APPENDIX 1
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COMCAST CORPORATION
1996 STOCK OPTION PLAN
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(As Amended and Restated, Effective March 3, 1999)
1. Purpose of Plan
The purpose of the Plan is to assist the Company in retaining valued
employees, officers and directors by offering them a greater stake in the
Company's success and a closer identity with it, and to aid in attracting
individuals whose services would be helpful to the Company and would contribute
to its success.
2. Definitions
(a) "Affiliate" means, with respect to any Person, any other Person
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that, directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, the term
"control," including its correlative terms "controlled by" and "under common
control with," mean, with respect to any Person, the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.
(b) "Board" means the board of directors of the Sponsor.
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(c) "Cash Right" means any right to receive cash in lieu of Shares
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granted under the Plan and described in Paragraph 3(a)(iii).
(d) "Cause" means:
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(i) for an employee of a Company, a finding by the Committee,
after full consideration of the facts presented on behalf of both the
Company and the employee, that the employee has breached his employment
contract with a Company, has disclosed trade secrets of a Company or has
been engaged in any sort of disloyalty to a Company, including, without
limitation, fraud, embezzlement, theft, commission of a felony or proven
dishonesty in the course of his employment.
(ii) for a Non-Employee Director, a finding by the
Committee, after full consideration of the facts presented on behalf of
both the Company and the Director, that such Non-Employee Director has
disclosed trade secrets of a Company, or has been engaged in any sort of
disloyalty to a Company, including, without
limitation, fraud, embezzlement, theft, commission of a felony or proven
dishonesty in the course of his service as a Non-Employee Director.
(e) "Change of Control" means any transaction or series of
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transactions as a result of which any Person who was a Third Party immediately
before such transaction or series of transactions owns then-outstanding
securities of the Sponsor having more than 50 percent of the voting power for
the election of directors of the Sponsor.
(f) "Code" means the Internal Revenue Code of 1986, as amended.
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(g) "Comcast Plan" means any restricted stock, stock bonus, stock
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option or other compensation plan, program or arrangement established or
maintained by the Company or an Affiliate, including but not limited to this
Plan, the Comcast Corporation 1997 Deferred Stock Option Plan, the Comcast
Corporation 1990 Restricted Stock Plan and the Comcast Corporation 1987 Stock
Option Plan.
(h) "Committee" means the committee described in Paragraph 5.
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(i) "Common Stock" means the Sponsor's Class A Special Common
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Stock, par value, $1.00.
(j) "Company" means the Sponsor and each of the Parent Companies
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and Subsidiary Companies.
(k) "Date of Grant" means the date as of which an Option is
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granted.
(l) "Disability" means a disability within the meaning of section
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22(e)(3) of the Code.
(m) "Election Date" means the date on which an individual is first
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elected to the Board as a Non-Employee Director, or is elected to the Board as a
Non-Employee Director following a period of one year or more during which such
individual was not a member of the Board.
(n) "Fair Market Value." If Shares are listed on a stock exchange,
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Fair Market Value shall be determined based on the last reported sale price of a
Share on the principal exchange on which Shares are listed on the last trading
day prior to the date of determination, or, if Shares are not so listed, but
trades of Shares are reported on the Nasdaq National Market, the last quoted
sale price of a Share on the Nasdaq National Market on the last trading day
prior to the date of determination.
(o) "Grant Date" means each February 1st after the date of
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adoption of the Plan by the Board.
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(p) "Immediate Family" means an Optionee's spouse and lineal
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descendants, any trust all beneficiaries of which are any of such persons and
any partnership all partners of which are any of such persons.
(q) "Incentive Stock Option" means an Option granted under the Plan,
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designated by the Committee at the time of such grant as an Incentive Stock
Option within the meaning of section 422 of the Code and containing the terms
specified herein for Incentive Stock Options; provided, however, that to the
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extent an Option granted under the Plan and designated by the Committee at the
time of grant as an Incentive Stock Option fails to satisfy the requirements for
an incentive stock option under section 422 of the Code for any reason, such
Option shall be treated as a Non-Qualified Option.
(r) "Non-Employee Director" means an individual who is a member of the
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Board, and who is not an employee of a Company, including an individual who is a
member of the Board and who previously was an employee of a Company.
(s) "Non-Qualified Option" means:
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(i) an Option granted under the Plan, designated by the Committee
at the time of such grant as a Non-Qualified Option and containing the
terms specified herein for Non-Qualified Options; and
(ii) an Option granted under the Plan and designated by the
Committee at the time of grant as an Incentive Stock Option, to the extent
such Option fails to satisfy the requirements for an incentive stock option
under section 422 of the Code for any reason.
(t) "Option" means any stock option granted under the Plan and
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described in either Paragraph 3(a)(i) or Paragraph 3(a)(ii).
(u) "Optionee" means a person to whom an Option has been granted under
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the Plan, which Option has not been exercised in full and has not expired or
terminated.
