Shares purchased under the Plan shall
be credited.
(e) Change of Control means any
transaction or series of transactions as a result of which any
Person who was a Third Party immediately before such transaction
or series of transactions owns then-outstanding securities of
the Company such that such Person has the ability to direct the
management of the Company, as determined by the Board in its
discretion. The Board may also determine that a Change of
Control shall occur upon the completion of one or more proposed
transactions. The Boards determination shall be final and
binding.
(f) Code means the Internal Revenue Code
of 1986, as amended.
(g) Committee means the Compensation
Committee of the Board.
(h) Company means Comcast Corporation, a
Pennsylvania corporation, including any successor thereto by
merger, consolidation, acquisition of all or substantially all
the assets thereof, or otherwise.
(i) Compensation means an Eligible
Employees wages as reported on Form W-2 (i.e.,
wages as defined in section 3401(a) of the Code and all
other payments of compensation for which the Participating
Company is required to furnish the employee a written statement
under sections 6041(d) and 6051(a)(3) of the Code) from a
Participating Company, reduced by reimbursements or other
expense allowances, fringe benefits (cash and non-cash), moving
expenses, deferred compensation, and welfare benefits, but
including salary reduction contributions and elective
contributions that are not includible in gross income under
sections 125 or 402(a)(8) of the Code.
A-1
(j) Election Form means the written or
electronic form acceptable to the Committee which an Eligible
Employee shall use to make an election to purchase Shares
through Payroll Deductions pursuant to the Plan.
(k) Eligible Employee means an Employee
who is not an Ineligible Employee. Notwithstanding the foregoing
to the contrary, solely for purposes of the Offering Period
commencing on October 1, 2002, the term Eligible
Employee means an Employee who was eligible to participate
in this Plan immediately before October 1, 2002.
(l) Eligible Employer means the Company
and any subsidiary of the Company, within the meaning of
section 424(f) of the Code.
(m) Employee means a person who is an
employee of a Participating Company.
(n) Fair Market Value means the closing
price per Share on the principal national securities exchange on
which the Shares are listed or admitted to trading or, if not
listed or traded on any such exchange, on the National Market
System of the National Association of Securities Dealers
Automated Quotation System (NASDAQ), or if not
listed or traded on any such exchange or system, the fair market
value as reasonably determined by the Board or the Committee,
which determination shall be conclusive.
(o) Five Percent Owner means an Employee
who, with respect to a Participating Company, is described in
section 423(b)(3) of the Code.
(p) Ineligible Employee means an
Employee who, as of an Offering Commencement Date:
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(1) is a Five Percent Owner; |
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(2) has been continuously employed by a Participating
Company on a full-time basis for less than 90 days; |
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(3) has been continuously employed by a Participating
Company on a part-time basis for less than one year; or |
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(4) is restricted from participating under
Paragraph 3(b). |
For purposes of this Paragraph 2(p), an Employee is
employed on a part-time basis if the Employee customarily works
less than 20 hours per week. For purposes of this
Paragraph 2(p), an Employee is employed on a full-time
basis if the Employee customarily works 20 or more hours per
week.
(q) Offering means an offering of Shares
by the Company to Eligible Employees pursuant to the Plan.
(r) Offering Commencement Date means the
first day of each January 1, April 1, July 1 and
October 1 beginning on or after Offerings are authorized by
the Board or the Committee, until the Plan Termination Date,
provided that the first Offering Commencement Date shall be on
the Effective Date.
(s) Offering Period means the period
extending from an Offering Commencement Date through the
following Offering Termination Date.
(t) Offering Termination Date means the
last day of each March, June, September and December following
an Offering Commencement Date, or such other Offering
Termination Date established in connection with a Terminating
Event.
(u) Participant means an Eligible
Employee who has timely delivered an Election Form to the
Committee in accordance with procedures established by the
Committee.
(v) Participating Company means, as
provided in Schedule A to the Plan, the Eligible Employers,
if any, that are approved by the Board or the Committee from
time to time.
(w) Payroll Deductions means amounts
withheld from a Participants Compensation pursuant to the
Plan, as described in Paragraph 5.
A-2
(x) Person means an individual, a
corporation, a partnership, an association, a trust or any other
entity or organization.
(y) Plan means the Comcast Corporation
2002 Employee Stock Purchase Plan, as set forth in this
document, and as may be amended from time to time.
(z) Plan Termination Date means the
earlier of:
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(1) the Offering Termination Date for the Offering in which
the maximum number of Shares specified in Paragraph 9 have
been issued pursuant to the Plan; or |
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(2) the date as of which the Board or the Committee chooses
to terminate the Plan as provided in Paragraph 14. |
(aa) Purchase Price means
85 percent of the lesser of: (1) the Fair Market Value
per Share on the Offering Commencement Date, or if such date is
not a trading day, then on the next trading day thereafter or
(2) the Fair Market Value per Share on the Offering
Termination Date, or if such date is not a trading day, then on
the trading day immediately preceding the Offering Termination
Date.
(bb) Shares means:
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(1) except as otherwise provided in
Paragraph 2(bb)(2), shares of Comcast Corporation
Class A Common Stock, par value $0.01. |
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(2) for the Offering Period commencing on October 1,
2002, shares of Comcast Corporation Class A Special Common
Stock, par value $0.01. |
(cc) Successor-in-Interest
means the Participants executor or administrator, or such
other person or entity to whom the Participants rights
under the Plan shall have passed by will or the laws of descent
and distribution.
(dd) Terminating Event means any of the
following events:
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(1) the liquidation of the Company; or |
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(2) a Change of Control. |
(ee) Third Party means any Person,
together with such Persons Affiliates, provided that the
term Third Party shall not include the Company or an
Affiliate of the Company.
(ff) Termination Form means the written
or electronic form acceptable to the Committee which an Employee
shall use to discontinue participation during an Offering Period
pursuant to Paragraph 7(b).
3. Eligibility and
Participation.
(a) Eligibility. Except to the extent participation
is restricted under Paragraph 3(b), each Eligible Employee
shall be eligible to participate in the Plan.
(b) Restrictions on Participation. Notwithstanding
any provisions of the Plan to the contrary, no Employee shall be
eligible to purchase Shares in an Offering to the extent that:
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(1) immediately after the purchase of Shares, such Employee
would be a Five Percent Owner; or |
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(2) a purchase of Shares would permit such Employees
rights to purchase stock under all employee stock purchase plans
of the Participating Companies which meet the requirements of
section 423(b) of the Code to accrue at a rate which
exceeds $25,000 in fair market value (as determined pursuant to
section 423(b)(8) of the Code) for each calendar year in
which such right to purchase Shares is outstanding. |
(c) Commencement of Participation. An Eligible
Employee shall become a Participant by completing an Election
Form and filing it with the Committee on or before the
15th day of the month
A-3
immediately preceding the Offering Commencement Date for the
first Offering to which such Election Form applies. Payroll
Deductions for a Participant shall commence on first payroll
period ending after the applicable Offering Commencement Date
when his or her authorization for Payroll Deductions becomes
effective, and shall end on the Plan Termination Date, unless
sooner terminated by the Participant pursuant to
Paragraph 7(b).
4. Shares Per
Offering.
The Plan shall be implemented by a series of Offerings that
shall commence after Offerings have been authorized by the Board
or the Committee, and terminate on the Plan Termination Date.
Offerings shall be made with respect to Compensation accumulated
during each Offering Period for the period commencing with the
first day of the first Offering Period (when such Offering
Period is authorized by the Board or the Committee) and ending
with the Plan Termination Date. Shares available for any
Offering shall be the difference between the maximum number of
Shares that may be issued under the Plan, as determined pursuant
to Paragraph 8(a), for all of the Offerings, less the
actual number of Shares purchased by Participants pursuant to
prior Offerings. If the total number of Shares subject to
purchase under the Plan on any Offering Termination Date exceeds
the maximum number of Shares available, the Board or the
Committee shall make a pro rata allocation of Shares available
for delivery and distribution in as nearly a uniform manner as
practicable, and as it shall determine to be fair and equitable,
and the unapplied Account balances shall be returned to
Participants as soon as practicable following the Offering
Termination Date.
5. Payroll Deductions.
(a) Amount of Payroll Deductions. On the Election
Form, an Eligible Employee may elect to have Payroll Deductions
of not more than 10 percent of Compensation earned for each
payroll period ending within the Offering Period, subject to the
limitation that the maximum amount of Payroll Deductions for any
Eligible Employee for any calendar year shall not exceed
$10,000. The rules established by the Committee regarding
Payroll Deductions, as reflected on the Election Form, shall be
consistent with section 423(b)(5) of the Code.
(b) Participants Accounts. All Payroll
Deductions with respect to a Participant pursuant to
Paragraph 5(a) shall be credited to the Participants
Account under the Plan.
(c) Changes in Payroll Deductions. A Participant may
discontinue Payroll Deductions during an Offering Period by
providing a Termination Form to the Committee at any time before
the Offering Termination Date applicable to any Offering. No
other change can be made during an Offering, including, but not
limited to, changes in the amount of Payroll Deductions for such
Offering. A Participant may change the amount of Payroll
Deductions for subsequent Offerings by giving written notice (or
notice in another form pursuant to procedures established by the
Committee) of such change to the Committee on or before the
15th day of the month immediately preceding the Offering
Commencement Date for the Offering for which such change is
effective.
6. Purchase of Shares.
(a) In General. On each Offering Termination Date,
each Participant shall be deemed to have purchased a number of
whole Shares equal to the quotient obtained by dividing the
balance credited to the Participants Account as of the
Offering Termination Date, by the Purchase Price, rounded to the
next lowest whole Share. Shares deemed purchased by a
Participant under the Plan shall be credited to the
Participants Brokerage Account as soon as practicable
following the Offering Termination Date.
(b) Terminating Events. The Company shall give
Participants at least 30 days notice (or, if not
practicable, such shorter notice as may be reasonably
practicable) prior to the anticipated date of the consummation
of a Terminating Event. The 20th day following the issuance
of such notice by the Company (or such earlier date as the Board
or the Committee may reasonably determine) shall constitute the
Offering Termination Date for any outstanding Offering.
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(c) Fractional Shares and Minimum Number of Shares.
Fractional Shares shall not be issued under the Plan. Amounts
credited to an Account remaining after the application of such
Account to the purchase of Shares under the Plan shall be
credited to the Participants Account for the next
succeeding Offering, or, at the Participants election,
returned to the Participant as soon as practicable following the
Offering Termination Date, without interest.
(d) Transferability of Rights to Purchase Shares. No
right to purchase Shares pursuant to the Plan shall be
transferable other than by will or by the laws of descent and
distribution, and no such right to purchase Shares pursuant to
the Plan shall be exercisable during the Participants
lifetime other than by the Participant.
7. Termination of
Participation.
(a) Account. Except as provided in
Paragraph 7(c), no amounts shall be distributed from
Participants Accounts during an Offering Period.
(b) Suspension of Participation. A Participant may
discontinue Payroll Deductions during an Offering Period by
providing a Termination Form to the Committee at any time before
the Offering Termination Date applicable to any Offering. All
amounts credited to such Participants Account shall be
applied to the purchase of Shares pursuant to Paragraph 6.
A Participant who discontinues Payroll Deductions during an
Offering Period shall not be eligible to participate in the
Offering next following the date on which the Participant
delivers the Termination Form to the Committee.
(c) Termination of Employment. Upon termination of a
Participants employment for any reason, all amounts
credited to such Participants Account shall be returned to
the Participant, or, following the Participants death, to
the Participants
Successor-in-Interest.
8. Interest.
No interest shall be paid or allowed with respect to Payroll
Deductions paid into the Plan or credited to any
Participants Account.
