UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities
Exchange
Act of 1934 (Amendment No. ___)
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Preliminary
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Confidential,
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material Pursuant to §240.14a-12
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THE
WASHINGTON POST COMPANY
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(Name
of Registrant as Specified In Its Charter)
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(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
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THE WASHINGTON POST
COMPANY
1150 15th Street, NW, Washington, DC 20071
March 24, 2008
TO OUR SHAREHOLDERS:
You are cordially
invited to the Company’s 2008 Annual Meeting of Shareholders, which will be held
in the Community Meeting Room, The Washington Post Building, 1150 15th Street, NW, Washington, DC 20071, on Thursday, May 8, 2008, at 8:00 a.m.
At the Meeting, there
will be a report on the Company’s activities and Directors will be elected for
the coming year.
It is important that
your shares be represented at the Meeting. Please sign the accompanying Proxy
and return it promptly in the envelope provided. If you plan to attend, kindly
so indicate in the space provided on the Proxy. You may also vote your shares by
telephone or on the Internet. If you choose to vote your shares by telephone or
on the Internet, please follow the instructions on the enclosed
Proxy.
| Sincerely yours, | |
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| DONALD E. GRAHAM | |
| Chairman |
THE WASHINGTON POST
COMPANY
Notice
of Annual Meeting of Shareholders — May 8, 2008
The
Annual Meeting of Shareholders of The Washington Post Company will be held in
the Community Meeting Room, The Washington Post Building, 1150
15th Street, NW,
Washington,
DC 20071, on Thursday, May 8, 2008, at 8:00 a.m., Eastern Daylight Saving Time,
for the following purposes:
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1.
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To
elect Directors for the ensuing year, as more fully described in the
accompanying Proxy Statement.
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| 2. | To transact such other business as may properly come before the Meeting or any adjournment thereof. |
The
Board of Directors has fixed the close of business on March 10, 2008, as the
record date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting.
It
is important that your shares be represented and voted at the Meeting. Please
sign and return your Proxy at your earliest convenience. You may also vote your
shares by telephone or on the Internet. If you choose to vote your shares by
telephone or on the Internet, please follow the instructions on the enclosed
Proxy. You may revoke your Proxy at any time before it has been voted at the
Annual Meeting. You may vote in person at the Annual Meeting even if you
returned a Proxy, provided that you first revoke your
Proxy.
| By Order of the Board of Directors, | |
| VERONICA DILLON, Secretary |
March 24, 2008
Washington, DC
THE
WASHINGTON POST COMPANY
1150
15th Street, NW,
Washington,
DC 20071
March
24, 2008
This
Proxy Statement contains information relating to the 2008 Annual Meeting of
Shareholders of The Washington Post Company (the “Company”) to be held at the
Company’s headquarters, 1150 15th Street, NW, Washington, DC 20071, on Thursday,
May 8, 2008, at 8:00 a.m., Eastern Daylight Saving Time, or any adjournments
thereof, for the purposes set forth in the accompanying Notice of the 2008
Annual Meeting of Shareholders. This Proxy Statement and the accompanying forms
of proxy and voting instructions are being delivered to shareholders on or about
March 24, 2008. The Board of Directors of the Company is making this proxy
solicitation.
QUESTIONS
AND ANSWERS
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Q:
What am I voting on?
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A:
You are voting on the election of Directors for a term of one year. A
Board of ten Directors is to be elected, seven by the holders of Class A
Stock voting separately as a class and three by the holders of Class B
Stock voting separately as a class. All Directors will hold office until
the next Annual Meeting and until their respective successors shall have
been elected and shall have qualified or as otherwise provided in the
bylaws of the Company.
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In the event
that any nominee withdraws or for any reason is not able to serve as a
Director, Donald E. Graham, John B. Morse, Jr., Veronica Dillon and Gerald
M. Rosberg, acting as your proxies, will either vote for such other person
as the Board of Directors may nominate or will not vote for anyone to
replace such nominee.
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Mr. Richard D.
Simmons will not be standing for re-election this year, having decided
after 27 years of Board service to retire.
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Q:
What are the voting recommendations of the
Board?
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A:
The Board recommends voting for each of the nominated Directors listed on
the proxy card. The Board knows of no reason that would cause any nominee
to be unable to act or to refuse to accept nomination or
election.
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Q:
Will any other matters be voted on?
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A:
Other than the election of Directors, we are not aware of any matters that
you will be asked to vote on at the Meeting. If any other matter is
properly brought before the Meeting, Donald E. Graham, John B. Morse, Jr.,
Veronica Dillon and Gerald M. Rosberg, acting as your proxies, will vote
for you at their discretion.
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Q:
How do I vote?
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A:
There are four ways to vote:
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• By Internet at
www.investorvote.com. We encourage you to vote this
way.
• By toll-free telephone at
1-800-652-8683.
• By completing and mailing your
proxy card.
• By written ballot at the
Meeting.
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If you vote by
Internet or telephone, your vote must be received by 5:00 p.m., Eastern
Daylight Saving Time, on the day before the Meeting. Your shares will be
voted as you indicate. If you do not indicate your voting preferences,
Donald E. Graham, John B. Morse, Jr., Veronica Dillon and Gerald M.
Rosberg, acting as your proxies, will vote your shares in favor of the
applicable nominated
Directors.
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3
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Q:
Who can vote?
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A:
You can vote if you were a shareholder of record as of the close of
business on March 10, 2008 (the “Record Date”). If you hold shares in
street name, your broker, bank or other nominee will instruct you as to
how your shares may be voted by proxy, including whether telephonic or
Internet voting options are available. You may not vote shares held in
street name in person at the Meeting unless you have a proxy executed in
your favor by your broker, bank or other
nominee.
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Q:
Can I change my vote?
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A:
Yes. You can change your vote or revoke your proxy at any time before the
Meeting by:
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• Entering a new vote by Internet
or telephone;
• Returning a later-dated proxy
card; or
• Voting in person at the Meeting,
provided you first revoke your previously voted
proxy.
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Q:
What vote is required to approve a proposal?
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A:
Directors will be elected by a plurality of the votes cast at the Meeting.
This means that the seven Class A Shareholder nominees receiving the
highest number of votes and the three Class B Shareholder nominees
receiving the highest number of votes cast shall be elected. You do not
have the right to cumulate votes in the election of Directors. A properly
executed proxy marked “WITHHELD” with respect to the election of one or
more Directors will not be voted with respect to the Director or Directors
indicated, although it will be counted for purposes of deter-mining
whether a quorum is present at the Meeting. Any shares not voted (whether
by abstention, broker non-vote or otherwise) will have no impact on the
vote, but these shares will be counted for purposes of determining whether
a quorum is present.
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Q:
Who will count the vote?
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A:
Computershare, the Company’s transfer agent and registrar, will count the
vote. One of its representatives will be included among the inspectors of
votes.
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Q:
Who can attend the Annual Meeting?
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A:
All shareholders of record as of the close of business on March 10, 2008,
can attend.
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Q:
What do I need to do to attend the Annual
Meeting?
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A:
To attend the Meeting, please follow these
instructions:
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• If you vote by using the
enclosed proxy card, check the appropriate box on the
card.
• If you vote by Internet or
telephone, follow the instructions provided for
attendance.
• If a broker or other nominee
holds your shares, bring proof of your ownership with you to the
Meeting.
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Seating at the
Meeting will be on a first-come, first-served basis, upon arrival at the
Meeting.
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Q:
Can I bring a guest?
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A:
No. The Meeting is for shareholders only.
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Q:
What is the quorum requirement of the Meeting?
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A:
A majority of the outstanding shares on March 10, 2008, constitutes a
quorum for voting at the Annual Meeting. If you vote, your shares will be
part of the quorum. Abstentions and broker non-votes will be counted in
determining the quorum, but neither will be counted as votes cast for the
purpose of electing Directors. On March 10, 2008, there were
1,291,693 shares of Class A Common Stock and 8,226,898 shares of Class B
Common Stock outstanding and entitled to
vote.
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4
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Q:
Who is soliciting proxies?
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A:
Solicitation of proxies will be made by the Company’s management through
the mail, in person, on the Internet or by telephone, without any
additional compensation being paid to such members of the Company’s
management. The cost of such solicitation will be borne by the Company. In
addition, the Company has requested brokers and other custodians, nominees
and fiduciaries to forward proxy cards and proxy soliciting material to
shareholders, and the Company will reimburse them for their expenses in so
doing.
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Q:
When are the shareholder proposals due for the 2009 Annual
Meeting?
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A:
Shareholder proposals submitted by shareholders entitled to vote on such
matters, meeting the requirements of the Securities and Exchange
Commission’s proxy rules, must be in writing, received by November 24,
2008, and addressed to the Secretary of the Company at 1150 15th Street, NW, Washington, DC 20071.
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Holders of
Class B Stock are entitled to vote only for the election of 30% of the
members of the Board of Directors (and, if required by the rules of the
New York Stock Exchange, on management proposals to reserve shares for
stock options, on equity-compensation plans and any material revisions to
the terms of such plans or to acquire the stock or assets of other
companies under certain circumstances). In accordance with the rules of
the Securities and Exchange Commission, proposals submitted on other
matters by holders of Class B Stock have not been and will not be included
in the Company’s proxy materials for annual
meetings.
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Q:
What other information about The Washington Post Company is
available?
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A:
The following information is
available:
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•
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The Company maintains on its
Internet website, www.washpostco.com, copies of the Annual Report on Form
10-K, the Annual Report to Shareholders, the Company’s Corporate
Governance Guidelines, Statement of Ethical Principles, the Code of
Business Conduct, the Audit Committee Charter, the Compensation Committee
Charter and other information about the Company.
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•
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In addition, printed copies of the
Company’s Corporate Governance Guidelines, the Code of Business Conduct,
Statement of Ethical Principles, the Audit Committee Charter, the
Compensation Committee Charter and the Annual Report on Form 10-K will be
furnished without charge (except exhibits) to any shareholder upon written
request addressed to the Treasurer of the Company at 1150 15th Street, NW,
Washington, DC 20071.
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Q:
Can I receive materials relating to annual shareholder meetings
electronically?
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A:
To assist the Company in reducing costs related to the Annual Meeting,
shareholders who vote via the Internet may consent to electronic delivery
of mailings related to future annual shareholder meetings. The Company
also makes its proxy statements and annual reports available online and
may eliminate mailing hard copies of these documents to those shareholders
who consent in advance to electronic distribution. If you hold shares in
your own name and you are voting via the Internet, you may consent online
when you vote. If you hold shares through an intermediary, such as a bank
or broker, please refer to the information provided by your bank or broker
for instructions on how to consent to electronic
distribution.
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5
ELECTION OF
DIRECTORS
NOMINEES FOR ELECTION BY CLASS A
SHAREHOLDERS
Lee C. Bollinger
Mr. Bollinger, age 61, became the 19th
President of Columbia University in June 2002. Prior to becoming President of
Columbia University, where he also serves as a member of the Law School faculty, Mr. Bollinger served as
President of the University of Michigan for five years and as Dean of the
University of Michigan Law School for seven years. He is a Governor of the
Federal Reserve Bank of New
York and a Founding Member
of the Royal Shakespeare Company’s International Council. He is also a Fellow of
the American Academy of Arts and Sciences and serves on the
Pulitzer Prize Board. Mr. Bollinger is the recipient of numerous honorary
degrees and awards, most notably for his national leadership in defending
affirmative action, for his service in higher education and for his defense of
freedom of speech and academic freedom. Mr. Bollinger was elected a Director of
the Company in May 2007.
Warren E. Buffett
Mr. Buffett, age 77, has for more than
37 years been Chairman of the Board and Chief Executive Officer of Berkshire Hathaway Inc. (a diversified holding
company). He was elected a Director of the Company in May 1996. Mr. Buffett is a
member of the Executive Committee of the Board and serves as Chairman of the
Finance Committee and as lead Director of the Board. Mr. Buffett also served as
a Director of the Company between 1974 and 1986. He is a Director of Berkshire
Hathaway Inc.
Barry Diller
Mr. Diller, age 66, has been Chairman of
the Board and Chief Executive Officer of IAC/InterActiveCorp (an information,
entertainment and direct selling company) since August 1995, and Chairman and
Senior Executive of Expedia, Inc., since August 2005. He was elected a Director
of the Company in September 2000 and is a member of the Finance and Compensation
Committees of the Board. Since December 1992, beginning with QVC, Mr. Diller has
served as chief executive for a number of predecessor companies engaged in media
and interactivity prior to the formation of IAC/InterActiveCorp. From October
1984 to April 1992, Mr. Diller served as Chairman and Chief Executive Officer of
Fox, Inc., and was responsible for the creation of Fox Broadcasting Company, in
addition to Fox’s motion picture operations. Prior to joining Fox, Inc., he
served for ten years as Chairman of the Board of Directors of Paramount Pictures
Corporation. Before joining Paramount, Mr. Diller served as Vice President of
Prime Time Television for ABC Entertainment. Mr. Diller is a Director of The
Coca-Cola Company and of Conservation International. He also is a member of the
Board of Trustees of New York University and serves on the boards of a number of
other educational and not-for-profit organizations.
Melinda F. Gates
Mrs. Gates, age 43, is Co-Chair of the
Bill & Melinda Gates Foundation. She was elected a Director of the Company
in September 2004. Mrs. Gates held a number of different positions after joining
Microsoft Corporation in 1987; she retired from her position as Microsoft’s
General Manager of Information Products in 1996. Following her retirement, Mrs.
Gates has directed her activities toward the non-profit world, having served as
a member of the Board of Trustees of Duke University and as Co-Chair of the
Washington State Governor’s Commission on Early Learning.
6
Thomas
S. Gayner
Mr.