(v) "Other Available Shares" means, as of any date, the excess,
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if any of:
(i) the total number of Shares owned by an Optionee; over
(ii) the sum of:
(x) the number of Shares owned by such Optionee for less
than six months; plus
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(y) the number of Shares owned by such Optionee that
has, within the preceding six months, been the
subject of a withholding certification pursuant to
Paragraph 16(b) or any similar withholding
certification under any other Comcast Plan; plus
(z) the number of Shares owned by such Optionee that
has, within the preceding six months, been received
in exchange for Shares surrendered as payment, in
full or in part, of the exercise price for an option
to purchase any securities of the Sponsor or an
Affiliate under any Comcast Plan, but only to the
extent of the number of Shares surrendered.
For purposes of this Paragraph 2(v), a Share that is subject to a deferral
election pursuant to another Comcast Plan shall not be treated as owned by an
Optionee until all conditions to the delivery of such Share have lapsed. For
purposes of Paragraphs 7(d), 8(d) and 16(b), the number of Other Available
Shares shall be determined separately for the Sponsor's Class A Special Common
Stock, par value, $1.00, and for the Sponsor's Class A Common Stock, par value,
$1.00.
(w) "Outside Director" means a member of the Board who is an "outside
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director" within the meaning of section 162(m)(4)(C) of the Code and applicable
Treasury Regulations issued thereunder.
(x) "Parent Company" means all corporations that, at the time in
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question, are parent corporations of the Sponsor within the meaning of section
424(e) of the Code.
(y) "Person" means an individual, a corporation, a partnership, an
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association, a trust or any other entity or organization.
(z) "Plan" means the Comcast Corporation 1996 Stock Option Plan.
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(aa) "Roberts Family." Each of the following is a member of the
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Roberts Family:
(i) Brian L. Roberts;
(ii) a lineal descendant of Brian L. Roberts; or
(iii) a trust established for the benefit of any of Brian L.
Roberts and/or a lineal descendant or descendants of Brian L. Roberts.
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(bb) "Share" or "Shares" means:
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(i) for all purposes of the Plan, a share or shares of Common
Stock or such other securities issued by the Sponsor as may be the subject
of an adjustment under Paragraph 11.
(ii) solely for purposes of Paragraphs 2(n), 2(v), 7(d),
8(d) and 16(b), the term "Share" or "Shares" also means a share or shares
of the Sponsor's Class A Common Stock, par value, $1.00.
(cc) "Sponsor" means Comcast Corporation, a Pennsylvania
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corporation, including any successor thereto by merger, consolidation,
acquisition of all or substantially all the assets thereof, or otherwise.
(dd) "Subsidiary Companies" means all corporations that, at the
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time in question, are subsidiary corporations of the Sponsor within the meaning
of section 424(f) of the Code.
(ee) "Ten Percent Shareholder" means a person who on the Date of
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Grant owns, either directly or within the meaning of the attribution rules
contained in section 424(d) of the Code, stock possessing more than 10% of the
total combined voting power of all classes of stock of his employer corporation
or of its parent or subsidiary corporations, as defined respectively in sections
424(e) and (f) of the Code, provided that the employer corporation is a Company.
(ff) "Terminating Event" means any of the following events:
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(i) the liquidation of the Sponsor; or
(ii) a Change of Control.
(gg) "Third Party" means any Person other than a Company,
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together with such Person's Affiliates, provided that the term "Third Party"
shall not include the Sponsor, an Affiliate of the Sponsor or any member or
members of the Roberts Family.
(hh) "1933 Act" means the Securities Act of 1933, as amended.
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(ii) "1934 Act" means the Securities Exchange Act of 1934, as
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amended.
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3. Rights To Be Granted
(a) Types of Options and Other Rights Available for Grant.
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Rights that may be granted under the Plan are:
(i) Incentive Stock Options, which give an Optionee who is an
employee of a Company the right for a specified time period to purchase a
specified number of Shares for a price not less than the Fair Market Value
on the Date of Grant;
(ii) Non-Qualified Options, which give the Optionee the
right for a specified time period to purchase a specified number of Shares
for a price determined by the Committee; and
(iii) Cash Rights, which give an Optionee the right for a
specified time period, and subject to such conditions, if any, as shall be
determined by the Committee and stated in the option document, to receive a
cash payment of such amount per Share as shall be determined by the
Committee and stated in the option document, in lieu of exercising a Non-
Qualified Option.
(b) Limit on Grant of Options. Subject to the approval of the
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Sponsor's shareholders, effective June 16, 1998, the maximum number of Shares
for which Options may be granted to any single individual in any calendar year,
adjusted as provided in Paragraph 11, shall be 5,000,000 Shares.
(c) Presumption of Incentive Stock Option Status. Each Option granted
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under the Plan to an employee of a Company is intended to be an Incentive Stock
Option, except to the extent any such grant would exceed the limitation of
Paragraph 9 and except for any Option specifically designated at the time of
grant as an Option that is not an Incentive Stock Option.