9. Shares.
(a) Maximum Number of Shares; Adjustments. Subject
to adjustment as provided in this Paragraph 9, not more
than 10,250,000 Shares in the aggregate may be issued
pursuant to the Plan pursuant to Offerings under the Plan,
including Offerings commenced since the Plan first became
effective as the Comcast Corporation 2001 Employee Stock
Purchase Plan. Shares delivered pursuant to the Plan may, at the
Companys option, be either treasury Shares or Shares
originally issued for such purpose. In the event that Shares are
changed into or exchanged for a different number or kind of
shares of stock or other securities of the Company, whether
through merger, consolidation, reorganization, recapitalization,
stock dividend, stock
split-up or other
substitution of securities of the Company, the Board or the
Committee shall make appropriate equitable anti-dilution
adjustments to the number and class of shares of stock available
for issuance under the Plan, to the number and class of shares
of stock subject to outstanding Offerings and to the Purchase
Price. Any reference to the Purchase Price in the Plan and in
any related documents shall be a reference to the Purchase Price
as so adjusted. Any reference to the term Shares in
the Plan and in any related documents shall be a reference to
the appropriate number and class of shares of stock available
for issuance under the Plan, as adjusted pursuant to this
Paragraph 9. The Boards or the Committees
adjustment shall be effective and binding for all purposes of
this Plan. All Shares issued pursuant to the Plan shall be
validly issued, fully paid and nonassessable.
(b) Participants Interest in Shares. A
Participant shall have no interest in Shares offered under the
Plan until Shares are credited to the Participants
Brokerage Account.
(c) Crediting of Shares to Brokerage Account. Shares
purchased under the Plan shall be credited to the
Participants Brokerage Account as soon as practicable
following the Offering Termination Date.
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(d) Restrictions on Purchase. The Board or the
Committee may, in its discretion, require as conditions to the
purchase of any Shares under the Plan such conditions as it may
deem necessary to assure that such purchase of Shares is in
compliance with applicable securities laws.
10. Expenses.
The Participating Companies shall pay all fees and expenses
incurred (excluding individual Federal, state, local or other
taxes) in connection with the Plan. No charge or deduction for
any such expenses will be made to a Participant upon the
termination of his or her participation under the Plan or upon
the distribution of certificates representing Shares purchased
with his or her Payroll Deductions.
11. Taxes.
The Participating Companies shall have the right to withhold
from each Participants Compensation an amount equal to all
federal, state, city or other taxes as the Participating
Companies shall determine are required to be withheld by them in
connection with the purchase of Shares under the Plan and in
connection with the sale of Shares acquired under the Plan. In
connection with such withholding, the Participating Companies
may make any such arrangements as they may deem necessary or
appropriate to protect their interests.
12. Plan and Contributions
Not to Affect Employment.
The Plan shall not confer upon any Eligible Employee any right
to continue in the employ of the Participating Companies.
13. Administration.
The Plan shall be administered by the Committee. The Board and
the Committee shall have authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to
it, and to make all other determinations deemed necessary or
advisable in administering the Plan, with or without the advice
of counsel. The Committee may delegate its administrative
duties, subject to its review and supervision, to the
appropriate officers and employees of the Company. The
determinations of the Board and the Committee on the matters
referred to in this Paragraph 13 shall be conclusive and
binding.
14. Amendment and
Termination.
The Board or the Committee may terminate the Plan at any time
and may amend the Plan from time to time in any respect;
provided, however, that upon any termination of the Plan, all
Shares or Payroll Deductions (to the extent not yet applied to
the purchase of Shares) under the Plan shall be distributed to
the Participants, provided further, that no amendment to the
Plan shall affect the right of any Participant to receive his or
her proportionate interest in the Shares or his or her Payroll
Deductions (to the extent not yet applied to the purchase of
Shares) under the Plan, and provided further that the Company
may seek shareholder approval of an amendment to the Plan if
such approval is determined to be required by or advisable under
the regulations of the Securities and Exchange Commission or the
Internal Revenue Service, the rules of any stock exchange or
system on which the Shares are listed or other applicable law or
regulation.
15. Effective Date.
The original effective date of the Plan was December 20,
2000. This amendment and restatement of the Plan is effective on
December 14, 2005.
16. Government and Other
Regulations.
(a) In General. The purchase of Shares under the
Plan shall be subject to all applicable laws, rules and
regulations, and to such approvals by any governmental agencies
as may be required.
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(b) Securities Law. The Committee shall have the
power to make each Offering under the Plan subject to such
conditions as it deems necessary or appropriate to comply with
the then-existing requirements of the Securities Act of 1933, as
amended, and the Securities Exchange Act of 1934, as amended,
including
Rule 16b-3 (or any
similar rule) promulgated by the Securities and Exchange
Commission thereunder.
17. Non-Alienation.
No Participant shall be permitted to assign, alienate, sell,
transfer, pledge or otherwise encumber his right to purchase
Shares under the Plan prior to time that Shares are credited to
the Participants Brokerage Account. Any attempt at
assignment, alienation, sale, transfer, pledge or other
encumbrance shall be void and of no effect.
18. Notices.
Any notice required or permitted hereunder shall be sufficiently
given only if delivered personally, telecopied, or sent by first
class mail, postage prepaid, and addressed:
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If to the Company:
Comcast Corporation
1500 Market Street
Philadelphia, PA, 19102
Fax: 215-981-7794
Attention: General Counsel
Or any other address provided pursuant to notice provided by
the Committee. |
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If to the Participant:
At the address on file with the Participating Company from time
to time, or to such other address as either party may hereafter
designate in writing (or via such other means of communication
permitted by the Committee) by notice similarly given by one
party to the other. |
19. Successors.
The Plan shall be binding upon and inure to the benefit of any
successors or assigns of the Company.
20. Severability.
If any part of this Plan shall be determined to be invalid or
void in any respect, such determination shall not affect,
impair, invalidate or nullify the remaining provisions of this
Plan which shall continue in full force and effect.
21. Acceptance.
The election by any Eligible Employee to participate in this
Plan constitutes his or her acceptance of the terms of the Plan
and his or her agreement to be bound hereby.
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22. Applicable Law.
This Plan shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania, to the extent not preempted by
applicable Federal law.
Executed as of the 14th day of December, 2005.
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COMCAST CORPORATION |
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By: |
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/s/ David L. Cohen |
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Attest: |
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/s/ Arthur R. Block |
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A-8
SCHEDULE A
Participating Companies
Effective as of January 1, 2005
Comcast Business Communications Holdings, Inc. and its
subsidiaries
Comcast Cable Communications Holdings, Inc. and its subsidiaries
Comcast Cable Communications, LLC, and its subsidiaries
Comcast Corporation
Comcast Holdings Corporation
Comcast Online Communications, Inc.
Comcast Shared Services Corporation
Comcast SportsNet West, Inc.
G4 Media, LLC
Home Team Sports Limited Partnership
International Channel
Outdoor Life Network, LLC
Philadelphia Sports Media, L.P.
TGC, Inc. d/b/a The Golf Channel
Comcast Sports Management Services
Comcast HTS Holdings, Inc.
Comcast SportsNet Philadelphia, L.P.
Effective as of October 1, 2005 (or as soon as
administratively practicable thereafter)
Comcast Spectacor, L.P.
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Appendix B
COMCAST CORPORATION
2002 RESTRICTED STOCK PLAN
(As Amended And Restated, Effective December 14,
2005)
1. Background and
Purpose
(a) Amendment and Restatement of Plan. COMCAST
CORPORATION, a Pennsylvania corporation, hereby amends and
restates the Comcast Corporation 2002 Restricted Stock Plan (the
Plan), effective December 14, 2005. The purpose
of the Plan is to promote the ability of Comcast Corporation to
recruit and retain employees and enhance the growth and
profitability of Comcast Corporation by providing the incentive
of long-term awards for continued employment and the attainment
of performance objectives.
(b) Purpose of the Amendment; Credits Affected. The
Plan has been amended and restated, effective December 14,
2005, to revise the rules relating to the delegation of
authority by the Committee. The Plan was previously amended and
restated, effective January 1, 2005 in order (i) to
preserve the favorable tax treatment available to amounts
deferred pursuant to the Plan before January 1, 2005 and
the earnings credited in respect of such amounts (each a
Grandfathered Amount) in light of the
American Jobs Creation Act of 2004, IRS Notice
2005-1, and the
regulations issued by the Department of the Treasury thereunder
(collectively, the AJCA), and (ii) with
respect to all other amounts eligible to be deferred under the
Plan, to comply with the requirements of the AJCA. Except as
provided in Paragraph 8(f)(iii) of the Plan, Grandfathered
Amounts will continue to be subject to the terms and conditions
of the Plan as in effect prior to the Amendment Date. All
amounts eligible to be deferred under the Plan other than
Grandfathered Amounts will be subject to the terms of this
amendment and restatement of the Plan and the AJCA.
(c) Reservation of Right to Amend to Comply with
AJCA. The Board and the Committee reserve the right to amend
the Plan, either retroactively or prospectively, in whatever
respect is required to achieve and maintain compliance with the
requirements of the AJCA.
(d) Deferral Provisions of Plan Unfunded and Limited to
Select Group of Management or Highly Compensated Employees.
Deferral Eligible Grantees and Non-Employee Directors may elect
to defer the receipt of Restricted Stock and Restricted Stock
Units as provided in Article VIII. The deferral provisions
of Article VIII and the other provisions of the Plan
relating to the deferral of Restricted Stock and Restricted
Stock Units are unfunded and maintained primarily for the
purpose of providing a select group of management or highly
compensated employees the opportunity to defer the receipt of
compensation otherwise payable to such eligible employees in
accordance with the terms of the Plan.
2. Definitions
(a) Acceleration Election means a
written election on a form provided by the Committee, pursuant
to which a Deceased Grantees
Successor-in-Interest
or a Disabled Grantee elects to accelerate the distribution date
of Shares issuable with respect to Restricted Stock and/or
Restricted Stock Units.
(b) Account means unfunded bookkeeping
accounts established pursuant to Paragraph 8(e) and
maintained by the Committee in the names of the respective
Grantees (i) to which Deferred Stock Units are deemed
credited and (ii) to which an amount equal to the Fair
Market Value of Deferred Stock Units with respect to which a
Diversification Election has been made and interest thereon are
deemed credited, reduced by distributions in accordance with the
Plan.
(c) Active Grantee means each Grantee
who is actively employed by a Participating Company.
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(d) Affiliate means, with respect to any
Person, any other person that, directly or indirectly, is in
control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, the term
control, including its correlative terms
controlled by and under common control
with, mean, with respect to any Person, the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or
otherwise.
(e) AJCA means the American Jobs
Creation Act of 2004, IRS Notice 2005-1 and
announcements, notices, revenue rulings and regulations issued
under the American Jobs Creation Act of 2004.
(f) Annual Rate of Pay means, as of any
date, an employees annualized base pay rate. An
employees Annual Rate of Pay shall not include sales
commissions or other similar payments or awards.