Gayner, age 46, is Executive Vice President and Chief Investment Officer of
Markel Corporation, a publicly traded insurance holding company headquartered in
Glen Allen, Virginia. Mr. Gayner was elected a Director of
the Company in January 2007 and is a member of the Audit Committee. Since 1990,
he has served as President of Markel Gayner Asset Management; he also served as
a Director of Markel Corporation from 1998 to 2003. Previously, he had been a
certified public accountant at PricewaterhouseCoopers LLP and a Vice President
of Davenport & Company of Virginia. Mr. Gayner serves on the Board of
Directors of The Davis Funds in New York City and on the Board of Governors of the
Community Foundation of Richmond.
Donald E. Graham
Mr. Graham, age 62, has been Chairman of
the Board of the Company since September 1993 and Chief Executive Officer of the
Company since May 1991. Mr. Graham served as President of the Company between
May 1991 and September 1993. He also was Publisher of The Washington Post for 21
years, a position he held between 1979 and 2000. Mr. Graham has been a Director
of the Company since 1974 and is Chairman of the Executive Committee and a
member of the Finance Committee of the Board. By virtue of his ownership of
48.7% of the outstanding Class A stock of the Company and his right to control
the vote, as a trustee of certain family trusts, of an additional 23.5% of such
stock, Mr. Graham effectively votes a total of 72.2% of the Class A shares. Mr.
Graham is a Trustee of the Federal City Council and the Philip L. Graham Fund.
He serves as Chairman and a Director of DC College Access Program and as a
Director of The Summit Fund of Washington and the College Success
Foundation.
Anne M. Mulcahy
Mrs. Mulcahy, age 55, has been Chairman
of the Board of Xerox Corporation since 2002 and Chief Executive Officer since
2001. Mrs. Mulcahy was elected a Director of the Company in January 2008. From
May 2000 through July 2001, she was President and Chief Operating Officer of
Xerox. Mrs. Mulcahy began her Xerox career as a field sales representative and
assumed positions with increasing responsibility in sales and senior management.
She was Vice President for Human Resources before becoming Chief Staff Officer
and later Corporate Senior Vice President. In addition to serving on the Xerox
Board of Directors, she is a Director of Citigroup Inc. and Target Corporation
and is the Chairman of the Corporate Governance Task Force of the Business
Roundtable.
NOMINEES FOR ELECTION BY CLASS B
SHAREHOLDERS
Christopher C. Davis
Mr. Davis, age 42, is Chairman of Davis
Selected Advisers, L.P., an investment counseling firm overseeing approximately
$56 billion in client assets. He became a Director of the Company in January
2006 and is a member of the Audit Committee of the Board. Mr. Davis is also a
director and officer of a number of mutual funds advised by Davis Selected
Advisers, L.P., as well as other entities controlled by Davis Selected Advisers,
L.P. Mr. Davis is President of the Hudson Highland Land Trust and also serves as
a Trustee of the American Museum of Natural History, Scenic Hudson Land Trust
and a number of other not-for-profit organizations.
7
John L. Dotson
Jr.
Mr.
Dotson, age 71, is Publisher Emeritus of the Beacon Journal (Akron,
Ohio)
where, prior to his retirement in 2001, he had been President and Publisher. He
became a Director of the Company in July 2001 and is a member of the
Compensation and Audit Committees of the Board. Mr. Dotson was inducted into the
National Association of Black Journalists Hall of Fame in August 2007. He is a
Co-Founder and Director of the Maynard Institute for Journalism Education, a
member of the Pulitzer Prize Board and serves on the Board of Visitors of the
John S. Knight Fellowship Program at Stanford University.
Ronald
L. Olson
Mr. Olson, age 66,
has since 1970 been a partner in the law firm of Munger, Tolles & Olson LLP,
which is one of several law firms retained by a subsidiary of the Company in
2005, 2006 and 2007, and which has again been retained in 2008. He became a
Director of the Company in September 2003 and is Chairman of the Compensation
Committee. Mr. Olson was a member of the Audit Committee of the Board until
October 2005. Mr. Olson is also a Director of Berkshire Hathaway Inc., Edison
International, Southern California Edison, City National Bank and City National
Corporation. He serves on the Board of the Council on Foreign Relations, the
RAND Corporation and a number of other not-for-profit
organizations.
Board
Committees
The standing
committees of the Board include an Audit Committee, a Compensation Committee, a
Finance Committee and an Executive Committee.
Given the ownership
structure of the Company and its status as a “controlled company” (see page 10),
the Board does not have a Nominating Committee. Decisions on nominees to the
Board are made through consultation between the Chairman of the Board and the
other members of the Board. The Company has not utilized the services of any
third party to assist in identifying and evaluating
nominees.
Audit
Committee
The
functions of the Audit Committee include overseeing (i) management’s conduct of
the Company’s financial reporting process (including the development and
maintenance of systems of internal accounting and financial controls), (ii) the
integrity of the Company’s financial statements, (iii) the Company’s compliance
with legal and regulatory requirements, (iv) the qualifications and independence
of the Company’s outside auditor, (v) the performance of the Company’s internal
audit function, (vi) the outside auditor’s annual audit of the Company’s
financial statements and (vii) the preparation of any report required by the
rules and regulations of the Securities and Exchange Commission. A current copy
of the Audit Committee’s Charter is available on the Company’s website,
www.washpostco.com; a copy of such Charter will be furnished without charge to
any shareholder upon written request addressed to the Treasurer of the Company
at 1150
15th Street, NW,
Washington,
DC 20071.
Christopher C.
Davis, John L. Dotson Jr. (appointed to the Committee in January 2008), Thomas
S. Gayner and Richard D. Simmons (Chairman) serve on the Audit Committee. The
Board of Directors has determined that all members of the Audit Committee are
non-employee, “financially literate,” “independent” Directors within the meaning
of the New York Stock Exchange listing standards. None of the members of the
Audit Committee has, other than in his capacity as a Committee or Board member,
accepted any consulting, advisory or other compensatory fee (other than pension
or other forms of deferred compensation for prior service, which is not
contingent in any way on continued service) from the Company or its affiliates,
and none of the members of the Audit Committee has a material relationship with
the Company.
8
The Board has determined that Richard D.
Simmons has the requisite background and experience to be, and is, designated an
“audit committee financial expert” within the meaning of Item 407(d)(5)(ii) of
Regulation S-K. In addition, the Board has determined that all of the members of
the Audit Committee are well-grounded in financial matters and are familiar with
generally accepted accounting principles. All of the members of the Audit
Committee have a general understanding of internal controls and procedures for
financial reporting, as well as an understanding of audit committee functions.
To the extent that matters come before the Audit Committee that involve
accounting issues, the members of the Audit Committee consult with and rely on
experts for their expertise. In addition, the Audit Committee has authority to
obtain advice from internal or external legal or other
advisors.
The Audit Committee held six meetings in
2007.
Compensation
Committee
The functions of the Compensation
Committee include (i) reviewing the compensation for the Company’s Chief
Executive Officer; (ii) consulting with the Chief Executive Officer with respect
to the compensation of the Company’s other executives (including, specifically,
approving all salaries of $250,000 or more per year for employees of Kaplan,
Inc., and those of $200,000 or more per year for employees of all of the other
business units, including corporate; all incentive compensation awards and all
other bonuses, other than sales bonuses, of $40,000 or more ($75,000 in the case
of Kaplan employees); and awards of restricted stock and stock options); (iii)
overseeing the administration and determination of awards under the Company’s
compensation plans; and (iv) preparing any report on executive compensation
required by the rules and regulations of the Securities and Exchange
Commission.
Lee C. Bollinger, Barry Diller, John L.
Dotson Jr. and Ronald L. Olson (Chairman) serve on the Compensation Committee.
All members of the Compensation Committee are non-employee, “independent”
Directors within the meaning of the listing requirements of the New York Stock
Exchange. George Wilson served as Chairman of the Compensation Committee until
February 2007 and retired from the Board in May 2007.
The Compensation Committee held seven
meetings in 2007.
Finance
Committee
The functions of the Finance Committee
include (i) reviewing with management the capital needs of the Company and (ii)
considering and making recommendations to the Board related to dividend policy,
major acquisitions and disposition of businesses, incurrence of indebtedness,
selection of managers of defined benefit plan assets, stock repurchase programs
and certain other financial matters.
Barry Diller, Donald E. Graham, Richard
D. Simmons and Warren E. Buffett (Chairman) serve on the Finance
Committee.
The Finance Committee held one meeting
in 2007.
Executive
Committee
The Executive Committee has and may
exercise all of the powers of the Board that may be delegated by law in the
management of the business and affairs of the Company and exercises the
authority of the Board between meetings.
Warren E. Buffett and Donald E. Graham
(Chairman) serve on the Executive Committee.
The Executive Committee held five
meetings in 2007.
Meeting
Attendance
The Board held a total of five meetings
in 2007. Each Director attended at least 75% of the meetings of the Board and
the committees of the Board on which the Director served, with the exception of
Anne M. Mulcahy, who was elected to the Board in January
2008.
The Board does not have a policy of
requiring Directors to attend annual meetings of shareholders and leaves it
entirely at the discretion of each Director as to whether he or she will attend
the meeting. Six Directors attended the 2007 Annual Meeting of
Shareholders.
9
Director
Compensation
Annual
Payments.
During
2007,
non-employee
Directors
received
the
following:
• $70,000
as
a retainer,
and
• reimbursement
of
out-of-pocket
expenses
for
the
meetings
they
attended.
Each non-employee Chairman of a Board committee receives an additional $5,000. Members of the Audit Committee also receiv
e an additional $10,000 annually for their service on that committee . Employee Directors receive no additional compensation for serving on the Board.
The total 2007 compensation of non-employee Directors is shown on the following table:
DIRECTOR
COMPENSATION
|
Name
(a)
|
Fees
Earned
or
Paid
in
Cash($)
(b)
|
Stock
Awards($)
(c)
|
Option
Awards($)
(d)
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Non-Equity
Incentive
Plan
Compensation($)
(e)
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Change
in
Pension
Value
and
Non-qualified
Deferred
Compensation
Earnings($)
(f)
|
All
Other
Compensation($)
(g)
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Total($)
(h)
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A. Lee C. Bollinger
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$52,500
|
–
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–
|
–
|
–
|
–
|
$52,500
|
|
B. Warren E. Buffett
|
75,000
|
–
|
–
|
–
|
–
|
–
|
75,000
|
|
C. Christopher C. Davis
|
80,000
|
–
|
–
|
–
|
–
|
–
|
80,000
|
|
D. Barry Diller
|
70,000
|
–
|
–
|
–
|
–
|
–
|
70,000
|
|
E. John L. Dotson Jr.
|
70,000
|
–
|
–
|
–
|
–
|
–
|
70,000
|
|
F. Melinda F. Gates
|
70,000
|
–
|
–
|
–
|
–
|
–
|
70,000
|
|
G.Thomas S. Gayner
|
80,000
|
–
|
–
|
–
|
–
|
–
|
80,000
|
|
H. Ronald L. Olson
|
75,000
|
–
|
–
|
–
|
–
|
–
|
75,000
|
|
I. Richard D. Simmons
|
85,000
|
–
|
–
|
–
|
–
|
–
|
85,000
|
|
J. George W. Wilson*
|
42,500
|
–
|
–
|
–
|
–
|
–
|
42,500
|
*Retired
from
the
Board
in
May
2007.
The
Company has in place a voluntary Deferred Compensation Plan for Directors of the
Company. The Plan provides an opportunity for participants to elect to defer the
receipt of either all or a portion of the fees received for service as a
Director. Elections to defer must be filed in advance of earning such fees.
Deferred amounts will earn investment credits in accordance with participant
elections from a choice of investment indexes. None of the deferred amounts was
credited with above-market interest. Deferred amounts will be payable at
retirement or such other future date as specified by the participant at the time
of election.
“Controlled
Company”
The descendants of Katharine Graham
(including the Company’s Chief Executive Officer and Chairman of the Board) and
trusts for the benefit of those descendants own all of the shares of Class A
Common Stock, which have the right to vote for 70% of the Board of Directors,
and thus the Company is a “controlled company” for purposes of Section 303A.00
of the New York Stock Exchange Listed Company Manual. As a “controlled company,”
the Company is exempt from certain governance requirements, including the
requirement that it have a nominating/corporate governance committee, and does
not deem it necessary to have a nominating committee. The Company does not have
in place a procedure by which shareholders may recommend nominees to the Board.
Notwithstanding the fact that as a “controlled company” the Company is not
required to have a board of directors comprised of a majority of “independent”
directors, the Board has determined that current members Lee C. Bollinger,
Warren E. Buffett, Christopher C. Davis, Barry Diller, John L. Dotson Jr.,
Melinda F. Gates, Thomas S. Gayner, Ronald L. Olson and Richard D. Simmons, who
together constitute a majority of the Board, are “independent” as outlined in
Section 303A.02 of the New York Stock Exchange Listed Company
Manual.
Meetings of the
Non-Management Directors
The listing requirements of the New York
Stock Exchange call for the non-management Directors of the Company to meet
regularly in executive session without management. The Board has appointed Mr.
Warren E. Buffett as lead Director and authorized him to preside at the
executive sessions. The non-management Directors met in May and November 2007
and expect to meet in executive session in 2008 as
appropriate.
10
Communicating with
Directors
Interested parties
may communicate concerns to the lead Director or to the other Directors of the
Company through Global Compliance Services, the Company’s third-party-managed
hotline via telephone at 1-866-687-8972 or online at
www.compliance-helpline.com/WashPostCo.jsp.
STOCK HOLDINGS OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information in
the following two tables relates to each person who, on February 1, 2008, was a
“beneficial owner” (as defined under the proxy rules of the Securities and
Exchange Commission) of more than 5% of the Company’s Class A or Class B Stock.