4. Shares Subject to Plan
Subject to adjustment as provided in Paragraph 11, not more than
20,000,000 Shares in the aggregate may be issued pursuant to the Plan upon
exercise of Options. Shares delivered pursuant to the exercise of an Option
may, at the Sponsor's option, be either treasury Shares or Shares originally
issued for such purpose. If an Option covering Shares terminates or expires
without having been exercised in full, other Options may be granted covering the
Shares as to which the Option terminated or expired.
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5. Administration of Plan
(a) Committee. The Plan shall be administered by the Subcommittee on
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Performance Based Compensation of the Compensation Committee of the Board or any
other committee or subcommittee designated by the Board, provided that the
committee administering the Plan is composed of two or more non-employee members
of the Board, each of whom is an Outside Director. Notwithstanding the
foregoing, if Non-Employee Directors are granted Options in accordance with the
provisions of Paragraph 8, the directors to whom such Options will be granted,
the timing of grants of such Options, the Option Price of such Options and the
number of Option Shares included in such Options shall be as specifically set
forth in Paragraph 8. No member of the Committee shall participate in the
resolution of any issue that exclusively involves an Option granted to such
member.
(b) Meetings. The Committee shall hold meetings at such times and
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places as it may determine. Acts approved at a meeting by a majority of the
members of the Committee or acts approved in writing by the unanimous consent of
the members of the Committee shall be the valid acts of the Committee.
(c) Exculpation. No member of the Committee shall be personally
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liable for monetary damages for any action taken or any failure to take any
action in connection with the administration of the Plan or the granting of
Options thereunder unless (i) the member of the Committee has breached or failed
to perform the duties of his office, and (ii) the breach or failure to perform
constitutes self-dealing, wilful misconduct or recklessness; provided, however,
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that the provisions of this Paragraph 5(c) shall not apply to the responsibility
or liability of a member of the Committee pursuant to any criminal statute.
(d) Indemnification. Service on the Committee shall constitute
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service as a member of the Board. Each member of the Committee shall be
entitled without further act on his part to indemnity from the Sponsor to the
fullest extent provided by applicable law and the Sponsor's By-laws in
connection with or arising out of any actions, suit or proceeding with respect
to the administration of the Plan or the granting of Options thereunder in which
he may be involved by reasons of his being or having been a member of the
Committee, whether or not he continues to be such member of the Committee at the
time of the action, suit or proceeding.
6. Eligibility
(a) Eligible individuals to whom Options may be granted shall be
employees, officers or directors of a Company who are selected by the Committee
for the grant of Options. Eligible individuals to whom Cash Rights may be
granted shall be individuals who are employees of a Company on the Date of
Grant. The terms and conditions of Options granted to individuals other than
Non-Employee Directors shall be determined by the Committee,
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subject to Paragraph 7. The terms and conditions of Cash Rights shall be
determined by the Committee, subject to Paragraph 7. The terms and conditions of
Options granted to Non-Employee Directors shall be determined by the Committee,
subject to Paragraph 8.
(b) An Incentive Stock Option shall not be granted to a Ten Percent
Shareholder except on such terms concerning the option price and term as are
provided in Paragraph 7(b) and 7(g) with respect to such a person. An Option
designated as Incentive Stock Option granted to a Ten Percent Shareholder but
which does not comply with the requirements of the preceding sentence shall be
treated as a Non-Qualified Option. An Option designated as an Incentive Stock
Option shall be treated as a Non-Qualified Option if the Optionee is not an
employee of a Company on the Date of Grant.
7. Option Documents and Terms - In General
All Options granted to Optionees other than Non-Employee Directors
shall be evidenced by option documents. The terms of each such option document
shall be determined from time to time by the Committee, consistent, however,
with the following:
(a) Time of Grant. All Options shall be granted within 10 years from
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the earlier of (i) the date of adoption of the Plan by the Board, or (ii)
approval of the Plan by the shareholders of the Sponsor.
(b) Option Price. The option price per Share with respect to any
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Option shall be determined by the Committee, provided, however, that with
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respect to any Incentive Stock Options, the option price per share shall not be
less than 100% of the Fair Market Value of such Share on the Date of Grant, and
provided further that with respect to any Incentive Stock Options granted to a
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Ten Percent Shareholder, the option price per Share shall not be less than 110%
of the Fair Market Value of such Share on the Date of Grant.
(c) Restrictions on Transferability. No Option granted under this
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Paragraph 7 shall be transferable otherwise than by will or the laws of descent
and distribution and, during the lifetime of the Optionee, shall be exercisable
only by him or for his benefit by his attorney-in-fact or guardian; provided
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that the Committee may, in its discretion, at the time of grant of a Non-
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Qualified Option or by amendment of an option document for an Incentive Stock
Option or a Non-Qualified Option, provide that Options granted to or held by an
Optionee may be transferred, in whole or in part, to one or more transferees and
exercised by any such transferee; provided further that (i) any such transfer is
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without consideration and (ii) each transferee is a member of such Optionee's
Immediate Family; and provided further that any Incentive Stock Option granted
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pursuant to an option document which is amended to permit transfers during the
lifetime of the Optionee shall, upon the effectiveness of such amendment, be
treated thereafter as a Non-Qualified Option. No transfer of an Option shall be
effective unless the Committee is notified of the terms and conditions of the
transfer and the Committee determines that the transfer complies with the
requirements for transfers of Options under the Plan and the option document.