(g) Applicable Interest Rate means:
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(i) Except as otherwise provided in
Paragraph 2(g)(ii), the Applicable Interest Rate means the
interest rate that, when compounded annually pursuant to rules
established by the Committee from time to time, is
mathematically equivalent to 8% per annum, compounded
annually, or such other interest rate established by the
Committee from time to time. The effective date of any reduction
in the Applicable Interest Rate shall not precede the later of:
(A) the 30th day following the date of the
Committees action to establish a reduced rate; or
(B) the lapse of 24 full calendar months from the date of
the most recent adjustment of the Applicable Interest Rate by
the Committee. |
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(ii) Effective for the period extending from a
Grantees employment termination date to the date the
Grantees Account is distributed in full, the Committee, in
its sole and absolute discretion, may designate the term
Applicable Interest Rate for such Grantees
Account to mean the lesser of: (A) the rate in effect under
Paragraph 2(g)(i) or (B) the interest rate that, when
compounded annually pursuant to rules established by the
Committee from time to time, is mathematically equivalent to the
Prime Rate plus one percent, compounded annually as of the last
day of the calendar year. Notwithstanding the foregoing, the
Committee may delegate its authority to determine the Applicable
Interest Rate under this Paragraph 2(g)(ii) to an officer
of the Company or committee of two or more officers of the
Company. |
(h) AT&T Broadband Transaction means
the acquisition of AT&T Broadband Corp. (now known as
Comcast Cable Communications Holdings, Inc.) by the Company.
(i) Award means an award of Restricted
Stock or Restricted Stock Units granted under the Plan.
(j) Board means the Board of Directors
of the Company.
(k) Change of Control means:
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(i) For all purposes of the Plan other than
Article VIII, any transaction or series of transactions as
a result of which any Person who was a Third Party immediately
before such transaction or series of transactions owns
then-outstanding securities of the Company such that such Person
has the ability to direct the management of the Company, as
determined by the Board in its discretion. The Board may also
determine that a Change of Control shall occur upon the
completion of one or more proposed transactions. The
Boards determination shall be final and binding. |
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(ii) For purposes of Article VIII, any transaction or
series of transactions that constitutes: |
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(1) a change in the ownership of the Company, within the
meaning of Q&A 12 of IRS Notice 2005-1; |
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(2) a change in effective control of the Company, within
the meaning of Q&A 13 of IRS Notice 2005-1; or |
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(3) a change in the ownership of a substantial portion of
the assets of the Company, within the meaning of Q&A 14 of
IRS Notice 2005-1. |
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(l) Code means the Internal Revenue Code
of 1986, as amended.
(m) Comcast Plan means any restricted
stock, restricted stock unit, stock bonus, stock option or other
compensation plan, program or arrangement established or
maintained by the Company or an Affiliate, including but not
limited to this Plan, the Comcast Corporation 2003 Stock Option
Plan, the Comcast Corporation 2002 Stock Option Plan, the
Comcast Corporation 1996 Stock Option Plan, Comcast Corporation
1987 Stock Option Plan and the Comcast Corporation 2002 Deferred
Stock Option Plan.
(n) Committee means the Compensation
Committee of the Board.
(o) Common Stock means Class A
Common Stock, par value $0.01, of the Company.
(p) Company means Comcast Corporation, a
Pennsylvania corporation, as successor to Comcast Holdings
Corporation (formerly known as Comcast Corporation), including
any successor thereto by merger, consolidation, acquisition of
all or substantially all the assets thereof, or otherwise.
(q) Company Stock Fund means a
hypothetical investment fund pursuant to which Deferred Stock
Units are credited with respect to a portion of an Award subject
to an Election, and thereafter until (i) the date of
distribution or (ii) the effective date of a
Diversification Election, to the extent a Diversification
Election applies to such Deferred Stock Units, as applicable.
The portion of a Grantees Account deemed invested in the
Company Stock Fund shall be treated as if such portion of the
Account were invested in hypothetical shares of Common Stock or
Special Common Stock otherwise deliverable as Shares upon the
Vesting Date associated with Restricted Stock or Restricted
Stock Units, and all dividends and other distributions paid with
respect to Common Stock or Special Common Stock were held
uninvested in cash and credited with interest at the Applicable
Interest Rate as of the next succeeding December 31 (to the
extent the Account continues to be deemed credited in the form
of Deferred Stock Units through such December 31).
(r) Date of Grant means the date on
which an Award is granted.
(s) Deceased Grantee means:
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(i) A Grantee whose employment by a Participating Company
is terminated by death; or |
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(ii) A Grantee who dies following termination of employment
by a Participating Company. |
(t) Deferral Eligible Employee means:
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(i) An Eligible Employee whose Annual Rate of Pay is
$200,000 or more as of both: (i) the date on which an
Initial Election is filed with the Committee; and (ii) the
first day of the calendar year in which such Initial Election
filed. |
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(ii) An Eligible Employee whose Annual Rate of Pay is
$125,000 as of each of: (A) June 30, 2002;
(B) the date on which an Initial Election is filed with the
Committee; and (C) the first day of each calendar year
beginning after December 31, 2002. |
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(iii) Each New Key Employee. |
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(iv) Each other employee of a Participating Company who is
designated by the Committee, in its sole and absolute
discretion, as a Deferral Eligible Employee. |
(u) Deferred Stock Units means the
number of hypothetical Shares subject to an Election.
(v) Disability means:
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(i) An individuals inability to engage in any
substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous
period of not less than 12 months; or |
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(ii) Circumstances under which, by reason of any medically
determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous |
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period of not less than 12 months, an individual is
receiving income replacement benefits for a period of not less
than three months under an accident or health plan covering
employees of the individuals employer. |
(w) Disabled Grantee means:
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(i) A Grantee whose employment by a Participating Company
is terminated by reason of Disability; |
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(ii) The duly-appointed legal guardian of an individual
described in Paragraph 2(w)(i) acting on behalf of such
individual. |
(x) Diversification Election means a
Grantees election to have a portion of the Grantees
Account credited in the form of Deferred Stock Units and
attributable to any grant of Restricted Stock or Restricted
Stock Units deemed liquidated and credited thereafter under the
Income Fund, as provided in Paragraph 8(g).
(y) Election means, as applicable, an
Initial Election, a Subsequent Election, or an Acceleration
Election.
(z) Eligible Employee means an employee
of a Participating Company, as determined by the Committee.
(aa) Fair Market Value means:
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(i) If Shares are listed on a stock exchange, Fair Market
Value shall be determined based on the last reported sale price
of a Share on the principal exchange on which Shares are listed
on the date of determination, or if such date is not a trading
day, the next trading date. |
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(ii) If Shares are not so listed, but trades of Shares are
reported on the Nasdaq National Market, Fair Market Value shall
be determined based on the last quoted sale price of a Share on
the Nasdaq National Market on the date of determination, or if
such date is not a trading day, the next trading date. |
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(iii) If Shares are not so listed nor trades of Shares so
reported, Fair Market Value shall be determined by the Committee
in good faith. |
(bb) Grandfathered Amount means Deferred
Stock Units described in Paragraph 1(b).
(cc) Grantee means an Eligible Employee
or Non-Employee Director who is granted an Award.
(dd) Hardship means a Grantees
severe financial hardship due to an unforeseeable emergency
resulting from a sudden and unexpected illness or accident of
the Grantee, or, a sudden and unexpected illness or accident of
a dependent (as defined by section 152(a) of the Code) of
the Grantee, or loss of the Grantees property due to
casualty, or other similar and extraordinary unforeseeable
circumstances arising as a result of events beyond the control
of the Grantee. A need to send the Grantees child to
college or a desire to purchase a home is not an unforeseeable
emergency. No Hardship shall be deemed to exist to the extent
that the financial hardship is or may be relieved
(a) through reimbursement or compensation by insurance or
otherwise, (b) by borrowing from commercial sources on
reasonable commercial terms to the extent that this borrowing
would not itself cause a severe financial hardship, (c) by
cessation of deferrals under the Plan, or (d) by
liquidation of the Grantees other assets (including assets
of the Grantees spouse and minor children that are
reasonably available to the Grantee) to the extent that this
liquidation would not itself cause severe financial hardship.
For the purposes of the preceding sentence, the Grantees
resources shall be deemed to include those assets of his spouse
and minor children that are reasonably available to the Grantee;
however, property held for the Grantees child under an
irrevocable trust or under a Uniform Gifts to Minors Act
custodianship or Uniform Transfers to Minors Act
custodianship shall not be treated as a resource of the
Grantee. The Committee shall determine whether the circumstances
of the Grantee constitute an unforeseeable emergency and thus a
Hardship within the meaning of this Paragraph 2(dd).
Following a uniform procedure, the Committees
B-4
determination shall consider any facts or conditions deemed
necessary or advisable by the Committee, and the Grantee shall
be required to submit any evidence of the Grantees
circumstances that the Committee requires. The determination as
to whether the Grantees circumstances are a case of
Hardship shall be based on the facts of each case; provided
however, that all determinations as to Hardship shall be
uniformly and consistently made according to the provisions of
this Paragraph 2(dd) for all Grantees in similar
circumstances.
(ee) Income Fund means a hypothetical
investment fund pursuant to which an amount equal to the Fair
Market Value of Deferred Stock Units subject to a
Diversification Election is credited as of the effective date of
such Diversification Election and as to which interest is
credited thereafter until the date of distribution at the
Applicable Interest Rate.
(ff) Initial Election means a written
election on a form provided by the Committee, pursuant to which
a Grantee: (i) elects, within the time or times specified
in Paragraph 8(a), to defer the distribution date of Shares
issuable with respect to Restricted Stock or Restricted Stock
Units; and (ii) designates the distribution date of such
Shares.
(gg) New Key Employee means each
employee of a Participating Company who: (i) becomes an
employee of a Participating Company and has an Annual Rate of
Pay of $200,000 or more as of his employment commencement date;
or (ii) has an Annual Rate of Pay that is increased to
$200,000 or more and who, immediately preceding such increase,
was not a Deferral Eligible Employee.
(hh) Non-Employee Director means an
individual who is a member of the Board, and who is not an
employee of the Company, including an individual who is a member
of the Board and who previously was an employee of the Company.
(ii) Normal Retirement means a
Grantees termination of employment that is treated by the
Participating Company as a retirement under its employment
policies and practices as in effect from time to time.
(jj) Other Available Shares means, as of
any date, the sum of:
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(i) The total number of Shares owned by a Grantee that were
not acquired by such Grantee pursuant to a Comcast Plan or
otherwise in connection with the performance of services to the
Company or an Affiliate; plus |
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(ii) The excess, if any of: |
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(1) The total number of Shares owned by a Grantee other
than the Shares described in Paragraph 2(jj)(i); over |
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(2) The sum of: |
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(A) The number of such Shares owned by such Grantee for
less than six months; plus |
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(B) The number of such Shares owned by such Grantee that
has, within the preceding six months, been the subject of a
withholding certification pursuant to Paragraph 9(c)(ii) or
any similar withholding certification under any other Comcast
Plan; plus |
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(C) The number of such Shares owned by such Grantee that
has, within the preceding six months, been received in exchange
for Shares surrendered as payment, in full or in part, or as to
which ownership was attested to as payment, in full or in part,
of the exercise price for an option to purchase any securities
of the Company or an Affiliate of the Company, under any Comcast
Plan, but only to the extent of the number of Shares surrendered
or attested to; plus |
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(D) The number of such Shares owned by such Grantee as to
which evidence of ownership has, within the preceding six
months, been provided to the Company in connection with the
crediting of Deferred Stock Units to such
Grantees Account under the Comcast Corporation 2002
Deferred Stock Option Plan (as in effect from time to time). |
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For purposes of this Paragraph 2(jj), a Share that is
subject to an Election pursuant to Paragraph 8 or a
deferral election pursuant to another Comcast Plan shall not be
treated as owned by a Grantee until all conditions to the
delivery of such Share have lapsed. The number of Other
Available Shares shall be determined separately for Common Stock
and Special Common Stock. For purposes of determining the number
of Other Available Shares, the term Shares shall
also include the securities held by a Grantee immediately before
the consummation of the AT&T Broadband Transaction that
became Shares as a result of the AT&T Broadband Transaction.
