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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934



For the Quarterly Period Ended September 30, 2003



Commission file number 0-26677



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INSIGHT COMMUNICATIONS COMPANY, INC.

(Exact name of registrant as specified
in its charter)



|Delaware                                                       |  | 13-4053502                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



|810 7thAvenue New York, New York         |  | 10019     
|---------------------------------------- |  | ----------
|(Address of principal executive offices) |  | (Zip code)



Registrants
telephone number, including area code: 917-286-2300



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes x No ̈



Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes x No ̈



Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.



|Class                                |  | Outstanding at October 23, 2003
|------------------------------------ |  | -------------------------------
|Class A Common Stock, $.01 Par Value |  | 50,495,531                     
|Class B Common Stock, $.01 Par Value |  | 8,879,468                      



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PART I. FINANCIAL INFORMATION



|Item 1. |  | Financial Statements
|------- |  | --------------------



The accompanying unaudited consolidated financial statements have been prepared in accordance with the requirements of Form 10-Q and, therefore, do not include all information and footnotes required by accounting
principles generally accepted in the United States. However, in our opinion, all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results of operations for the relevant periods have been made. Results
for the interim periods are not necessarily indicative of the results to be expected for the year. These financial statements should be read in conjunction with the summary of significant accounting policies and the notes to the consolidated
financial statements included in our Annual Report on Form 10-K, as amended, for the year ended December 31, 2002.



1



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INSIGHT COMMUNICATIONS COMPANY, INC.

CONSOLIDATED BALANCE SHEETS

(dollars in thousands)



|                                                                                                                                                |  | September 30,2003 |           |   | December 31,2002 |  
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | --------- | - | ---------------- | -
|                                                                                                                                                |  | unaudited         |           |   |                  |  
|Assets                                                                                                                                          |  |                   |           |   |                  |  
|Cash and cash equivalents                                                                                                                       |  | $                 | 54,010    |   |                  | $
|Investments                                                                                                                                     |  |                   | 4,891     |   |                  |  
|Trade accounts receivable, net of allowance for doubtful accounts of $1,220 and $1,296 as of September 30, 2003 and December 31,
2002           |  |                   | 23,717    |   |                  |  
|Launch funds receivable                                                                                                                         |  |                   | 7,599     |   |                  |  
|Prepaid expenses and other assets                                                                                                               |  |                   | 24,027    |   |                  |  
|                                                                                                                                                |  |                   |           |   |                  |  
|Total current assets                                                                                                                            |  |                   | 114,244   |   |                  |  
|Fixed assets, net                                                                                                                               |  |                   | 1,208,372 |   |                  |  
|Goodwill                                                                                                                                        |  |                   | 72,430    |   |                  |  
|Franchise costs                                                                                                                                 |  |                   | 2,361,959 |   |                  |  
|Deferred financing costs, net of accumulated amortization of $12,424 and $9,030 as of September 30, 2003 and December 31,
2002                  |  |                   | 31,838    |   |                  |  
|Other non-current assets                                                                                                                        |  |                   | 5,170     |   |                  |  
|                                                                                                                                                |  |                   |           |   |                  |  
|Total assets                                                                                                                                    |  | $                 | 3,794,013 |   |                  | $
|                                                                                                                                                |  |                   |           |   |                  |  
|Liabilities and stockholders equity                                                                                                            |  |                   |           |   |                  |  
|Accounts payable                                                                                                                                |  | $                 | 48,854    |   |                  | $
|Accrued expenses and other liabilities                                                                                                          |  |                   | 32,613    |   |                  |  
|Accrued property taxes                                                                                                                          |  |                   | 24,079    |   |                  |  
|Accrued programming costs                                                                                                                       |  |                   | 39,729    |   |                  |  
|Deferred revenue                                                                                                                                |  |                   | 10,801    |   |                  |  
|Interest payable                                                                                                                                |  |                   | 44,041    |   |                  |  
|Debt  current portion                                                                                                                          |  |                   | 46,688    |   |                  |  
|Preferred interest distribution payable                                                                                                         |  |                   |          |   |                  |  
|                                                                                                                                                |  |                   |           |   |                  |  
|Total current liabilities                                                                                                                       |  |                   | 246,805   |   |                  |  
|Deferred revenue                                                                                                                                |  |                   | 5,023     |   |                  |  
|Debt                                                                                                                                            |  |                   | 2,745,940 |   |                  |  
|Other non-current liabilities                                                                                                                   |  |                   | 6,134     |   |                  |  
|Minority interest                                                                                                                               |  |                   | 228,876   |   |                  |  
|Preferred interests                                                                                                                             |  |                   |          |   |                  |  
|Stockholders equity:                                                                                                                           |  |                   |           |   |                  |  
|Preferred stock; $.01 par value; 100,000,000 shares authorized; no shares issued and outstanding as of September 30, 2003 and
December 31, 2002 |  |                   |          |   |                  |  
|Common stock; $.01 par value:                                                                                                                   |  |                   |           |   |                  |  
|Class A - 300,000,000 shares authorized; 50,495,531 and 50,704,390 shares issued and outstanding as of September 30, 2003 and
December 31, 2002 |  |                   | 505       |   |                  |  
|Class B - 100,000,000 shares authorized; 8,879,468 and 9,354,468 shares issued and outstanding as of September 30, 2003 and
December 31, 2002   |  |                   | 88        |   |                  |  
|Additional paid-in-capital                                                                                                                      |  |                   | 806,878   |   |                  |  
|Accumulated deficit                                                                                                                             |  |                   | (249,956  | ) |                  |  
|Deferred stock compensation                                                                                                                     |  |                   | (4,888    | ) |                  |  
|Accumulated other comprehensive income (loss)                                                                                                   |  |                   | 8,608     |   |                  |  
|                                                                                                                                                |  |                   |           |   |                  |  
|Total stockholders equity                                                                                                                      |  |                   | 561,235   |   |                  |  
|                                                                                                                                                |  |                   |           |   |                  |  
|Total liabilities and stockholders equity                                                                                                      |  | $                 | 3,794,013 |   |                  | $
|                                                                                                                                                |  |                   |           |   |                  |  



See accompanying
notes



2



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INSIGHT COMMUNICATIONS COMPANY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share amounts)



|                                                                                                                                 |  | Three monthsended September 30, |         |   | Nine monthsended September 30, |  
|-------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | -
|                                                                                                                                 |  | 2003                            |         |   | 2002                           |  
|Revenue                                                                                                                          |  | $                               | 228,395 |   |                                | $
|Operating costs and expenses:                                                                                                    |  |                                 |         |   |                                |  
|Programming and other operating costs                                                                                            |  |                                 | 81,655  |   |                                |  
|Selling, general and administrative                                                                                              |  |                                 | 48,240  |   |                                |  
|High-speed Internet charges                                                                                                      |  |                                 |        |   |                                |  
|Depreciation and amortization                                                                                                    |  |                                 | 56,667  |   |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Total operating costs and expenses                                                                                               |  |                                 | 186,562 |   |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Operating income                                                                                                                 |  |                                 | 41,833  |   |                                |  
|Other income (expense):                                                                                                          |  |                                 |         |   |                                |  
|Gain on cable system exchange                                                                                                    |  |                                 |        |   |                                |  
|Interest expense                                                                                                                 |  |                                 | (54,291 | ) |                                |  
|Interest income                                                                                                                  |  |                                 | 296     |   |                                |  
|Other                                                                                                                            |  |                                 | (1,134  | ) |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Total other expense, net                                                                                                         |  |                                 | (55,129 | ) |                                |  
|Loss before minority interest, investment activity, extinguishments of obligations, gain on contract settlement and income
taxes |  |                                 | (13,296 | ) |                                |  
|Minority interest income (expense)                                                                                               |  |                                 | (9,792  | ) |                                |  
|Loss from early extinguishments of debt                                                                                          |  |                                 | (10,879 | ) |                                |  
|Loss on settlement of put obligation                                                                                             |  |                                 | (11,979 | ) |                                |  
|Gain on settlement of programming contract                                                                                       |  |                                 | 37,137  |   |                                |  
|Impairment write-down of investments                                                                                             |  |                                 |        |   |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Loss before income taxes                                                                                                         |  |                                 | (8,809  | ) |                                |  
|Provision for income taxes                                                                                                       |  |                                 |        |   |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Net loss                                                                                                                         |  |                                 | (8,809  | ) |                                |  
|Accrual of preferred interests                                                                                                   |  |                                 |        |   |                                |  
|                                                                                                                                 |  |                                 |         |   |                                |  
|Net loss applicable to common stockholders                                                                                       |  | $                               | (8,809  | ) |                                | $
|                                                                                                                                 |  |                                 |         |   |                                |  
|Basic and diluted loss per share attributable to common stockholders                                                             |  | $                               | (.15    | ) |                                | $
|Basic and diluted weighted-average shares outstanding                                                                            |  |                                 | 59,393  |   |                                |  



