FORM 10-Q

10-Q 1 d10q.htm FORM 10-Q FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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, 2002

Commission file numbers	333-33540
	333-33540-1

INSIGHT MIDWEST, L.P.
INSIGHT CAPITAL, INC.
(Exact name of registrants as specified in their charters)

Delaware		13-4079232
Delaware		13-4079679
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Nos.)

810 7^th Avenue New York, New York		10019
(Address of principal executive offices)		(Zip code)

Registrants’ telephone number, including area code: 917-286-2300

Indicate by check mark whether the registrants (1) have 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 registrants were required to file such reports) and (2) have been subject to such filing requirements for the past 90 days.

Yes

Indicate the number of shares outstanding of each of the registrants’ classes of common stock, as of the latest practicable date.

	Insight Midwest, L.P.	– Not Applicable
	Insight Capital, Inc.	– Not Applicable

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 for the year ended December 31, 2001.

INSIGHT MIDWEST L.P.
CONSOLIDATED BALANCE SHEETS
(in thousands)

		September 30, 2002			December 31, 2001

		*(unaudited)*
Assets
Cash and cash equivalents		$	4,019		$	12,146
Trade accounts receivable, net of allowance for doubtful accounts of $1,661 and $2,818 as of September 30, 2002 and December 31, 2001			17,957			22,918
Launch funds receivable			7,173			12,980
Prepaid expenses and other assets			10,962			20,647

	Total current assets		40,111			68,691
Fixed assets, net			1,167,296			1,133,627
Goodwill			15,198			15,198
Franchise costs			2,325,974			2,319,688
Deferred financing costs, net of accumulated amortization of $6,093 and $3,885 as of September 30, 2002 and December 31, 2001			23,620			23,876

	Total assets	$	3,572,199		$	3,561,080

Liabilities and partners’ capital
Accounts payable		$	21,512		$	66,712
Accrued expenses and other liabilities			18,912			21,225
Accrued property taxes			17,901			11,030
Accrued programming costs			25,568			24,287
Deferred revenue			6,713			8,673
Interest payable			39,240			21,940
Debt – current portion			3,750			—
Preferred interest distribution payable			1,750			5,250
Due to affiliates			21,342			22,040

	Total current liabilities		156,688			181,157
Deferred revenue			7,092			12,262
Debt			2,386,167			2,298,362
Other non-current liabilities			59,731			62,964

	Total liabilities		2,609,678			2,554,745
Commitments and contingencies
Preferred interests			190,220			185,713
Partners’ capital:
Partners’ accumulated capital			791,980			843,377
Accumulated other comprehensive loss			(19,679	)		(22,755	)

	Total partners’ capital		772,301			820,622

	Total liabilities and partners’ capital	$	3,572,199		$	3,561,080

See accompanying notes

INSIGHT MIDWEST, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands)

		Three months ended September 30,						Nine months ended September 30,

		2002			2001			2002			2001

Revenue		$	203,768		$	182,867		$	593,772		$	537,546
Operating costs and expenses:
	Programming and other operating costs		68,927			65,309			205,898			192,337
	Selling, general and administrative		37,855			33,415			110,561			100,721
	Management fees		6,365			5,291			17,435			15,382
	Non-recurring high-speed data service charges		—			—			4,116			—
	Depreciation and amortization		61,227			91,669			156,865			266,739

Total operating costs and expenses			174,374			195,684			494,875			575,179

Operating income (loss)			29,394			(12,817	)		98,897			(37,633	)
Other income (expense):
	Interest expense		(47,636	)		(45,666	)		(135,481	)		(140,310	)
	Interest income		36			182			134			736
	Other		36			(52	)		60			(588	)

Total other expense, net			(47,564	)		(45,536	)		(135,287	)		(140,162	)
Net loss before extraordinary item			(18,170	)		(58,353	)		(36,390	)		(177,795	)
Extraordinary loss from early extinguishment of debt			—			—			—			(10,315	)

Net loss			(18,170	)		(58,353	)		(36,390	)		(188,110	)
Accrual of preferred interests			(5,050	)		(4,848	)		(15,007	)		(14,421	)

Net loss attributable to common interests		$	(23,220	)	$	(63,201	)	$	(51,397	)	$	(202,531	)

See accompanying notes

INSIGHT MIDWEST, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)

			Nine months ended September 30,

			2002			2001

Operating activities:
Net loss			$	(36,390	)	$	(188,110	)
Adjustments to reconcile net loss to net cash provided by operating activities:
	Depreciation and amortization			156,865			266,739
	Extraordinary loss from early extinguishments of debt			—			10,315
	Provision for losses on trade accounts receivable			10,091			8,827
	Amortization of note discount			555			554
	Changes in operating assets and liabilities, net of the effects of acquisitions:
		Trade accounts receivable		(5,021	)		(14,168	)
		Launch fund receivable		5,807			8,519
		Prepaid expenses and other assets		9,714			(7,805	)
		Accounts payable		(45,200	)		4,030
		Accrued expenses and other liabilities		15,804			36,098

Net cash provided by operating activities				112,225			124,999

Investing activities:
Purchase of fixed assets				(185,660	)		(228,582	)
Purchase of intangible assets				(235	)		—
Purchase of cable television systems, net of cash acquired				(8,822	)		(61,982	)

Net cash used in investing activities				(194,717	)		(290,564	)