Under the proxy rules, a person is deemed to be the “beneficial owner” of stock
if such person has (or shares) either investment power or voting power over such
stock or has (or shares) the right to acquire such stock within 60 days by any
of a number of means, including the conversion of another security that is
convertible into such stock. A substantial number of shares of the Company’s
Class A and Class B Stock are held in trusts or subject to other agreements that
provide for the sharing of investment power, voting power or both among several
persons, each of whom is deemed by the Securities and Exchange Commission to be
a “beneficial owner” of the shares so held. Furthermore, in many cases such
persons do not include the beneficiary of the trust who, although not deemed to
be a “beneficial owner” in the absence of voting or investment power over the
shares, is nevertheless shown below as a beneficial owner because of the
beneficiary’s economic interest in the shares. In addition, since all of the
shares of Class A Stock are convertible at the option of the holder into Class B
Stock on a share-for-share basis, each “beneficial owner” of shares of Class A
Stock is deemed by the Securities and Exchange Commission to be a “beneficial
owner” of the same number of shares of Class B Stock. In indicating below a
person’s “beneficial ownership” of shares of Class B Stock it has been assumed
that such person has converted into Class B Stock all shares of Class A Stock of
which such person is a “beneficial owner.” For these reasons, there is very
substantial duplication in the numbers of shares and percentages shown in the
following table.
Principal Holders of
Stock
|
Shares
(%)
|
||||
|
Name and Address
of
|
Class A
Stock
|
Class B
Stock*
|
||
|
Beneficial
Owner
|
||||
|
Donald E. Graham
(a)(h)
|
1,198,960
(92.8%)
|
3,350,080
(35.2%)
|
||
|
1150 15th Street,
NW
|
||||
|
Washington, DC
|
||||
|
William W. Graham
(b)(h)
|
224,887
(17.4%)
|
**
|
||
|
11661 San Vincente Boulevard,
Suite 401
|
||||
|
Los Angeles, CA
|
||||
|
Stephen M. Graham
(c)(h)
|
208,255
(16.1%)
|
**
|
||
|
18 East 78th
Street
|
||||
|
New York, NY
|
||||
|
Elizabeth G. Weymouth
(d)(h)
|
435,711
(33.7%)
|
576,700
(6.1%)
|
||
|
251 West 57th
Street
|
||||
|
New York, NY
|
||||
|
George J. Gillespie III
(e)(h)
|
313,835
(24.3%)
|
**
|
||
|
825 Eighth
Avenue
|
||||
|
New York, NY
|
||||
|
Daniel L. Mosley
(f)(h)
|
906,645
(70.2%)
|
1,140,054
(12.0%)
|
||
|
825 Eighth
Avenue
|
||||
|
New York, NY
|
||||
|
Berkshire Hathaway Inc.
(g)
|
—
|
1,727,765
(18.2%)
|
||
|
1440 Kiewit Plaza
|
||||
|
Omaha, NE
|
||||
|
Harris Associates L.P.
(i)
|
—
|
472,213
(5.0%)
|
||
|
2 North LaSalle Street, Suite
500
|
||||
|
Chicago, IL
|
||||
|
*
|
The calculations set forth in this
table relating to percentage ownership of Class B Stock include 1,291,693
shares of Class B Stock issuable upon conversion of shares of Class A
Stock beneficially owned.
|
|
**
|
Less than
5%.
|
(Footnotes continued on following
page.)
11
|
(a)
|
According to information as of February 1, 2008, and available to the Company, Mr. Donald Graham has voting and investment power with respect to shares of Class A
Stock as follows: shared voting power, 1,193,560 (92.4%) shares, and shared investment power, 1,193,560 (92.4%)
shares. The holdings of Class A
Stock recorded for Mr. Graham include 5,400 shares held by Mr. Graham’s wife, in which he disclaims beneficial ownership.
|
|
Mr.
Graham
also
has
voting
and
investment
power
with
respect
to
shares
of
Class
B Stock
as
follows:
sole
voting
power,
1,747,765
(18.4%)
shares;
sole
investment
power,
20,000
(<1%)
shares;
shared
voting
power
281,405
(3.0%)
shares;
and
shared
investment
power,
281,405
(3.0%)
shares.
The
holdings
of
Class
B Stock
recorded
for
Mr.
Graham
include
121,950
shares
of
Class
B Stock
held
by
Mr.
Graham’s
wife,
in
which he
disclaims
beneficial
ownership,
and
1,198,960
(12.6%)
shares
issuable
upon
conversion
of
shares
of
Class
A Stock
deemed
to
be
beneficially
owned
by
Mr.
Graham.
The
holdings
of
Class
B Stock
recorded
for
Mr.
Graham
also
include
shares
of
Class
B Stock
owned
by
subsidiaries of
Berkshire
Hathaway
Inc.,
which
have
the
sole
investment
power
of
the
shares;
sole
voting
power
is
held
by
Mr.
Donald
Graham
under
an agreement
dated
as
of
February
25,
1977,
and
amended
and
extended
on
September
13,
1985,
May
15,
1996,
and
July
6,
2006,
which
has
a termination
date
(which
may
be
extended)
of
February
24,
2017.
|
|
(b)
|
According
to
information
as
of
February
1,
2008,
and
available
to
the
Company,
Mr.
William
Graham
has
voting
and
investment
power
with respect
to
shares
of
Class
A Stock
as
follows:
shared
voting
power,
49,952
(3.9%)
shares,
and
shared
investment
power,
49,952
(3.9%)
shares. In
addition,
Mr.
William
Graham,
as
the
beneficiary
of
trusts
even
though
he
has
no
voting
or
investment
power
with
respect
thereto,
is
deemed to
be
the
beneficial
owner
of
174,935
(13.5%)
shares
of
Class A Stock.
The
holdings
of
Class
B Stock
recorded
for
Mr.
William
Graham,
including
shares
issuable
upon
conversion
of
shares
of
Class
A Stock
deemed
to
be
beneficially
owned
by
Mr.
Graham,
are
less
than
5%.
|
|
(c)
|
According to information as of February 1, 2008, and available to the Company, Mr. Stephen Graham has voting and investment power with respect to shares
of Class A
Stock as follows: sole voting power, 15,687 (1.2%); sole investment power, 15,687 (1.2%); shared voting power,74,068 (5.7%) shares; and shared
investment power, 74,068 (5.7%) shares. In addition, Mr. Stephen Graham, as the beneficiary of trusts even though he has no voting or investment power with respect thereto, is deemed to be the beneficial owne
|
|
(d)
|
According to information as of
|
|
(e)
|
According to information as of
|
|
(f)
|
According to information as of
|
|
(g)
|
According to information as of
|
|
(h)
|
According to information as of
|
|
(i)
|
According to information based on <
font style="DISPLAY: inline; COLOR: #211d1e; FONT-STYLE: normal">the Schedule 13G filings by Harris Associates L.P. on February 12, 2008, Harris Ass
ociates L.P. (“Harris”)was deemed to be the beneficial owner of 472,213 (5.0%) shares of Class B
Stock. Harris has sole voting and investment power over 472,213
(5.0%) shares of Class B
Stock.
|
12
The
table
below,
which
is
based
on
information
furnished
to
the
Company
by
its
Directors
and
officers, shows
as
of
February
1,
2008,
for
each
person
nominated
for
election
as
a Director,
each
named
executive
officer and
for
all
Directors
and
executive
officers
of
the
Company
as
a group,
the
number
of
shares
of
each
class
of Common
Stock
“beneficially
owned”
(as
defined
in
the
Securities
and
Exchange
Commission’s
proxy
rules)
and,
in the
case
of
each
nominee
for
election
as
a Director,
the
nature
of
such
“beneficial
ownership.”
For
the
reasons
set forth
in
the
first
paragraph
of
this
section
of
the
Proxy
Statement,
there
is
very
substantial
duplication
in
the
numbers of
shares
and
percentages
shown
in
the
following
table.
Holdings
of
Directors
and
Officers*
|
Shares (%)
|
||||
|
Class A
|
Class B
(a)
|
|||
|
Lee C. Bollingerw
|
–
|
–
|
||
|
Warren E. Buffettw(b)
|
–
|
1,727,765
(18.2%)
|
||
|
Christopher C. Davisw
|
–
|
5,000(c)
|
||
|
Barry Dillerw
|
–
|
1,000(c)
|
||
|
Veronica
Dillon+
|
–
|
550(c)
|
||
|
John L. Dotson Jr.w
|
–
|
100(c)
|
||
|
Melinda F. Gatesw
|
–
|
1,100(c)
|
||
|
Thomas S. Gaynerw(d)
|
–
|
5,300(c)
|
||
|
Donald E. Grahamw+(e)
|
1,198,960
(92.8%)
|
3,350,080
(35.2%)
|
||
|
Ann L.
McDaniel+(f)
|
–
|
3,381(c)
|
||
|
John B. Morse,
Jr.+(g)
|
–
|
4,886(c)
|
||
|
Anne M. Mulcahyw
|
–
|
–
|
||
|
Ronald L. Olsonw
|
–
|
300(c)
|
||
|
Gerald M.
Rosberg+(h)
|
–
|
5,825(c)
|
||
|
All Directors and executive
officers as a group,
|
||||
|
eliminating duplications(i) (14
individuals)
|
1,198,960
(92.8%)
|
3,377,522
(35.5%)
|
||
| * |
Unless
otherwise indicated, the Directors and officers listed have sole voting
and investment power with respect to such securities. None of the
securities has been pledged as security.
|
| (a) |
Includes
1,291,693 shares of Class B Stock issuable upon conversion of shares of
Class A Stock beneficially owned.
|
| (b) |
With respect
to voting securities which may be beneficially owned by Mr. Buffett, see
footnote (g) on page 12.
|
| (c) |
Less than
1%.
|
| (d) | Includes 5,200 shares of Class B Stock held for the account of a number of beneficial owners in which Mr. Gayner disclaims beneficial ownership. |
| (e) |
See Table of
“Principal Holders of Stock” on page
11.
|
| (f) |
Includes 2,250
shares Ms. McDaniel has the right to purchase on or before April 1, 2008,
pursuant to stock options.
|
| (g) |
Includes 2,750
shares Mr. Morse has the right to purchase on or before April 1, 2008,
pursuant to stock options.
|
| (h) |
Includes 5,000
shares Mr. Rosberg has the right to purchase on or before April 1, 2008,
pursuant to stock options.
|
| (i) |
Includes
1,198,960 shares of Class B Stock issuable upon conversion of shares of
Class A Stock “beneficially owned” by Directors and executive officers and
10,000 shares of Class B Stock which Directors and executive officers have
the right to purchase on or before April 1, 2008, pursuant to stock
options, and shares of restricted stock awarded to executive officers in
accordance with The Washington Post Company Incentive Compensation Plan.
It does not include 64,534 shares of Class B Stock held as of February 1,
2008, by the trustee of various savings plans maintained by the Company
and its business units over which the trustee has voting and investment
powers.
|
| w | Director. |
|
+
|
Executive Officer. |
Section
16(a)
Beneficial
Ownership
Reporting
Compliance
Section 16(a) of the
Securities Exchange Act of 1934 requires the Company’s Directors, executive
officers and persons who own more than 10% of a registered class of the
Company’s equity securities to file with the Securities and Exchange Commission
and the New York Stock Exchange initial reports of ownership and reports of
changes in ownership of Class B Stock.
To the Company’s
knowledge, based solely on a review of such reports and on information furnished
to the Company and written representations that no other reports were required,
during the fiscal year ended December 30, 2007, all applicable Section 16(a)
filing requirements were met.
13
EXECUTIVE
COMPENSATION
Compensation
Discussion and Analysis
Overview
of Compensation Program
The
Compensation Committee (the “Committee”) of the Board of Directors has
responsibility for establishing and continually monitoring adherence to the
Company’s compensation philosophy – a philosophy designed to attract, retain and
motivate qualified and talented employees who are enthusiastic about the
Company’s mission and culture. The Committee, which was chaired by George W.
Wilson from January to February 2007 and thereafter by Ronald L. Olson starting
in February 2007 through the present, and included Lee C. Bollinger, Barry
Diller and John L. Dotson Jr., seeks to establish total compensation packages
that are attractive to employees and comparable, but not dramatically different,
than those offered by peer companies in the education and media industries with
comparable revenue. Through regular meetings and discussions with management,
the Committee ensures that the total compensation paid to all executives,
including named executive officers of the Company, and all employees earning
more than $200,000 ($250,000 in the case of Kaplan, Inc. (“Kaplan”) employees)
in salary, is fair, reasonable and based on performance goals established to
increase value for shareholders by facilitating the long-term growth of the
Company. The Committee considers both short- and long-term plans in determining
compensation. Annual plans are used to motivate and reward management for
hitting specific yearly goals. Long-term plans, typically three years in
duration, are designed to reward cumulative long-term growth. All performance
targets, however, even those in annual or relatively short-term plans, are
designed to reward executives for making decisions that will enhance the
long-term value of the Company. No targets are based on quarterly or
partial-year results. Some of these plans reward with cash, and others reward
with stock-based compensation. The Company has no specific formula for
allocating between cash and non-cash compensation or between long-term and
current compensation. Management and the Committee select the method of
compensation thought most likely to lead to achievement of the goal; however,
the Company has historically favored cash compensation over non-cash
compensation. Management and the Committee believe that cash incentives provide
more targeted awards for specific performance.
All named
executive officers, except Donald E. Graham, Chairman and Chief Executive
Officer, receive an annual salary and restricted stock awards every other year
and participate in performance-based annual bonus plans and four-year cash-based
Performance Unit Plans. Named executive officers and others occasionally receive
restricted stock or stock option grants in off-cycle years as a reward for past
performance and incentive for future performance. They also receive the benefits
of Supplemental Executive Retirement Plans. Mr. Graham receives a salary and
participates in the Performance Unit Plans and the defined benefit portion of
the Supplemental Executive Retirement Plan as described below.