See accompanying
notes



3



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INSIGHT COMMUNICATIONS COMPANY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)



|                                                                                |  | Nine months endedSeptember 30, |         
|------------------------------------------------------------------------------- |  | ------------------------------ | --------
|                                                                                |  | 2003                           |         
|Operating activities:                                                           |  |                                |         
|Net loss                                                                        |  | $                              | (12,000 
|Adjustments to reconcile net loss to net cash provided by operating activities: |  |                                |         
|Depreciation and amortization                                                   |  |                                | 171,936 
|Non-cash consulting expense                                                     |  |                                | 45      
|Impairment of investments                                                       |  |                                | 1,500   
|Loss on interest rate swaps                                                     |  |                                | 1,201   
|Loss on early extinguishments of debt                                           |  |                                | 2,616   
|Loss on settlement of put obligation                                            |  |                                | (7,100  
|Gain on settlement of programming contract                                      |  |                                | (34,819 
|Gain on cable systems exchange                                                  |  |                                | (26,992 
|Minority interest                                                               |  |                                | 7,778   
|Provision for losses on trade accounts receivable                               |  |                                | 9,712   
|Contribution of stock to 401(k) Plan                                            |  |                                | 1,299   
|Amortization of note discount                                                   |  |                                | 24,624  
|Changes in operating assets and liabilities, net of the effect of acquisitions: |  |                                |         
|Trade accounts receivable                                                       |  |                                | (7,704  
|Launch fund receivable                                                          |  |                                | (2,402  
|Prepaid expenses and other assets                                               |  |                                | (7,673  
|Accounts payable                                                                |  |                                | 1,634   
|Accrued expenses and other liabilities                                          |  |                                | 47,677  
|                                                                                |  |                                |         
|Net cash provided by operating activities                                       |  |                                | 171,332 
|                                                                                |  |                                |         
|Investing activities:                                                           |  |                                |         
|Purchase of fixed assets                                                        |  |                                | (131,133
|Purchase of intangible assets                                                   |  |                                | (815    
|Purchase of investments                                                         |  |                                | (980    
|Purchase of Coaxial interests                                                   |  |                                | (10,321 
|Purchase of cable television systems, net                                       |  |                                | (26,475 
|                                                                                |  |                                |         
|Net cash used in investing activities                                           |  |                                | (169,724
|                                                                                |  |                                |         
|Financing activities:                                                           |  |                                |         
|Distributions of preferred interests                                            |  |                                | (11,554 
|Net proceeds from borrowings under credit facility                              |  |                                | 212,000 
|Repayment of credit facility                                                    |  |                                | (25,000 
|Repayment of Coaxial notes                                                      |  |                                | (195,869
|Debt issuance costs                                                             |  |                                | (2,140  
|Principal payment on capital lease and other non-current liabilities            |  |                                |        
|Proceeds from exercise of stock options                                         |  |                                | 115     
|                                                                                |  |                                |         
|Net cash used in financing activities                                           |  |                                | (22,448 
|                                                                                |  |                                |         
|Net decrease in cash and cash equivalents                                       |  |                                | (20,840 
|Cash and cash equivalents, beginning of period                                  |  |                                | 74,850  
|                                                                                |  |                                |         
|Cash and cash equivalents, end of period                                        |  | $                              | 54,010  
|                                                                                |  |                                |         



See accompanying
notes



4



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



1. Organization and Basis of Presentation



Through our wholly owned subsidiary, Insight Communications Company, L.P. (Insight LP), we own a 50% interest in Insight Midwest, L.P. (Insight Midwest), which through its operating subsidiaries, Insight
Communications Midwest, LLC (Insight Communications Midwest), Insight Kentucky Partners II, L.P. (Insight Kentucky) and Insight Communications of Central Ohio, LLC (Insight Ohio), owns and operates cable
television systems in Indiana, Kentucky, Ohio, and Illinois which passed approximately 2.3 million homes and served approximately 1.3 million customers as of September 30, 2003. In addition, we also owned and operated a cable television system in
Griffin, Georgia through February 28, 2003.



Insight LP is the general partner
of Insight Midwest. Through Insight LP, we manage all of Insight Midwests systems and also manage certain systems owned by an affiliate of Comcast Cable Holdings, LLC (Comcast Cable) (formerly known as AT&T Broadband, LLC), the
owner of the remaining 50% interest in Insight Midwest.



Our other wholly owned
subsidiary, Insight Interactive LLC, owns a 100% equity interest in SourceSuite, LLC the results of which have been consolidated as of January 1, 2002 as a result of Insight Interactives acquisition of the remaining 50% equity interest from
Source Media, Inc. in March 2002.



The accompanying consolidated financial
statements include our accounts and those of our wholly owned subsidiaries, Insight LP and Insight Interactive LLC.



Certain prior period amounts have been reclassified to conform to the current period presentation.



2. Responsibility for Interim Financial Statements



Our accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted
in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnote disclosures required by accounting principles
generally accepted in the United Sates for complete financial statements.



In
our opinion, the consolidated financial statements reflect all adjustments considered necessary for a fair statement of the consolidated results of operations and financial position for the interim periods presented. All such adjustments are of a
normal recurring nature. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to consolidated financial statements contained in our Annual Report on Form
10-K, as amended, for the year ended December 31, 2002.



5



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



2. Responsibility for Interim Financial Statements (continued)



The preparation of financial statements in conformity with accounting principles generally accepted in the United
States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates. The results of operations for the three and nine months ended September 30, 2003 are not necessarily indicative of the results to be expected for the year ending
December 31, 2003 or any other interim period.



3. Recent Accounting
Pronouncements



In June 2001, the FASB issued SFAS No. 143,
Accounting for Asset Retirement Obligations. SFAS No. 143 addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. We adopted
SFAS No. 143 on January 1, 2003, in accordance with the new statement. The adoption of SFAS No. 143 had no impact on our financial condition or results of operations.



In June 2002, the FASB issued SFAS No. 146, Accounting for Disposal Obligations, which became effective for us beginning January
1, 2003. SFAS No. 146 supersedes EITF Issue No. 94-3 Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring). SFAS No. 146 addresses the
accounting for and disclosure of costs to terminate an existing contractual obligation (including but not limited to operating leases), incremental direct and other costs associated with the related disposal activity and termination benefits
(severance pay) provided to employees pursuant to a one-time benefit arrangement that does not constitute a preexisting or newly-created ongoing benefit plan. The adoption of SFAS No. 146 had no impact on our consolidated financial position or
results of operations.



In December 2002, the FASB issued SFAS No. 148,
Accounting for Stock-Based Compensation  Transition and Disclosure, which amends SFAS No. 123, to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based
employee compensation. In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method used on reported results. The disclosure provisions
of SFAS No. 148 are effective for fiscal years ending after December 15, 2002 and have been included in these consolidated financial statements.



Pursuant to SFAS No. 148, we have elected to continue to account for employee stock-based compensation under APB Opinion No. 25, Accounting for Stock Issued to
Employees, using an intrinsic value approach to measure compensation expense. Accordingly, no compensation expense has been recognized for options granted to employees under the Plan since all such options were granted at exercise prices equal
to or greater than fair market value on the date of grant.



6



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



3. Recent Accounting Pronouncements (continued)



The following table summarizes relevant information as to our reported results under the intrinsic value method of
accounting for stock awards, with supplemental information, as if the fair value recognition provisions of SFAS No. 123 had been applied to each of the three and nine month periods ended September 30, 2003 and 2002 (in thousands, except per share
data):



|                                                                                             |  | Three months endedSeptember 30, |         |   | Nine months endedSeptember 30, |  
|-------------------------------------------------------------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | -
|                                                                                             |  | 2003                            |         |   | 2002                           |  
|Net loss attributable to common stockholders                                                 |  | $                               | (8,809  | ) |                                | $
|Stock-based compensation as reported, net of tax                                             |  |                                 | 429     |   |                                |  
|Stock-based compensation determined under fair value based method for all awards, net of tax |  |                                 | (1,976  | ) |                                |  
|                                                                                             |  |                                 |         |   |                                |  
|Adjusted net loss attributable to common stockholders                                        |  | $                               | (10,356 | ) |                                | $
|                                                                                             |  |                                 |         |   |                                |  
|Basic and diluted net loss per share, as reported                                            |  | $                               | (.15    | ) |                                | $
|                                                                                             |  |                                 |         |   |                                |  
|Basic and diluted net loss per share, SFAS 123 adjusted                                      |  | $                               | (.17    | ) |                                | $
|                                                                                             |  |                                 |         |   |                                |  



In January 2003, the FASB issued FASB
Interpretation No. 46, Consolidation of Variable Interest Entities (FIN 46), which requires variable interest entities (commonly referred to as SPEs) to be consolidated by the primary beneficiary of the entity if certain
criteria are met. FIN 46 is effective immediately for all new variable interest entities created or acquired after January 31, 2003. For variable interest entities created or acquired prior to February 1, 2003, the provisions of FIN 46 will become
effective during the fourth quarter of 2003. For variable interest entities acquired prior to February 1, 2003, any difference between the net amount added to the balance sheet and the amount of any previously recognized interest in the variable
interest entity will be recognized as a cumulative effect of an accounting change. We are currently evaluating the provisions of FIN 46 but do not believe the adoption of FIN 46 will have a significant impact on our consolidated financial position
or results of operations.