Financing activities:
Distributions of preferred interests				(14,000	)		(14,000	)
Proceeds from borrowings under credit facilities				86,000			1,527,000
Repayments of credit facilities				(95,000	)		(654,900	)
Borrowings from parent under inter-company loan				100,000			—
Repayment of debt in connection with cable system transactions				—			(659,165	)
Principal payments on capital leases and other non-current liabilities				(683	)		(46	)
Debt issuance costs				(1,952	)		(11,202	)

Net cash provided by financing activities				74,365			187,687

Net increase (decrease) in cash and cash equivalents				(8,127	)		22,122
Cash and cash equivalents, beginning of period				12,146			5,735

Cash and cash equivalents, end of period			$	4,019		$	27,857

See accompanying notes

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Basis of Presentation

We were formed in September 1999 to serve as the holding company and a financing vehicle for Insight Communications Company, Inc.’s (“Insight Inc.”) cable television system joint venture with AT&T Broadband, LLC (“AT&T Broadband”). We are owned 50% by Insight Communications Company, L.P. (“Insight LP”), which is wholly owned by Insight Inc., and 50% by AT&T Broadband, through its indirect subsidiary TCI of Indiana Holdings, LLC (“TCI”).

AT&T Broadband has agreed with Comcast Corporation to merge their respective cable systems and certain other assets into a new combined company to be known as AT&T Comcast Corporation. The transaction will not result in any direct change in our ownership structure, and upon its completion Insight LP will continue to serve as the general partner of us and as the manager of all of our systems.

Through our wholly owned subsidiaries Insight Communications of Central Ohio, LLC (“Insight Ohio”) and Insight Midwest Holdings, LLC (“Insight Midwest Holdings”), which wholly owns Insight Communications Midwest, LLC (“Insight Communications Midwest”) and Insight Communications of Kentucky, L.P. (“Insight Kentucky”), we own and operate cable television systems in Indiana, Kentucky, Ohio, Illinois and Georgia which passed approximately 2.2 million homes and served approximately 1.3 million customers as of September 30, 2002. Insight LP is our general partner and effectively controls all our operating and financial decisions.

The accompanying consolidated financial statements include the accounts of Insight Ohio and Insight Midwest Holdings.

On September 30, 2002, Insight Communications Midwest signed an agreement with InterMedia Partners Southeast (“IPSE”), an affiliate of AT&T Broadband, to exchange its Griffin, Georgia cable television systems, including approximately 13,000 customers, plus $25.0 million for certain cable television systems currently managed by Insight LP located in New Albany, Indiana and Shelbyville, Kentucky, together including approximately 23,000 customers. Additionally, pursuant to the agreement, Insight Communications Midwest will receive a closing credit equal to the amount by which its out-of-pocket costs for the rebuild and upgrade of the Griffin, Georgia system exceeds $7.1 million or, alternatively, IPSE will receive a credit for the amount by which such costs are less than $7.1 million.

This system exchange, which is tentatively scheduled to close in the first quarter of 2003 or earlier, subject to regulatory approval, will be accounted for as a sale of Insight Communications Midwest’s Griffin, Georgia systems and a purchase of the New Albany, Indiana and Shelbyville, Kentucky systems. In connection with this system exchange, Insight Communications Midwest will record a gain or loss equal to the difference between the fair value and carrying value of the Griffin, Georgia systems on the closing date. The purchase price of the New Albany, Indiana and Shelbyville, Kentucky systems will be allocated to such cable television systems’ assets acquired in relation to their fair values with any excess being allocated to franchise costs.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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, except as described in Note 9. 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 for the year ended December 31, 2001.

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 nine months ended September 30, 2002 are not necessarily indicative of the results to be expected for the year ending December 31, 2002 or any other interim period.

3. Recent Accounting Pronouncements

In May 2002, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 145, “Rescission of FASB Statements No. 4, 44, and 62, Amendment of FASB Statement No. 13, and Technical Corrections”. SFAS No. 145 eliminates the requirement under SFAS No. 4, “Reporting Gains and Losses from Extinguishment of Debt”, to report gains and losses from extinguishments of debt as extraordinary items in the income statement. Accordingly, gains or losses from extinguishments of debt for fiscal years beginning after May 15, 2002 shall not be reported as extraordinary items unless the extinguishment qualifies as an extraordinary item under the provisions of APB Opinion No. 30, “Reporting the Results of Operations – Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions”. Upon adoption of this pronouncement, any gain or loss on extinguishment of debt previously classified as an extraordinary item in prior periods presented that does not meet the criteria of APB Opinion No. 30 for such classification should be reclassified to conform with the provisions of SFAS No. 145. Accordingly, upon adoption of this pronouncement on January 1, 2003, we expect to reclassify a loss from early extinguishment of debt of $10.3 million recorded during the three months ended March 31, 2001, to results from continuing operations.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4. Accounting for Franchise Fees

Under our franchise agreements, we are obligated to pay to local franchising authorities up to 5% of our gross revenue derived from providing cable and other services the majority of which are passed through to customers. We have historically recorded revenue net of franchise fees charged to our customers. Staff announcement D-103, issued by the FASB in November 2001, specifies that reimbursements received from a customer should be reflected as revenues and not as a reduction of expenses. This staff announcement applies to financial reporting periods beginning after December 15, 2001. Upon application of this staff announcement, comparative financial statements for prior periods are required to be reclassified to comply with the guidance in this staff announcement. Consequently, we have reclassified the amounts in the prior period accompanying consolidated statements of operations to reflect franchise fees on a gross basis with reimbursements as revenue and payments as expense. The effect on the prior period statements of operations was to increase both revenue and selling, general and administrative costs by $6.1 million for the three months ended September 30, 2001 and $17.7 million for the nine months ended September 30, 2001.