Compensation
Committee Charter
The Board has delegated to the Committee the responsibility of overseeing the
administration of the Company’s compensation plans and the preparation of all
reports and documents required by the rules and regulations of the Securities
and Exchange Commission. To fulfill this mission, the Committee is required to
meet at least once a year. The Committee annually reviews and approves the
corporate goals and objectives upon which the compensation of the Chief
Executive Officer and senior management, including the named executive officers,
is based. The Committee evaluates the Chief Executive Officer’s performance in
light of these goals and objectives. Furthermore, the Committee reviews and
makes recommendations to the Board with respect to any incentive compensation
plans and equity-based plans for the Company to be adopted or submitted to
shareholders for approval. The Committee reviews the Company’s succession plans,
including (i) the Chairman and Chief Executive Officer’s recommendations as to a
successor should he be disabled or unable to perform his duties for an extended
period of time and, annually, (ii) the Company’s efforts at management
development.
The Committee may request that any officer or employee of the Company, including
its affiliates, or the Company’s outside counsel or an independent auditor,
attend meetings of the Committee or meet with any members of, or consultants to,
the Committee. The Committee has authority to retain or terminate any
compensation consultant used to assist in the evaluation of director, chief
executive officer or senior management compensation and has sole authority to
approve the consultant’s fees and other retention terms. The Committee did not
retain any such consultant for such purpose in 2007 and does not intend to do so
in 2008. The Committee also has authority to obtain advice and assistance from
internal or external legal, accounting or other advisors.
During 2007, the Committee met seven times. Mr. Graham, the Chief Executive
Officer, and Ms. McDaniel, Vice President – Human Resources and the secretary of
the Committee (also a named executive officer), attended all Committee meetings.
Mr. Jonathan Grayer, Chief Executive Officer of Kaplan, joined one meeting.
Representatives of Goldman, Sachs & Co. joined another session by telephone
to assist the Committee in estimating the fair value of Kaplan.
14
Role
of Executive Officers in Compensation Decisions
The
Committee makes all compensation decisions for the named executive officers of
the Company except those perquisites under $200,000 that may be approved by the
CEO. The Committee also approves the compensation of all employees earning
annual salaries of $200,000 ($250,000 in the case of Kaplan employees) or more
and bonuses of $40,000 ($75,000 in the case of Kaplan employees) or
more.
Except
for awards involving themselves, Mr. Graham and Ms. McDaniel recommend to the
Committee the size of each component of compensation based on a discussion with
the head of the division where the employee works, a review of his or her
performance and a comparison of available compensation survey data for that job
and geographic area. The Committee examines each of the suggested compensation
actions and, in its sole discretion, modifies the awards when appropriate to
better reflect the goals of the Company.
At his
request, Mr. Graham has not received a raise in his annual salary in 17 years,
nor has he received an annual bonus. He stopped accepting grants of restricted
stock in the Company in 2004. All compensation for Ms. McDaniel is determined
solely by the Chief Executive Officer and the Committee. The CEO and the
Committee use the same performance-based criteria to set Ms. McDaniel’s
compensation as they do for all other named executive officers and other senior
staffers.
Setting
Executive Compensation
To meet
its objectives, the Committee asks the Chief Executive Officer and the secretary
of the Committee to draft annual and long-term incentive-based cash and non-cash
executive compensation plans. The Committee reviews and, in its sole discretion,
modifies the formula and goals established for various awards under the plans
before the plans take effect, which is no later than the end of the first
quarter of the first year covered by the plan.
Through
the programs described below, a significant portion of the Company’s executive
compensation is linked directly to business unit and corporate performance and
stock price appreciation. The Committee intends to continue the policy of
linking executive compensation to corporate performance and returns to
shareholders and deems it desirable that compensation paid under the Incentive
Compensation Plan and the Stock Option Plan meet the requirements of Section
162(m) of the Internal Revenue Code concerning deductibility of executive
compensation. However, the Committee reserves the right to put in place
compensation programs that do not meet those requirements, which may result in
compensation payments that are not deductible to the Company, if such programs
are otherwise in the best interests of the Company.
Elements
of Compensation
The
compensation package offered by the Company to its executive officers consists
of the following components:
|
•
|
Competitive
base salary;
|
|
|
•
|
Short-term
incentive compensation in the form of performance-based annual
bonuses;
|
|
|
•
|
Long-term
equity-based incentive compensation in the form of restricted stock,
performance units and stock options;
|
|
|
•
|
Perquisites;
and
|
|
|
•
|
Retirement
benefits.
|
Base
Salary
The
Company pays named executive officers, and other employees, base salaries to
compensate them for services rendered during the fiscal year. Salaries for named
executive officers are based on their responsibilities, their prior experience
and their recent performance, and are benchmarked against market data provided
by outside surveys. In 2007, the Committee relied on data from the Towers Perrin
Survey of Compensation for Media Executives, which gathers data from media
companies that provide print, magazine, broadcast and cable services similar to
those provided by the Company. The Company compares its management salaries to
those of companies in similar industries and with comparable revenues. Salaries
are typically reviewed on a 12-month or longer cycle, except when there is a
significant change in the executive’s responsibilities during a shorter period
of time. Such adjustments are determined by evaluating (i) the scope of the new
responsibilities, (ii) the competitive market value of that role, (iii) the
performance of the individual and (iv) the performance of the Company. The
average raise for the named executive officers in 2007 was 8.7% and reflected
the achievement of financial and management goals desired by Mr. Graham and the
Committee.
15
With
respect to the base salary paid to Mr. Graham in 2007, the Committee took into
account a comparison of base salaries paid to chief executive officers of peer
education and media companies, the Company’s results in 2007 and Mr. Graham’s
performance since 1979, when he became publisher of The Washington Post. The
Committee noted that Mr. Graham’s base salary was, and has long been,
significantly below the median of base salaries paid to chief executive officers
of these peer companies, including other prominent media companies such as The
New York Times Company; similarly sized media companies, including the Tribune
Company; and other publicly held education companies, including Apollo Group,
Inc., DeVry, Inc., Strayer Education, Inc., and Corinthian Colleges, Inc.
However, at Mr. Graham’s request, the Committee left his salary at $400,000. The
Committee does not give significance to Mr. Graham’s below-market salary when
reviewing and establishing salaries for other named executive
officers.
Performance-Based
Incentive Compensation
To
supplement base salaries and to reward management (including named executive
officers and other employees key to the long-term success of the Company) for
meeting specific individual and financial goals, the Class A shareholders of the
Company adopted in December 1981 the Long-Term Incentive Compensation Plan, the
predecessor plan to the Incentive Compensation Plan now in place. In 2001, the
Annual Compensation Plan, originally approved by the Class A Shareholders in
February 1974, was combined with the Long-Term Incentive Compensation Plan to
create the Incentive Compensation Plan (the “Plan”). The purpose of these plans
was, and is, to provide greater incentives to those employees who have been or
will be responsible for the Company’s future growth, profitability and continued
success and to strengthen the ability of the Company to attract, motivate and
retain such employees. There are at present approximately 185 employees who are
participants under the Plan and receive annual bonus awards, hold restricted
stock or stock option grants and/or hold grants of Performance Units. Each named
executive officer, except Mr. Graham (who only participates in the Performance
Units portion of the Plan), participates in each of these programs.
Annual
Bonuses
The Plan
calls for annual incentive compensation awards based on the Company’s and its
business units’ financial performance compared to goals set immediately prior to
or at the beginning of the year in which the award is to be earned. The payout
upon the achievement of such goals is equal to a percentage of base salary,
which is also set at the beginning of the year. Those percentages are determined
on an individual basis, taking into account the responsibilities, prior
experience and recent performance of the relevant employee. The percentage
targets for all named executive officers, except Mr. Graham and Mr. Rosberg,
were each increased by 20% in 2007 in order to eliminate the past practice of
asking the Committee to increase or decrease bonus payouts based on gains or
losses as a result of one-time unbudgeted events. The percentage of one named
executive officer, Gerald M. Rosberg, was increased to 100% of salary at the
beginning of 2006 to reflect additional responsbilities relating to strategic
planning that he was asked to assume at Kaplan. No named executive officer
received an actual bonus payment any higher than it would have been under the
previous practice, and none received the maximum amount permitted by the plan.
In 2007, the annual bonus formula for the named executive officers was based on
an earnings per share target because the Committee believed that such a goal
would align the interests of shareholders and the named executive officers in
growing the value of the Company. Gerald M. Rosberg’s annual bonus formula also
contained an achievement target tied to the performance of Kaplan, Inc.
Management and the Committee believe that they have designed the targets to be
challenging but achievable. Over the past several years, the Company has
generally achieved it financial goals and paid out at target or above in the
bonus portion of the plan, except for 2001 and 2007. In 2001, the targets were
not met and no bonuses were paid based on this plan. The payouts for 2007 are
specified below. Had the earnings per share been 85% or less than the target,
the named executive officers, except Mr. Rosberg, would have received no
bonuses. Had the earnings per share been 85% or less than the target and the
Kaplan target been under 90% of the specified goal, Mr. Rosberg would have
received no bonus. At target, they could have received 100% of their bonus
potential. The maximum payout possible was 175% of target for 135% achievement
of the earnings per share goal. In 2007, the Company achieved 99.2 % of the
earnings per share goal, as adjusted to exclude certain unusual items, such as
foreign exchange gains. In March 2008, Mr. Rosberg was paid 98% of his bonus
target and the other named executive officers, excluding Mr. Graham, were paid
between 64% and 69%.
Bonus
awards under the Plan, which includes certain of the Company’s employees at all
divisions, for any year may not exceed more than 10% of that year’s Incentive
Profit, which is calculated as follows: First, an amount equal to 12% of
Shareholder’s Equity (as defined by the Plan) is calculated, which is then
subtracted from the Company’s Consolidated Profit Before Income Taxes (as
defined by the Plan). The remainder is the Incentive Profit. For 2007, the
maximum amount that could have been awarded under the Plan was $14.2 million;
the amount actually awarded was $8.0 million to 94 executives throughout the
Company, including the named executive officers.
16
Restricted
Stock
No target
stock ownership level exists for the named executive officers, but to align the
interests of shareholders and management and to ensure that the full potential
of an executive’s compensation package cannot be realized unless stock
appreciation occurs over a number of years, the Plan also provides for grants of
restricted stock in the Company. To determine the number of shares to be
granted, the Committee considers on an individual basis the likely value of
shares already held, the level of contribution the employee has previously made
and the potential of the employee to bring additional value to the Company. The
shares are vested at the end of the restriction period, usually four years, and
vesting does not accelerate under their terms, except at the discretion of the
Committee.
Grants
are usually made in odd-numbered years. Each of the named executive officers,
other than Mr. Graham, received grants of restricted stock in early 2007. Chief
Financial Officer John B. Morse, Jr. had 200 shares from a grant in 2005; he
received an additional grant of 200 shares in 2007. Vice President – Planning
and Development Gerald M. Rosberg had 150 shares from a grant in 2005; he
received an additional 200 shares in 2007. Vice President, General Counsel and
Secretary Veronica Dillon had 175 shares from a grant in 2005; she received an
additional grant of 250 shares in 2007. Vice President – Human Resources Ann L.
McDaniel had 150 shares from a grant in 2005; she received an additional grant
of 150 shares in 2007. In recognition of her new responsibilities as Managing
Director of Newsweek, Inc., Ms. McDaniel also received an additional award of
750 shares in 2007.
Performance
Units
To
highlight specific long-term financial goals, the Plan provides for Performance
Unit Plans. All named executive officers participate in these plans, in which
performance-based goals are determined at the beginning of each four-year award
cycle. The goals consider operating income, peer company performance, cash flow,
earnings per share, measures of economic value added, print product circulation
and/or quantitative revenue growth or profitability measurements of the Company
as a whole or any business unit thereof. Management and the Committee believe
that they have designed the performance-based goals to be challenging but
achievable. In two of the past three award cycles, the Company exceeded its
goals and paid out above target. In the 2001-2004 award cycle, the targeted
performance goals were not met and the plan paid out below target. Each
performance unit has a nominal value of $100. The maximum payout of performance
units is $200 per unit, and the payment of a total award to any individual at
the end of an award cycle may not exceed $5 million. (Currently, no named
executive officer has units in any award cycle whose total is likely to be worth
more than $1 million).
There
were new grants of performance units to the named executive officers in 2007,
and each of them also held grants from one previous cycle. The 2005-2008 plan is
based on a two-pronged target. Sixty-five percent of the target depends on the
Company’s operating divisions’ achievement (excluding Kaplan) against
Performance Unit financial targets for the period and 35% depends on the
increase in the value of Kaplan, Inc. The 2007-2010 plan is also based on a
two-pronged target. Sixty-five percent of the target depends on the Company’s
operating divisions’ achievement (excluding Kaplan) against Performance Unit
financial targets for the period and 35% depends on achievement of cumulative
operating income targets for Kaplan, Inc., for the period. These targets were
selected by the Committee because they reflected the key priorities for the
Company on the grant date for the applicable time periods. Mr. Graham holds
7,500 units in the 2005-2008 cycle and 9,750 units in the 2007-2010 cycle. Mr.
Morse holds 5,000 units in the 2005-2008 cycle and 6,500 units in the 2007-2010
cycle. Mr. Rosberg holds 3,500 units in the 2005-2008 cycle and 6,500 units in
the 2007-2010 cycle. Ms. McDaniel holds 3,500 units in the 2005-2008 cycle and
5,200 units in the 2007-2010 cycle. Ms. Dillon, who joined the Corporate office
in 2007, was awarded 1,500 units in the 2005-2008 award cycle and 4,550 units in
the 2007-2010 cycle. Mr. Graham has requested that he be paid out no more than
$400,000 for the open cycles of the Performance Unit plan.