In May 2003, the FASB issued SFAS No. 150,
Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. This Statement establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both
liabilities and equity. SFAS No. 150 requires that an issuer classify a financial instrument that is within its scope as a liability or, in some circumstances, as an asset, with many such financial instruments having been previously classified as
equity. SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective July 1, 2003. SFAS No. 150 is to be implemented by reporting



7



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



3. Recent Accounting Pronouncements (continued)



the cumulative effect of a change in an accounting principle for financial instruments outstanding before the issuance date of the Statement and still
existing at July 1, 2003. Restatement is not permitted.



As of July 1, 2003, we
had $195.2 million of preferred interests recorded in our balance sheets as temporary equity. These preferred interests were fully accreted to their maturity value of $195.9 million as of August 15, 2003 and were subsequently converted to common
interests in connection with our refinancing of the obligations of Insight Ohio. In connection with the adoption of SFAS No. 150, for the three months ended September 30, 2003, we recorded a $5.0 million accrual of preferred interests, which has
been included in interest expense in our consolidated statements of operations.



As of September 30, 2003 we had $228.9 million of minority interests recorded in our balance sheet as temporary equity related to Insight Midwest. On October 29, 2003, the FASB announced that it had deferred indefinitely the application of
SFAS No. 150 as it applies to minority interests related to limited life entities consolidated in parent company financial statements. Although this application was deferred, the disclosure requirements of SFAS No. 150 still apply and, therefore,
companies are required to disclose the estimated settlement value of these non-controlling interests. If the Company were to adopt this aspect of the Standard under its current provisions, it would be expected to have a material impact on the
Companys financial statements.



The Insight Midwest partnership was
formed in September 1999 to serve as the holding company and a financing vehicle for our cable television system 50/50 joint venture with an indirect subsidiary of AT&T Broadband (now known as Comcast Cable). The results of the partnership are
included in our consolidated financial statements since we as general partner effectively control Insight Midwests operating and financial decisions. The partnership will continue until October 1, 2011 unless terminated earlier in accordance
with the provisions of the Insight Midwest partnership agreement.



Depending on
the nature of the dissolution, Insight Midwest will be required to either distribute to Comcast Cable some of its cable systems, to be determined in accordance with the partnership agreement, equal to 50% of the net market value of the partnership
or, upon liquidation, an amount in cash equal to 50% of the net proceeds received.



We are currently evaluating the estimated settlement value of these minority interests and will disclose such settlement value in our Form 10-K for the year ending December 31, 2003.



4. Long-Lived Assets



Fixed assets consisted of:



|                                               |  | September 30,2003 |           |   | December 31,2002 |  
|---------------------------------------------- |  | ----------------- | --------- | - | ---------------- | -
|                                               |  | (in thousands)    |          
|Land, buildings and improvements               |  | $                 | 38,063    |   |                  | $
|Cable system equipment                         |  |                   | 1,988,174 |   |                  |  
|Furniture, fixtures and office equipment       |  |                   | 17,614    |   |                  |  
|                                               |  |                   |           |   |                  |  
|                                               |  |                   | 2,043,851 |   |                  |  
|Less accumulated depreciation and amortization |  |                   | (835,479  | ) |                  |  
|                                               |  |                   |           |   |                  |  
|Total fixed assets, net                        |  | $                 | 1,208,372 |   |                  | $
|                                               |  |                   |           |   |                  |  



We recorded amortization expense of
$1.2 million and $3.5 million for the three and nine months ended September 30, 2003 and $436,000 and $3.5 million for the three and nine months ended September 30, 2002. We estimate aggregate amortization expense, primarily related to deferred
financing costs, to be approximately $5.0 million for each of the five succeeding fiscal years.



5. Debt



|                                         |  | September 30,2003 |           |   | December 31,2002 |  
|---------------------------------------- |  | ----------------- | --------- | - | ---------------- | -
|                                         |  | (in thousands)    |          
|Insight Ohio Credit Facility             |  | $                 |          |   |                  | $
|Insight Midwest Holdings Credit Facility |  |                   | 1,650,000 |   |                  |  
|Insight Midwest 93⁄4% Senior Notes         |  |                   | 385,000   |   |                  |  
|Insight Midwest 101⁄2% Senior Notes        |  |                   | 500,000   |   |                  |  
|Insight Inc. 121⁄4% Senior Discount Notes  |  |                   | 360,000   |   |                  |  
|                                         |  |                   |           |   |                  |  
|                                         |  |                   | 2,895,000 |   |                  |  
|Less unamortized discount on notes       |  |                   | (102,372  | ) |                  |  
|                                         |  |                   |           |   |                  |  
|Total debt                               |  | $                 | 2,792,628 |   |                  | $
|                                         |  |                   |           |   |                  |  



8



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



5. Debt (continued)



Insight Midwest Holdings $1.975 Billion Credit Facility



On March 28, 2002, we loaned $100.0 million to Insight Midwest, $97.0 million of which was
contributed to Insight Midwest Holdings, LLC in April 2002 for use in paying down the credit facility balance and in funding financing costs associated with the amendments, and $3.0 million of which was contributed to Insight Ohio as of March 28,
2002. Insight Midwest Holdings is a wholly-owned subsidiary of Insight Midwest, holds all of the outstanding equity of each of our operating subsidiaries and serves as borrower under a $1.975 billion credit facility. Insight Midwest Holdings is
permitted under the credit facility to make distributions to Insight Midwest for the purpose of repaying our loan provided that there are no defaults existing under the credit facility. The loan to Insight Midwest bears annual interest of 9%,
compounded semi-annually, has a scheduled maturity date of January 31, 2011 and permits prepayments.



On August 26, 2003 we amended the Insight Midwest Holdings Credit Facility in connection with our plan to refinance all of the obligations and conditionally guaranteed obligations of Insight Ohio. The amendment
increased the Term B loan portion of the credit facility from $900.0 million to $1.125 billion which increased the total facility size to $1.975 billion from $1.750 billion. We recorded $2.0 million of deferred financing costs associated with this
amendment that will be amortized over the remaining term of the credit facility.



On August 29, 2003, Insight Midwest Holdings distributed $22.0 million to Insight Midwest which, in turn, contributed this amount to Insight Ohio for the purpose of repaying the Insight Ohio Credit Facility. Simultaneously, Insight Ohio
used these proceeds plus cash on hand to repay the then outstanding balance of the Insight Ohio Credit Facility of $22.5 million plus accrued interest.



Ohio Refinancing



On August 21, 1998, Insight LP and Coaxial Communications of Central Ohio, Inc. (Coaxial) entered into a contribution agreement pursuant to which Coaxial contributed to Insight Ohio substantially all of
the assets and liabilities of its cable television systems located in Columbus, Ohio and Insight LP contributed $10.0 million in cash to Insight Ohio. As a result of the contribution, Coaxial owned 25% of the non-voting common equity and Insight LP,
through its subsidiary Insight Holdings of Ohio, LLC, owned 75% of the non-voting common equity of Insight Ohio. In addition, Coaxial also received two separate series of voting preferred equity (Series A Preferred Interest$140 million and
Series B Preferred Interest$30 million) of Insight Ohio.



The Voting
Preferred Interests provided for cash distributions to Coaxial and certain of its affiliates in amounts equal to the payments required on the 10% Senior Notes and the 127/8% Senior Discount Notes. Insight Ohio was required to redeem the Series A Preferred Interests in August 2006 and the Series B Preferred Interest in August 2008. The Senior Notes
and Senior Discount Notes were conditionally guaranteed by Insight Ohio.



9



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



5. Debt (continued)



On August 8, 2000, Insight Ohio purchased Coaxials 25% non-voting common equity interest. The purchase price
was 800,000 shares of our common stock and cash in the amount of $2.6 million. In connection with the purchase, Insight Ohios operating agreement was amended to, among other things, remove certain participating rights of the principals of
Coaxial and certain of its affiliates. Additionally, the agreement was amended to incorporate 70% of Insight Ohios total voting power into the common equity interests of Insight Ohio and 30% of Insight Ohios total voting power into the
Preferred Interests of Insight Ohio.