(kk) Participating Company means the
Company and each of the Subsidiary Companies.
(ll) Performance-Based Compensation
means performance-based compensation within the
meaning of Q&A 22 of IRS Notice
2005-1, or such
other guidance as may be issued by the Department of the
Treasury under section 409A of the Code.
(mm) Performance Period means a period
of at least 12 months during which a Grantee may earn
Performance-Based Compensation.
(nn) Person means an individual, a
corporation, a partnership, an association, a trust or any other
entity or organization.
(oo) Plan means the Comcast Corporation
2002 Restricted Stock Plan, as set forth herein, and as amended
from time to time.
(pp) Prime Rate means, for any calendar
year, the interest rate that, when compounded daily pursuant to
rules established by the Committee from time to time, is
mathematically equivalent to the prime rate of interest
(compounded annually) as published in the Eastern Edition of
The Wall Street Journal on the last business day
preceding the first day of such calendar year, and as adjusted
as of the last business day preceding the first day of each
calendar year beginning thereafter.
(qq) Restricted Stock means Shares
subject to restrictions as set forth in an Award.
(rr) Restricted Stock Unit means a unit
that entitles the Grantee, upon the Vesting Date set forth in an
Award, to receive one Share.
(ss) Retired Grantee means a Grantee who
has terminated employment pursuant to a Normal Retirement.
(tt) Rule 16b-3
means Rule 16b-3
promulgated under the 1934 Act, as in effect from time to
time.
(uu) Share or Shares
means:
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(i) except as provided in Paragraph 2(uu)(ii), a share
or shares of Common Stock. |
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(ii) with respect to Awards granted before the consummation
of the AT&T Broadband Transaction as to which a Vesting Date
has not occurred, and for purposes of Paragraphs 2(jj) and
9(c), the term Share or Shares also
means a share or shares of Special Common Stock. |
(vv) Special Common Stock means
Class A Special Common Stock, par value $0.01, of the
Company.
(ww) Special Diversification Election
means, with respect to each separate grant of Restricted Stock
or Restricted Stock Units, a Diversification Election by a
Grantee other than a Non-Employee Director to have more than
40 percent of the Deferred Stock Units credited to such
Grantees Account in the Company Stock Fund liquidated and
credited thereafter under the Income Fund, as provided in
Paragraph 8(g)(i), if (and to the extent that) it is
approved by the Committee in accordance with
Paragraph 8(g)(ii).
(xx) Subsequent Election means a written
election on a form provided by the Committee, filed with the
Committee in accordance with Paragraph 8(d), pursuant to
which a Grantee: (i) elects, within the time or times
specified in Paragraph 8(d), to further defer the
distribution date of Shares issuable with
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respect to Restricted Stock or Restricted Stock Units; and
(ii) designates the distribution date of such Shares.
(yy) Subsidiary Companies means all
business entities that, at the time in question, are
subsidiaries of the Company, within the meaning of
section 424(f) of the Code.
(zz) Successor-in-Interest
means the estate or beneficiary to whom the right to payment
under the Plan shall have passed by will or the laws of descent
and distribution.
(aaa) Terminating Event means any of the
following events:
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(i) the liquidation of the Company; or |
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(ii) a Change of Control. |
(bbb) Third Party means any Person,
together with such Persons Affiliates, provided that the
term Third Party shall not include the Company or an
Affiliate of the Company.
(ccc) Vesting Date means, as applicable:
(i) the date on which the restrictions imposed on a Share
of Restricted Stock lapse or (ii) the date on which the
Grantee vests in a Restricted Stock Unit.
(ddd) 1933 Act means the Securities
Act of 1933, as amended.
(eee) 1934 Act means the Securities
Exchange Act of 1934, as amended.
3. Rights To Be
Granted
Rights that may be granted under the Plan are:
(a) Rights to Restricted Stock which gives the Grantee
ownership rights in the Shares subject to the Award, subject to
a substantial risk of forfeiture, as set forth in
Paragraph 7, and to deferred payment, as set forth in
Paragraph 8; and
(b) Rights to Restricted Stock Units which give the Grantee
the right to receive Shares upon a Vesting Date, as set forth in
Paragraph 7, and to deferred payment, as set forth in
Paragraph 8. The maximum number of Shares subject to Awards
that may be granted to any single individual in any calendar
year, adjusted as provided in Paragraph 10, shall be one
million Shares.
4. Shares Subject to the
Plan
(a) Not more than 15 million Shares in the aggregate
may be issued under the Plan pursuant to the grant of Awards,
subject to adjustment in accordance with Paragraph 10,
provided that subject to the approval of the Companys
shareholders at the Companys Annual Meeting of
Shareholders to be held in 2006, the number of Shares in the
aggregate that may be issued under the Plan, pursuant to the
grant of Awards, subject to adjustment in accordance with
Paragraph 10, shall be increased from 15 million to
35 million. The Shares issued under the Plan may, at the
Companys option, be either Shares held in treasury or
Shares originally issued for such purpose.
(b) If Restricted Stock or Restricted Stock Units are
forfeited pursuant to the term of an Award, other Awards with
respect to such Shares may be granted.
5. Administration of the
Plan
(a) Administration. The Plan shall be administered
by the Committee, provided that with respect to Awards to
Non-Employee Directors, the rules of this Section 5 shall
apply so that all references in this Section 5 to the
Committee shall be treated as references to either the Board or
the Committee acting alone.
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(b) Grants. Subject to the express terms and
conditions set forth in the Plan, the Committee shall have the
power, from time to time, to:
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(i) select those Employees and Non-Employee Directors to
whom Awards shall be granted under the Plan, to determine the
number of Shares and/or Restricted Stock Units, as applicable,
to be granted pursuant to each Award, and, pursuant to the
provisions of the Plan, to determine the terms and conditions of
each Award, including the restrictions applicable to such Shares
and the conditions upon which a Vesting Date shall
occur; and |
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(ii) interpret the Plans provisions, prescribe, amend
and rescind rules and regulations for the Plan, and make all
other determinations necessary or advisable for the
administration of the Plan. |
The determination of the Committee in all matters as stated
above shall be conclusive.
(c) Meetings. The Committee shall hold meetings at
such times and places as it may determine. Acts approved at a
meeting by a majority of the members of the Committee or acts
approved in writing by the unanimous consent of the members of
the Committee shall be the valid acts of the Committee.
(d) Exculpation. No member of the Committee shall be
personally liable for monetary damages for any action taken or
any failure to take any action in connection with the
administration of the Plan or the granting of Awards thereunder
unless (i) the member of the Committee has breached or
failed to perform the duties of his office, and (ii) the
breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness; provided, however, that the
provisions of this Paragraph 5(d) shall not apply to the
responsibility or liability of a member of the Committee
pursuant to any criminal statute.
(e) Indemnification. Service on the Committee shall
constitute service as a member of the Board. Each member of the
Committee shall be entitled without further act on his part to
indemnity from the Company to the fullest extent provided by
applicable law and the Companys Articles of Incorporation
and By-laws in connection with or arising out of any action,
suit or proceeding with respect to the administration of the
Plan or the granting of Awards thereunder in which he may be
involved by reason of his being or having been a member of the
Committee, whether or not he continues to be such member of the
Committee at the time of the action, suit or proceeding.
(f) Delegation of Authority.
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(i) Named Executive Officers and Section 16(b)
Officers. All authority with respect to the grant,
amendment, interpretation and administration of grants and
awards of restricted stock and restricted stock units with
respect to any Eligible Employee who is either (x) a Named
Executive Officer (i.e., an officer who is required to be
listed in the Companys Proxy Statement Compensation Table)
or (y) is subject to the short-swing profit recapture rules
of section 16(b) of the 1934 Act, is reserved to the
Committee. |
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(ii) Senior Officers and Highly Compensated
Employees. The Committee may delegate to a committee
consisting of the Chairman of the Committee and one or more
officers of the Company designated by the Committee, discretion
under the Plan to grant, amend, interpret and administer grants
of Restricted Stock and Restricted Stock Units with respect to
any Eligible Employee who (x) holds a position with Comcast
Corporation of Senior Vice President or a position of higher
rank than Senior Vice President or (y) has a base salary of
$500,000 or more. |
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(iii) Other Employees. The Committee may delegate to
an officer of the Company, or a committee of two or more
officers of the Company, discretion under the Plan to grant,
amend, interpret and administer grants of Restricted Stock and
Restricted Stock Units with respect to any Eligible Employee
other than an Eligible Employee described in
Section 5(f)(i) or Section 5(f)(ii). |
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(g) Termination of Delegation of Authority. Any
delegation of authority described in Paragraph 5(f) shall
continue in effect until the earliest of:
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(i) such time as the Committee shall, in its discretion,
revoke such delegation of authority; |
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(ii) in the case of delegation under Section 5(f)(ii),
the delegate shall cease to serve as Chairman of the Committee
or serve as an employee of the Company for any reason, as the
case may be and in the case of delegation under
Section 5(f)(iii), the delegate shall cease to serve as an
employee of the Company for any reason; or |
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(iii) the delegate shall notify the Committee that he
declines to continue exercise such authority. |
6. Eligibility
Awards may be granted only to Eligible Employees and, subject to
the approval of the shareholders of the Company at the Annual
Meeting of Shareholders of the Company to be held in 2005,
Non-Employee Directors.
7. Restricted Stock and
Restricted Stock Unit Awards
The Committee may grant Awards in accordance with the Plan,
provided that the Board or the Committee may grant Awards to
Non-Employee Directors authorized by the Comcast Corporation
2002 Non-Employee Director Compensation Plan, or otherwise. With
respect to Awards to Non-Employee Directors, the rules of this
Section 7 shall apply so that either the Board or the
Committee acting alone shall have all of the authority otherwise
reserved in this Section 7 to the Committee.
The terms and conditions of Awards shall be set forth in writing
as determined from time to time by the Committee, consistent,
however, with the following:
(a) Time of Grant. All Awards shall be granted
within ten (10) years from the date of adoption of the Plan
by the Board.
(b) Terms of Awards. The provisions of Awards need
not be the same with respect to each Grantee. No cash or other
consideration shall be required to be paid by the Grantee in
exchange for an Award.
(c) Awards and Agreements. Each Grantee shall be
provided with an agreement specifying the terms of an Award. In
addition, a certificate shall be issued to each Grantee in
respect of Restricted Shares subject to an Award. Such
certificate shall be registered in the name of the Grantee and
shall bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Award. The
Company may require that the certificate evidencing such
Restricted Stock be held by the Company until all restrictions
on such Restricted Stock have lapsed.
(d) Restrictions. Subject to the provisions of the
Plan and the Award, the Committee may establish a period
commencing with the Date of Grant during which the Grantee shall
not be permitted to sell, transfer, pledge or assign Restricted
Stock awarded under the Plan.
(e) Vesting/Lapse of Restrictions. Subject to the
provisions of the Plan and the Award, a Vesting Date for
Restricted Stock or Restricted Stock Units subject to an Award
shall occur at such time or times and on such terms and
conditions as the Committee may determine and as are set forth
in the Award; provided, however, that except as otherwise
provided by the Committee, a Vesting Date shall occur only if
the Grantee is an employee of a Participating Company as of such
Vesting Date, and has been an employee of a Participating
Company continuously from the Date of Grant. The Award may
provide for Restricted Stock or Restricted Stock Units to vest
in installments, as determined by the Committee. The Committee
may, in its sole discretion, waive, in whole or in part, any
remaining conditions to vesting with respect to such
Grantees Restricted Stock or Restricted Stock Units. All
references to Shares in Awards granted before the consummation
of the AT&T Broadband Transaction as to which a Vesting Date
has not occurred shall be deemed to be references to Special
Common Stock.