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Any person to whom an Option has been transferred may exercise any Options only
in accordance with the provisions of Paragraph 7(g) and this Paragraph 7(c).
(d) Payment Upon Exercise of Options. Full payment for Shares
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purchased upon the exercise of an Option shall be made in cash, by certified
check payable to the order of the Sponsor, or, at the election of the Optionee
and as the Committee may, in its sole discretion, approve, by surrendering
Shares with an aggregate Fair Market Value equal to the aggregate option price,
or by delivering such combination of Shares and cash as the Committee may, in
its sole discretion, approve; provided, however, that Shares may be surrendered
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in satisfaction of the option price only if the Optionee certifies in writing to
the Sponsor that the Optionee owns a number of Other Available Shares as of the
date the Option is exercised that is at least equal to the number of Shares to
be surrendered in satisfaction of the Option Price; provided further, however,
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that the option price may not be paid in Shares if the Committee determines that
such method of payment would result in liability under section 16(b) of the 1934
Act to an Optionee. Except as otherwise provided by the Committee, if payment
is made in whole or in part in Shares, the Optionee shall deliver to the Sponsor
certificates registered in the name of such Optionee representing Shares legally
and beneficially owned by such Optionee, free of all liens, claims and
encumbrances of every kind and having a Fair Market Value on the date of
delivery that is not greater than the option price accompanied by stock powers
duly endorsed in blank by the record holder of the Shares represented by such
certificates. If the Committee, in its sole discretion, should refuse to accept
Shares in payment of the option price, any certificates representing Shares
which were delivered to the Sponsor shall be returned to the Optionee with
notice of the refusal of the Committee to accept such Shares in payment of the
option price. The Committee may impose such limitations and prohibitions on the
use of Shares to exercise an Option as it deems appropriate.
(e) Issuance of Certificate Upon Exercise of Options; Payment of Cash.
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Only whole Shares shall be issuable upon exercise of Options. Any right to a
fractional Share shall be satisfied in cash. Upon satisfaction of the
conditions of Paragraph 10, a certificate for the number of whole Shares and a
check for the Fair Market Value on the date of exercise of any fractional Share
to which the Optionee is entitled shall be delivered to such Optionee by the
Sponsor.
(f) Termination of Employment. For purposes of the Plan, a transfer
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of an employee between two employers, each of which is a Company, shall not be
deemed a termination of employment. For purposes of Paragraph 7(g), an
Optionee's termination of employment shall be deemed to occur on the date an
Optionee ceases to serve as an active employee of a Company, as determined by
the Committee in its sole discretion, or, if the Optionee is a party to an
employment agreement with a Company, on the effective date of the Optionee's
termination of employment as determined under such agreement.
(g) Periods of Exercise of Options. An Option shall be exercisable in
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whole or in part at such time or times as may be determined by the Committee and
stated in the
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option document, provided, however, that if the grant of an Option would be
subject to section 16(b) of the 1934 Act, unless the requirements for exemption
therefrom in Rule 16b-3(c)(1), under such Act, or any successor provision, are
met, the option document for such Option shall provide that such Option is not
exercisable until not less than six months have elapsed from the Date of Grant.
Except as otherwise provided by the Committee in its discretion, no Option shall
first become exercisable following an Optionee's termination of employment for
any reason; provided further, that:
(i) In the event that an Optionee terminates employment with the
Company for any reason other than death or Cause, any Option held by such
Optionee and which is then exercisable shall be exercisable for a period of
90 days following the date the Optionee terminates employment with the
Company (unless a longer period is established by the Committee); provided,
however, that if such termination of employment with the Company is due to
the Disability of the Optionee, he shall have the right to exercise those
of his Options which are then exercisable for a period of one year
following such termination of employment (unless a longer period is
established by the Committee); provided, however, that in no event shall an
Incentive Stock Option be exercisable after five years from the Date of
Grant in the case of a grant to a Ten Percent Shareholder, nor shall any
other Option be exercisable after ten years from the Date of Grant.
(ii) In the event that an Optionee terminates employment
with the Company by reason of his death, any Option held at death by such
Optionee which is then exercisable shall be exercisable for a period of one
year from the date of death (unless a longer period is established by the
Committee) by the person to whom the rights of the Optionee shall have
passed by will or by the laws of descent and distribution; provided,
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however, that in no event shall an Incentive Stock Option be exercisable
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after five years from the Date of Grant in the case of a grant to a Ten
Percent Shareholder, nor shall any other Option be exercisable after ten
years from the Date of Grant.