In addition, certain other prior period amounts have been reclassified to conform to the current period presentation.

5. Long-Lived Assets

Fixed assets consisted of:

	September 30, 2002			December 31, 2001

	*(in thousands)*
Land, buildings and improvements	$	32,117		$	31,233
Cable system equipment		1,741,733			1,555,244
Furniture, fixtures and office equipment		14,504			13,893

		1,788,354			1,600,370
Less accumulated depreciation and amortization		(621,058	)		(466,743	)

Total fixed assets, net	$	1,167,296		$	1,133,627

In July 2001, the FASB issued SFAS No. 142, “Goodwill and Other Intangible Assets,” which became effective for us beginning January 1, 2002 and changed the accounting for goodwill and franchise costs from an amortization method to an impairment only approach. In addition, the standard includes provisions, upon adoption, for the reclassification of certain existing recognized intangibles to goodwill and franchise costs, reassessment of the useful lives of existing recognized intangibles, reclassification of certain intangibles out of previously reported goodwill and franchise costs and the testing for impairment of existing goodwill and franchise costs.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5. Long-Lived Assets (continued)

SFAS No. 142 requires that goodwill and franchise costs be tested annually for impairment using a two-step process. The first step is to identify a potential impairment that, in transition, was performed as of January 1, 2002. The second step of the transitional impairment test measures the amount of the impairment loss, if any, and must be completed by December 31, 2002. Based on our analysis, there was no impairment of goodwill or franchise costs upon the adoption of SFAS No. 142 on January 1, 2002. We will be performing this two-step annual impairment test on October 1 of each succeeding year beginning with October 1, 2002.

Applying the effects of the adoption of SFAS No. 142 to the three and nine month periods ended September 30, 2001, would have resulted in loss before extraordinary items of $(10.6) million and $(34.5) million and net loss of $(10.6) million and $(44.8) million. The reconciliation of reported net loss to pro forma net loss adjusted for the effects of SFAS No. 142 for the three and nine months ended September 30, 2001 is as follows (in thousands):

		Three Months Ended September 30, 2001			Nine Months Ended September 30, 2001

Net loss as reported		$	(58,353	)	$	(188,110	)
Less amortization for:
	Franchise costs		42,111			126,333
	Goodwill		5,664			16,992

Pro forma net loss		$	(10,578	)	$	(44,785	)

In August 2001, the FASB issued SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” which became effective for us beginning January 1, 2002. SFAS No. 144 supersedes FASB Statement No. 121, “Accounting for the Impairment or Disposal of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of,” and the accounting and reporting provisions relating to the disposal of a segment of a business of Accounting Principles Board Opinion No. 30. The adoption of SFAS No. 144 had no impact on our consolidated financial position or results of operations.

We recorded amortization expense of $210,000 and $2.8 million for the three and nine months ended September 30, 2002 and $48.4 million and $145.3 million for the three and nine months ended September 30, 2001. We estimate aggregate amortization expense to be approximately $3.0 million for each of the five succeeding fiscal years.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. Debt

Debt consisted of:

		September 30, 2002			December 31, 2001

		*(in thousands)*
Insight Ohio Credit Facility		$	25,000		$	25,000
Note Payable to Insight Inc.			100,000			—
Insight Midwest Holdings Credit Facility			1,571,000			1,580,000
Insight Midwest 9¾% Senior Notes			200,000			200,000
Insight Midwest 10½% Senior Notes			500,000			500,000

			2,396,000			2,305,000
Less unamortized discount on notes			(6,083	)		(6,638	)

	Total debt	$	2,389,917		$	2,298,362

Insight Midwest Holdings Credit Facility

Insight Midwest Holdings is party to a $1.75 billion credit facility. On March 25, 2002, we formally requested approval from the lenders of amendments to the leverage ratio covenant to allow Insight Midwest Holdings more flexibility and to increase the aggregate amount that can be distributed to us for the purpose of making investments in Insight Ohio. In addition, on March 28, 2002, we borrowed $100.0 million from Insight Inc. to lower its effective interest rates, $97.0 million of which was contributed to Insight Midwest Holdings 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 on March 28, 2002. Pursuant to the credit facility amendments, Insight Midwest Holdings is permitted to make distributions to us for the purpose of repaying this loan provided that the leverage ratio is less than 4.25 and there are no defaults existing under the credit facility. This loan bears annual interest of 9%, has a scheduled maturity date of January 31, 2011 and permits prepayments. On April 18, 2002, the lenders approved these amendments to the credit facility.

On June 6, 2002, a further amendment to the credit facility was entered into which permits distributions by Insight Midwest Holdings to us for the purpose of repaying the $100.0 million loan from Insight Inc., without regard to the minimum leverage ratio requirement. This amendment will become effective if, by no later than December 31, 2002, we complete a debt offering of at least $175.0 million and contribute the proceeds to Insight Midwest Holdings.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. Debt (continued)

Debt Principal Payments

As of September 30, 2002, principal payments required on our debt were as follows (in thousands):

2002		$	—
2003			5,000
2004			80,000
2005			81,250
2006			97,750
Thereafter			2,132,000

	Total	$	2,396,000

Interest Rate Swap and Collar Agreements

We enter into interest-rate swap and collar agreements to modify the interest characteristics of our outstanding debt from a floating rate to a fixed rate basis. These agreements involve the payment of fixed rate amounts in exchange for floating 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.