As a result of this transaction, the
financial results of Insight Ohio were consolidated with our financial results effective January 1, 2000, with minority interest recorded for the 25% common interest owned by Coaxial through August 8, 2000. In connection with this transaction,
Insight LP recorded a step-up in fair value of Insight Ohios assets of $229.2 million, which represents the difference between the purchase price and its equity in Insight Ohios net assets in excess of Insight Ohios net assets.
This amount was allocated to franchise costs and goodwill.



Although the
financial results of Insight Ohio since 2000 have been consolidated as a result of this transaction, for financing purposes, until September 29, 2003, Insight Ohio was an unrestricted subsidiary of ours and was prohibited by the terms of its
indebtedness from making distributions to us.



On September 25, 2003, we
purchased all the outstanding equity of the owners of Coaxial, which held the preferred interests of Insight Ohio and 800,000 shares of our stock, for $29.4 million. The purchase was financed through existing cash on hand. Additionally, the Purchase
and Option Agreement, dated August 8, 2000, was terminated. In connection with the purchase, we recorded a loss on the settlement of the put obligation of $12.0 million.



In connection with these transactions, we retired the 800,000 shares of our stock held by Coaxial and, immediately thereafter, contributed
the purchased interests and Insight Midwests interests in Insight Ohio to Insight Midwest Holdings. Additionally, the Series A and Series B preferred interests were converted to common interests.



On September 29, 2003, we retired the remaining Ohio obligations, comprised of the Senior
Notes and Senior Discount Notes, through our refinancing of the Insight Midwest Holdings Credit Facility. Insight Ohio is now a restricted subsidiary under the terms of our indentures. We recorded a loss of $10.9 million on the extinguishment of
these obligations as a result of call premiums and the write-off of deferred financing costs.



10



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



5. Debt (continued)



Debt Principal Payments



As of September 30, 2003, principal payments required on our debt were as follows (in thousands):



|2003       |  | $ |         
|---------- |  | - | ---------
|2004       |  |   | 62,250   
|2005       |  |   | 83,500   
|2006       |  |   | 83,500   
|2007       |  |   | 83,500   
|Thereafter |  |   | 2,582,250
|           |  |   |          
|Total      |  | $ | 2,895,000
|           |  |   |          



6. Derivative Instruments



We enter into derivative instruments, typically interest-rate swap and
collar agreements, to modify the interest characteristics of our outstanding debt to either a floating or fixed rate basis. These agreements involve fixed and floating rate interest payments in exchange for floating and fixed rate interest receipts
over the life of the agreement without an exchange of the underlying principal amount. The differential to be paid or received is accrued as interest rates change and is recognized as an adjustment to interest expense related to the debt. The
related amount payable or receivable is included in other liabilities or assets. We record the effective portion of certain derivatives gains or losses as accumulated other comprehensive income or loss in the accompanying consolidated balance
sheets. Gains and losses related to derivative instruments that are determined not to be effective are recorded in our consolidated statements of operations as either an adjustment to interest expense or other income or expense depending on whether
the swap is a cash flow hedge or fair value hedge.



Floating Rate to
Fixed Rate Swaps



As of September 30, 2003 and December 31, 2002, we
had entered into various interest rate swap and collar agreements effectively fixing interest rates between 5.0% and 5.9% on $150.0 million and $435.0 million notional value of debt. One agreement was outstanding as of September 30, 2003. This
agreement expires in August 2004. We recorded $817,000 and $2.7 million of accrued interest related to these agreements as of September 30, 2003 and December 31, 2002. As of September 30, 2003 and December 31, 2002, the estimated fair value (cost if
terminated) of our interest rate swap agreements was approximately $(4.9) million and $(17.8) million.



Fixed Rate to Floating Rate Swaps



In February 2003, we entered into two interest rate swap agreements whereby we swapped fixed rates under our 101⁄2% senior notes due in December 2010 for variable rates equal to six-month LIBOR, plus the applicable margin of
approximately 7.7%, on $185.0 million notional value of debt. Six-month



11



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



6. Derivative Instruments (continued)



LIBOR ranged between 1.26% and 1.34% for February and March 2003. In May 2003, we settled these swaps and received proceeds of $1.8 million and recorded a
gain in this amount, which is included in other income (expense).



In July
2003, we entered into three new interest rate swap agreements whereby we swapped fixed rates under our 101⁄2% senior notes due in December 2010 for variable rates equal to six-month LIBOR, plus the applicable margin of approximately 8.3%, on
$185.0 million notional value of debt. These agreements expire November 1, 2005. We recorded a loss on these swaps of $1.2 million for the three months ended September 30, 2003, which is included in other income. As of September 30, 2003, we
recorded $341,000 of interest receivable related to these agreements. The fair market value (cost if terminated) of these agreements was $(1.2) million as of September 30, 2003.



7. Comprehensive Income (Loss)



We own equity securities that are classified as available-for-sale and reported at market value, with unrealized gains and losses recorded as accumulated other
comprehensive income or loss in the accompanying consolidated balance sheets. In addition, we record the effective portion of certain derivatives gains or losses as accumulated other comprehensive income or loss in the accompanying
consolidated balance sheets.



The following is a reconciliation of net loss to
comprehensive income (loss) (in thousands):



|                                                        |  | Three months endedSeptember 30, |        |   | Nine months endedSeptember 30, |  
|------------------------------------------------------- |  | ------------------------------- | ------ | - | ------------------------------ | -
|                                                        |  | 2003                            |        |   | 2002                           |  
|Net loss                                                |  | $                               | (8,809 | ) |                                | $
|Unrealized gain (loss) on securities available-for-sale |  |                                 | 372    |   |                                |  
|Unrealized gain (loss) on interest rate swaps           |  |                                 | 1,270  |   |                                |  
|                                                        |  |                                 |        |   |                                |  
|Comprehensive income (loss)                             |  | $                               | (7,167 | ) |                                | $
|                                                        |  |                                 |        |   |                                |  



8. Related Party Transactions



Managed Systems



On March 17, 2000, we entered into a two-year management agreement with Comcast of
Montana/Indiana/Kentucky/Ohio (formerly known as InterMedia Partners Southeast), an affiliate of Comcast Cable, to provide management services to cable television systems owned by Comcast. The management agreement, which had been extended, was set
to expire on June 30, 2003. On June 27, 2003, the management agreement was further extended with the provision that either party may terminate the agreement at any time on 30 days notice. As of September 30, 2003, these systems served



12



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



8. Related Party Transactions (continued)



approximately 91,300 customers in the state of Indiana. We recognized management fees in connection with this agreement of $610,000 and $1.8 million for the
three and nine months ended September 30, 2003 and $718,000 and $2.1 million for the three and nine months ended September 30, 2002.



On February 28, 2003, Insight Communications Midwest exchanged with Comcast of Montana/Indiana/Kentucky/Ohio the system we then owned in Griffin, Georgia, serving
approximately 11,800 customers, plus $25.0 million, for the managed systems located in New Albany, Indiana and Shelbyville, Kentucky, together serving approximately 23,400 customers. Additionally, pursuant to the agreement, Insight Communications
Midwest paid approximately $1.5 million as a closing adjustment to Comcast of Montana/Indiana/Kentucky/Ohio to complete the rebuild and upgrade of the Griffin, Georgia system.



This system exchange was accounted for on that date as a sale of the Griffin, Georgia system and a purchase of the New Albany, Indiana and
Shelbyville, Kentucky systems. In connection with this system exchange, we recorded a gain of approximately $27.0 million equal to the difference between the fair value and carrying value of the Griffin, Georgia system as of the closing date. Of the
$64.5 million purchase price of the New Albany, Indiana and Shelbyville, Kentucky systems $31.9 million was preliminarily allocated to such cable television systems assets acquired in relation to their fair values and $32.6 million was
preliminarily allocated to franchise costs.



Programming



We purchase the majority of our programming through affiliates of
Comcast Cable. Charges for such programming, including a 11⁄2% administrative fee, were $36.7 million and $107.5 million for the three and nine months ended September 30, 2003 and $33.1 million and $97.3 million for the three and nine months
ended September 30, 2002. As of September 30, 2003 and December 31, 2002, $53.2 million and $22.6 million of accrued programming costs were due to affiliates of Comcast Cable. We believe that the programming rates charged through these affiliates
are lower than those available from independent parties.



In 2001, in
connection with the purchase and contribution of our systems primarily located in Illinois, we acquired, through affiliates of Comcast Cable, an above-market programming contract. The above-market portion of the contract was recorded, as an
adjustment to the purchase price of the Illinois systems of $36.5 million as a long-term programming liability recorded in other non-current liabilities. This contract, under litigation between affiliates of Comcast Cable and the programmer, was
renegotiated during the third quarter of 2003 and indirectly resulted in more favorable programming rates for us. As such, we recorded an adjustment to programming expense of $3.1 million and recorded a gain on the extinguishment of the liability
for $37.1 million, both of which have been recorded in our consolidated statements of operations during the three months ended September 30, 2003.