(iii) In the event that an Optionee's employment with the
Company is terminated for Cause, each unexercised Option held by such
Optionee shall terminate and cease to be exercisable; provided
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further, that in such event, in addition to immediate termination of the
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Option, the Optionee, upon a determination by the Committee shall
automatically forfeit all Shares otherwise subject to delivery upon
exercise of an Option but for which the Sponsor has not yet delivered the
Share certificates, upon refund by the Sponsor of the option price.
(h) Date of Exercise. The date of exercise of an Option shall be the
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date on which written notice of exercise, addressed to the Sponsor at its main
office to the attention of its Secretary, is hand delivered, telecopied or
mailed first class postage prepaid;
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provided, however, that the Sponsor shall not be obligated to deliver any
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certificates for Shares pursuant to the exercise of an Option until the Optionee
shall have made payment in full of the option price for such Shares. Each such
exercise shall be irrevocable when given. Each notice of exercise must (i)
specify the Incentive Stock Option, Non-Qualified Option or combination thereof
being exercised; and (ii) include a statement of preference (which shall binding
on and irrevocable by the Optionee but shall not be binding on the Committee) as
to the manner in which payment to the Sponsor shall be made (Shares or cash or a
combination of Shares and cash). Each notice of exercise shall also comply with
the requirements of Paragraph 15.
(i) Cash Rights. The Committee may, in its sole discretion, provide
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in an option document for an eligible Optionee that Cash Rights shall be
attached to Non-Qualified Options granted under the Plan. All Cash Rights that
are attached to Non-Qualified Options shall be subject to the following terms:
(i) Such Cash Right shall expire no later than the Non-Qualified
Option to which it is attached.
(ii) Such Cash Right shall provide for the cash payment of such
amount per Share as shall be determined by the Committee and stated in the
option document.
(iii) Such Cash Right shall be subject to the same
restrictions on transferability as the Non-Qualified Option to which it is
attached.
(iv) Such Cash Right shall be exercisable only when such
conditions to exercise as shall be determined by the Committee and stated
in the option document, if any, have been satisfied.
(v) Such Cash Right shall expire upon the exercise of the Non-
Qualified Option to which it is attached.
(vi) Upon exercise of a Cash Right that is attached to a Non-
Qualified Option, the Option to which the Cash Right is attached shall
expire.
8. Option Documents and Terms - Non-Employee Directors
Options granted pursuant to the Plan to Non-Employee Directors shall
be granted, without any further action by the Committee, in accordance with the
terms and conditions set forth in this Paragraph 8. Options granted pursuant to
Paragraph 8(a) shall be evidenced by option documents. The terms of each such
option document shall be consistent with Paragraphs 8(b) through 8(g), as
follows:
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(a) Grant of Options to Non-Employee Directors. Each Non-Employee
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Director shall be granted, commencing on the Grant Date next following the
adoption of this Plan by the Board and on each successive Grant Date thereafter,
a Non-Qualified Option to purchase 5,400 Shares. Notwithstanding the preceding
sentence, each newly elected Non-Employee Director:
(i) shall be granted a Non-Qualified Option to purchase 9,000
Shares on the Election Date; and
(ii) shall not be entitled to the grant of an Option hereunder on
the Grant Date immediately following the Non-Employee Director's Election
Date if such Election Date is within ninety (90) days of the Grant Date.
(b) Option Price. The option price per Share with respect to any
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Option granted under this Paragraph 8 shall be 100% of the Fair Market Value of
such Share on the Grant Date.
(c) Restrictions on Transferability. No Option granted under this
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Paragraph 8 shall be transferable otherwise than by will or the laws of descent
and distribution and, during the lifetime of the Optionee, shall be exercisable
only by him or for his benefit by his attorney-in-fact or guardian; provided
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that the Committee may, in its discretion, at the time of grant of an Option or
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by amendment of an option document for an Option, provide that Options may be
transferred, in whole or in part, to one or more transferees and exercised by
any such transferee; provided further that (i) any such transfer is without
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consideration, and (ii) each transferee is a member of such Optionee's Immediate
Family. No transfer of an Option shall be effective unless the Committee is
notified of the terms and conditions of the transfer and the Committee
determines that the transfer complies with the requirements for transfers of
Options under the Plan and the option document. Any person to whom an Option
has been transferred may exercise any Options only in accordance with the
provisions of Paragraph 8(f) and this Paragraph 8(c).