B-9
(f) Rights of the Grantee. Grantees may have such
rights with respect to Shares subject to an Award as may be
determined by the Committee and set forth in the Award,
including the right to vote such Shares, and the right to
receive dividends paid with respect to such Shares. A Grantee
whose Award consists of Restricted Stock Units shall not have
the right to vote or to receive dividend equivalents with
respect to such Restricted Stock Units.
(g) Termination of Grantees Employment. A
transfer of an Eligible Employee between two employers, each of
which is a Participating Company, shall not be deemed a
termination of employment. In the event that a Grantee
terminates employment with all Participating Companies, all
Restricted Shares and/or Restricted Stock Units as to which a
Vesting Date has not occurred shall be forfeited by the Grantee
and deemed canceled by the Company.
(h) Delivery of Shares. Except as otherwise provided
by Paragraph 8, when a Vesting Date occurs with respect to
all or a portion of an Award of Restricted Stock or Restricted
Stock Units, the Company shall notify the Grantee that a Vesting
Date has occurred, and shall deliver to the Grantee (or the
Grantees
Successor-in-Interest)
a certificate for the number of Shares as to which a Vesting
Date has occurred (or in the case of Restricted Stock Units, the
number of Shares represented by such Restricted Stock Units)
without any legend or restrictions (except those that may be
imposed by the Committee, in its sole judgment, under
Paragraph 9(a)). The right to payment of any fractional
Shares that may have accrued shall be satisfied in cash,
measured by the product of the fractional amount times the Fair
Market Value of a Share at the Vesting Date, as determined by
the Committee.
8. Deferral Elections
A Grantee may elect to defer the receipt of Shares that would
otherwise be issuable with respect to Restricted Stock or
Restricted Stock Units as to which a Vesting Date has occurred,
as provided by the Committee in the Award, consistent, however,
with the following:
(a) Initial Election.
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(i) Election. Each Grantee who is a Non-Employee
Director or a Deferral Eligible Employee shall have the right to
defer the receipt of some or all of the Shares issuable with
respect to Restricted Stock or Restricted Stock Units as to
which a Vesting Date has not yet occurred, by filing an Initial
Election to defer the receipt of such Shares on a form provided
by the Committee for this purpose. |
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(ii) Deadline for Initial Election. No Initial
Election to defer the receipt of Shares issuable with respect to
Restricted Stock or Restricted Stock Units that are not
Performance-Based Compensation shall be effective unless it is
filed with the Committee on or before the 30th day
following the Date of Grant provided that pursuant to
Q-A 21 of IRS
Notice 2005-1, to
the extent provided by the Committee or its delegate, a Grantee
may, on or before March 15, 2005, make an Initial Election
with respect to Restricted Stock or Restricted Stock Units that
were granted before January 1, 2005 and were not vested on
December 31, 2004, and with respect to Restricted Stock or
Restricted Stock Units that may be granted after
December 31, 2004, provided further that the Restricted
Stock or Restricted Stock Units to which the Initial Election
relates have not been vested at the time the Initial Election is
filed. No Initial Election to defer the receipt of Shares
issuable with respect to Restricted Stock or Restricted Stock
Units that are Performance-Based Compensation shall be effective
unless it is filed with the Administrator at least six months
before the end of the Performance Period during which such
Performance-Based Compensation may be earned. |
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(iii) Special Transition Rule. Pursuant to
Q-A 20 of IRS
Notice 2005-1, to
the extent provided by the Committee or its delegate, a Grantee
may, on or before December 31, 2005, terminate the deferral
of Restricted Stock or Restricted Stock Units pursuant to an
Initial Election or cancel an Initial Election with regard to
amounts deferred under the Plan, provided that if a Grantee
terminates the deferral of Compensation pursuant to an Initial
Election under this Paragraph 8(a)(iii), the Company shall
pay the Grantee the Compensation that would have been deferred
if the deferral of |
B-10
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Compensation had not been terminated, and provided further that
if a Grantee cancels an Initial Election with regard to amounts
deferred under the Plan, the Company shall pay the Grantee the
amount deferred pursuant to such Initial Election through the
cancellation date, plus income, gains and losses credited with
respect thereto as provided in this Article VIII. |
(b) Effect of Failure of Vesting Date to Occur. An
Election shall be null and void if a Vesting Date with respect
to the Restricted Stock or Restricted Stock Units does not occur
before the distribution date for Shares issuable with respect to
such Restricted Stock or Restricted Stock Units identified in
such Election.
(c) Deferral Period. Except as otherwise provided in
Paragraph 8(d), all Shares issuable with respect to
Restricted Stock or Restricted Stock Units that are subject to
an Election shall be delivered to the Grantee (or the
Grantees
Successor-in-Interest)
without any legend or restrictions (except those that may be
imposed by the Committee, in its sole judgment, under
Paragraph 9(a)), on the distribution date for such Shares
designated by the Grantee on the most recently filed Election.
Subject to acceleration or deferral pursuant to
Paragraph 8(d) or Paragraph 11, no distribution may be
made earlier than January 2nd of the third calendar
year beginning after the Vesting Date, nor later than
January 2nd of the eleventh calendar year beginning
after the Vesting Date. The distribution date may vary with each
separate Election.
(d) Additional Elections. Notwithstanding anything
in this Paragraph 8(d) to the contrary, no Subsequent
Election shall be effective until 12 months after the date
on which such Subsequent Election is made.
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(i) Each Active Grantee who has previously made an Initial
Election to receive a distribution of part or all of his or her
Account, or who, pursuant to this Paragraph 8(d)(i) has
made a Subsequent Election to defer the distribution date for
Shares issuable with respect to Restricted Stock or Restricted
Stock Units for an additional period from the originally-elected
distribution date, may elect to defer the distribution date for
a minimum of five and a maximum of ten additional years from the
previously-elected distribution date, by filing a Subsequent
Election with the Committee on or before the close of business
at least one year before the date on which the distribution
would otherwise be made. |
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(ii) A Deceased Grantees
Successor-in-Interest
may elect to: (A) file a Subsequent Election to defer the
distribution date for the Deceased Grantees Shares
issuable with respect to Restricted Stock or Restricted Stock
Units for five additional years from the date payment would
otherwise be made; or (B) file an Acceleration Election to
accelerate the distribution date for the Deceased Grantees
Shares issuable with respect to Restricted Stock or Restricted
Stock Units from the date payment would otherwise be made to a
date that is as soon as practicable following the Deceased
Grantees death. A Subsequent Election must be filed with
the Committee at least one year before the date on which the
distribution would otherwise be made, as reflected on the
Deceased Grantees last Election. An Acceleration Election
pursuant to this Paragraph 8(d)(ii) must be filed with the
Committee as soon as practicable following the Deceased
Grantees death, as determined by the Committee. |
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(iii) A Disabled Grantee may elect to accelerate the
distribution date of the Disabled Grantees Shares issuable
with respect to Restricted Stock or Restricted Stock Units from
the date payment would otherwise be made to a date that is as
soon as practicable following the date the Disabled Grantee
became disabled. An Acceleration Election pursuant to this
Paragraph 8(d)(iii) must be filed with the Committee as
soon as practicable following the Deceased Grantees death,
as determined by the Committee. |
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(iv) A Retired Grantee may elect to defer the distribution
date of the Retired Grantees Shares issuable with respect
to Restricted Stock or Restricted Stock Units for five
additional years from the date payment would otherwise be made.
A Subsequent Election must be filed with the Committee at |
B-11
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least one year before the date on which the distribution would
otherwise be made, as reflected on the Retired Grantees
last Election. |
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(v) Discretion to Provide for Distribution in Full Upon
or Following a Change of Control. To the extent permitted by
IRS Notice
2005-1, in
connection with a Change of Control, and for the
12-month period
following a Change of Control, the Committee may exercise its
discretion to terminate the deferral provisions of the Plan and,
notwithstanding any other provision of the Plan or the terms of
any Initial Election or Subsequent Election, distribute the
Account of each Grantee in full and thereby effect the
revocation of any outstanding Initial Elections or Subsequent
Elections. |
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(vi) Hardship. Notwithstanding the terms of an
Initial Election or Subsequent Election, if, at the
Grantees request, the Committee determines that the
Grantee has incurred a Hardship, the Committee may, in its
discretion, authorize the immediate distribution of all or any
portion of the Grantees Account. |
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(vii) Other Acceleration Events. To the extent
permitted by
Q-A 15 of IRS
Notice 2005-1,
notwithstanding the terms of an Initial Election or Subsequent
Election, distribution of all or part of a Grantees
Account may be made: |
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(1) To the extent necessary to fulfill a domestic relations
order (as defined in section 414(p)(1)(B) of the Code). |
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(2) To the extent necessary to comply with a certificate of
divestiture (as defined in section 1043(b)(2) of the Code). |
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(3) To pay the Federal Insurance Contribution Act
(FICA) tax imposed under sections 3101 and
3121(v)(2) of the Code on compensation deferred under the Plan
(the FICA Amount) plus the income tax at source on
wages imposed under section 3401 of the Code with respect
to the FICA Amount, and to pay the additional income tax at
source on wages attributable to the pyramiding section 3401
wages and taxes, provided that the total amount distributable
under this Paragraph 8(d)(vii)(3) shall not exceed the sum
of the FICA Amount and the income tax withholding related to
such FICA Amount. |
(e) Book Accounts. An Account shall be established
for each Grantee who makes an Election. Deferred Stock Units
shall be credited to the Account as of the date an Election
becomes effective. Each Deferred Stock Unit will represent, as
applicable, either a hypothetical share of Common Stock or a
hypothetical share of Special Common Stock credited to the
Account in lieu of delivery of the Shares to which the Election
applies. To the extent an Account is deemed invested in the
Income Fund, the Committee shall credit earnings with respect to
such Account at the Applicable Interest Rate, as further
provided in Paragraph 8(g).
(f) Plan-to-Plan
Transfers. The Administrator may delegate its authority to
arrange for
plan-to-plan transfers
as described in this Paragraph 8(f) to an officer of the
Company or committee of two or more officers of the Company.
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(i) The Administrator may, with a Grantees consent,
make such arrangements as it may deem appropriate to transfer
the Companys obligation to pay benefits with respect to
such Grantee which have not become payable under this Plan, to
another employer, whether through a deferred compensation plan,
program or arrangement sponsored by such other employer or
otherwise, or to another deferred compensation plan, program or
arrangement sponsored by the Company or an Affiliate. Following
the completion of such transfer, with respect to the benefit
transferred, the Grantee shall have no further right to payment
under this Plan. |
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(ii) The Administrator may, with a Grantees consent,
make such arrangements as it may deem appropriate to assume
another employers obligation to pay benefits with respect
to such Grantee which have not become payable under the deferred
compensation plan, program or arrangement under which such
future right to payment arose, to the Plan, or to assume a
future payment obligation of the Company or an Affiliate under
another plan, program or arrangement sponsored by the Company |
B-12
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or an Affiliate. Upon the completion of the Plans
assumption of such payment obligation, the Administrator shall
establish an Account for such Grantee, and the Account shall be
subject to the rules of this Plan, as in effect from time to
time. |
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(iii) Pursuant to
Q-A 19(c) of
IRS Notice
2005-1, to the
extent provided by the Committee or its delegate, a Grantee may,
on or before December 31, 2005, with respect to all or any
portion of his or her Grandfathered Amount under the Plan as in
effect on December 31, 2004, and with respect to any
initial deferrals made after December 31, 2004, make new
payment elections as to the form and timing of payment of such
amounts as may be permitted under this Plan, provided that
following the completion of such new payment election, such
amounts shall not be treated as a Grandfathered Amount, but
instead shall be treated as a non-Grandfathered Amount, subject
to the rules of this Plan. |
(g) Crediting of Income, Gains and Losses on
Accounts. Except as otherwise provided in
Paragraph 8(h), the value of a Grantees Account as of
any date shall be determined as if it were invested in the
Company Stock Fund.