13



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



8. Related Party Transactions (continued)



Telephone Agreements



In July 2000, to facilitate delivery of telephone services we entered into a ten-year agreement with AT&T Broadband (now known as
Comcast Cable) that allows Insight Midwest to deliver local telephone service. Under the terms of the agreement, Insight Midwest leases certain capacity on our local network to Comcast Cable. Revenue earned from leased network capacity used in the
provision of telephone services was $1.7 million and $4.2 million for the three and nine months ended September 30, 2003 and $624,000 and $1.2 million for the three and nine months ended September 30, 2002.



In addition, Insight Midwest provides certain services and support for which it receives
additional payments related to installations, marketing and billing support. Fee revenue earned in connection with installations is deferred and amortized over the expected term a telephone customer maintains their telephone service, currently
estimated to be three years. Marketing and billing support revenue is recognized in the period such services are performed.



Advertising Services



In October 1999, to facilitate the administration of our advertising services in our Kentucky Systems, we entered into an agreement with an affiliate of AT&T
Broadband, which provides for this affiliate to perform all of our Kentucky advertising sales and related administrative services. The agreement has been extended beyond its scheduled December 31, 2003 expiration date and may thereafter be
terminated by either party upon 30 days notice. We, through our Kentucky Systems, earned advertising revenues through this affiliate of $4.5 million and $13.7 million for the three and nine months ended September 30, 2003 and $3.7 million and $10.8
million for the three and nine months ended September 30, 2002. As of September 30, 2003 and December 31, 2002, we had $9.4 million and $8.5 million as a receivable due from this affiliate included in other current assets. We pay this affiliate a
fixed and variable fee for providing this service based on advertising sales cash flow growth. As of September 30, 2003 and December 31, 2002, we had $184,000 and $308,000 recorded as payables to this affiliate related to such services.



SourceSuite



On March 14, 2002, Insight Interactive purchased the remaining 50% equity interest in SourceSuite that it did not already own from Source
Media by tendering $10.2 million face amount of Source Medias 12% bonds. The fair market value of such tendered bonds on March 14, 2002 was $205,000. The excess of the fair value of SourceSuites acquired assets and liabilities over the
purchase price of $205,000, totaling $571,000, was allocated as a reduction to long-lived assets based on their respective fair values. The operating results of SourceSuite have been consolidated in the accompanying financial statements effective
January 1, 2002.



14



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



8. Related Party Transactions (continued)



Employee Loans



In October 1999 and April 2000, we made loans to certain of our employees that were used to satisfy their individual income tax withholding
obligations resulting from their receipt of shares in connection with our initial public offering. The aggregate principal amount of these loans is approximately $4.3 million as of September 30, 2003 and is included in other non-current assets. The
notes accrue interest at a rate of 5% per annum and mature on October 1, 2009, or 180 days following termination of employment. The notes provide, at our election, for forgiveness of accrued interest and for gross-up payments related to the
employees income tax liabilities arising from such forgiveness, provided the employee is then employed by us in good standing.



In December 2002, the Board of Directors approved a plan whereby each affected employee was offered the opportunity to repay the outstanding loan amounts through
surrendering a number of pledged shares with a value equal to the outstanding loan amounts. In return, the employees would receive shares a five-year vesting period and separate grants of non-qualified stock options vesting over five and nine year
periods.



On December 23, 2002, our then President and Chief Operating Officer,
Kim D. Kelly, accepted this offer and surrendered 746,941 shares in full payment of the $9.6 million outstanding principal amount of her loan, and in turn received 450,000 shares of Class B common stock with a five-year vesting period, 600,000
non-qualified stock options vesting equally over five years and 300,000 non-qualified stock options with a cliff vesting after nine years. All of the stock options issued had an exercise price equal to the closing market value of our common stock on
December 23, 2002. As of December 31, 2002, the fair value of the shares was recorded as deferred stock compensation on our balance sheet in the amount of $5.9 million. This deferred compensation was being amortized on a straight-line basis into our
operating results as non-cash compensation through December 23, 2007.



In
August 2003, Ms. Kelly resigned as President and Chief Operating Officer. In connection with Ms. Kellys resignation, she entered into a severance arrangement with us, which waived the forfeiture and termination provisions of the 450,000
restricted shares of common stock and the 900,000 stock options, granted in December 2002, and the 100,000 stock options granted in July 2002. As of December 1, 2003, Ms. Kelly will no longer be an employee and, as a result, we will be required, in
accordance with SFAS No. 123 and Financial Interpretation No. 44, to re-measure the value of these equity instruments on a quarterly basis from December 1, 2003 through November 30, 2006. Such re-measurement will be recorded as non-cash compensation
expense in our consolidated statements of operations.



Additionally, pursuant
to the approval of our Board of Directors on July 31, 2003, all accrued interest on the remaining outstanding notes from October 1, 2002 through September 30, 2003 was forgiven. We made gross-up payments with respect to the income taxes related to
such interest forgiveness on behalf of the affected employees. Forgiven interest from October 1, 2002 through September 30, 2003 amounted to $219,000, and gross-up payments with respect to the employees income tax liabilities resulting from
such forgiven interest amounted to $209,000, which amount has been ratably accrued into our statement of operations as compensation expense over the twelve months ended September 30, 2003.



15



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



9. At Home Corporation



High-speed Internet service charges were incurred through February 28, 2002 as a result of payments made to At Home Corporation
(@Home), the former provider of high-speed Internet services for all of our systems, except for those located in Ohio. On September 28, 2001, @Home filed for protection under Chapter 11 of the Bankruptcy Code. For the purpose of
continuing service to existing customers and to resume the provisioning of service to new customers, we entered into an interim service arrangement that required that we pay $10.0 million to @Home to extend service for three months through February
28, 2002. As a result of this arrangement we incurred approximately $4.1 million in excess of our original agreed-to cost for such services rendered from January 1, 2002 through February 28, 2002 which are presented as high-speed Internet charges on
our statement of operations.



10. Commitments and Contingencies



Programming Contracts



We enter into long-term contracts with third parties who provide us with programming for
distribution over our cable television systems. These programming contracts are a significant part of our business and represent a substantial portion of our operating costs. Since future fees under such contracts are based on numerous variables,
including number and type of customers, we have not recorded any liabilities with respect to such contracts.



Litigation



In November 2000, we
filed a state court action against the City of Louisville for its grant, in September 2000, of a more favorable franchise to Knology of Louisville, Inc. Upon commencement of this action, the City, pursuant to a provision in its franchise agreement
with Knology, automatically suspended Knologys franchise pending a final, non-appealable court determination as to whether Knologys franchise was more favorable than the franchise under which we operated. In November 2000, Knology filed
a federal court action against us seeking monetary damages and other relief for alleged violations of federal laws arising out of our having filed, pursuant to the provisions of our own franchise agreement with the City, the state court action. In
March 2001, the federal court preliminarily set aside the suspension of Knologys franchise. In March 2002, a state circuit court ruled against our claim that Knologys franchise was more favorable. We appealed the circuit courts
order to the state court of appeals which, in June 2003, upheld the lower court ruling. We have filed a motion for discretionary review of the appeals courts ruling which is now pending before the Kentucky Supreme Court. In May 2003, the
federal court granted us summary judgment and dismissed six of Knologys 11 claims. The court granted summary judgment to Knology on three claims, two of which resulted in permanently enjoining enforcement of the automatic suspension provision
of Knologys franchise agreement and do not involve damages. The third such claim is for violation of Knologys first amendment rights, which will proceed to trial solely on the issue of damages, and would result in an award of legal fees
and court costs specific to such claim if upheld. The remaining undecided claims relate to allegations of anticompetitive conduct and are to proceed to trial on the merits. The federal court has stayed any trial pending final resolution of the state
court action. In August 2003, the court agreed, in part, with our



16



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INSIGHT COMMUNICATIONS COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



10. Commitments and Contingencies (continued)



Motion for Reconsideration, that the stay provision provides no justification for an injunction since the language was severed. Further, the court granted
our Motion to Certify Questions for an Immediate Appeal to the Sixth Circuit Court of Appeals where the Motion to Certify for Immediate Appeal is presently pending. We continue to believe that we have substantial and meritorious defenses to the
remaining asserted federal claims and intend to defend them vigorously. Consequently, we have not recorded any loss reserves in the accompanying financial statements.



We are subject to various legal proceedings that arise in the ordinary course of business. While it is impossible to determine with
certainty the ultimate outcome of these matters, it is our opinion that the resolution of these matters will not have a material adverse affect on our consolidated financial condition.