(d) Payment Upon Exercise of Options. Full payment for Shares
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purchased upon the exercise of an Option shall be made in cash, by certified
check payable to the order of the Sponsor, or, at the election of the Optionee
and as the Committee may, in its sole discretion, approve, by surrendering
Shares with an aggregate Fair Market Value equal to the aggregate option price,
or by delivering such combination of Shares and cash as the Committee may, in
its sole discretion, approve; provided, however, that Shares may be surrendered
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in satisfaction of the option price only if the Optionee certifies in writing to
the Sponsor that the Optionee owns a number of Other Available Shares as of the
date the Option is exercised that is at least equal to the number of Shares to
be surrendered in satisfaction of the Option Price; provided further, however,
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that the option price may not be paid in Shares if the Committee determines that
such method of payment would result in liability under section 16(b) of the 1934
Act to an Optionee. Except as otherwise provided by the Committee, if payment
is made in
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whole or in part in Shares, the Optionee shall deliver to the Sponsor
certificates registered in the name of such Optionee representing Shares legally
and beneficially owned by such Optionee, free of all liens, claims and
encumbrances of every kind and having a Fair Market Value on the date of
delivery that is not greater than the option price accompanied by stock powers
duly endorsed in blank by the record holder of the Shares represented by such
certificates. If the Committee, in its sole discretion, should refuse to accept
Shares in payment of the option price, any certificates representing Shares
which were delivered to the Sponsor shall be returned to the Optionee with
notice of the refusal of the Committee to accept such Shares in payment of the
option price. The Committee may impose such limitations and prohibitions on the
use of Shares to exercise an Option as it deems appropriate.
(e) Issuance of Certificate Upon Exercise of Options; Payment of Cash.
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Only whole Shares shall be issuable upon exercise of Options granted under this
Paragraph 8. Any right to a fractional Share shall be satisfied in cash. Upon
satisfaction of the conditions of Paragraph 10, a certificate for the number of
whole Shares and a check for the Fair Market Value on the date of exercise of
any fractional Share to which the Optionee is entitled shall be delivered to
such Optionee by the Sponsor.
(f) Periods of Exercise of Options. An Option granted under this
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Paragraph 8 shall not be exercisable for six months after the Date of Grant, and
shall then be exercisable in its entirety. No Option shall first become
exercisable following an Optionee's termination of service as a Non-Employee
Director for any reason; provided further, that:
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(i) In the event that an Optionee terminates service as a Non-
Employee Director for any reason other than death or Cause, any Option held
by such Optionee and which is then exercisable shall be exercisable for a
period of 90 days following the date the Optionee terminates service as a
Non-Employee Director; provided, however, that if such termination of
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employment with the Company is due to the Disability of the Optionee, he
shall have the right to exercise those of his Options which are then
exercisable for a period of one year following the date the Optionee
terminates service as a Non-Employee Director; provided, however, that in
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no event shall an Option be exercisable after five years from the Grant
Date.
(ii) In the event that an Optionee terminates service as a
Non-Employee Director by reason of his death, any Option held at death by
such Optionee which is then exercisable shall be exercisable for a period
of one year from the date of death by the person to whom the rights of the
Optionee shall have passed by will or by the laws of descent and
distribution; provided, however, that in no event shall an
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Option be exercisable after five years from the Grant Date.
(iii) In the event that an Optionee's service as a Non-
Employee Director is terminated for Cause, each unexercised Option shall
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terminate and cease to be exercisable; provided further, that in
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such event, in addition to immediate termination of the Option, the
Optionee shall automatically forfeit all Shares otherwise subject to
delivery upon exercise of an Option but for which the Sponsor has not
yet delivered the Share certificates, upon refund by the Sponsor of
the option price.
(g) Date of Exercise. The date of exercise of an Option granted
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under this Paragraph 8 shall be the date on which written notice of exercise,
addressed to the Sponsor at its main office to the attention of its Secretary,
is hand delivered, telecopied or mailed first class postage prepaid; provided,
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however, that the Sponsor shall not be obligated to deliver any certificates for
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Shares pursuant to the exercise of an Option until the Optionee shall have made
payment in full of the option price for such Shares. Each such exercise shall
be irrevocable when given. Each notice of exercise must (i) specify the Option
being exercised; and (ii) include a statement as to the manner in which payment
to the Sponsor shall be made (Shares or cash or a combination of Shares and
cash). Each notice of exercise shall also comply with the requirements of
Paragraph 15.
9. Limitation on Exercise of Incentive Stock Options.
The aggregate Fair Market Value (determined as of the time Options are
granted) of the Shares with respect to which Incentive Stock Options may first
become exercisable by an Optionee in any one calendar year under the Plan and
any other plan of the Company shall not exceed $100,000. The limitations
imposed by this Paragraph 9 shall apply only to Incentive Stock Options granted
under the Plan, and not to any other options or stock appreciation rights. In
the event an individual receives an Option intended to be an Incentive Stock
Option which is subsequently determined to have exceeded the limitation set
forth above, or if an individual receives Options that first become exercisable
in a calendar year (whether pursuant to the terms of an option document,
acceleration of exercisability or other change in the terms and conditions of
exercise or any other reason) that have an aggregate Fair Market Value
(determined as of the time the Options are granted) that exceeds the limitations
set forth above, the Options in excess of the limitation shall be treated as
Non-Qualified Options.
10. Rights as Shareholders
An Optionee shall not have any right as a shareholder with respect to
any Shares subject to his Options until the Option shall have been exercised in
accordance with the terms of the Plan and the option document and the Optionee
shall have paid the full purchase price for the number of Shares in respect of
which the Option was exercised and the Optionee shall have made arrangements
acceptable to the Sponsor for the payment of applicable taxes consistent with
Paragraph 16.