Stock
Options
Although
the Company grants stock options sparingly, the Company’s Stock Option Plan,
which was reauthorized by shareholders as recently as 2003 and is separate from
the Plan, provides that shares of Class B Stock can be issued upon the exercise
of stock options that have been granted to key employees of the Company. The
Committee grants options only when a key employee has made a significant
contribution to the Company and demonstrates the ability to contribute more. The
options generally vest 25% per year over four years and are exercisable for ten
years from the grant date. None of the named executive officers received stock
option grants in 2007. As of the end of the Company’s 2007 fiscal year, Mr.
Morse held options to acquire 3,000 shares of Class B Stock (1,000 granted in
1998, 1,000 granted in 1999 and 1,000 granted in 2004). Mr. Rosberg held options
to acquire 5,000 shares of Class B Stock (1,000 granted in 1998, 2,000 granted
in 1999 and 2,000 granted in 2000). Ms. McDaniel held options to acquire 2,500
shares of Class B Stock (500 granted in 2001, 1,000 granted in 2003 and
17
1,000 granted in 2004).
Given Mr. Graham’s significant ownership in the Company, the Committee has not
granted any stock options to Mr. Graham.
Perquisites
The
Company provides few perquisites for the named executive officers. In 2007, Mr.
Morse received financial and tax advice valued at $9,116. Ms. McDaniel received
financial and tax advice valued at $8,346. Ms. Dillon received financial and tax
advice valued at $10,559. Ms. Dillon also received a housing allowance for
Washington, DC of $66,107 because her primary residence is in New
York.
Retirement
Benefits
Most
employees in the Company, including named executive officers, are eligible to
participate in the Company’s retirement benefit programs. Benefits under these
basic plans are determined on the basis of base salary only, exclusive of all
bonuses, deferred compensation and other forms of remuneration. The Company also
maintains 401(k) savings plans in which most employees are eligible to
participate.
Corporate
employees, including all named executive officers who are vested and who begin
to take their pension benefit at age 65 or whose age and years of service when
added together equal 90, receive an annual pension equal to 1.75% of their
highest average 60-month compensation annualized up to the limits permitted by
the Internal Revenue Code, minus covered compensation multiplied by the
appropriate Social Security offset percentage, multiplied by the number of years
of credited service under The Washington Post Company Retirement Program, with
credited service limited to 30 years. An annual cash pension supplement is also
provided to assist in payment of retiree medical coverage equal to $200
multiplied by the number of years of credited service under The Washington Post
Company Retirement Program. An additional cash pension supplement of $3,000 per
year was added in 2007 for those employees who retire prior to age 65 and who
participate in the Company’s medical insurance plans. The amount of the
supplement was determined by calculating the number that would make most
employees whole when the Company passed on a significant increase in the amount
that each retiree must pay for retiree medical insurance. The premiums are now
split 50-50 between the retiree and the Company. The pre-65 supplement is
discontinued when the retiree reaches age 65 and qualifies for
Medicare.
The
Company matches $1.30 on the dollar up to 4% on compensation permitted by the
Internal Revenue Service, for all Corporate employees who participate in the
401(k) plan.
Effective
January 1, 1989, the Company adopted an unfunded Supplemental Executive
Retirement Plan (the “SERP”), which was designed to retain and recruit key
executives. Participants in the SERP, including named executive officers, are
selected by management as employees management most wants to retain, because of
their superior performance, and approved by the Committee.
To offset
limitations placed on the income that can be considered in the formulas of
retirement plans by the IRS, the SERP provides a “supplemental normal retirement
benefit.” This benefit is calculated under the rules of the qualified benefit
retirement plan, but without reference to the IRS-imposed income limitations,
and includes in the calculation earnings from annual bonuses in the case of
certain key executives (including the named executive officers). In any instance
in which a retiring executive’s supplemented normal retirement benefit exceeds
the benefit payable by the qualified benefit plan or plans ($185,000 in 2008),
the Company will pay the excess to him or her as a supplemental retirement
benefit.
The SERP
also provides key executives, including the named executive officers, with
tax-deferred accruals of amounts proportionate to the benefits available to
non-highly compensated participants in the Company’s 401(k) savings plan, to the
extent that benefits exceed those under the Company’s basic plans because of the
tax law limitations ($46,000 in 2008). The executive is required to defer
compensation to the SERP savings plan in order to receive the applicable
matching company credit each year. In 2006, Mr. Graham waived his right to
maintain a separate unfunded savings plan account under the SERP.
The
Company also has a Deferred Compensation Plan for senior executives (including
the named executive officers) comparable to similar plans at peer companies
including those in the same industries with comparable revenues. This plan
provides an opportunity for participants to elect to defer the receipt of all or
a portion of cash awards under the annual and/or long-term components of the
Plan. Elections to defer must be filed in the year prior to the year(s) such
awards are earned. Deferred amounts earn investment credits in accordance with
participant elections from a choice of investment indexes. Deferred amounts will
be payable at retirement or such other future
18
date as
specified by the participant at the time of election. At the end of 2007, Mr.
Morse had a balance of $1,939,954 in deferred compensation; Mr. Rosberg had a
balance of $2,165,868; Ms. Dillon had a balance of $25,359; and Ms. McDaniel had
a balance of $599,612. Mr. Graham does not participate in the Deferred
Compensation Plan.
The
retirement plans are more fully described under “Pension Benefits,” beginning on
page 23.
Employment
Agreements and Severance Packages
Consistent
with its policy, the Company has not entered into any employment agreements with
or guaranteed severance packages to any of the named executive
officers.
Other
Benefit Plans
The plans
described above are similar to those offered to all senior management throughout
the divisions of The Washington Post Company. To attract, retain and motivate
talented executives in the competitive education marketplace, a stock option
plan was established in 1997 to provide equity incentives to Kaplan executives
consistent with those available to the management of publicly traded education
companies. The Kaplan Stock Option Plan (“KSOP”) is tied exclusively to
increases in Kaplan’s estimated value regardless of the Company’s performance as
a whole. No named executive officers participate in this plan.
Kaplan
Stock Option Plan
The KSOP
has served as a vehicle to attract, retain and motivate talented executives in
an increasingly competitive marketplace and industry segment. Under the KSOP,
options were granted to purchase common shares of Kaplan at the fair market
value on the date of the grant. Additionally, Kaplan shares were granted to a
senior manager of Kaplan over the past three years. The size of each grant was
determined by the value of the Kaplan stock and Kaplan stock options at the
time, the likely growth in that value and the importance of the individual to
growing the value of the Company in the future. All options granted will expire
no later than December 31, 2011, at the expiration of the KSOP. Each year, in
accordance with the KSOP, the Committee sets the fair market value of Kaplan as
if it were a public company. Goldman, Sachs & Co. assisted the Committee in
reviewing the data and setting the value. As of December 31, 2007, two Kaplan
employees held options to purchase 69,662 shares of Kaplan stock and held 6,544
Kaplan shares. An additional 1,778 Kaplan shares were issued in 2008 related to
2007 share awards. The significant majority of the options and shares are held
by Kaplan CEO Jonathan Grayer.
Once an
option is vested, the participant has the right to put the shares to Kaplan at
the prevailing fair market value or, upon exercise, the participant may elect to
receive Kaplan shares. Kaplan has the right to, and does, call shares held by
individuals whose employment is terminated. Since Kaplan can be required to
repurchase shares from all participants, an obligation exists that must be
accrued on Kaplan’s balance sheet on an accelerated basis over the vesting
period. As of December 31, 2007, the related stock compensation liability
amounted to approximately $101.2 million. The liability is “marked to market” as
the estimated fair market value of Kaplan stock options changes. This method can
result in some volatility throughout the year.
COMPENSATION
COMMITTEE REPORT
The
Committee has reviewed and discussed the Compensation Discussion and Analysis
required by Item 402(b) of Regulation S-K with management and, based on such
review and discussions, the Committee recommended to the Board that the
Compensation Discussion and Analysis be included in this Proxy
Statement.
| Ronald L. Olson, Chairman | |
| Lee C. Bollinger | |
| Barry Diller | |
| John L. Dotson Jr. |
19
Compensation
Committee Interlocks and Insider Participation
Barry
Diller and John L. Dotson Jr. served as members of the Compensation Committee in
2007. Ronald L. Olson was appointed to serve on the Compensation Committee in
February 2007. Lee C. Bollinger was appointed to serve on the Compensation
Committee in May 2007. No member of the Compensation Committee has ever been an
employee or officer of the Company. Ronald L. Olson, Chairman of the
Compensation Committee, is a partner in the law firm of Munger, Tolles &
Olson LLP (“Munger, Tolles”). Munger, Tolles provides legal services to Kaplan.
In 2007, Kaplan paid approximately $200,000 to Munger, Tolles in legal fees and
associated costs.
The
following table shows the compensation paid by the Company during 2007 to the
principal executive officer, the principal financial officer and the three most
highly compensated executive officers of the Company.
SUMMARY
COMPENSATION TABLE
|
Name
and
Principal
Position
(a)
|
Year
(b)
|
Salary($)
(c)
|
Stock
Awards($)
(d)1
|
Option
Awards($)
(e)1,2
|
Non-Equity
Incentive
Plan
Com-
pensation($)
(f)3
|
Change
in
Pension
Value
and
Non-
qualified
Deferred
Compen-
sation
Earnings($)
(g)4
|
All
Other
Compen-
sation($)
(h)6
|
Total($)
(i)
|
|
Donald
E.
Graham
|
||||||||
|
Chairman
of
the
Board
and
|
2007
|
$400,000
|
–
|
–
|
–
|
–
|
$11,700
|
$411,700
|
|
Chief
Executive
Officer
|
2006
|
400,000
|
$53,872
|
–
|
$
400,000
|
–
|
11,836
|
865,708
|
|
John
B.
Morse,
Jr.
|
||||||||
|
Vice
President –
Finance
and
|
2007
|
600,000
|
86,431
|
$ 68,733
|
288,600
|
$562,821
|
44,006
|
1,361,991
|
|
Chief
Financial
Officer
|
2006
|
585,000
|
85,066
|
68,733
|
1,286,170
|
295,187
|
48,865
|
2,369,021
|
|
Gerald
M.
Rosberg
|
||||||||
|
Vice
President –
Planning
and
|
2007
|
500,000
|
74,143
|
–
|
490,500
|
336,094
|
29,126
|
939,363
|
|
Development
|
2006
|
400,000
|
59,310
|
–
|
1,003,048
|
119,615
|
21,196
|
1,603,169
|
|
Veronica
Dillon
|
||||||||
|
Vice
President,
General
Counsel
|
2007
|
500,000
|
89,607
|
–
|
192,400
|
351,026
|
106,407
|
1,047,040
|
|
and
Secretary5
|
||||||||
|
Ann
L.
McDaniel
|
2007
|
440,000
|
77,206
|
122,053
|
169,312
|
344,237
|
33,994
|
1,017,490
|
|
Vice
President –
Human
Resources
|
2006
|
380,000
|
63,799
|
126,900
|
756,656
|
169,408
|
39,034
|
1,535,797
|
|
(1)
|
The value of the stock awards and the option awards is determined in accordance with FAS 123R as disclosed in the Comnpany’s 2007 Form 10K (footnote I) and 2006 Form 10K (footnote H). It represents
|
|
| (2) | The Company began expensing stock options in 2002. The amounts shown in column (e) reflect expenses associated with options granted in 2002 and thereafter. | |
| (3) | Amounts
in this column for 2007 represent payments under the |
|
| (4) | There were no above-market or preferential earnings on compensation that are deferred on a basis that is not tax-qualified. Thus, < font style="DISPLAY: inline; COLOR: #211d1e">no such earnings are reflected in the amounts shown in this column. | |
|
Pension benefits were assumed to commence at the age when they are first unreduced and were discounte<
font style="DISPLAY: inline; COLOR: #000000">d to the date as of which they were
determined (either 12/31/2007 or 12/31/2006). Assumed benefit commencement ages are shown below, rounded to the nearest age:
|
||
|
Graham: age 63 (12/31/2007); age 62 (12/31/2006)
Morse: age 65 (12/31/2007 and 12/31/2006)
Rosberg: age 65 (12/31/2007 and 12/31/2006)
Dillon: age 65 (12/31/2007 and 12/31/2006)
McDaniel: age 59 (12/31/2007 and 12/31/2006)
|
||
| Benefits in 2007 are attributable to The Retirement Plan for Washington Post Companies (“Retirement Plan”) and the Supplemental Executive Retirement Plan (“SERP”) as follows: Mr. Graham—($6,075) Retirement Plan and ($49,189) the SERP; Mr. Morse—$70,907 Retirement Plan and $491,914 the SERP; Mr. Rosberg—$54,134 Retirement Plan and $281,960 the SERP; Ms. Dillon—$34,917 Retirement Plan and $316,109 the SERP; and Ms. McDaniel—$72,751 Retirement Plan and $271,486 the SERP. The value of Mr. Graham’s pension benefits decreased from the prior yearend due to a combination of factors including his previously attaining the maximum plan service and unreduced benefit age, and no increase in his pensionable pay. | ||
| (5) | Ms. Dillon became General Counsel in January 2007. | |
| (6) | For
2007, the amounts presented in column (h) include the |
|
20
ALL
OTHER COMPENSATION
|
Name
(a)
|
Perquisites
($)
(b)a
|
401
(k)
Company
Contributions
($)
(c)
|
SERP
Company
Contributions
($)
(d)
|
Dividends
Not
Factored
in
Grant
Date
Fair
Value
of
Equity
Awards
($)
(e)b
|
Total
($)
(f)
|
|
Donald E. Graham
|
–
|
$11,700
|
–
|
–
|
$ 11,700
|
|
John B. Morse, Jr.