As of September 30, 2002 and December 31, 2001, we had entered into various interest rate swap and collar agreements with a fair value of $19.7 million and $22.8 million, included in other liabilities, effectively fixing interest rates between 4.7% and 5.9%, plus the applicable margin, on $435.0 million and $500.0 million notional value of debt. Of the agreements outstanding as of September 30, 2002, $285.0 million expire in July 2003 and $150.0 million expire in August 2004. As of September 30, 2002, we had $2.5 million of accrued interest related to these agreements.

7. Comprehensive Loss

Comprehensive loss totaled $20.0 million and $33.3 million for the three and nine months ended September 30, 2002 and $70.8 million and $215.0 million for the three and nine months ended September 30, 2001. Comprehensive loss for the nine months ended September 30, 2001 included a $1.9 million transition adjustment loss representing the cumulative effect of adopting SFAS No. 133. We record the effective portion of interest rate swaps’ gains or losses as accumulated other comprehensive income or loss in the accompanying consolidated balance sheets.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

8. Related Party Transactions

Programming

We purchase substantially all of our pay television and other programming from affiliates of AT&T Broadband. Charges for such programming, including a 1½% administrative fee, were $33.1 million and $97.3 million for the three and nine months ended September 30, 2002 and $26.5 million and $81.6 million for the three and nine months ended September 30, 2001. As of September 30, 2002 and December 31, 2001, $11.1 million and $10.3 million of accrued programming costs were due to affiliates of AT&T Broadband. We believe that the programming rates charged by the affiliates of AT&T Broadband are lower than those available from independent parties.

Telephony Agreements

In July 2000, to facilitate delivery of telephone services, we entered into a ten-year agreement with AT&T Broadband that allows us to deliver to our customers local telephone service under the AT&T Digital Phone brand. Under the terms of the agreement, we lease for a fee certain capacity on our network to AT&T Broadband. We provide certain services and support for which we receive additional payments. We began providing telephony services to a limited number of our customers in 2001. Revenue related to telephony services was $624,000 and $1.2 million for the three and nine months ended September 30, 2002 and $53,000 and $58,000 for the three and nine months ended September 30, 2001. The capital required to deploy telephone services over our networks is shared, with AT&T Broadband responsible for switching and transport facilities. AT&T also pays us for installations, marketing and billing support that amounted to $2.0 million and $4.8 million for the three and nine months ended September 30, 2002 and $458,000 and $631,000 for the three and nine months ended September 30, 2001.

Advertising Services

In October 1999, to facilitate the administration of our advertising services in our Kentucky Systems, we entered into an agreement expiring on January 1, 2004 with TCI Media Services LLC (“TCI Media Services”), a subsidiary of AT&T Corp., which provides for TCI Media Services to perform all of our Kentucky advertising sale and related administrative services. We recorded advertising revenues from TCI Media Services derived from our Kentucky Systems of $3.7 million and $10.8 million for the three and nine months ended September 30, 2002 and $3.3 million and $8.8 million for the three and nine months ended September 30, 2001. As of September 30, 2002 and December 31, 2001, we had $6.5 million and $6.9 million recorded as a receivable due from TCI Media Services included in other current assets. We pay TCI Media Services a fixed and variable fee for providing this service based on advertising sales cash flow growth. As of September 30, 2002 and December 31, 2001, we had $291,000 and $666,000 recorded as payables to TCI Media Services related to such services.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9. At Home Corporation

Non-recurring high-speed data 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 data 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 non-recurring high-speed data 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

Insight Kentucky and certain prior owners of the Kentucky Systems have been named in class actions regarding the pass-through of state and local property tax charges to approximately 320,000 customers by the prior owners of the Kentucky Systems. The plaintiffs seek monetary damages and the enjoinment of the collection of such taxes. We have entered into agreements with the plaintiffs to settle these lawsuits. Such settlement agreements have been preliminarily approved by the courts and are subject to a determination of fairness and final court approval. The settlements will not have a material effect on our results of operations or cash flows.

Additionally, we have filed a state court action against the City of Louisville for its grant of a more favorable franchise to Knology, Inc. (“Knology”). Our commencement of this action automatically suspended this franchise pending a court determination. 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 from the City, the state court action. In March 2001, the federal court preliminarily set aside the state court suspension of Knology’s franchise. We believe we have substantial and meritorious defenses to the asserted federal claims and intend to defend it vigorously. Consequently, we have not recorded any loss reserves in the accompanying financial statements.

INSIGHT MIDWEST, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10. Commitments and Contingencies (continued)

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.