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11. Changes in Capitalization
(a) Except as provided in Paragraph 11(b), in the event that
Shares are changed into or exchanged for a different number or kind of shares of
stock or other securities of the Sponsor, whether through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split-up or other
substitution of securities of the Sponsor, the Board shall make appropriate
equitable anti-dilution adjustments to the number and class of shares of stock
available for issuance under the Plan, and subject to outstanding Options, and
to the option prices and the amounts payable pursuant to any Cash Rights. Any
reference to the option price in the Plan and in option documents shall be a
reference to the option price as so adjusted. Any reference to the term
"Shares" in the Plan and in option documents shall be a reference to the
appropriate number and class of shares of stock available for issuance under the
Plan, as adjusted pursuant to this Paragraph 11. The Board's adjustment shall
be effective and binding for all purposes of this Plan.
(b) Paragraph 11(a) shall not apply to the number of Shares that
become subject to the grant of Options under Paragraph 8(a). Paragraph 11(a)
shall apply for the purpose of making appropriate equitable anti-dilution
adjustments to Options granted pursuant to Paragraph 8(a) before the effective
date of the relevant event giving rise to the adjustment under Paragraph 11(a).
12. Terminating Events
(a) The Sponsor shall give Optionees at least thirty (30) days' notice
(or, if not practicable, such shorter notice as may be reasonably practicable)
prior to the anticipated date of the consummation of a Terminating Event. Upon
receipt of such notice, and for a period of ten (10) days thereafter (or such
shorter period as the Board shall reasonably determine and so notify the
Optionees), each Optionee shall be permitted to exercise the Option to the
extent the Option are then exercisable; provided that, the Sponsor may, by
-------------
similar notice, require the Optionee to exercise the Option, to the extent the
Option is then exercisable, or to forfeit the Option (or portion thereof, as
applicable). The Committee may, in its discretion, provide that upon the
Optionee's receipt of the notice of a Terminating Event under this Paragraph
12(a), the entire number of Shares covered by Options shall become immediately
exercisable. Upon the close of the period described in this Paragraph 12(a)
during which an Option may be exercised in connection with a Terminating Event,
such Option (including such portion thereof that is not exercisable) shall
terminate to the extent that such Option have not theretofore been exercised.
(b) Notwithstanding Paragraph 12(a), in the event the Terminating
Event is not consummated, the Option shall be deemed not to have been exercised
and shall be exercisable thereafter to the extent it would have been exercisable
if no such notice had been given.
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13. Interpretation
The Committee shall have the power to interpret the Plan and to make
and amend rules for putting it into effect and administering it. It is intended
that the Incentive Stock Options granted under the Plan shall constitute
incentive stock options within the meaning of section 422 of the Code, and that
Shares transferred pursuant to the exercise of Non-Qualified Options shall
constitute property subject to federal income tax pursuant to the provisions of
section 83 of the Code. The provisions of the Plan shall be interpreted and
applied insofar as possible to carry out such intent.
14. Amendments
The Board or the Committee may amend the Plan from time to time in
such manner as it may deem advisable. Nevertheless, neither the Board nor the
Committee may, without obtaining approval within twelve months before or after
such action by such vote of shareholders as may be required by Pennsylvania law
for any action requiring shareholder approval, or by a majority of votes cast at
a duly held shareholders' meeting at which a majority of all voting stock is
present and voting on such amendment, either in person or in proxy (but not, in
any event, less than the vote required pursuant to Rule 16b-3(b) under the 1934
Act) change the class of individuals eligible to receive an Incentive Stock
Option, extend the expiration date of the Plan, decrease the minimum option
price of an Incentive Stock Option granted under the Plan or increase the
maximum number of shares as to which Options may be granted, except as provided
in Paragraph 11 hereof. In addition, the provisions of Paragraph 8 that
determine (i) which directors shall be granted Options; (ii) the number of
Shares subject to Options; (iii) the option price of Shares subject to Options;
and (iv) the timing of grants of Options shall not be amended more than once
every six months, other than to comport with changes in the Code or the Employee
Retirement Income Security Act of 1974, as amended, if applicable. No
outstanding Option shall be affected by any such amendment without the written
consent of the Optionee or other person then entitled to exercise such Option.
15. Securities Law
(a) In General. The Committee shall have the power to make each
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grant under the Plan subject to such conditions as it deems necessary or
appropriate to comply with the then-existing requirements of the 1933 Act or the
1934 Act, including Rule 16b-3 (or any similar rule) of the Securities and
Exchange Commission.