17



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|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- |  | -------------------------------------------------------------------------------------



Forward-Looking Statements



Some of the information in this quarterly report contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements
by forward-looking words such as may, will, expect, anticipate, believe, estimate and continue or similar words. You should read statements that contain these words
carefully because they:



| |  | discuss our future expectations;
| | - | --------------------------------



| |  | contain projections of our future results of operations or of our financial condition; or
| | - | -----------------------------------------------------------------------------------------



| |  | state other forward-looking information.
| | - | ------------------------------------------



We believe it is important to communicate our expectations to our investors. However, there may be events in the future that we are not able to accurately predict or over
which we have no control. The risk factors listed in our Annual Report on Form 10-K, as amended, for the year ended December 31, 2002, as well as any cautionary language in this quarterly report, provide examples of risks, uncertainties and events
that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. Examples of these risks include our history and expectation of future net losses, our substantial debt, changes in laws and
regulations, increasing programming costs and competition. You should be aware that the occurrence of the events described in these risk factors and elsewhere in this quarterly report could have a material adverse effect on our business, operating
results and financial condition.



Results of Operations



Revenues are earned from customer fees for cable television programming services including
premium, digital and pay-per-view services and ancillary services, such as rental of converters and remote control devices, installations and from selling advertising. In addition, we earn revenues from providing high-speed Internet and from
facilitating the delivery of telephone services as well as from commissions for products sold through home shopping networks and management fees.



Some of the principal reasons for our net losses through September 30, 2003 include depreciation and amortization associated with our acquisitions and capital
expenditures related to construction and upgrading of our systems, and interest costs on borrowed money. Beginning January 1, 2002, we no longer record amortization expense associated with goodwill and franchise costs; however, we expect to continue
to report net losses for the foreseeable future. We cannot predict what impact, if any, continued losses will have on our ability to finance our operations in the future.



18



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The following table is derived for the periods presented from our consolidated financial statements that are included in
this report and sets forth certain statement of operations data for our consolidated operations:



|                                                    |  | Three MonthsEnded September 30, |         |   | Nine MonthsEnded September 30, |  
|--------------------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | -
|                                                    |  | 2003                            |         |   | 2002                           |  
|                                                    |  | (in thousands)                  |        
|Revenue                                             |  | $                               | 228,395 |   |                                | $
|Operating costs and expenses:                       |  |                                 |         |   |                                |  
|Programming and other operating costs               |  |                                 | 81,655  |   |                                |  
|Selling, general and administrative                 |  |                                 | 48,240  |   |                                |  
|High-speed Internet charges                         |  |                                 |        |   |                                |  
|Depreciation and amortization                       |  |                                 | 56,667  |   |                                |  
|                                                    |  |                                 |         |   |                                |  
|Total operating costs and expenses                  |  |                                 | 186,562 |   |                                |  
|                                                    |  |                                 |         |   |                                |  
|Operating income                                    |  |                                 | 41,833  |   |                                |  
|Operating cash flow                                 |  |                                 | 98,500  |   |                                |  
|Interest expense                                    |  |                                 | 54,291  |   |                                |  
|Minority interest income (expense)                  |  |                                 | (9,792  | ) |                                |  
|Net loss                                            |  |                                 | (8,809  | ) |                                |  
|Net cash provided by operating activities           |  |                                 | 66,847  |   |                                |  
|Net cash used in investing activities               |  |                                 | 57,716  |   |                                |  
|Net cash provided by (used in) financing activities |  |                                 | (60,039 | ) |                                |  
|Capital expenditures                                |  |                                 | 47,022  |   |                                |  



Operating cash flow is a financial
measure that is not calculated and presented in accordance with accounting principles generally accepted in the United States. We define operating cash flow as operating income or loss before depreciation and amortization. Operating cash flow is
useful to management in measuring the overall operational strength and performance of our company. A limitation of this measure, however, is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in
generating our revenues. Management evaluates the costs of such tangible and intangible assets through other financial measures such as capital expenditures and investment spending. Another limitation of operating cash flow is that it does not
reflect income net of interest expense, which is a significant expense of our company because of the substantial debt we incurred to acquire our cable television systems and finance the capital expenditures for the upgrade of our cable network.



Despite the limitations of operating cash flow, management believes that the
presentation of this financial measure is relevant and useful for investors because it allows investors to evaluate our performance in a manner similar to the method used by management. In addition, operating cash flow is commonly used in the cable
television industry to analyze and compare cable television companies on the basis of operating performance, although our measure of operating cash flow may not be directly comparable to similar measures used by other companies. Operating cash flow
should not be regarded as an alternative to, or more meaningful than, either operating income or net income as an indicator of operating performance or cash flows as a measure of liquidity, as well as other measures of financial performance reported
in accordance with accounting principles generally accepted in the United States.



19



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The following is a reconciliation of operating income to operating cash flow:



|                              |  | Three MonthsEnded September 30, |        | Nine MonthsEnded September 30,
|----------------------------- |  | ------------------------------- | ------ | ------------------------------
|                              |  | 2003                            |        | 2002                          
|                              |  | (in thousands)                 
|Operating income              |  | $                               | 41,833 |                               
|Adjustment:                   |  |                                 |        |                               
|Depreciation and amortization |  |                                 | 56,667 |                               
|                              |  |                                 |        |                               
|Operating cash flow           |  | $                               | 98,500 |                               
|                              |  |                                 |        |                               



Operating cash flow includes
high-speed Internet charges of $4.1 million for the nine months ended September 30, 2002 that were excluded in previous reports filed by us.



Three Months Ended September 30, 2003 Compared to Three Months Ended September 30, 2002



The $22.3 million or 11% increase in revenue was primarily a result of gains in high-speed Internet and digital service revenue, which
increased 57% and 30% over the prior years quarter, primarily due to an increased customer base. In addition, basic cable service revenue increased 5%, primarily due to basic rate increases.



Revenue by service offering were as follows for the three months ended September 30 (in
thousands):



|                              |  | 2003Revenue byServiceOffering |         | % of TotalRevenue |       |   | 2002Revenue byServiceOffering |   | % of TotalRevenue | 
|----------------------------- |  | ----------------------------- | ------- | ----------------- | ----- | - | ----------------------------- | - | ----------------- | 
|Basic                         |  | $                             | 135,829 |                   | 59.5  | % |                               | $ | 128,777           | 
|Digital                       |  |                               | 21,391  |                   | 9.4   | % |                               |   | 16,466            | 
|High-speed Internet           |  |                               | 24,346  |                   | 10.7  | % |                               |   | 15,488            | 
|Premium / analog pay-per-view |  |                               | 13,776  |                   | 6.0   | % |                               |   | 14,591            | 
|Telephone                     |  |                               | 3,232   |                   | 1.4   | % |                               |   | 1,735             | 
|Advertising                   |  |                               | 14,550  |                   | 6.4   | % |                               |   | 13,007            | 
|Franchise fees                |  |                               | 6,928   |                   | 3.0   | % |                               |   | 6,550             | 
|Other                         |  |                               | 8,343   |                   | 3.6   | % |                               |   | 9,432             | 
|                              |  |                               |         |                   |       |   |                               |   |                   | 
|Total                         |  | $                             | 228,395 |                   | 100.0 | % |                               | $ | 206,046           | 
|                              |  |                               |         |                   |       |   |                               |   |                   | 



Revenue Generating Units
(RGUs) were approximately 1,934,900 as of September 30, 2003 compared to approximately 1,753,600 as of September 30, 2002. This represents a growth rate of 10%. Giving effect to the Griffin swap, RGUs grew 10% from the prior year
quarter. RGUs represent the sum of basic, digital, high-speed Internet, and telephone customers.



20



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Average monthly revenue per basic customer, including management fee revenue and SourceSuite revenue, was $58.81 for the
three months ended September 30, 2003, compared to $53.24 for the three months ended September 30, 2002 primarily reflecting the continued successful rollout of new product offerings in all markets. Average monthly revenue per basic customer for
high-speed Internet and digital service increased to $11.78 for the three months ended September 30, 2003, up from $8.25 for the three months ended September 30, 2002.



Programming and other operating costs increased $10.8 million or 15%. Programming costs increased 5%, primarily attributable to increased
programming rates, an increase in customers served, and additional programming in the newly rebuilt systems. These increases were offset by a $3.1 million credit due to the settlement of a programming contract. Excluding the settlement of the
programming contract, programming costs increased 11%. Other operating costs increased 44%, primarily attributable to increased high-speed Internet costs driven by the net addition of 83,900 high-speed Internet customers, year over year. In
addition, labor costs increased due to the transition from upgrade activities to maintenance activities associated with the growth of new customers.



Selling, general and administrative expenses increased $5.5 million or 13%, primarily as a result of increased costs related to annual salary increases and payroll
related costs for existing employees, some of which are one-time expenses, as well as the addition of new employees. In addition, marketing expenses increased to support the continued roll-out of new products; legal fees also increased related to
ongoing litigation. Partially offsetting these increases was an increase in marketing support funds (recorded as a reduction to selling, general and administrative expenses) for the promotion of new channel launches.