INSIGHT CAPITAL, INC.,
BALANCE SHEETS
(in thousands)

		September 30, 2002			December 31, 2001

		*(unaudited)*
Assets
Cash		$	1		$	1
Deferred financing costs, net			10,906			12,004

	Total assets	$	10,907		$	12,005

Liabilities and shareholders’ deficit
Accrued interest		$	31,625		$	13,625

	Total current liabilities		31,625			13,625
Senior notes, to be paid by Insight Midwest, LP			693,917			693,362

	Total liabilities		725,542			706,987
Shareholders’ deficit:
Common stock; $.01 par value; 1,000 shares authorized, issued and outstanding			—			—
Paid-in-capital			1			1
In-substance allocation of proceeds related to senior notes to be paid by Insight Midwest			(550,430	)		(586,430	)
Accumulated deficit			(164,206	)		(108,553	)

	Total shareholders’ deficit		(714,635	)		(694,982	)

	Total liabilities and shareholders’ deficit	$	10,907		$	12,005

See accompanying notes

INSIGHT CAPITAL, INC.
STATEMENTS OF OPERATIONS
(unaudited)
(in thousands)

		Three months ended September 30,						Nine months ended September 30,

		2002			2001			2002			2001

Expenses:
Amortization		$	(366	)	$	(366	)	$	(1,098	)	$	(1,098	)
Interest expense			(18,185	)		(18,185	)		(54,555	)		(54,555	)

	Net loss	$	(18,551	)	$	(18,551	)	$	(55,653	)	$	(55,653	)

See accompanying notes

INSIGHT CAPITAL, INC.
STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)

		Nine months ended September 30,

		2002			2001

Cash flows from operating activities:
Net loss		$	(55,653	)	$	(55,653	)
Adjustments to reconcile net loss to net cash provided by operating activities:
	Amortization		1,098			1,098
	Interest expense assumed by affiliate		54,555			54,555

Net cash provided by operating activities			—			—

Net increase in cash			—			—
Cash, beginning of period			1			1

Cash, end of period		$	1		$	1

See accompanying notes

INSIGHT CAPITAL, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of Business

Insight Capital, Inc. (the “Company”), a Delaware corporation, was formed on September 23, 1999, for the sole purpose of being a co-issuer with Insight Midwest, L.P. (“Insight Midwest”) of senior notes which allows certain investors the ability to be holders of the debt. The Company has no operations. The outstanding shares of the Company are owned by Insight Midwest.

2. Responsibility for Interim Financial Statements

The accompanying unaudited financial statements of the Company 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 States for complete financial statements.

In management’s opinion, the financial statements reflect all adjustments considered necessary for a fair statement of the financial position as of the interim dates presented. These unaudited interim financial statements should be read in conjunction with the audited financial statements and notes to financial statements contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2001.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the Company 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. Actual results could differ from those estimates.

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 for the year ended December 31, 2001, 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

A substantial portion of our 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 data and telephone services as well as from commissions for products sold through home shopping networks.

administrative costs by $6.1 million for the three months ended September 30, 2001 and $17.7 million for the nine months ended September 30, 2001.

Some of the principal reasons for our net losses through December 31, 2001 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.

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 (in thousands):

					Three Months Ended September 30,						Nine Months Ended September 30,

					2002			2001			2002			2001

Revenue					$	203,768		$	182,867		$	593,772		$	537,546
Operating costs and expenses:
				Programming and other operating costs		68,927			65,309			205,898			192,337
				Selling, general and administrative		37,855			33,415			110,561			100,721
			Management fees			6,365			5,291			17,435			15,382
		Non-recurring high-speed data charges				—			—			4,116			—
	Depreciation and amortization					61,227			91,669			156,865			266,739

Total operating costs and expenses						174,374			195,684			494,875			575,179

Operating income (loss)						29,394			(12,817	)		98,897			(37,633	)
Operating cash flow						90,621			78,852			259,878			229,106
Interest expense						(47,636	)		(45,666	)		(135,481	)		(140,310	)
Net loss						(18,170	)		(58,353	)		(36,390	)		(188,110	)
Net cash provided by operating activities						65,548			46,707			112,225			124,999
Net cash used in investing activities						65,653			83,120			194,717			290,564
Net cash provided by financing activities						2,703			52,954			74,365			187,687

Operating Cash Flow (“OCF”) represents earnings before interest, taxes, depreciation and amortization, other income and expense, non-recurring high-speed data costs and extraordinary items. We believe that OCF is commonly used in the cable television industry to analyze and compare cable television companies on the basis of operating performance, leverage and liquidity. However, OCF is not intended to be a performance measure that should 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 determined in accordance with accounting principles generally accepted in the United States. Refer to our consolidated financial statements, including our consolidated statements of cash flows, which appear elsewhere in this report.

The following calculations of OCF (in thousands) are not necessarily comparable to similarly titled amounts of other companies:

						Three Months Ended September 30,						Nine Months Ended September 30,

						2002			2001			2002			2001

Net loss						$	(18,170	)	$	(58,353	)	$	(36,390	)	$	(188,110	)
Adjustments:
					Interest expense		47,636			45,666			135,481			140,310
					Interest income		(36	)		(182	)		(134	)		(736	)
				Depreciation and amortization			61,227			91,669			156,865			266,739
			Other (income) expense				(36	)		52			(60	)		588
		Non-recurring high-speed data costs					—			—			4,116			—
	Extraordinary loss from early extinguishment of debt						—			—			—			10,315

Operating cash flow						$	90,621		$	78,852		$	259,878		$	229,106

Three Months Ended September 30, 2002 Compared to Three Months Ended September 30, 2001

Revenue increased $20.9 million or 11.4% to $203.8 million for the three months ended September 30, 2002, from $182.9 million for the three months ended September 30, 2001. The increase in revenue was primarily the result of gains in our high-speed data and digital services with revenue increases over the prior year’s quarter of 57.0% and 36.2%. In addition, our basic cable service revenue increased primarily due to basic cable rate increases.

