Excite@Home Announces New Board and Completion of Partner Distribution Agreements, AT&T Assumes 74 Percent Voting Stake

REDWOOD CITY, Calif. and NEW YORK, Aug. 28 /PRNewswire/ -- AT&T (NYSE: T) and Excite@Home (Nasdaq: ATHM), today announced shareholder approval for the company's new board and governance structure and completion of extension contracts with AT&T, Cox Communications and Comcast. The existing Board of Directors unanimously approved the completion of each transaction. The completion of the extensions, in conjunction with the newly assigned board, reflect a common belief among Excite@Home and its cable partners that growing subscribers on high-speed cable Internet services is a key objective over the coming years.

"This paves the way for continued broadband expansion," said George Bell, chairman and CEO, Excite@Home. "We are more committed than ever to using our broadband network for the consumer and commercial deployment of broadband services. With these deals firmly in place, we are primed to take advantage of each and every broadband opportunity that is presented."

"This is all about extending the reach and accelerating the availability of the Internet," said C. Michael Armstrong, chairman and CEO of AT&T. "Working together, Excite@Home and AT&T will bring high-speed Internet services to millions of homes and businesses and seize a great growth opportunity."

Excite@Home will also convert about 50 million of AT&T's Series A shares into Series B shares, each of which has 10 votes. As a result, AT&T will have, on a fully diluted basis, approximately 25 percent of the economic interest in Excite@Home and 74 percent of the voting interest, as compared to the 24 percent economic interest and 56 percent voting interest AT&T had previously. The new governance and economic structure will be effective September 1, 2000. In connection with the new distribution agreements through 2008, AT&T will also have the right to purchase up to approximately 25 million Series A shares and 25 million Series B shares.

Excite@Home Board of Directors and Governance

The Company's new board will consist of six members designated by AT&T, four independent members and one management representative. The Excite@Home board will be chaired by George Bell, Chairman and CEO of Excite@Home and consist of the following members. The eleventh member will be named soon.

-- Mike Armstrong, Chairman & CEO, AT&T
-- Mohan Gyani, President and CEO, AT&T Wireless Services
-- Will Hearst, General Partner, Kleiner, Perkins, Caufield & Byers
-- Frank Ianna, President, AT&T Network Services
-- Tom Jermoluk, Partner, Kleiner, Perkins, Caufield & Byers
-- John Petrillo, Executive Vice President of Corporate Strategy & Business Development, AT&T
-- Ted Rogers, Chief Executive Officer, Rogers Communications Inc.
-- Rick Roscitt, President AT&T Business Services
-- Dan Somers, President and CEO, AT&T Broadband

David Woodrow, executive vice president of business development, Cox Communications; Brian L. Roberts, president of Comcast Corporation; and John Malone, Chairman, Liberty Media Group have retired from the board.

Distribution agreement specifics

Based on these agreements announced and executed in March, 2000, Excite@Home and AT&T have extended their relationship through 2008, and Comcast and Cox have extended their relationship with Excite@Home through 2006. Excite@Home's current exclusive relationships with AT&T, Cox and Comcast will continue through the currently scheduled expiration date in June 2002. Thereafter, for the remaining extension period, Excite@Home will be the provider of platform/connectivity services used by its principal cable partners in delivering their high-speed Internet services and Excite@Home's portal, Excite.com, also will be featured on the cable partners' high-speed Internet service start pages. In addition, Excite@Home will work with AT&T to deliver services to consumers via advanced TV, narrowband initiatives and wireless services, subject to negotiation with AT&T Wireless Group. Overall, these new arrangements expand Excite@Home's current business model and represent a significant opportunity for the company as it provides connectivity and content distribution services in partnership with cable companies.

Under the agreements finalized today, Comcast and Cox will each receive new warrants to purchase two Series A shares for each home its system passes. These warrants will vest in installments every six months beginning in June, 2001, and be fully vested in June, 2006, if Comcast and Cox have elected to continue their extended non-exclusive distribution agreements through that period.

Financial impact on AT&T

With the resolution of pending litigation between Excite@Home and Cablevision, AT&T will begin consolidating Excite@Home as part of its financial results in September rather than fourth quarter (October) as previously anticipated. With AT&T having voting control of the company, Excite@Home's financial results are now included in AT&T's operational EPS. This, along with the transaction's earlier closing date, adjusts AT&T's third quarter operational EPS target of $.40 - .43 by approximately 5 cents to $.35 - .38. On the same basis, restated operational earnings per share for the first and second quarters are $.48 and $.53, respectively. On an annual basis, previous operational EPS guidance of $1.75 - $1.80 will be reduced by approximately 1 to 2 cents reflecting the transaction's earlier close. Independently, Excite@Home will continue to announce its own financial results.

ABOUT AT&T

AT&T is among the world's premier voice, data, and video communications company. In addition to 70 million business and residential long-distance customers, AT&T serves over 10 million cable subscribers, nearly 12 million wireless customers, and provides Internet access to more than 2 million users. With annual revenues of more than $62 billion and 148,000 employees, AT&T provides services to customers worldwide.

ABOUT EXCITE@HOME

Excite@Home (Nasdaq: ATHM) is the leader in broadband, offering residential and commercial broadband services, with a global footprint of 105(1) million homes under long-term cable and DSL contract. Excite@Home offers consumers broadband services over cable-modem, DSL and other 'last-mile' connections and businesses high-speed commercial services. Excite@Home has over 30(1) million cable franchise homes under contract outside of North America and localized versions of the Excite service in 10 leading international markets.

(1) Effective upon the closing of Excite Chello.

Excite@Home, @Home, Excite and the "@" stylized logo are trademarks of At Home Corporation and may be registered in certain jurisdictions