|
$ 9,116
|
11,700
|
$19,500
|
$3,690
|
44,006
|
|
Gerald M. Rosberg
|
–
|
11,700
|
14,300
|
3,126
|
29,126
|
|
Veronica Dillon
|
76,666
|
11,700
|
14,300
|
3,741
|
106,407
|
|
Ann L. McDaniel
|
8,346
|
11,700
|
11,180
|
2,768
|
33,994
|
| (a) | The amounts presented in column (b) represent financial planning services provided by the Company as follows: Mr. Morse, $9,116; Ms. Dillon, $10,559; and Ms. McDaniel, $8,346. In addition, Ms. Dillon had $66,107 in living expenses. |
| (b) | The amounts presented in column (e) represent dividends attributable to restricted stock granted under the Company’s Incentive Compensation Plan. |
The
following table provides information on awards made under the Company’s
Incentive Compensation Plan to each of the named executive officers in 2007. The
types of awards granted in 2007 include annual incentive, restricted stock
awards, and performance units:
GRANTS
OF PLAN-BASED AWARDS
|
All
Other
|
All
Other
|
Grant
|
||||||||
|
Nonequity
|
Stock
|
Option
|
Exercise
|
Date
|
||||||
|
Incentive
Plan
|
Awards:
|
Awards:
|
or
Base
|
Fair
|
||||||
|
Awards:
|
Estimated
Future Payouts Under
|
Number
|
Number
of
|
Price
of
|
Value
of
|
|||||
|
Approval
or
|
Number
of
|
Non-Equity
Incentive Plan Awards
|
of
Shares
|
Securities
|
Option
|
Stock
and
|
||||
|
Grant
|
Action
Date, if
|
Units
or Other
|
of
Stock or
|
Underlying
|
Awards
|
Option
|
||||
|
Date
|
Different
|
Rights
(#)
|
Threshold($)
|
Target($)
|
Max($)
|
Units
(#)
|
Options(#)
|
($/share)
|
Awards
|
|
|
Name
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
(k)
|
|
Donald
E. Graham
|
||||||||||
|
Performance
Units1
|
–
|
–
|
9,750
|
$
7,898
|
$400,000
|
$400,000
|
–
|
–
|
–
|
–
|
|
John
B. Morse, Jr.
|
||||||||||
|
Annual
Incentive2
|
–
|
–
|
–
|
105,000
|
420,000
|
735,000
|
–
|
–
|
–
|
–
|
|
Restricted
Stock3
|
01/02/07
|
12/07/06
|
–
|
–
|
–
|
–
|
200
|
–
|
–
|
$149,120
|
|
Performance
Units1
|
–
|
–
|
6,500
|
5,265
|
650,000
|
1,300,000
|
–
|
–
|
–
|
–
|
|
Gerald
M. Rosberg
|
||||||||||
|
Annual
Incentive2
|
–
|
–
|
–
|
62,500
|
500,000
|
712,500
|
–
|
–
|
–
|
–
|
|
Restricted
Stock3
|
01/02/07
|
12/07/06
|
–
|
–
|
–
|
–
|
200
|
–
|
–
|
149,120
|
|
Performance
Units1
|
–
|
–
|
6,500
|
5,265
|
650,000
|
1,300,000
|
–
|
–
|
–
|
–
|
|
Veronica
Dillon
|
||||||||||
|
Annual
Incentive2
|
–
|
–
|
–
|
75,000
|
300,000
|
525,000
|
–
|
–
|
–
|
–
|
|
Restricted
Stock3
|
01/02/07
|
12/07/06
|
–
|
–
|
–
|
–
|
250
|
–
|
–
|
186,400
|
|
Performance
Units1
|
–
|
–
|
4,550
|
3,686
|
455,000
|
910,000
|
–
|
–
|
–
|
–
|
|
Ann
L. McDaniel
|
||||||||||
|
Annual
Incentive2
|
–
|
–
|
–
|
66,000
|
264,000
|
462,000
|
–
|
–
|
–
|
–
|
|
Restricted
Stock3
|
01/02/07
|
12/07/06
|
–
|
–
|
–
|
–
|
150
|
–
|
–
|
111,840
|
|
Performance
Units1
|
–
|
–
|
5,200
|
4,212
|
520,000
|
1,040,000
|
–
|
–
|
–
|
–
|
|
Restricted
Stock3
|
12/06/07
|
–
|
–
|
–
|
–
|
–
|
750
|
–
|
–
|
594,375
|
| (1) | These grants represent performance units granted as part of a four-year award cycle. The Compensation Committee has set the performance-based goals for these grants, which are to be paid in Fiscal Year 2011. With the exception of those performance units granted to Mr. Graham, the amount in column (e) represents the minimum payment level which is $0.81 per unit. The amount shown in column (f) represents the nominal value of each unit which is $100, and the amount in column (g) represents the maximum payout per unit which is $200 per unit. The amounts appearing in columns (f) and (g) for Mr. Graham reflect his request that he be paid no more than $400,000 as a result of this award. In the event that the goals set by the Compensation Committee for these grants are not attained, no amount will be paid. |
| (2) | Amounts represented are the threshold, target and maximum payouts under the annual bonus component of the Company’s Incentive Compensation Plan. The Compensation Committee set the performance-based goals for the purpose of the annual incentive awards to be paid for Fiscal Year 2007. With the exception of Mr. Rosberg, the amount in column (e) represents the minimum payment level, which is 25% of the target amount shown in column (f). The amount in column (g) represents the maximum payout level, which is 175% of the target amount shown in column (f). For Mr. Rosberg, the amount in column (e) represents the minimum payment level which is 12.5% of the target amount shown in column (f). The amount shown in column (g) represents the maximum payout level, which is 142.5% of the target amount shown in column (f). In the event that the goals set by the Compensation Committee are not attained, no amount would be paid. |
| (3) | These grants represent shares of restricted stock. These awards vest at the end of a four-year restriction period. Dividends are payable on these awards from date of grant and are included in column (e) of the All Other Compensation table. |
21
NARRATIVE
DISCLOSURE TO SUMMARY COMPENSATION TABLE AND
GRANTS
OF PLAN-BASED AWARDS TABLE
The
following describes material features of the compensation disclosed in the
Summary Compensation Table and the Grants of Plan-Based Awards
Table.
Annual Bonus/Incentive. Both
tables show the annual bonus component under the Company’s Incentive
Compensation Plan. See the Compensation Discussion and Analysis for further
details on the annual bonuses.
Restricted Stock. The Summary
Compensation Table includes the value of Restricted Stock awarded in 2005 and
2007 to the named executive officers. Additionally, the Grants of Plan-Based
Awards Table reflects the number of restricted shares granted in 2007 and the
fair value of the awards on the date of grant. Restricted Stock generally vests
four years from the date of grant, subject to continued employment.
Performance Units. The Grants
of Plan-Based Awards Table presents Performance Units granted under the
Company’s Incentive Compensation Plan. Grants of Performance Units are made as
part of a four-year award cycle. The Compensation Committee sets the
performance-based goals for the grants at the beginning of each four-year award
cycle. See the Compensation Discussion and Analysis for further details on
Performance Units.
Stock Options. The value of
the stock option awards shown in the Summary Compensation Table represent
options granted under the Company’s Stock Option Plan. The options vest 25% per
year over a four-year period from the date of grant and are exercisable for ten
years from the date of grant.
The
following table shows the number of shares covered by exercisable and
unexercisable options and unvested restricted stock held by the Company’s named
executive officers on December 30, 2007.
OUTSTANDING
EQUITY AWARDS AT FISCAL YEAR-END
|
Option
Awards1
|
Stock
Awards2
|
||||||||
|
Equity
|
|||||||||
|
Equity
|
Incentive
|
||||||||
|
Equity
|
Incentive
|
Plan
Awards:
|
|||||||
|
Incentive
|
Plan
Awards:
|
Market
or
|
|||||||
|
Plan
Awards:
|
Market
|
Number
of
|
Payout
Value
|
||||||
|
Number
of
|
Number
of
|
Number
of
|
Number
of
|
Value
of
|
Unearned
|
of
Unearned
|
|||
|
Securities
|
Securities
|
Securities
|
Shares
or
|
Shares
or
|
Shares,
Units
|
Shares,
Units
|
|||
|
Underlying
|
Underlying
|
Underlying
|
Units
of
|
Units
of
|
or
Other
|
or
Other
|
|||
|
Unexercised
|
Unexercised
|
Unexercised
|
Option
|
Option
|
Stock
That
|
Stock
That
|
Rights
That
|
Rights
That
|
|
|
Options:
|
Options:
|
Unearned
|
Exercise
|
Expiration
|
Have
Not
|
Have
Not
|
Have
Not
|
Have
Not
|
|
|
Name
|
Exercisable
|
Unexercisable
|
Options
|
Price($)
|
Date
|
Vested(#)
|
Vested($)
|
Vested(#)
|
Vested($)
|
|
(a)
|
(#)
(b)
|
(#)
(c)
|
(#)
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
|
Donald
E. Graham
|
–
|
–
|
–
|
–
|
–
|
–
|
–
|
–
|
–
|
|
John
B. Morse, Jr.
|
1,000
|
–
|
–
|
$517.25
|
12/11/08
|
400
|
$320,600
|
–
|
–
|
|
1,000
|
–
|
–
|
543.00
|
12/20/09
|
|||||
|
750
|
250
|
–
|
953.50
|
12/13/14
|
|||||
|
Gerald
M. Rosberg
|
1,000
|
–
|
–
|
517.25
|
12/11/08
|
350
|
280,525
|
–
|
–
|
|
500
|
–
|
–
|
548.00
|
03/01/09
|
|||||
|
1,500
|
–
|
_
|
543.00
|
12/20/09
|
|||||
|
2,000
|
–
|
–
|
585.50
|
12/14/10
|
|||||
|
Veronica
Dillon
|
–
|
–
|
–
|
–
|
–
|
425
|
340,638
|
–
|
–
|
|
Ann
L. McDaniel
|
500
|
–
|
–
|
517.21
|
12/10/11
|
1,050
|
841,575
|
–
|
–
|
|
1000
|
–
|
–
|
816.05
|
12/02/13
|
|||||
|
750
|
250
|
–
|
953.50
|
12/13/14
|
|||||
|
(1)
|
Stock
Options granted under the Company’s Stock Option Plan vest 25% per year
over a four-year period from the date of grant.
|
||
|
The
following are the vesting dates of outstanding options granted to the
named executive officers:
|
|||
|
John
B. Morse, Jr.
|
1,000
|
12/11/1999
to 12/11/2002 — fully vested
|
|
|
1,000
|
12/20/2000
to 12/20/2003 — fully vested
|
||
|
1,000
|
12/13/2005
to 12/13/2008 — 750 fully vested
|
||
|
Gerald
M. Rosberg
|
1,000
|
12/11/1999
to 12/11/2002 — fully vested
|
|
|
500
|
03/01/2000
to 03/01/2003 — fully vested
|
||
|
1,500
|
12/20/2000
to 12/20/2003 — fully vested
|
||
|
2,000
|
12/14/2001
to 12/14/2004 — fully vested
|
||
|
Ann
L. McDaniel
|
500
|
12/10/2002
to 12/10/2005 — fully vested
|
|
|
1,000
|
12/02/2004
to 12/02/2007 — fully vested
|
||
|
1,000
|
12/13/2005
to 12/13/2008 — 750 fully
vested
|
||
22
|
(2)
|
Stock
awards have been granted in the form of restricted stock under the
Company’s Incentive Compensation Plan as of December 30, 2007. With the
exception of an award granted to Ms. McDaniel on 12/06/2007, all of the
awards listed below vest 100% at the end of the relevant four-year award
cycle. The award granted to Ms. McDaniel on 12/06/2007 was made outside
the four-year award cycle and will vest four years from the date of grant.
The following are the vesting dates of the grants to the named
executives:
|
||
|
John
B. Morse, Jr.
|
200
|
01/05/2009
|
|
|
200
|
01/03/2011
|
||
|
Gerald
M. Rosberg
|
150
|
01/05/2009
|
|
|
200
|
01/03/2011
|
||
|
Veronica
Dillon
|
175
|
01/05/2009
|
|
|
250
|
01/03/2011
|
||
|
Ann
L. McDaniel
|
150
|
01/05/2009
|
|
|
150
|
01/03/2011
|
||
|
750
|
12/06/2011
|
||
The
following table shows the number of Kaplan shares resulting from the exercise of
options and the number of Class B shares resulting from the vesting of
restricted stock by named executive officers in 2007 and the value realized upon
the related exercise and vesting.
OPTION
EXERCISES AND STOCK VESTED
|
Option
Awards
|
Stock
Awards
|
|||
|
Number
of Shares
|
Number
of Shares
|
|||
|
Acquired
on
|
Value
Realized
|
Acquired
on
|
Value
Realized
|
|
|
Name
|
Exercise
(#)
|
on
Exercise ($)
|
Vesting
(#)
|
on
Vesting ($)
|
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
|
Donald
E. Graham
|
–
|
–
|
300
|
$224,175
|
|
John
B. Morse, Jr.
|
–
|
–
|
200
|
149,450
|
|
Gerald
M. Rosberg
|
–
|
–
|
125
|
93,406
|
|
Veronica
Dillon
|
1,125(1)
|
$1,675,518
|
125
|
93,406
|
|
Ann
L. McDaniel
|
–
|
–
|
150
|
112,088
|
(1) In early 2007, Ms.
Dillon exercised 1,125 Kaplan Stock Options awarded to her during her tenure at
Kaplan, Inc.
PENSION
BENEFITS
The
Pension Benefits table includes information related to the Company’s
tax-qualified defined benefit plan, The Retirement Plan for Washington Post
Companies (the “Retirement Plan”), as well as the associated nonqualified plan,
The Washington Post Company Supplemental Executive Retirement Plan (“SERP”). The
Retirement Plan covers most full-time non-bargained employees of the Company and
provides benefits that are based on formulas that take into account base salary
and service. Such formulas are contained in individual affiliate benefits
schedules including the TWPC Retirement Benefits Schedule, the Newsweek
Retirement Benefits Schedule and the Kaplan Cash Balance Retirement Benefits
Schedule. Benefits under the Retirement Plan become vested after 3 or 5 years of
service, depending on which schedules cover the individual employee. All of the
named executive officers are fully vested in their benefits under the Retirement
Plan. The SERP provides benefits that are calculated based on the formulas in
the Retirement Plan, but including bonuses under the Incentive Compensation
Plan, rather than just base salary and without regard to: (i) the salary
limitation applicable to tax-qualified plans (currently $230,000) or (ii) the
benefit limitation applicable to tax-qualified plans (currently $185,000 per
year commencing at age 65). The SERP provides benefits only to the extent that
the benefit described above exceeds the benefit in the Retirement
Plan.