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

	2002 Revenue by Service Offering		% of Total Revenue			2001 Revenue by Service Offering		% of Total Revenue

Basic	$	128,777		63.2	%	$	119,346		65.3	%
Digital		16,466		8.1	%		12,085		6.6	%
High-speed data		15,488		7.6	%		9,863		5.4	%
Premium		14,335		7.0	%		14,173		7.7	%
Analog pay-per-view		256		0.1	%		873		0.5	%
Advertising		13,007		6.4	%		11,742		6.4	%
Franchise fees		6,550		3.2	%		6,073		3.3	%
Other		8,889		4.4	%		8,712		4.8	%

Total	$	203,768		100.0	%	$	182,867		100.0	%

RGUs (Revenue Generating Units) were approximately 1,753,600 as of September 30, 2002 compared to approximately 1,602,300 as of September 30, 2001 on a same-store basis. This represents an annualized growth rate of 9.4%. RGUs represent the sum of basic, digital, high-speed data, and telephone customers.

Average monthly revenue per basic customer was $52.65 for the three months ended September 30, 2002, compared to $47.89 for the three months ended September 30, 2001 primarily reflecting the continued successful rollout of new product offerings in all markets. Average monthly revenue per basic customer for high-speed data and digital service increased to $8.25 for the three months ended September 30, 2002, up from $5.75 for the three months ended September 30, 2001.

Programming and other operating costs increased $3.6 million or 5.5% to $68.9 million for the three months ended September 30, 2002, from $65.3 million for the three months ended September 30, 2001. The increase in programming and other operating costs was primarily the result of increased programming rates for our classic and digital service as well as for additional programming added in rebuilt systems. Programming costs increased 10.5% for the three months ended September 30, 2002 from the three months ended September 30, 2001.

Selling, general and administrative expenses increased $4.4 million or 13.3% to $37.9 million for the three months ended September 30, 2002, from $33.4 million for the three months ended September 30, 2001. The increase in selling, general and administrative expenses was primarily the result of increased customer service and insurance partially offset by a decrease in marketing costs.

Management fees increased $1.1 million or 20.3% to $6.4 million for the three months ended September 30, 2002, from $5.3 million for the three months ended September 30, 2001. Management fees equal to approximately 3% of revenues are paid to Insight LP.

Depreciation and amortization expense decreased $30.4 million or 33.2% to $61.2 million for the three months ended September 30, 2002, from $91.7 million for the three months ended September 30, 2001.

The decrease in depreciation and amortization expense was primarily the result of ceasing the amortization of goodwill and indefinite lived intangible assets associated with the adoption of SFAS No. 142, effective January 1, 2002. This was partially offset by an approximate $9.0 million write-down of the carrying value of current video-on-demand equipment, which is being replaced on or about December 31, 2002 in connection with our transition to a new video-on-demand service provider.

OCF increased $11.8 million or 14.9% to $90.6 million for the three months ended September 30, 2002, from $78.9 million for the three months ended September 30, 2001. This increase was due primarily to increased digital and high-speed data revenue, partially offset by increases in programming and other operating costs and selling, general and administrative costs.

Interest expense increased $2.0 million or 4.3% to $47.6 million for the three months ended September 30, 2002, from $45.7 million for the three months ended September 30, 2001. The increase was the result of higher outstanding debt, which averaged $2.4 billion for the three months ended September 30, 2002, versus $2.2 billion for the three months ended September 30, 2001.

For the three months ended September 30, 2002, the net loss was $18.2 million.

Nine Months Ended September 30, 2002 Compared to Nine Months Ended September 30, 2001

Revenue increased $56.2 million or 10.5% to $593.8 million for the nine months ended September 30, 2002, from $537.5 million for the nine months ended September 30, 2001. The increase in revenue was primarily the result of gains in our high-speed data and digital services with revenue increases over the prior year’s period of 66.1% and 46.1%. In addition, our basic cable service revenue increased primarily due to basic cable rate increases.

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

	2002 Revenue by Service Offering		% of Total Revenue			2001 Revenue by Service Offering		% of Total Revenue

Basic	$	376,116		63.3	%	$	354,289		65.9	%
Digital		48,447		8.2	%		33,160		6.2	%
High-speed data		41,220		6.9	%		24,810		4.6	%
Premium		44,388		7.5	%		43,579		8.1	%
Analog pay-per-view		1,217		0.2	%		3,405		0.6	%
Advertising		37,831		6.4	%		33,471		6.2	%
Franchise fees		19,102		3.2	%		17,698		3.3	%
Other		25,451		4.3	%		27,134		5.1	%

Total	$	593,772		100.0	%	$	537,546		100.0	%

Average monthly revenue per basic customer was $51.04 for the three months ended September 30, 2002, compared to $46.78 for the three months ended September 30, 2001 primarily reflecting the continued successful rollout of new product offerings in all markets. Average monthly revenue per basic customer for high-speed data and digital service increased to $7.70 for the nine months ended September 30, 2002, up from $5.05 for the nine months ended September 30, 2001.

Programming and other operating costs increased $13.6 million or 7.1% to $205.9 million for the nine months ended September 30, 2002, from $192.3 million for the nine months ended September 30, 2001. The increase in programming and other operating costs was primarily the result of increased programming rates for our classic and digital service as well as for additional programming added in rebuilt systems. Programming costs increased 11.5% for the nine months ended September 30, 2002 from the nine months ended September 30, 2001.