(h) Diversification Elections.
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(i) In General. A Diversification Election shall be
available: (A) at any time that a Registration Statement
filed under the 1933 Act (a Registration
Statement) is effective with respect to the Plan; and
(B) with respect to a Special Diversification Election, if
and to the extent that the opportunity to make such a Special
Diversification Election has been approved by the Committee. No
approval is required for a Diversification Election other than a
Special Diversification Election. |
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(ii) Committee Approval of Special Diversification
Elections. The opportunity to make a Special Diversification
Election and the extent to which a Special Diversification
Election applies to Deferred Stock Units credited to the Company
Stock Fund may be approved or rejected by the Committee in its
sole discretion. A Special Diversification Election shall only
be effective if (and to the extent) approved by the Committee. |
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(iii) Timing and Manner of Making Diversification
Elections. Each Grantee and, in the case of a Deceased
Grantee, the
Successor-in-Interest,
may make a Diversification Election to convert up to
40 percent (or in the case of a Special Diversification
Election, up to the approved percentage) of Deferred Stock Units
attributable to each grant of Restricted Stock or Restricted
Stock Units credited to the Company Stock Fund to the Income
Fund. No deemed transfers shall be permitted from the Income
Fund to the Company Stock Fund. Diversification Elections under
this Paragraph 8(h)(iii) shall be prospectively effective
on the later of: (A) the date designated by the Grantee on
a Diversification Election filed with the Committee; or
(B) the business day next following the lapse of six months
from the date Deferred Stock Units subject to the
Diversification Election are credited to the Grantees
Account. In no event may a Diversification Election be effective
earlier than the business day next following the lapse of six
(6) months from the date Deferred Stock Units are credited
to the Account following the lapse of restrictions with respect
to an Award. |
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(iv) Timing of Credits. Account balances subject to
a Diversification Election under this Paragraph 8(h) shall
be deemed transferred from the Company Stock Fund to the Income
Fund immediately following the effective date of such
Diversification Election. The value of amounts deemed invested
in the Income Fund immediately following the effective date of a
Diversification Election shall be based on hypothetical sales of
Common Stock or Special Common Stock, as applicable, underlying
the liquidated Deferred Stock Units at Fair Market Value as of
the effective date of a Diversification Election. |
(i) Effect of Distributions within Five Years of
Effective Date of Diversification Election. If, pursuant to
Paragraphs 8(a) through 8(d), Shares distributable with
respect to Deferred Stock Units credited to the Company Stock
Fund that are attributable to an Award as to which a
Diversification Election was made are distributed on or before
the fifth anniversary of the effective date of such
B-13
Diversification Election (and, in the case of a Grantee who
is a
Successor-in-Interest,
whether or not such Diversification Election was made by a
Grantees
predecessor-in-interest),
then, except as may otherwise be provided by the Committee in
its sole and absolute discretion, the following percentage of
the Grantees Account credited to the Income Fund and
attributable to such Diversification Election shall be
distributed simultaneously with such Shares, without regard to
any election to the contrary:
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Distributable Percentage of Corresponding |
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Time that Shares are Distributable |
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Income Fund Amount |
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On or before the third anniversary of a Diversification Election |
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60% |
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After the third anniversary of a Diversification Election and on
or before the fourth anniversary of a Diversification Election |
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40% |
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After the fourth anniversary of a Diversification Election and
on or before the fifth anniversary of a Diversification Election |
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20% |
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After the fifth anniversary of a Diversification Election |
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0% |
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(j) Grantees Status as General Creditors. A
Grantees right to delivery of Shares subject to an
Election under this Paragraph 8, or to amounts deemed
invested in the Income Fund pursuant to a Diversification
Election, shall at all times represent the general obligation of
the Company. The Grantee shall be a general creditor of the
Company with respect to this obligation, and shall not have a
secured or preferred position with respect to such obligation.
Nothing contained in the Plan or an Award shall be deemed to
create an escrow, trust, custodial account or fiduciary
relationship of any kind. Nothing contained in the Plan or an
Award shall be construed to eliminate any priority or preferred
position of a Grantee in a bankruptcy matter with respect to
claims for wages.
(k) Non-Assignability, Etc. The right of a Grantee
to receive Shares subject to an Election under this
Paragraph 8, or to amounts deemed invested in the Income
Fund pursuant to a Diversification Election, shall not be
subject in any manner to attachment or other legal process for
the debts of such Grantee; and no right to receive Shares or
cash payments hereunder shall be subject to anticipation,
alienation, sale, transfer, assignment or encumbrance.
9. Securities Laws;
Taxes
(a) Securities Laws. The Committee shall have the
power to make each grant of Awards under the Plan subject to
such conditions as it deems necessary or appropriate to comply
with the then- existing requirements of the 1933 Act and
the 1934 Act, including
Rule 16b-3. Such
conditions may include the delivery by the Grantee of an
investment representation to the Company in connection with a
Vesting Date occurring with respect to Shares subject to an
Award, or the execution of an agreement by the Grantee to
refrain from selling or otherwise disposing of the Shares
acquired for a specified period of time or on specified terms.
(b) Taxes. Subject to the rules of
Paragraph 9(c), the Company shall be entitled, if necessary
or desirable, to withhold the amount of any tax, charge or
assessment attributable to the grant of any Award or the
occurrence of a Vesting Date with respect to any Award. The
Company shall not be required to deliver Shares pursuant to any
Award until it has been indemnified to its satisfaction for any
such tax, charge or assessment.
(c) Payment of Tax Liabilities; Election to Withhold
Shares or Pay Cash to Satisfy Tax Liability.
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(i) In connection with the grant of any Award or the
occurrence of a Vesting Date under any Award, the Company shall
have the right to (A) require the Grantee to remit to the
Company an |
B-14
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amount sufficient to satisfy any federal, state and/or local
withholding tax requirements prior to the delivery or transfer
of any certificate or certificates for Shares subject to such
Award, or (B) take any action whatever that it deems
necessary to protect its interests with respect to tax
liabilities. The Companys obligation to make any delivery
or transfer of Shares shall be conditioned on the Grantees
compliance, to the Companys satisfaction, with any
withholding requirement. |
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(ii) Except as otherwise provided in this
Paragraph 9(c)(ii), any tax liabilities incurred in
connection with grant of any Award or the occurrence of a
Vesting Date under any Award under the Plan shall be satisfied
by the Companys withholding a portion of the Shares
subject to such Award having a Fair Market Value approximately
equal to the minimum amount of taxes required to be withheld by
the Company under applicable law, unless otherwise determined by
the Committee with respect to any Grantee. Notwithstanding the
foregoing, the Committee may permit a Grantee to elect one or
both of the following: (A) to have taxes withheld in excess
of the minimum amount required to be withheld by the Company
under applicable law; provided that the Grantee certifies in
writing to the Company at the time of such election that the
Grantee owns Other Available Shares having a Fair Market Value
that is at least equal to the Fair Market Value to be withheld
by the Company in payment of withholding taxes in excess of such
minimum amount; and (B) to pay to the Company in cash all
or a portion of the taxes to be withheld in connection with such
grant or Vesting Date. In all cases, the Shares so withheld by
the Company shall have a Fair Market Value that does not exceed
the amount of taxes to be withheld minus the cash payment, if
any, made by the Grantee. Any election pursuant to this
Paragraph 9(c)(ii) must be in writing made prior to the
date specified by the Committee, and in any event prior to the
date the amount of tax to be withheld or paid is determined. An
election pursuant to this Paragraph 9(c)(ii) may be made
only by a Grantee or, in the event of the Grantees death,
by the Grantees legal representative. No Shares withheld
pursuant to this Paragraph 9(c)(ii) shall be available for
subsequent grants under the Plan. The Committee may add such
other requirements and limitations regarding elections pursuant
to this Paragraph 9(c)(ii) as it deems appropriate. |
10. Changes in
Capitalization
The aggregate number of Shares and class of Shares as to which
Awards may be granted and the number of Shares covered by each
outstanding Award shall be appropriately adjusted in the event
of a stock dividend, stock split, recapitalization or other
change in the number or class of issued and outstanding equity
securities of the Company resulting from a subdivision or
consolidation of the Shares and/or other outstanding equity
security or a recapitalization or other capital adjustment (not
including the issuance of Shares and/or other outstanding equity
securities on the conversion of other securities of the Company
which are convertible into Shares and/or other outstanding
equity securities) affecting the Shares which is effected
without receipt of consideration by the Company. The Committee
shall have authority to determine the adjustments to be made
under this Paragraph 10 and any such determination by the
Committee shall be final, binding and conclusive.
11. Terminating Events
The Committee shall give Grantees at least thirty
(30) days notice (or, if not practicable, such
shorter notice as may be reasonably practicable) prior to the
anticipated date of the consummation of a Terminating Event. The
Committee may, in its discretion, provide in such notice that
upon the consummation of such Terminating Event, any conditions
to the occurrence of a Vesting Date with respect to an Award of
Restricted Stock or Restricted Stock Units (other than
Restricted Stock or Restricted Stock Units that have previously
been forfeited) shall be eliminated, in full or in part.
Further, the Committee may, in its discretion, provide in such
notice that notwithstanding any other provision of the Plan or
the terms of any Election made pursuant to Paragraph 8,
upon the consummation of a Terminating Event, Shares issuable
with respect to Restricted Stock or Restricted Stock Units
subject to an Election made pursuant to Paragraph 8 shall
be transferred to the Grantee, and all amounts credited to the
Income Fund shall be paid to the Grantee.
B-15
12. Claims Procedure
If an individual (hereinafter referred to as the
Applicant, which reference shall include the legal
representative, if any, of the individual) does not receive
timely payment of benefits to which the Applicant believes he is
entitled under Paragraph 8 of the Plan, the Applicant may
make a claim for benefits in the manner hereinafter provided.
An Applicant may file a claim for benefits with the Committee on
a form supplied by the Committee. If the Committee wholly or
partially denies a claim, the Committee shall provide the
Applicant with a written notice stating:
(a) The specific reason or reasons for the denial;
(b) Specific reference to pertinent Plan provisions on
which the denial is based;
(c) A description of any additional material or information
necessary for Applicant to perfect the claim and an explanation
of why such material or information is necessary; and
(d) Appropriate information as to the steps to be taken in
order to submit a claim for review.
Written notice of a denial of a claim shall be provided within
90 days of the receipt of the claim, provided that if
special circumstances require an extension of time for
processing the claim, the Committee may notify the Applicant in
writing that an additional period of up to 90 days will be
required to process the claim.
If the Applicants claim is denied, the Applicant shall
have 60 days from the date of receipt of written notice of
the denial of the claim to request a review of the denial of the
claim by the Committee. Request for review of the denial of a
claim must be submitted in writing. The Applicant shall have the
right to review pertinent documents and submit issues and
comments to the Committee in writing. The Committee shall
provide a written decision within 60 days of its receipt of
the Applicants request for review, provided that if
special circumstances require an extension of time for
processing the review of the Applicants claim, the
Committee may notify the Applicant in writing that an additional
period of up to 60 days shall be required to process the
Applicants request for review.
It is intended that the claims procedures of this Plan be
administered in accordance with the claims procedure regulations
of the Department of Labor set forth in 29 CFR
§ 2560.503-1.