Retirement
Plan Benefits under the TWPC Retirement Benefit Schedule
Mr.
Graham, Mr. Morse, Mr. Rosberg, Ms. Dillon and Ms. McDaniel are participants in
the TWPC Retirement Benefits Schedule. Benefits payable under this Schedule
include the following, subject to the limitations on tax-qualified plans
mentioned above:
|
•
|
An
annual pension (payable one-twelfth each month) equal to: (a) 1.75% of the
average annual salary for the 60-month period producing the highest
average; multiplied by (b) years of credited service (up to 30 years);
reduced by (c) an offset to partially reflect social security benefits to
the extent funded by
the
|
23
|
|
Company.
The social security offset is calculated by multiplying “covered
compensation” by the “offset percentage.” Covered compensation in this
context is the average Social Security Taxable Wage Base over the 35 year
period prior to the year in which a participant reaches social security
retirement age. The offset percentage is a percentage ranging from 0.54%
to 0.60% (depending on the year of the participant’s birth), multiplied by
years of credited service (up to 30 years).
|
|
|
•
|
An
annual Cash Pension Supplement equal to $200 multiplied by years of
credited service up to 30 years.
|
|
|
•
|
A
temporary Pre-Age 65 Supplement of $250 per month payable until age 65 to
employees retiring after age 55 with 10 years of
service.
|
|
Benefits
under the Retirement Plan are payable in the form of a single life annuity. In
addition, several optional forms are available that continue benefits to the
employee’s spouse or beneficiary with the monthly benefit amount reduced so that
the resulting pension is actuarially equivalent to the single life annuity. The
Retirement Plan’s normal retirement age is 65 but an employee may retire under
the TWPC Retirement Benefits Schedule with a reduced benefit at age 55 with 10
years of service. The reduction is a percentage based on age at retirement. For
example, at age 55 the reduction is 60%, and at age 58 the reduction is 26%.
However, if the employee’s age plus years of service at retirement is at least
90, then there is no reduction for early payment.
Retirement
Plan Benefits under the Newsweek Retirement Benefits Schedule
A portion
of Ms. McDaniel’s pension benefit was earned under the Newsweek Retirement
Benefits Schedule. Benefits payable under this Schedule include the following,
subject to the limitations on tax-qualified plans mentioned above:
|
•
|
An
annual pension (payable one-twelfth each month) equal to: 1.1% of the
highest average compensation multiplied by years of credited service with
Newsweek after 1982 (with a slightly different formula for service before
1983).
|
|
|
•
|
An
annual Cash Pension Supplement equal to $150 multiplied by years of
credited service up to 30 years.
|
|
The
Newsweek Retirement Benefits Schedule permits early retirement with full
benefits at various combinations of age and service. Ms. McDaniel is presently
entitled to an unreduced early retirement benefit.
Retirement
Plan Benefits under the Kaplan Cash Balance Retirement Benefit
Schedule
A portion
of Ms. Dillon’s pension benefit was earned under the Kaplan Cash Balance
Retirement Benefits Schedule. Under this Schedule, each employee has an account
(expressed as a lump sum amount, rather than as an annuity) that is credited
with compensation-based credits and interest credits. Compensation-based credits
vary from 2.25% of salary to 3.75% of salary, depending on years of service.
Interest is credited on these accounts at a rate equal to the interest rate on
one-year U.S. Treasury securities plus one percent. Upon retirement, the
employee may elect various forms of annuities that are actuarially equivalent to
the accumulated account balance or, alternatively, may elect a lump sum payment.
Benefits are payable upon termination of employment at any age.
SERP
Benefits
As
explained above, the SERP provides benefits to each of the named executive
officers under the formulas outlined above, counting bonuses in addition to
salary and without regard to the limits on compensation and benefits, to the
extent that the resulting total benefit exceeds the benefits payable under the
Retirement Plan. Benefits under the SERP are paid at retirement or age 55, if
later, and are payable either in the form of a life annuity or an actuarially
equivalent annuity form that is one of the optional forms of benefit in the
Retirement Plan provided, however, that any benefits otherwise payable before
the first day of the seventh month following retirement will be withheld until
such date.
24
Pension
Benefits
|
Number
of
|
Present
|
Payments
|
|||
|
Years
of
|
Value
of
|
During
|
|||
|
Credited
|
Accumulated
|
Last
Fiscal
|
|||
|
Name
|
Plan
Name
|
Service
|
Benefit
|
Year
|
|
|
(a)
|
(b)
|
(c)1
|
(d)2
|
(e)3
|
|
|
Donald
E. Graham
|
Retirement Plan
|
37
|
$1,171,459
|
–
|
|
|
SERP
|
37
|
1,092,188
|
–
|
||
|
John
B. Morse, Jr.
|
Retirement Plan
|
19
|
527,450
|
–
|
|
|
SERP
|
19
|
1,747,904
|
–
|
||
|
Gerald
M. Rosberg
|
Retirement Plan
|
12
|
333,128
|
–
|
|
|
SERP
|
12
|
717,642
|
–
|
||
|
Veronica
Dillon
|
Retirement Plan
|
17
|
82,721
|
–
|
|
|
SERP
|
17
|
1,323,026
|
–
|
||
|
Ann
L. McDaniel
|
Retirement Plan
|
24
|
573,532
|
–
|
|
|
SERP
|
24
|
873,745
|
–
|
||
| (1) | Data in this column represent the number of years of credited service earned by the named executive officer as of December 31, 2007. Mr. Graham’s total years of credited service are shown, even though the pension formula limits credited service to 30 years. This limitation is reflected in the calculated amounts in column (d). Ms. McDaniel has prior service with Newsweek, and Ms. Dillon has prior service with Kaplan, both of which are included in this column. |
| (2) | Amounts in this column represent the actuarial present value of the named executive officer’s accumulated benefit under the plan, as of December 31, 2007. The benefits valued for Ms. McDaniel include The Washington Post Company and Newsweek amounts. The benefits valued for Ms. Dillon include The Washington Post Company and Kaplan Cash Balance amounts. The assumptions used in determining the present value of accumulated benefits were those used for disclosure under FAS 158 at December 31, 2007 (included in Note J in the Company’s 2007 Form 10-K); 1994 GAM mortality tables for males and females; and a 6% discount rate. The benefits reflect service and earnings through December 31, 2007, and are valued as payable commencing on the date at which they are unreduced. Mr. Graham, Mr. Morse, Mr. Rosberg and Ms. Dillon are presently eligible for early retirement under the Retirement Plan. There can be no assurance that the amounts listed in this column will ever be fully paid out to the applicable named executive officer. |
| (3) | No payments were made from these plans to the named executive officers during 2007. |
This
table includes information related to the SERP and the Deferred Compensation
Plan. Among the benefits provided under the SERP is a supplemental defined
contribution plan benefit, which is equal to the applicable Company matching
contribution percentage multiplied by a maximum of 4% of the participating
executive’s base salary in excess of the annual covered compensation limit
applied to qualified plan benefits. The executive is required to make
contributions to the SERP in order to receive the applicable matching Company
credit each year. The Deferred Compensation Plan provides an opportunity for
participants to elect to defer the receipt of all or a portion of cash awards
under the annual and/or long-term components of the Incentive Compensation Plan.
Elections to defer must be filed in advance of earning such awards. Deferred
amounts under both plans will earn investment credits in accordance with the
participant’s elections from a choice of investment indexes. Amounts deferred
under the SERP are payable on the first day of the seventh month following
termination. Amounts deferred under the Deferred Compensation Plan are payable
six months following the date of termination or such other future date as
specified by the participant at the time of election.
NONQUALIFIED
DEFERRED COMPENSATION
|
Executive
|
Registrant
|
Aggregate
|
Aggregate
|
Aggregate
|
|
|
Contributions
in
|
Contributions
in
|
Earnings
in
|
Withdrawals/
|
Balance
at
|
|
|
Name
|
Last
FY ($)
|
Last
FY ($)
|
Last
FY ($)
|
Distributions
($)
|
last
FYE ($)
|
|
(a)
|
(b)1
|
(c)2
|
(d)3
|
(e)
|
(f)4
|
|
Donald
E. Graham
|
–
|
–
|
–
|
–
|
–
|
|
John
B. Morse, Jr.
|
$434,615
|
$19,500
|
$
69,371
|
–
|
$1,939,954
|
|
Gerald
M. Rosberg
|
535,400
|
14,300
|
142,391
|
–
|
2,165,868
|
|
Veronica
Dillon
|
11,000
|
14,300
|
59
|
–
|
25,359
|
|
Ann
L. McDaniel
|
189,146
|
11,180
|
34,929
|
–
|
599,612
|
| (1) | Amounts in this column represent contributions by the named executive officer to the SERP and to the Deferred Compensation Plan as follows: Mr. Morse – $15,000 to the SERP and $419,615 to Deferred Compensation; Mr. Rosberg – $11,000 to the SERP and $524,400 to Deferred Compensation; Ms. Dillion – $11,000 to the SERP; Ms. McDaniel – $8,600 to the SERP and $180,546 to Deferred Compensation Plan. |
| (2) | Company matching credits to the SERP are included in column (h) in the Summary Compensation Table for fiscal year 2007. |
| (3) | Amounts in this column represent investment credits to the SERP and to the Deferred Compensation Plans based on the named executive officer’s investment election as follows: Mr. Morse – ($389) to the SERP and $69,760 to Deferred Compensation Plan; Mr. Rosberg – $43,098 to the SERP and $99,293 to Deferred Compensation Plan; Ms. Dillion – $59 to the SERP; Ms. McDaniel – $6,773 to the SERP and $28,156 to Deferred Compensation Plan. These earnings are not included in the Summary Compensation Table; investments credits reflect market performance of investment indexes selected by the named executive officer. |
25
| (4) |
Amounts
in this column represent balances at December 31, 2007 for the SERP and
Deferred Compensation Plan as follows: Mr. Morse –$381,138 in the SERP and
$1,558,816 in deferred compensation; Mr. Rosberg – $203,556 in the SERP
and $1,962,312 in deferred compensation; Ms. Dillion – $25,359 in the
SERP; Ms. McDaniel – $101,721 in the SERP and $497,891 in deferred
compensation.
|
AUDIT COMMITTEE
REPORT
One of the standing
committees of the Board of Directors of the Company is the Audit Committee.
Currently there are four non-employee members of the Board on the Audit
Committee: Christopher C. Davis, John L. Dotson Jr., Thomas S. Gayner and
Richard D. Simmons, who serves as Chairman of the Audit Committee. The Audit
Committee operates under a delegation of authority from the Board of Directors,
which has determined that each Committee member is “independent” under the
listing standards of the New York Stock Exchange. Specifically, the Board
determined that none of the members of the Audit Committee (or any immediate
family member) (i) had been employed by or affiliated with the Company within
the past three years, (ii) received any compensation from the Company other than
Director and committee fees and pension or other forms of deferred compensation
(not contingent in any way on continued service), (iii) is an executive officer
of a company that makes payments to or receives payments from the Company in an
amount that exceeds the greater of $1 million or 2% of such other company’s
consolidated gross revenues within the past three years or (iv) has a material
relationship with the Company.
Management
has the primary responsibility for the preparation of the Company’s financial
statements in accordance with generally accepted accounting principles and for
the financial reporting process, including its system of internal control. The
Company’s independent auditor, PricewaterhouseCoopers LLP, is responsible for
auditing those financial statements in accordance with auditing standards
generally accepted in the United
States of America and
for issuing a report thereon. In this context, the Audit Committee’s
responsibility is to monitor and review these processes, as well as the
independence and performance of the Company’s auditor. In undertaking its
monitoring and reviewing responsibilities, without independent verification, the
Audit Committee has relied on (i) management’s representation that the financial
statements have been prepared with integrity and objectivity and in conformity
with generally accepted accounting principles in the United
States of America and
(ii) the representations of PricewaterhouseCoopers LLP included in their report
on the Company’s financial statements.
The Audit Committee
has reviewed and discussed the audited fiscal year 2007 financial statements
with the Company’s management. In addition, the Audit Committee has discussed
with PricewaterhouseCoopers LLP the matters required to be discussed by
Statement on Accounting Standards No. 61 (Communication with Audit Committees),
as modified or supplemented. The Audit Committee has received the written
disclosures and the letter from PricewaterhouseCoopers LLP required by
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), as modified or supplemented, and has discussed with the independent
auditor its independence from the Company and the Company’s management. The
Audit Committee has also considered whether PricewaterhouseCoopers LLP’s
provision of non-audit services to the Company is compatible with the
independence of such firm.
The Audit Committee
also continued to pay close attention and devoted considerable time to reviewing
and understanding the certification process on internal controls mandated under
Section 404 of the Sarbanes-Oxley Act of 2002.
Preapproval
policy
In
2007, the Audit Committee again reviewed and reauthorized its policies and
procedures with regard to the preapproval of audit and non-audit services
performed by the independent auditor in order to assure that the provision of
such services does not impair the auditor’s independence. Unless a type of
service to be provided by the independent auditor has received preapproval, it
will require specific preapproval by the Audit Committee. Any proposed
services exceeding preapproved cost levels will require specific preapproval by
the Audit Committee. The term of any preapproval is 12 months from the date of
preapproval, unless the Audit Committee specifically provides for a different
period. The Audit Committee will periodically review and preapprove the services
that may be provided by the independent auditor without obtaining specific
preapproval from the Chairman of the Audit Committee, as well as revise the list
of preapproved services from time to time, based on subsequent
determinations.