Selling, general and administrative expenses increased $9.8 million or 9.8% to $110.6 million for the nine months ended September 30, 2002, from $100.7 million for the nine months ended September 30, 2001. The increase in selling, general and administrative expenses was primarily the result of increased customer service and insurance partially offset by a decrease in marketing costs.

Management fees increased $2.1 million or 13.3% to $17.4 million for the three months ended September 30, 2002, from $15.4 million for the three months ended September 30, 2001. Management fees equal to approximately 3% of revenues are paid to Insight LP.

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 decreased $109.9 million or 41.2% to $156.9 million for the nine months ended September 30, 2002, from $266.7 million for the nine months ended September 30, 2001. The decrease in depreciation and amortization expense was primarily the result of ceasing the amortization of goodwill and indefinite lived intangible assets associated with the adoption of SFAS No. 142, effective January 1, 2002. This was partially offset by an approximate $9.0 million write-down of the carrying value of current video-on-demand equipment, which is being replaced on or about December 31, 2002 in connection with our transition to a new video-on-demand service provider.

OCF increased $30.8 million or 13.4% to $259.9 million for the nine months ended September 30, 2002, from $229.1 million for the nine months ended September 30, 2001. This increase was due primarily to increased digital and high-speed data revenue, partially offset by increases in programming and other operating costs and selling, general and administrative costs.

Interest expense decreased $4.8 million or 3.4% to $135.5 million for the nine months ended September 30, 2002, from $140.3 million for the nine months ended September 30, 2001. The decrease was the result of lower interest rates, which averaged 7.7% for the nine months ended September 30, 2002, versus 9.5% for the nine months ended September 30, 2001. Partially offsetting this decrease was higher outstanding debt, which averaged $2.3 billion for the nine months ended September 30, 2002, from $2.0 billion for the nine months ended September 30, 2001.

For the nine months ended September 30, 2002, the net loss was $36.4 million.

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.

Cash provided by operations for the nine months ended September 30, 2002 and 2001 was $112.2 million and $125.0 million.

Cash used in investing activities for the nine months ended September 30, 2002 and 2001 was $194.7 million and $290.6 million. The decrease was primarily attributable to the absence of significant acquisitions of cable television systems and reduced capital expenditures in 2002.

Cash provided by financing activities for the nine months ended September 30, 2002 and 2001 was $74.4 million and $187.7 million. The change was primarily attributable to lower net borrowings from our credit facility.

For the nine months ended September 30, 2002 and 2001, we spent $185.7 million and $228.6 million in capital expenditures largely to support our plant rebuild in Illinois which is estimated to be substantially completed by year-end, telephone deployment and success-based capital including interactive digital and high-speed data expansion.

On April 18, 2002, we entered into an amendment to the Insight Midwest Holdings credit facility which delayed by six months the scheduled reduction to the leverage ratio covenant to allow Insight Midwest Holdings more financing flexibility, and increased the aggregate amount that can be distributed to us for the purpose of making investments in Insight Ohio. Previously, on March 28, 2002, Insight Inc. loaned $100.0 million to us to lower its effective interest rates, $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. Pursuant to the credit facility amendments, Insight Midwest Holdings is permitted to make distributions to us for the purpose of repaying this loan provided that the leverage ratio is less than 4.25 to 1.0 and there are no defaults existing under the credit facility. This loan bears annual interest of 9%, has a scheduled maturity date of January 31, 2011 and permits prepayments.

We have a substantial amount of debt. Our high level of debt could have important consequences for you. 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. We believe that the 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 the $179.0 million of unused availability under the Midwest Holdings Credit Facility as of September 30, 2002 to fund any shortfall resulting from the inability of our cash from operations to fund our capital expenditures, meet our debt service requirements or otherwise fund our operations.

The following table summarizes our contractual obligations and commitments, excluding interest, preferred dividends and commitments for programming, as of September 30, 2002, including periods in which the related payments are due (in thousands):

		Long-Term Debt		Preferred Interests		Operating Leases		Total

2002		$	—	$	—	$	732	$	732
2003			5,000		—		2,439		7,439
2004			80,000		—		1,800		81,800
2005			81,250		—		1,187		82,437
2006			97,750		140,000		895		238,645
Thereafter			2,132,000		55,869		1,304		2,189,173

	Total cash obligations	$	2,396,000	$	195,869	$	8,357	$	2,600,226

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 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, 2002, $285.0 million of our interest rate swap and collar agreements expire in July 2003 and $150.0 million expire in August 2004.

The fair market value and carrying value of our 9¾% and 10½% senior notes was $619.0 million and $693.9 million as of September 30, 2002. 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, 2002, the estimated fair value (cost if terminated) of our interest rate swap and collar agreements was approximately $(19.7) 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 partners’ capital as a component of other comprehensive loss depending on whether the derivative financial instruments qualify for hedge accounting.

As of September 30, 2002, we had entered into interest rate swaps that approximated $435.0 million, or 27.3%, of our borrowings under all of our credit facilities. A hypothetical 100 basis point increase in interest rates along the entire interest rate yield curve would increase our annual interest expense by approximately $11.6 million.

Item 4. Controls and Procedures

Within the 90 days prior to the date of this report, under the supervision and with the participation of Insight Midwest, L.P.’s (“Insight Midwest”) management, including its Chief Executive Officer and its Chief Financial Officer, Insight Midwest’s management has evaluated the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, Insight Midwest’s Chief Executive Officer and its Chief Financial Officer have concluded that Insight Midwest’s disclosure controls and procedures are effective in timely alerting them to material information relating to Insight Midwest (including its consolidated subsidiaries) required to be included in Insight Midwest’s periodic SEC filings. There have been no significant changes in Insight Midwest’s internal controls or in other factors that could significantly affect internal controls subsequent to the date of their evaluation.