Depreciation and amortization expense decreased $5.8 million or 9% primarily as a result of a
one-time $11.1 million write-down of our obsolete video on demand equipment in the three months ended September 30, 2002. Excluding this impairment charge, depreciation and amortization increased $5.3 million or 10% primarily as a result of
additional capital expenditures through September 30, 2003 to support the continued rebuild of our Illinois systems, extend our plant and continue the rollout of digital, high-speed Internet and telephone services to existing and new service areas.



Operating cash flow increased $6.0 million or 6% primarily due to increased
basic, digital and high-speed Internet revenue, offset by increases in programming and other operating costs and selling, general and administrative costs.



Interest expense remained relatively flat quarter over quarter. The increase of $3.3 million or 7% is primarily due to the inclusion of $5.0 million of accruals for
preferred interests in accordance with SFAS No. 150, effective July 1, 2003. Previously, the accrual was treated as a dividend below net income or loss. Additionally, the increase is related to higher outstanding debt, which averaged $2.7 billion
for the three months ended September 30, 2003, versus $2.5 billion for the three months ended September 30, 2002. These increases were partially offset by a decrease in interest expense due to lower interest rates, which averaged 7.6% for the three
months ended September 30, 2003, versus 8.7% for the three months ended September 30, 2002.



Minority interest decreased $21.4 million or 184% to expense of $9.8 million from income of $11.6 million. The decrease is a direct result of the increase in net income attributable to common interests recorded by
Insight Midwest primarily due to the gain on settlement of a programming contract partially offset by the loss from the extinguishment of the Coaxial debt.



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For the three months ended September 30, 2003, the net loss was $8.8 million.



Nine Months Ended September 30, 2003 Compared to Nine Months Ended September 30, 2002



The $66.9 million or 11% increase in revenue was primarily a result of
gains in high-speed Internet and digital service revenue, which increased 62% and 25% over the prior years nine months primarily due to an increased customer base. In addition, basic cable service revenue increased 6% primarily due to basic
rate increases.



Revenue by service offering were as follows for the nine
months ended September 30 (in thousands):



|                              |  | 2003Revenue byServiceOffering |         | % of TotalRevenue |       |   | 2002Revenue byServiceOffering |   | % of TotalRevenue | 
|----------------------------- |  | ----------------------------- | ------- | ----------------- | ----- | - | ----------------------------- | - | ----------------- | 
|Basic                         |  | $                             | 400,305 |                   | 60.1  | % |                               | $ | 376,117           | 
|Digital                       |  |                               | 60,572  |                   | 9.1   | % |                               |   | 48,447            | 
|High-speed Internet           |  |                               | 66,959  |                   | 10.0  | % |                               |   | 41,220            | 
|Premium / analog pay-per-view |  |                               | 42,867  |                   | 6.4   | % |                               |   | 45,605            | 
|Telephone                     |  |                               | 8,596   |                   | 1.3   | % |                               |   | 3,674             | 
|Advertising                   |  |                               | 42,264  |                   | 6.3   | % |                               |   | 37,831            | 
|Franchise fees                |  |                               | 20,442  |                   | 3.1   | % |                               |   | 19,101            | 
|Other                         |  |                               | 24,482  |                   | 3.7   | % |                               |   | 27,620            | 
|                              |  |                               |         |                   |       |   |                               |   |                   | 
|Total                         |  | $                             | 666,487 |                   | 100.0 | % |                               | $ | 599,615           | 
|                              |  |                               |         |                   |       |   |                               |   |                   | 



Average monthly revenue per basic
customer, including management fee revenue and SourceSuite revenue, was $57.08 for the nine months ended September 30, 2003, compared to $51.53 for the nine months ended September 30, 2002 primarily reflecting the continued successful rollout of new
product offerings in all markets. Average monthly revenue per basic customer for high-speed Internet and digital service increased to $10.92 for the nine months ended September 30, 2003, up from $7.70 for the nine months ended September 30, 2002.



Programming and other operating costs increased $32.2 million or 15%.
Programming costs increased 9%, primarily attributable to increased programming rates, an increase in customers served, and additional programming in the newly rebuilt systems. These increases were offset by a $3.1 million credit due to the
settlement of a programming contract. Excluding the settlement of the programming contract, programming costs increased 11%. Other operating costs increased 26%, primarily attributable to increased high-speed Internet costs driven by the net
addition of 83,900 high-speed Internet customers, year over year. In addition, labor costs increased due to the transition from upgrade activities to maintenance activities associated with the growth of new customers.



Selling, general and administrative expenses increased $15.2 million or 12% primarily as a
result of increased costs related to annual salary increases and payroll related costs for existing employees, some of which are one-time expenses, as well as the addition of new employees. In addition, marketing



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expenses increased to support the continued roll-out of new products; legal fees also increased related to ongoing litigation. Partially offsetting these
increases was an increase in marketing support funds (recorded as a reduction to selling, general and administrative expenses) for the promotion of new channel launches.



High-speed Internet service charges were incurred through February 28, 2002 as a result of payments made to @Home, the former provider of
high-speed Internet services for all of our systems, except for those located in Ohio. On September 28, 2001, @Home filed for protection under Chapter 11 of the Bankruptcy Code. For the purpose of continuing service to existing customers and to
resume the provisioning of service to new customers, we entered into an interim service arrangement that required us to pay $10.0 million to @Home to extend service for three months through February 28, 2002. As a result of this arrangement we
incurred approximately $4.1 million in excess of our original agreed-to cost for such services rendered through February 28, 2002.



Depreciation and amortization expense increased $11.6 million or 7% primarily as a result of additional capital expenditures through September 30, 2003 to support the
continued rebuild of our Illinois systems, extend our plant and continue the rollout of digital, high-speed Internet and telephone services to existing and new service areas. Excluding the write-down of our obsolete video on demand equipment during
the three months ended September 30, 2002, depreciation and amortization increased $22.7 million or 15%.



Operating cash flow increased $23.6 million or 9% primarily due to increased basic, digital and high-speed Internet revenue, partially offset by increases in programming and other operating costs and selling, general
and administrative costs. In addition, the increase in operating cash flow is also attributable to the absence of high-speed Internet service charges to @Home for the nine months ended September 30, 2003 that were previously included in the
adjustments to operating cash flow during the nine months ended September 30, 2002.



Interest expense remained relatively flat period over period. The increase of $2.6 million or 2% is primarily due to the inclusion of $5.0 million of accruals for preferred interests in accordance with SFAS No. 150, effective July 1, 2003.
Previously, the accrual was treated as a dividend below net income or loss. Additionally, the increase is related to higher outstanding debt, which averaged $2.7 billion for the nine months ended September 30, 2003, versus $2.6 billion for the nine
months ended September 30, 2002. These increases were partially offset by a decrease in interest expense due to lower interest rates, which averaged 8.0% for the nine months ended September 30, 2003, versus 8.3% for the nine months ended September
30, 2002.



Minority interest decreased $33.5 million or 130% to expense of $7.8
million from income of $25.7 million. The decrease is a direct result of the increase in net income attributable to common interests recorded by Insight Midwest primarily due to the $27.0 million gain recorded on the swap of our Griffin, GA system
for the managed Shelbyville, KY and New Albany, IN systems owned by Comcast of Montana/Indiana/Kentucky/Ohio during the first quarter of 2003, the gain on settlement of a programming contract and increased operating income partially offset by the
loss from the extinguishment of the Coaxial debt.



For the nine months ended
September 30, 2003, the net loss was $12.0 million.



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Liquidity and Capital Resources



Our business requires cash for operations, debt service, capital expenditures and acquisitions. The cable television business has
substantial on-going capital requirements for the construction, expansion and maintenance of its broadband networks. Expenditures have primarily been used to upgrade our existing cable network, and in the future will be used for network extensions,
new services, converters and network upgrades. Historically, we have been able to meet our cash requirements with cash flow from operations, borrowings under our credit facilities and issuances of private and public debt and equity.



Cash provided by operations for the nine months ended September 30, 2003 and 2002 was $171.3
million and $117.6 million. The increase was primarily attributable to the increase in accrued programming costs during the nine months ended September 30, 2003 and the timing of cash receipts and payments related to the remaining working capital
accounts.



Cash used in investing activities for the nine months ended
September 30, 2003 and 2002 was $169.7 million and $198.3 million. The decrease was primarily attributable to reduced capital spending during the nine months ended September 30, 2003 due to the near completion of our system rebuilds offset by cash
paid for the swap of our Griffin, GA system for the managed Shelbyville, KY and New Albany, IN systems owned by Comcast of Montana/Indiana/Kentucky/Ohio and the purchase of the Coaxial interests.



Cash used in financing activities for the nine months ended September 30, 2003 and 2002 was
$22.4 million and $25.6 million. The change was primarily due to the net impact of the retirement of the Ohio obligations through the refinancing of the Insight Midwest Holdings Credit Facility. We contributed $33.6 million and $14.0 million to
Insight Ohio during the nine months ended September 30, 2003 and 2002.