Claims for benefits under the Plan must be filed with the
Committee at the following address:
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Comcast Corporation
1500 Market Street
Philadelphia, PA 19102
Attention: General Counsel |
13. Amendment and
Termination
The Plan may be terminated by the Board at any time. The Plan
may be amended by the Board or the Committee at any time. No
Award shall be affected by any such termination or amendment
without the written consent of the Grantee.
B-16
14. Effective Date
The effective date of this amendment and restatement of the Plan
is December 14, 2005.
15. Governing Law
The Plan and all determinations made and actions taken pursuant
to the Plan shall be governed in accordance with Pennsylvania
law.
Executed as of the 14th day of December, 2005.
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COMCAST CORPORATION |
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By: |
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/s/ David L. Cohen |
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Attest: |
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/s/ Arthur R. Block |
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B-17
Appendix C
COMCAST CORPORATION
2006 CASH BONUS PLAN
(Effective January 1, 2006)
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1. |
Background and Purpose |
Comcast Corporation, a Pennsylvania corporation, hereby adopts
the Comcast Corporation 2006 Cash Bonus Plan (the
Plan), effective as of January 1, 2006, as the
successor to the Comcast Corporation 2002 Executive Cash Bonus
Plan (the Executive Plan), the Comcast Corporation
2002 Supplemental Cash Bonus Plan (the Supplemental
Plan) and the Comcast Corporation 2004 Management
Achievement Plan (the MAP). The purpose of the Plan
is to provide management employees of Comcast Corporation (the
Company) and the Companys Affiliates (as
defined below) with an incentive to accomplish such business
objectives as from time to time may be determined by the
Committee.
(a) Affiliate means, with respect to any
Person, any other person that, directly or indirectly, is in
control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, the term
control, including its correlative terms
controlled by and under common control
with, mean, with respect to any Person, the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or
otherwise.
(b) Award means a cash bonus award
granted under the Plan. An Award shall be expressed as the
percentage of a Grantees base salary payable for a Plan
Year that shall become payable if the Targets established by the
Committee are satisfied. The portion of an Award that shall be
payable to a Grantee shall be determined by the Committee in
accordance with the rules established for the Award for each
Plan Year.
(c) Board means the Board of Directors
of the Company.
(d) Change of Control means any
transaction or series of transactions as a result of which any
Person who was a Third Party immediately before such transaction
or series of transactions owns then-outstanding securities of
the Company such that such Person has the ability to direct the
management of the Company, as determined by the Board in its
discretion. The Board may also determine that a Change of
Control shall occur upon the completion of one or more proposed
transactions. The Boards determination shall be final and
binding.
(e) Committee means the Compensation
Committee of the Board or such other committee of the Board
assigned by the Board to administer the Plan.
(f) Company means Comcast Corporation, a
Pennsylvania corporation, including any successor thereto by
merger, consolidation, acquisition of all or substantially all
the assets thereof, or otherwise.
(g) Date of Grant means the date on
which an Award is granted.
(h) Eligible Employee means an employee
of the Company or an Affiliate, as determined by the Committee.
(i) Grantee means an Eligible Employee
who is granted an Award.
(j) Person means an individual, a
corporation, a partnership, an association, a trust or any other
entity or organization.
C-1
(k) Plan means the Comcast Corporation
2006 Cash Bonus Plan as set forth herein, and as amended from
time to time.
(l) Plan Year means the calendar year.
(m) Qualitative Performance Standards
means performance standards other than Quantitative Performance
Standards, including but not limited to customer service,
management effectiveness, workforce diversity and other
Qualitative Performance Standards relevant to the Companys
business, as may be established by the Committee, and the
achievement of which shall be determined in the discretion of
the Committee.
(n) Quantitative Performance Standards
means performance standards such as income, expense, operating
cash flow, capital spending, numbers of customers of or
subscribers for various services and products offered by the
Company or a division, customer service measurements and other
objective financial or service-based standards relevant to the
Companys business as may be established by the Committee.
(o) Target means, for any Plan Year, the
Qualitative Performance Standards and the Quantitative
Performance Standards established by the Committee, in its
discretion. Qualitative Performance Standards, Quantitative
Performance Standards and the weighting of such Standards may
differ from Plan Year to Plan Year, and within a Plan Year, may
differ among Grantees or classes of Grantees.
(p) Terminating Event means any of the
following events:
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(i) the liquidation of the Company; or |
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(ii) a Change of Control. |
(q) Third Party means any Person,
together with such Persons Affiliates, provided that the
term Third Party shall not include the Company or an
Affiliate of the Company.
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3. |
Administration of the Plan |
(a) Administration. The Plan shall be administered
by the Committee. The Committee shall have the power and duty to
do all things necessary or convenient to effect the intent and
purposes of the Plan and not inconsistent with any of the
provisions hereof, whether or not such powers and duties are
specifically set forth herein, and, by way of amplification and
not limitation of the foregoing, the Committee shall have the
power to:
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(i) provide rules and regulations for the management,
operation and administration of the Plan, and, from time to
time, to amend or supplement such rules and regulations; |
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(ii) construe the Plan, which construction, as long as made
in good faith, shall be final and conclusive upon all parties
hereto; |
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(iii) correct any defect, supply any omission, or reconcile
any inconsistency in the Plan in such manner and to such extent
as it shall deem expedient to carry the same into effect, and it
shall be the sole and final judge of when such action shall be
appropriate; and |
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(iv) determine whether the conditions to the payment of a
cash bonus pursuant to an Award have been satisfied. |
The resolution of any questions with respect to payments and
entitlements pursuant to the provisions of the Plan shall be
determined by the Committee, and all such determinations shall
be final and conclusive.
(b) Grants. Subject to the express terms and
conditions set forth in the Plan, the Committee shall have the
power, from time to time, to select those Eligible Employees to
whom Awards shall be granted under the Plan, to determine the
amount of cash to be paid pursuant to each Award, and, pursuant
to the provisions of the Plan, to determine the terms and
conditions of each Award.
C-2
(c) Delegation of Authority.
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(i) Named Executive Officers and Section 16(b)
Officers. All authority with respect to the grant,
amendment, interpretation and administration of Awards with
respect to any Eligible Employee who is either (x) a Named
Executive Officer (i.e., an officer who is required to be
listed in the Companys Proxy Statement Compensation Table)
or (y) is subject to the short-swing profit recapture rules
of section 16(b) of the 1934 Act, is reserved to the
Committee. |
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(ii) Senior Officers and Highly Compensated
Employees. The Committee may delegate to a committee
consisting of the Chairman of the Committee and one or more
officers of the Company designated by the Committee, discretion
under the Plan to grant, amend, interpret and administer Awards
with respect to any Eligible Employee who (x) holds a
position with Comcast Corporation of Senior Vice President or a
position of higher rank than Senior Vice President or
(y) has a base salary of $500,000 or more. |
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(iii) Other Employees. The Committee may delegate to
an officer of the Company, or a committee of two or more
officers of the Company, discretion under the Plan to grant,
amend, interpret and administer Awards with respect to any
Eligible Employee other than an Eligible Employee described in
Paragraph 3(c)(i) or Paragraph 3(c)(ii). |
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(iv) Termination of Delegation of Authority.
Delegation of authority as provided under this
Paragraph 3(c) shall continue in effect until the earliest
of: |
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(x) such time as the Committee shall, in its discretion,
revoke such delegation of authority; |
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(y) in the case of delegation under
Paragraph 5(c)(ii), the delegate shall cease to serve as
Chairman of the Committee or serve as an employee of the Company
for any reason, as the case may be and in the case of delegation
under Paragraph 5(c)(iii), the delegate shall cease to
serve as an employee of the Company for any reason; or |
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(z) the delegate shall notify the Committee that he
declines to continue exercise such authority. |
(d) Grantee Information. The Company shall furnish
to the Committee in writing all information the Company deems
appropriate for the Committee to exercise its powers and duties
in administration of the Plan. Such information shall be
conclusive for all purposes of the Plan and the Committee shall
be entitled to rely thereon without any investigation thereof;
provided, however, that the Committee may correct any errors
discovered in any such information.
Awards may be granted only to Eligible Employees of the Company
and its Affiliates, as determined by the Committee. No Awards
shall be granted to an individual who is not an Eligible
Employee of the Company or an Affiliate of the Company.
The Committee may grant Awards in accordance with the Plan. The
terms and conditions of Awards shall be as determined from time
to time by the Committee, consistent, however, with the
following:
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(a) Time of Grant. Awards may be granted at any time
from the date of adoption of the Plan by the Board until the
Plan is terminated by the Board or the Committee. |
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(b) Non-uniformity of Awards. The provisions of
Awards need not be the same with respect to each Grantee. |
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(c) Establishment of Targets and Conditions to Payment
of Awards. |
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(i) Awards shall be expressed as a percentage of a
Grantees base salary. |
C-3
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(ii) The Committee shall establish such conditions on the
payment of a bonus pursuant to an Award as it may, in its sole
discretion, deem appropriate. |
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(iii) The Award may provide for the payment of Awards in
installments, or upon the satisfaction of Qualitative
Performance Standards or Quantitative Performance Standards, on
an individual, divisional or Company-wide basis, as determined
by the Committee. |
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(iv) The Committee shall establish the Targets for each
Plan Year no later than 90 days after the first day of the
Plan Year, or, if sooner, within the first 25% of the Plan Year,
provided, however, that the Committee must determine that, as of
the date the Quantitative Performance Standards are established,
it is substantially uncertain whether the Quantitative
Performance Standards will be achieved. Each Grantee shall be
entitled to receive payment of the Award for a Plan Year only
after certification by the Committee that the Targets
established by the Committee for such Plan Year have been
satisfied. The Company shall pay the Awards under the Plan to
each Grantee as soon as practicable with respect to each Plan
Year, but not later than
21/2
months following the close of such Plan Year. |
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(v) For purposes of calculating whether any Quantitative
Performance Standard has been met, in the event there is a
significant acquisition or disposition of any assets, business
division, company or other business operations of the Company or
such division or business unit that is reasonably expected to
have an effect on the Quantitative Performance Standard as
otherwise determined under the terms of the Plan, the relevant
performance objectives shall be adjusted to take into account
the impact of such acquisition or disposition by increasing or
decreasing such goals in the same proportion as the relevant
performance measure of the Company or such division or business
unit would have been affected for the prior performance
measurement period on a pro forma basis had such an acquisition
or disposition occurred on the same date during the prior
performance measurement period; provided further that such
adjustment shall be based upon the historical equivalent of the
relevant performance measure of the business or assets so
acquired or disposed of for the prior performance measurement
period, as shown by such records as are available to the
Company, as further adjusted to reflect any aspects of the
transaction that should be taken into account to ensure
comparability between amounts in the prior performance
measurement period and the current performance measurement
period. |
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(vi) Notwithstanding the determination of the amount of a
Grantees bonus payable with respect to any Plan Year under
the Plan, the Committee shall have the discretion to reduce or
eliminate the bonus otherwise payable to a Grantee if it
determines that such a reduction or elimination of the bonus is
in the best interests of the Company. In addition, in the
discretion of the Committee, based on the satisfaction of
performance standards as it may determine, whether or not
previously designated as a Target, such additional amounts as
may be determined by the Committee may be included in an Award
for a Plan Year. |
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(e) Termination of Grantees Employment. |
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(1) A transfer of an Eligible Employee between two
employers, each of which is the Company or an Affiliate of the
Company (a Transfer), shall not be deemed a
termination of employment. The Committee may grant Awards
pursuant to which the Committee reserves the right to modify the
calculation of an Award in connection with a Transfer. In
general, except as otherwise provided by the Committee at the
time an Award is granted or in connection with a Transfer, upon
the Transfer of a Grantee between divisions while an Award is
outstanding and unexpired, the outstanding Award shall be
treated as having terminated and expired, and a new Award shall
be treated as having been made, effective as of the effective
date of the Transfer, for the portion of the Award which had not
expired or been paid, but subject to the performance and payment
conditions applicable generally to Awards for Grantees who are
employees of the transferee division, all as shall be determined
by the Committee in an equitable manner. |
C-4
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(2) In the event that a Grantee terminates employment with
the Company and its Affiliates, all Awards remaining subject to
conditions to payment shall be forfeited by the Grantee and
deemed canceled by the Company. |
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(f) Maximum Grant. In no event shall the amount paid
to any Grantee pursuant to an Award for any Plan Year exceed
$12 million. |
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(g) Shareholder Approval. The effectiveness of the
grants of Awards under the Plan relating to payments on the
satisfaction of the Quantitative Performance Standards
established by the Committee from time to time shall be
conditioned on the approval of the Plan by the Companys
shareholders. |
The Committee shall give Grantees at least thirty
(30) days notice (or, if not practicable, such
shorter notice as may be reasonably practicable) prior to the
anticipated date of the consummation of a Terminating Event. The
Committee may, in its discretion, provide in such notice that
upon the consummation of such Terminating Event, any remaining
conditions to payment of a Grantees Award shall be waived,
in whole or in part.