Within the 90 days prior to the date of this report, under the supervision and with the participation of Insight Capital, Inc.’s (“Insight Capital”) management, including its Chief Executive Officer and its Chief Financial Officer, Insight Capital’s management has evaluated the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, Insight Capital’s Chief Executive Officer and its Chief Financial Officer have concluded that Insight Capital’s disclosure controls and procedures are effective in timely alerting them to material information relating to Insight Capital (including its consolidated subsidiaries) required to be included in Insight Capital’s periodic SEC filings. There have been no significant changes in Insight Capital’s internal controls or in other factors that could significantly affect internal controls subsequent to the date of their evaluation.

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits:

	10.1	Asset Exchange Agreement, dated September 30, 2002, between InterMedia Partners Southeast and Insight Communications Midwest, LLC (Filed as an Exhibit to the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002 of Insight Communications Company, Inc. and incorporated herein by reference.)

	10.2	First Amendment to Amended and Restated Limited Partnership of Insight Midwest, L.P., dated September 30, 2002 (Filed as an Exhibit to the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2002 of Insight Communications Company, Inc. and incorporated herein by reference.)

(b) Reports on Form 8-K:

None

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 14, 2002	INSIGHT MIDWEST, L.P.


	By:	/s/ Dinesh C. Jain

		Dinesh C. Jain Senior Vice President and Chief Financial Officer (Principal Financial Officer)

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.

	INSIGHT CAPITAL, INC.


	By:	/s/ Dinesh C. Jain

		Dinesh C. Jain Senior Vice President and Chief Financial Officer (Principal Financial Officer)

CERTIFICATIONS

I, Kim D. Kelly, certify that:

	1)	I have reviewed this quarterly report on Form 10-Q of Insight Midwest, L.P. (the “registrant”);

	2)	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

	3)	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

	4)	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for The registrant and we have:

		a)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

		b)	evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

		c)	presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5)	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

		a)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

		b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6)	The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

	/s/ KIM D. KELLY

	Kim D. Kelly President and Chief Executive Officer Insight Midwest, L.P. November 14, 2002

I, Dinesh C. Jain, certify that:

1)	I have reviewed this quarterly report on Form 10-Q of Insight Midwest, L.P. (the “registrant”);

2)	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3)	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4)	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

		a)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

		b)	evaluated the effectiveness of the registrant disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report; and

		c)	presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5)	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

		a)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

		b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6)	The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

	/s/ DINESH C. JAIN

	Dinesh C. Jain Senior Vice President and Chief Financial Officer Insight Midwest, L.P. November 14, 2002

I, Kim D. Kelly, certify that:

1)	I have reviewed this quarterly report on Form 10-Q of Insight Capital, Inc. (the “registrant”);

2)	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3)	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4)	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

		a)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

		b)	evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

		c)	presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5)	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

		d)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

		e)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6)	The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

	/s/ KIM D. KELLY

	Kim D. Kelly President and Chief Executive Officer Insight Capital, Inc. November 14, 2002

I, Dinesh C. Jain, certify that:

1)	I have reviewed this quarterly report on Form 10-Q of Insight Capital, Inc. (the “registrant”);

2)	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3)	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4)	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

		d)	designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

		e)	evaluated the effectiveness of the registrant disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report; and

		f)	presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5)	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

		c)	all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

		d)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

	/s/ DINESH C. JAIN

	Dinesh C. Jain Senior Vice President and Chief Financial Officer Insight Capital, Inc. November 14, 2002

CERTIFICATION OF CHIEF EXECUTIVE OFFICER UNDER
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Kim D. Kelly, hereby certify that the quarterly report on Form 10-Q of Insight Midwest, L.P. (the “registrant”) for the quarter ended September 30, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.

	/s/ KIM D. KELLY

	Kim D. Kelly President and Chief Executive Officer Insight Midwest, L.P. November 14, 2002

CERTIFICATION OF CHIEF FINANCIAL OFFICER UNDER
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Dinesh C. Jain, hereby certify that the quarterly report on Form 10-Q of Insight Midwest, L.P. (the “registrant”) for the quarter ended September 30, 2002, as filed with the Securities and Exchange Commission on the date hereof fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.

	/s/ DINESH C. JAIN

	Dinesh C. Jain Senior Vice President and Chief Financial Officer Insight Midwest, L.P. November 14, 2002

CERTIFICATION OF CHIEF EXECUTIVE OFFICER UNDER
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Kim D. Kelly, hereby certify that the quarterly report on Form 10-Q of Insight Capital, Inc. (the “registrant”) for the quarter ended September 30, 2002, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.

	/s/ KIM D. KELLY

	Kim D. Kelly President and Chief Executive Officer Insight Capital, Inc. November 14, 2002

CERTIFICATION OF CHIEF FINANCIAL OFFICER UNDER
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Dinesh C. Jain, hereby certify that the quarterly report on Form 10-Q of Insight Capital, Inc. (the “registrant”) for the quarter ended September 30, 2002, as filed with the Securities and Exchange Commission on the date hereof fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.

	/s/ DINESH C. JAIN

	Dinesh C. Jain Senior Vice President and Chief Financial Officer Insight Capital, Inc. November 14, 2002