(b) Acknowledgment of Securities Law Restrictions on Exercise. To
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the extent required by the Committee, unless the Shares subject to the Option
are covered by a then current registration statement or a Notification under
Regulation A under the 1933 Act, each notice of exercise of an Option shall
contain the Optionee's acknowledgment in form and substance satisfactory to the
Committee that:
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(i) the Shares subject to the Option are being purchased for
investment and not for distribution or resale (other than a distribution or
resale which, in the opinion of counsel satisfactory to the Sponsor, may be
made without violating the registration provisions of the Act);
(ii) the Optionee has been advised and understands that (A)
the Shares subject to the Option have not been registered under the 1933
Act and are "restricted securities" within the meaning of Rule 144 under
the 1933 Act and are subject to restrictions on transfer and (B) the
Sponsor is under no obligation to register the Shares subject to the Option
under the 1933 Act or to take any action which would make available to the
Optionee any exemption from such registration;
(iii) the certificate evidencing the Shares may bear a
restrictive legend; and
(iv) the Shares subject to the Option may not be transferred
without compliance with all applicable federal and state securities laws.
(c) Delay of Exercise Pending Registration of Securities.
----------------------------------------------------
Notwithstanding any provision in the Plan or an option document to the contrary,
if the Committee determines, in its sole discretion, that issuance of Shares
pursuant to the exercise of an Option should be delayed pending registration or
qualification under federal or state securities laws or the receipt of a legal
opinion that an appropriate exemption from the application of federal or state
securities laws is available, the Committee may defer exercise of any Option
until such Shares are appropriately registered or qualified or an appropriate
legal opinion has been received, as applicable.
16. Withholding of Taxes on Exercise of Option
(a) Whenever the Company proposes or is required to deliver or
transfer Shares in connection with the exercise of an Option, the Company shall
have the right to (i) require the recipient to remit to the Sponsor an amount
sufficient to satisfy any federal, state and local withholding tax requirements
prior to the delivery or transfer of any certificate or certificates for such
Shares or (ii) take any action whatever that it deems necessary to protect its
interests with respect to tax liabilities. The Sponsor's obligation to make any
delivery or transfer of Shares on the exercise of an Option shall be conditioned
on the recipient's compliance, to the Sponsor's satisfaction, with any
withholding requirement. In addition, if the Committee grants Options or amends
option documents to permit Options to be transferred during the life of the
Optionee, the Committee may include in such option documents such provisions as
it determines are necessary or appropriate to permit the Company to deduct
compensation expenses recognized upon exercise of such Options for federal or
state income tax purposes.
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(b) Except as otherwise provided in this Paragraph 16(b), any tax
liabilities incurred in connection with the exercise of an Option under the Plan
other than an Incentive Stock Option shall be satisfied by the Sponsor's
withholding a portion of the Shares underlying the Option exercised having a
Fair Market Value approximately equal to the minimum amount of taxes required to
be withheld by the Sponsor under applicable law, unless otherwise determined by
the Committee with respect to any Optionee. Notwithstanding the foregoing, the
Committee may permit an Optionee to elect one or both of the following: (i) to
have taxes withheld in excess of the minimum amount required to be withheld by
the Sponsor under applicable law; provided that the Optionee certifies in
writing to the Sponsor that the Optionee owns a number of Other Available Shares
having a Fair Market Value that is at least equal to the Fair Market Value of
Option Shares to be withheld by the Company for the then-current exercise on
account of withheld taxes in excess of such minimum amount, and (ii) to pay to
the Sponsor in cash all or a portion of the taxes to be withheld upon the
exercise of an Option. In all cases, the Shares so withheld by the Company shall
have a Fair Market Value that does not exceed the amount of taxes to be withheld
minus the cash payment, if any, made by the Optionee. Any election pursuant to
this Paragraph 16(b) must be in writing made prior to the date specified by the
Committee, and in any event prior to the date the amount of tax to be withheld
or paid is determined. An election pursuant to this Paragraph 16(b) may be made
only by an Optionee or, in the event of the Optionee's death, by the Optionee's
legal representative. No Shares withheld pursuant to this Paragraph 16(b) shall
be available for subsequent grants under the Plan. The Committee may add such
other requirements and limitations regarding elections pursuant to this
Paragraph 16(b) as it deems appropriate.
17. Effective Date and Term of Plan
This amendment and restatement of the Plan is effective as of March 3,
1999, provided that subject to the approval of the Sponsor's shareholders, the
increase in the maximum number of Shares for which Options may be granted to any
single individual in any calendar year to 5,000,000, as provided in Paragraph
3(b), is effective as of June 16, 1998. The Plan shall expire no later than the
tenth anniversary of the date the Plan was initially adopted by the Board,
unless sooner terminated by the Board.
18. General
Each Option shall be evidenced by a written instrument containing such
terms and conditions not inconsistent with the Plan as the Committee may
determine. The issuance of Shares on the exercise of an Option shall be subject
to all of the applicable requirements of the corporation law of the Sponsor's
state of incorporation and other applicable laws, including
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federal or state securities laws, and all Shares issued under the Plan shall be
subject to the terms and restrictions contained in the Articles of Incorporation
and By-Laws of the Sponsor, as amended from time to time.
Executed as of the 3rd day of March, 1999.
COMCAST CORPORATION
By:
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Attest: ----------------------------
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