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7. |
Amendment and Termination |
No Awards shall be granted for any period commencing after
December 31, 2015, provided that the effectiveness of the
grants of Awards under the Plan after December 31, 2010
relating to payments on the satisfaction of the Quantitative
Performance Standards established by the Committee from time to
time shall be conditioned on the approval of the Plan by the
Companys shareholders. To the extent that awards are or
have been made pursuant to the terms of the Executive Plan, the
Supplemental Plan or the MAP, the Committee may, in its
discretion, treat such awards as Awards under this Plan. The
Plan may be terminated by the Board or the Committee at any
time. The Plan may be amended by the Board or the Committee at
any time. No Award shall be affected by any such termination or
amendment without the written consent of the Grantee.
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8. |
Miscellaneous Provisions |
(a) Unsecured Creditor Status. A Grantee entitled to
payment of an Award hereunder shall rely solely upon the
unsecured promise of the Company, as set forth herein, for the
payment thereof, and nothing herein contained shall be construed
to give to or vest in a Grantee or any other person now or at
any time in the future, any right, title, interest, or claim in
or to any specific asset, fund, reserve, account, insurance or
annuity policy or contract, or other property of any kind
whatever owned by the Company, or in which the Company may have
any right, title, or interest, nor or at any time in the future.
(b) Non-Assignment of Awards. The Grantee shall not
be permitted to sell, transfer, pledge or assign any amount
payable pursuant to the Plan or an Award, provided that the
right to payment under an Award may pass by will or the laws of
descent and distribution.
(c) Other Company Plans. It is agreed and understood
that any benefits under this Plan are in addition to any and all
benefits to which a Grantee may otherwise be entitled under any
other contract, arrangement, or voluntary pension, profit
sharing or other compensation plan of the Company, whether
funded or unfunded, and that this Plan shall not affect or
impair the rights or obligations of the Company or a Grantee
under any other such contract, arrangement, or voluntary
pension, profit sharing or other compensation plan.
(d) Separability. If any term or condition of the
Plan shall be invalid or unenforceable to any extent or in any
application, then the remainder of the Plan, with the exception
of such invalid or unenforceable provision, shall not be
affected thereby, and shall continue in effect and application
to its fullest extent.
(e) Continued Employment. Neither the establishment
of the Plan, any provisions of the Plan, nor any action of the
Committee shall be held or construed to confer upon any Grantee
the right to a
C-5
continuation of employment by the Company. The Company reserves
the right to dismiss any employee (including a Grantee), or
otherwise deal with any employee (including a Grantee) to the
same extent as though the Plan had not been adopted.
(f) Incapacity. If the Committee determines that a
Grantee is unable to care for his affairs because of illness or
accident, any benefit due such Grantee under the Plan may be
paid to his spouse, child, parent, or any other person deemed by
the Committee to have incurred expense for such Grantee
(including a duly appointed guardian, committee, or other legal
representative), and any such payment shall be a complete
discharge of the Companys obligation hereunder.
(g) Withholding. The Company shall withhold the
amount of any federal, state, local or other tax, charge or
assessment attributable to the grant of any Award or lapse of
restrictions under any Award as it may deem necessary or
appropriate, in its sole discretion.
The Plan and all determinations made and actions taken pursuant
to the Plan shall be governed in accordance with Pennsylvania
law.
The effective date of the Plan is January 1, 2006.
Executed as of the 21st day of March, 2006
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COMCAST CORPORATION |
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By: |
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/s/ David L. Cohen |
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Attest: |
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/s/ Arthur R. Block |
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C-6
CO-PS-2006
Admission Ticket
Notice of 2006 Annual Meeting
Thursday, May 18, 2006, 9:00 a.m.
Wachovia Complex
3601 South Broad Street
Philadelphia, PA 19148
Please present this ticket for admittance of
shareholder(s) named to the left, together
with one guest.
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Annual Meeting Proxy Card
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123456 |
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C0123456789
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12345 |
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o
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Mark this box with an X if you plan to attend
the annual meeting of shareholders.
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o
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Mark this box with an X to discontinue annual
report mailing for your account (a proxy
card and proxy statement will continue to be mailed). |
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A Election of Directors The Board of Directors recommends a vote FOR all director nominees.
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1. Nominees:
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(01) S. Decker Anstrom
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(02) Kenneth J. Bacon
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(03) Sheldon M. Bonovitz
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(04) Edward D. Breen |
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(05) Julian A. Brodsky
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(06) Joseph J. Collins
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(07) J. Michael Cook
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(08) Jeffrey A. Honickman |
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(09) Brian L. Roberts
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(10) Ralph J. Roberts
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(11) Dr. Judith Rodin
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(12) Michael I. Sovern |
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TO VOTE FOR ALL NOMINEES
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o
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TO WITHHOLD VOTE FROM ALL NOMINEES |
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FOR ALL EXCEPT
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To withhold a vote for a specific nominee, mark this box with an X and the
numbered box to the right from the numbered list of nominees above. |
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01 o
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02 o
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03 o
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04 o |
05 o
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06 o
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07 o
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08 o |
09 o
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10 o
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11 o
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12 o |
B Proposals The Board of Directors recommends a vote FOR proposals 25.
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For
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Against
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Abstain |
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2. Independent Auditors.
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o
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o
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3. 2002 Employee Stock Purchase Plan.
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o
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o
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o |
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4. 2002 Restricted Stock Plan.
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o
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5. 2006 Cash Bonus Plan.
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o
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The Board of Directors recommends a vote AGAINST shareholder proposals 6-10.
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For
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Against
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Abstain |
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6. Prevent the issuance of new stock options.
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o
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o
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o |
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7. Require that the Chairman of the Board not be an employee.
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o
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o
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8. Limit compensation for management.
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o
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9. Adopt a recapitalization plan.
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o
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10. Establish a majority vote shareholder committee.
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C Authorized Signatures Sign Here This section must be completed for your instructions to be executed.
Please sign as name(s) appears hereon. Give full title if you are signing for a corporation,
partnership or other entity, or as an attorney, administrator, executor, guardian, trustee or in
any other representative capacity.
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Signature 1 Please keep signature within the box
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Signature 2 Please keep signature within the box
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Date (mm/dd/yyyy) |
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n
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0 0 8 4 1 7 1
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8 U P X
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C O Y
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Annual Meeting Agenda
8:00
a.m. Doors Open to Meeting Room
9:00
a.m. Welcome and Introduction; Matters for Shareholder Vote
DIRECTIONS
From New Jersey via the Walt Whitman Bridge
Take the Broad Street exit. At the bottom of the ramp, make a left on to Broad
Street and follow the signs to the Sports Complex. The Wachovia Complex will
be on your left.
From Interstate 76/Schuylkill Expressway
From I-76 Eastbound, follow the signs for South Jersey, Walt Whitman Bridge and
Sports Complex. Take the Broad Street exit. At the bottom of the exit ramp, make a
right on to Broad Street. The Wachovia Complex will be on your left.
From Interstate 476/Blue Route
Take I-476
South to the end. Follow signs for I-95 North, Philadelphia. Take
I-95
North to Broad Street exit. The Wachovia Complex will be on your right.
From Interstate 95
From I-95 Northbound or Southbound, take the Broad Street exit. The Wachovia
Complex will be on your right.
Public Transportation
SEPTA (Southeastern Pennsylvania Transportation Authority). Take the Broad
Street (Orange) line South to the Pattison Ave. stop (last stop). When you exit the
subway, the Wachovia Complex will be immediately to the south and east.
Parking Information
There is ample free parking available in the Wachovia Complex. Shareholders
should use the main entrance to the Wachovia Complex which is located on Broad
Street at 3601 South Broad Street. The gate attendant will direct you to the parking
area and building.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING ON MAY 18, 2006
I hereby appoint David L. Cohen and Arthur R. Block, and each of them acting individually, as
proxies, with the powers I would possess if personally present,
and with full power of substitution, to vote all my shares in Comcast Corporation at the annual
meeting of shareholders to be held at the Wachovia Complex,
3601 South Broad Street, Philadelphia, PA 19148 at 9:00 a.m. Eastern Time on May 18, 2006, and at
any adjournment or postponement thereof, upon all
matters that may properly come before the meeting, including the matters described in the proxy
statement, and in accordance with my instructions on the
reverse side of this proxy card. In the event that any other matter may properly come before the
meeting, or any adjournment or postponement thereof, the
proxies are each authorized to vote such matter in his discretion. I hereby revoke all previous
proxies given to vote at the annual meeting or any adjournment
or postponement thereof.
I acknowledge receipt of the notice of annual meeting of shareholders, and the proxy statement and
2005 annual report of Comcast Corporation.
The shares represented by this proxy card will be voted in accordance with your instructions if the
card is signed and returned. If your card is signed and
returned without instructions, except as otherwise required by the plan noted below, your shares
will be voted in favor of all the director
nominees, in favor of Proposals 25 and against Proposals 6-10. Voting by Internet, telephone or
mail votes all your shares as a shareholder of record
and in the Comcast Corporation Retirement-Investment Plan. If you do not vote by Internet or
telephone, mail a proxy card or attend the annual meeting
and vote by ballot, your shares will not be voted, except that if you hold shares in the Comcast
Corporation Retirement-Investment Plan and do not return
your proxy card or do not specify how to vote your shares on your proxy card, the plan trustee will
vote your shares in the same proportion on each matter
as it votes shares held in this plan for which voting directions were received. If you are voting
with this proxy card, please mark your choices and sign the
other side of the proxy card and return it promptly to Comcast Corporation c/o Computershare, N.A.,
P.O. Box 43106, Providence, RI 02940.
IMPORTANT NOTICE: All annual meeting attendees may be asked to present a valid government-issued
photo identification, such as a drivers
license or passport, before entering the meeting. In addition, video and audio recording devices
and other electronic devices will not be permitted
at the annual meeting, and attendees will be subject to security inspections.
INTERNET AND TELEPHONE VOTING INSTRUCTIONS
You can vote by Internet or telephone! Available 24 hours a day 7 days a week!
Instead of mailing your proxy, you may choose one of the two voting methods outlined below to vote
your proxy.
If you vote by the Internet or telephone, please DO NOT mail back this proxy card.
Proxies submitted by the Internet or telephone must be received by 5:00 p.m., Eastern Time, on May
17, 2006.
THANK YOU FOR VOTING.