For the
nine months ended September 30, 2003 and 2002, we spent $131.1 million and $188.1 million in capital expenditures largely to support our plant rebuild in Illinois, which is substantially completed, telephone deployment and success-based capital,
including interactive digital and high-speed Internet expansion.



On March 28,
2002, we loaned $100.0 million to Insight Midwest, $97.0 million of which was contributed to Insight Midwest Holdings on April 18, 2002 for use in paying down the credit facility balance and in funding financing costs associated with the amendments,
and $3.0 million of which was contributed to Insight Ohio on March 28, 2002. Insight Midwest Holdings is permitted to make distributions to Insight Midwest for the purpose of repaying our loan provided that there are no defaults existing under the
credit facility. The loan to Insight Midwest bears annual interest of 9%, compounded semi-annually, has a scheduled maturity date of January 31, 2011 and permits prepayments.



On August 26, 2003 we amended the Insight Midwest Holdings Credit Facility in connection with our plan to refinance all of the obligations
and conditionally guaranteed obligations of Insight Ohio. The amendment increased the Term B loan portion of the credit facility from $900.0 million to $1.125 billion which increased the total facility size to $1.975 billion from $1.750 billion. We
recorded $2.0 million of deferred financing costs associated with this amendment that will be amortized over the remaining term of the credit facility.



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On August 29, 2003, Insight Midwest Holdings distributed $22.0 million to Insight Midwest which, in turn, contributed
this amount to Insight Ohio. Simultaneously, Insight Ohio used these proceeds plus cash on hand to repay the then outstanding balance of the Insight Ohio Credit Facility of $22.5 million plus accrued interest.



On September 29, 2003, Insight Midwest Holdings used $206.7 million of the Insight Midwest
Holdings Credit Facility to repay the outstanding principal, interest and call premiums related to the Senior Notes and Senior Discount Notes issued by Coaxial and its affiliates. Both series of notes had been conditionally guaranteed by
Insight Ohio.



We have a substantial amount of debt. Our high level of debt
could have important consequences for you. Our investments in our operating subsidiaries, including Insight Midwest, constitute substantially all of our operating assets. Consequently, our subsidiaries conduct all of our consolidated operations and
own substantially all of our operating assets. Our principal source of cash we need to pay our obligations and to repay the principal amount of our debt obligations is the cash that our subsidiaries generate from their operations and their
borrowings. Our subsidiaries are not obligated to make funds available to us and are restricted by the terms of their indebtedness from doing so. Our ability to access the cash flow of our subsidiaries may be contingent upon our ability to refinance
the debt of our subsidiaries.



We believe that the Insight Midwest Holdings
Credit Facility, cash on-hand and our cash flow from operations are sufficient to support our current operating plan. We have the ability to draw upon $325.0 million of unused availability under the Insight Midwest Holdings Credit Facility as of
September 30, 2003 to fund any shortfall resulting from the inability of Insight Midwests cash from operations to fund its capital expenditures, meet its debt service requirements or otherwise fund its operations.



The following table summarizes our contractual obligations and commitments, excluding
interest and commitments for programming, as of September 30, 2003, including periods in which the related payments are due (in thousands):



|                       |  | Long-TermDebt |           | OperatingLeases |   | Total 
|---------------------- |  | ------------- | --------- | --------------- | - | ------
|2003                   |  | $             |          |                 | $ | 1,143 
|2004                   |  |               | 62,250    |                 |   | 3,489 
|2005                   |  |               | 83,500    |                 |   | 2,842 
|2006                   |  |               | 83,500    |                 |   | 2,503 
|2007                   |  |               | 83,500    |                 |   | 2,006 
|Thereafter             |  |               | 2,582,250 |                 |   | 4,314 
|                       |  |               |           |                 |   |       
|Total cash obligations |  | $             | 2,895,000 |                 | $ | 16,297
|                       |  |               |           |                 |   |       



|Item 3. |  | Quantitative and Qualitative Disclosure About Market Risk
|------- |  | ---------------------------------------------------------



Our revolving credit and term loan agreements bear interest at floating rates. Accordingly, we are exposed to potential losses related to changes in interest rates. We do
not enter into derivatives or other financial instruments for trading or speculative purposes. In order to manage our exposure to interest



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rate risk, we enter into derivative financial instruments, typically interest rate swaps and collars. The counter-parties to our swap and collar agreements
are major financial institutions.



As of September 30, 2003, we had entered
into floating to fixed rate interest rate swaps that approximated $150.0 million, or 9%, of our borrowings under all of our credit facilities, which expires in August 2004. A hypothetical 100 basis point increase in interest rates along the entire
interest rate yield curve would increase our annual interest expense by approximately $15.0 million.



In February 2003, we entered into two interest rate swap agreements whereby we swapped fixed rates under our 101⁄2% senior notes due in December 2010 for variable rates equal to six-month LIBOR, plus the applicable
margin of approximately 7.7%, on $185.0 million notional value of debt. Six-month LIBOR ranged between 1.26% and 1.34% for February and March 2003. In May 2003, we settled these swaps and received proceeds of $1.8 million and recorded a gain in this
amount, which is included in other income.



In July 2003, we entered into three
new interest rate swap agreements whereby we swapped fixed rates under our 101⁄2% senior notes due in December 2010 for variable rates equal to six-month LIBOR, plus the applicable margin of approximately 8.4%, on $185.0 million notional value of
debt. These agreements expire November 1, 2005. We recorded a loss on these swaps of $1.2 million, which is included in other income. A hypothetical 100 basis point increase in interest rates along the entire interest rate yield curve would increase
our annual interest expense by approximately $1.9 million.



The fair market
value and carrying value of our 93⁄4% senior notes, 101⁄2% senior notes and 121⁄4% senior discount notes was $1.18 billion and $1.14 billion as of September 30, 2003. The fair market value of our credit facility borrowings approximates its
carrying value as the credit facility borrowings bear interest at floating rates of interest. As of September 30, 2003, the estimated fair value (cost if terminated) of our interest rate swap and collar agreements was approximately ($6.1) million,
which represents the amount required to enter into offsetting contracts with similar remaining maturities based on quoted market prices and is reflected in our financial statements as other non-current liabilities. Changes in the fair value of
derivative financial instruments are either recognized in income or in stockholders equity as a component of accumulated other comprehensive income (loss) depending on whether the derivative financial instruments qualify for hedge accounting.



|Item 4. |  | Controls and Procedures
|------- |  | -----------------------



Our management carried out an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure
controls and procedures as of September 30, 2003. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective to ensure that information required to be
disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission.



There has not been any change in our internal control over financial reporting
in connection with the evaluation required by Rule 13a-15(d) under the Exchange Act that occurred during the quarter ended September 30, 2003 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.



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PART II. OTHER INFORMATION



|Item 1. |  | Legal Proceedings
|------- |  | -----------------



See Note 10 to Notes to Consolidated Financial Statements.



|Item 2. |  | Changes in Securities
|------- |  | ---------------------



During the three months ended September 30, 2003, we issued 33,253 shares of Class A common stock in connection with our matching contributions to our 401(k) plan and
granted stock options to certain of our employees, directors and external consultants to purchase an aggregate of 84,000 shares of Class A common stock. The issuances of common stock and grants of stock options were not registered under the
Securities Act of 1933 because such issuances and grants either did not involve an offer or sale for purposes of Section 2(a)(3) of the Securities Act of 1933, in reliance on the fact that the matching contributions and stock options were issued and
granted for no consideration, or were offered and sold in transactions not involving a public offering, exempt from registration under the Securities Act of 1933 pursuant to Section 4(2) and in compliance with Rule 506 thereunder.



|Item 6. |  | Exhibits and Reports on Form 8-K
|------- |  | --------------------------------



(a) Exhibits:



|     | 
|---- | 
|10.1 | 
|     | 
|10.2 | 
|     | 
|10.3 | 
|     | 
|10.4 | 
|     | 
|10.5 | 
|     | 
|10.6 | 
|     | 
|10.7 | 
|     | 
|31.1 | 
|     | 
|31.2 | 
|     | 
|32   | 



(b) Reports on Form 8-K:



We filed the following report on Form 8-K during the three months ended
September 30, 2003:



| |  | On August 1, 2003, relating to and attaching our press release announcing our second quarter 2003 results (Items 7 and 12).
| | - | ---------------------------------------------------------------------------------------------------------------------------



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SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.



|Date: November 13, 2003 |  |  |  | INSIGHT COMMUNICATIONS COMPANY, INC.                                                                                              
|----------------------- |  |  |  | ----------------------------------------------------------------------------------------------------------------------------------
|                        |  | 
|                        |  |  |  | /s/    Dinesh C.
Jain                                                                                                             
|                        |  |  |  | Dinesh C. Jain Executive Vice President, Chief Operating Officer and Interim Chief Financial Officer (Principal Financial Officer)



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