26
The Audit Committee
will not delegate its responsibilities to preapprove services performed by the
independent auditor to management. The Audit Committee may delegate preapproval
authority to one or more of its members. The annual audit services engagement
terms and fees will be subject to the specific preapproval of the Audit
Committee. The Audit Committee will approve, if necessary, any changes in terms,
conditions and fees resulting from changes in audit scope, Company structure or
other matters. In addition to the annual audit services engagement specifically
approved by the Audit Committee, the Audit Committee may grant preapproval for
other audit services, which are those services that only the independent auditor
reasonably can provide.
Audit-related
services are assurance and related services that are reasonably related to the
performance of the audit or review of the Company’s financial statements or that
are traditionally performed by the independent auditor. The Audit Committee
believes that the provision of audit-related services does not impair the
independence of the independent auditor.
The Audit Committee
believes that the independent auditor can provide tax services to the Company
such as tax compliance, tax planning and tax advice without impairing such
auditor’s independence. However, the Audit Committee will not permit the
retention of the independent auditor in connection with a transaction initially
recommended by the independent auditor, the purpose of which may be tax
avoidance and the tax treatment of which may not be supported in the Internal
Revenue Code and related regulations.
The Audit Committee
may grant preapproval to those permissible non-audit services classified as “All
Other” services that it believes are routine and recurring services and would
not impair the independence of the auditor. Preapproval fee levels for all such
services to be provided by the independent auditor will be established annually
by the Audit Committee. Any proposed services exceeding these levels will
require specific preapproval by the Audit Committee.
Requests or
applications to provide services that require specific approval by the Audit
Committee will be submitted to the Audit Committee by the Chief Financial
Officer or Controller (or other designated officer) and must include a statement
from that individual as to whether, in his or her view, the request or
application is consistent with the SEC’s rules on auditor
independence.
In addition, the
Audit Committee has established procedures for, and received periodic reports
on, the receipt, retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls or auditing matters and the
confidential, anonymous submission by employees of the Company of concerns
regarding questionable accounting or auditing matters through the use of a
third-party-managed telephone hotline.
27
Audit
Fees
PricewaterhouseCoopers
LLP fees for the annual audit, statutory audits and reviews of financial
statements included in the Company’s quarterly filings, including reimbursable
expenses, were $3,590,914 in 2007 and $3,856,000* in 2006, which fees were
reviewed and approved by the Audit Committee.
Audit-Related
Fees
PricewaterhouseCoopers
LLP fees for assurance and related services reasonably related to the
performance of the audit or reviews of financial statements and not included
under “Audit Fees” above, including reimbursable expenses, were $406,900 in 2007
and $529,490* in 2006, which fees were reviewed and approved by the Audit
Committee. These fees were primarily for financial due diligence and transaction
analysis, audits of employee retirement and savings plans and other
audit-related reports.
Tax
Fees
PricewaterhouseCoopers
LLP fees for tax compliance, tax advice and tax planning, including reimbursable
expenses, were $767,733 in 2007 and $1,239,135 in 2006, which fees were reviewed
and approved by the Audit Committee. These fees were primarily for tax due
diligence and transaction analysis, as well as federal, multistate and foreign
tax consulting.
All
Other Fees
PricewaterhouseCoopers
LLP fees for all other products and services provided by PricewaterhouseCoopers
LLP were $10,000 in 2007 and $22,031 in 2006. There were no fees paid to
PricewaterhouseCoopers LLP for financial information systems design or
implementation in either 2007 or 2006.
Based on such
review and discussion and in reliance thereon, the Audit Committee recommended
to the Board of Directors, and the Board has approved, that the audited
financial statements be included in the Company’s Annual Report on Form
10-K for the year ended December 30, 2007, for filing with the Securities
and Exchange Commission.
|
Richard D. Simmons,
Chairman
|
|
|
Christopher C.
Davis
|
|
|
John L. Dotson
Jr.
|
|
|
Thomas S.
Gayner
|
| * |
For annual and
statutory audits, fees are classified based upon the year under audit
versus the year paid. Accordingly, the amounts reported for Audit Fees
and Audit-Related Fees in 2006 have been adjusted to include
additional fees for audit and audit-related services rendered and not
reflected in the
Company’s 2006 Proxy
Statement.
|
28
Transactions
with Related Persons, Promoters and Certain Control Persons
Effective
September 2007, the Company renewed for one year a contract with Mrs. Elizabeth
G. Weymouth, the daughter of the late Mrs. Katharine Graham and the sister of
Mr. Donald E. Graham, under which she contributes articles to The Washington
Post newspaper and is to be compensated at the rate of $25,000 annually. In
addition, Mrs. Weymouth is employed full-time as a Senior Editor at
Newsweek magazine, and she received $184,063 in compensation in
2007.
Effective
February 11, 2008, Katharine Weymouth, a granddaughter of the late Mrs.
Katharine Graham, a daughter of Mrs. Elizabeth G. Weymouth and a niece of Mr.
Donald E. Graham, was appointed Publisher of The Washington Post newspaper and
CEO of Washington Post Media. Prior to her recent appointment, Ms. Weymouth
served as Vice President–Advertising of The Washington Post newspaper. In 2007,
Ms. Weymouth was paid $220,000 in base salary and she received a bonus of
$108,167 based on the achievement of pre-established performance goals. She
was awarded 100 shares of restricted stock and 1,000 Performance Units from the
2005-2008 Award Cycle and 200 shares of restricted stock and 2,400
Performance Units from the 2007-2010 Award Cycle. Ms. Weymouth’s salary was
increased to $500,000 in February 2008.
OTHER
MATTERS THAT MAY COME BEFORE THE MEETING
As of the
date of this Proxy Statement, the only matters that the Board of Directors
expects to present to the meeting are those discussed herein. If any other
matter or matters are properly brought before the meeting or any adjournment
thereof, it is the intention of the persons named in the accompanying form of
Proxy to vote on those matters in accordance with their best
judgment.
Upon the
recommendation of the Audit Committee, the Board of Directors has selected
PricewaterhouseCoopers LLP as the Company’s independent registered accountant to
audit and report on its financial statements for the fiscal year 2008. The same
firm has acted as the Company’s independent accountant continuously since the
Company was organized in 1946. As in previous years, a representative of
PricewaterhouseCoopers LLP will be present at the Annual Meeting, will have the
opportunity to make any statement that he or she may desire with respect to the
Company’s financial statements for 2007 and the firm’s relationship with the
Company and will be available to respond to appropriate questions from
shareholders.
29
Notice of
Annual Meeting
and
Proxy Statement
2008
THE
WASHINGTON
POST
COMPANY
THE
WASHINGTON
POST
COMPANY
|
Using
a black ink pen, mark your
votes with an X as
shown in
this
example. Please do not write outside the designated
areas.
|
 |
||||||||
|
Annual
Meeting Proxy Card Class — Class A Common
|
|||||||||
PLEASE FOLD ALONG
THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED
ENVELOPE. |
A
|
Proposals
— The Board of Directors recommends a vote FOR all the nominees listed and
FOR Proposal
2.
|
|
1.
|
Election
of Directors:
|
For
|
Withhold
|
For
|
Withhold
|
For
|
Withhold
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|||||
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01
- Lee C. Bollinger
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 |
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02
- Warren E. Buffett
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03
- Barry Diller
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 |
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04
- Melinda F. Gates
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05
- Thomas S. Gayner
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06
- Donald E. Graham
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07
- Anne M. Mulcahy
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For
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Against
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Abstain
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|||||
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2.
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To
transact such other business as may properly come before
said
meeting or any adjournment thereof.
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|
B
|
Non-Voting
Items
|
||
|
Change of Address —
Please print new address below.
|
|
Comments — Please print your comments below. | |
|
|
|||
|
C
|
Authorized
Signatures — This section must be completed for your vote to be counted. —
Date and Sign Below
|
||||||||
|
Please
sign exactly as name(s) appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, corporate officer,
trustee, guardian, or custodian, please give
|
|||||||||
|
full
title.
|
|||||||||
|
Date
(mm/dd/yyyy) — Please print date below.
|
Signature
1 — Please keep signature within the box.
|
Signature
2 — Please keep signature within the box.
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|||||||
|
/ /
|
|||||||||
 |
7 1 B V |
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|||||||
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00U9IA
|
|||||||||
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE
BOTTOM PORTION IN THE ENCLOSED ENVELOPE. THE WASHINGTON
POST COMPANY
|
Proxy — The Washington Post
Company
|
Class
A Common Stock
Annual
Meeting of Stockholders - May 8, 2008
Solicited
on behalf of the Board of Directors
The
undersigned hereby appoints Donald E. Graham, John B. Morse, Jr., Veronica
Dillon and Gerald M. Rosberg, and each of them, his/her true and lawful agents
and proxies, with full power of substitution in each, to represent the
undersigned, and to vote as indicated on the reverse of this Proxy all shares of
Class A Common Stock which the undersigned is entitled to vote, at the Annual
Meeting of Stockholders of THE WASHINGTON POST COMPANY to be held on May 8,
2008, and at any adjournments thereof, on all matters coming before said
meeting.
You
are encouraged to specify your choices by marking the appropriate boxes. SEE
REVERSE SIDE, but you need not mark any boxes if you wish to vote in accordance
with the Board of Directors’ recommendations. The Proxy Committee cannot vote
your shares unless you sign and return this card.
Please
vote, date and sign this proxy on the other side and return promptly in the
enclosed envelope.
(Continued
and to be voted on reverse side.)
THE
WASHINGTON
POST
COMPANY
|
Electronic Voting
Instructions
You can vote by Internet or
telephone!
Available 24 hours a day, 7 days a
week!
Instead of mailing your proxy, you
may choose one of the two voting
methods outlined below to vote
your proxy.
VALIDATION DETAILS ARE LOCATED
BELOW IN THE TITLE BAR.
Proxies submitted by the Internet
or telephone must be received by
5:00 p.m., Eastern Daylight Saving
Time, on May 7, 2008.
|
||||
 |
Vote by
Internet
|
|||
|
• ● Log on to the
Internet and go to
www.investorvote.com
• ● Follow the
steps outlined on the secured website.
|
||||
 |
Vote by
telephone
|
|||
|
• ● Call toll
free 1-800-652-VOTE (8683) within the United
States, Canada & Puerto Rico any time on a touch
tone
telephone.
There is NO CHARGE
to you for the
call.
• ● Follow the
instructions provided by the recorded message.
|
||||
|
Using a black ink pen, mark your votes with an
X as shown in
this example. Please do not write
outside the designated areas.
|
|
|||
|
Annual
Meeting Proxy Card — Class B Common
|
 |
 |
 |
IF YOU HAVE NOT VOTED VIA
THE INTERNET OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN
THE ENCLOSED ENVELOPE. |
A
|
Proposals
— The Board of Directors recommends a vote FOR all the
nominees listed and FOR Proposal
2.
|
|||||||||
|
1.
|
Election
of Directors:
|
For
|
Withhold
|
For
|
Withhold
|
For
|
Withhold
|
|||
|
01
- Christopher C. Davis
|
|
|
02
- John L. Dotson Jr.
|
|
|
03
- Ronald L. Olson
|
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|
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|
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|
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For
|
Against
|
Abstain
|
||||
|
2.
|
To
transact such other business as may properly come before
said
meeting or any adjournment thereof.
|
|
|
|
|
B
|
Non-Voting
Items
|
Meeting Attendance | ||||||
|
Change of Address —
Please print new address below.
|
Comments — Please print
your comments below.
|
|||||||
|
Mark
the box to the right
if
you plan to attend the
Annual
Meeting.
|
|
|||||||
|
C
|
Authorized
Signatures — This section must be completed for your vote to be counted. —
Date and Sign Below
|
||||||||
|
Please
sign exactly as name(s) appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, corporate officer,
trustee, guardian, or custodian, please give
|
|||||||||
|
full
title.
|
|||||||||
|
Date
(mm/dd/yyyy) — Please print date below.
|
Signature
1 — Please keep signature within the box.
|
Signature
2 — Please keep signature within the box.
|
|||||||
|
/ /
|
|||||||||
|
3 1 D V |
|
|||||||
|
00U9JA
|
|||||||||
IF YOU HAVE NOT VOTED VIA
THE INTERNET OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN
THE ENCLOSED ENVELOPE. THE WASHINGTON
POST COMPANY
|
Proxy — The Washington Post
Company
|
The
Washington Post Company
Class
B Common Stock
Annual
Meeting of Stockholders - May 8, 2008
Solicited
on behalf of the Board of Directors
The
undersigned hereby appoints Donald E. Graham, John B. Morse, Jr., Veronica
Dillon and Gerald M. Rosberg, and each of them, his/her true and lawful agents
and proxies, with full power of substitution in each, to represent the
undersigned, and to vote as indicated on the reverse of this Proxy all shares of
Class B Common Stock which the undersigned is entitled to vote, at the Annual
Meeting of Stockholders of THE WASHINGTON POST COMPANY to be held on May 8,
2008, and at any adjournments thereof, on all matters coming before said
meeting.
You
are encouraged to specify your choices by marking the appropriate boxes. SEE
REVERSE SIDE, but you need not mark any boxes if you wish to vote in accordance
with the Board of Directors’ recommendations. The Proxy Committee cannot vote
your shares unless you sign and return this card.
Please
vote, date and sign this proxy on the other side and return promptly in the
enclosed envelope.
(Continued
and to be voted on reverse side.)
TO
CHANGE YOUR VOTE
Any
subsequent vote by any means will change your prior vote. For example, if you
voted by telephone, a subsequent Internet vote will change your vote. The last
vote received before 5:00 p.m., Eastern Daylight Saving Time on May 7, 2008 will
be the one counted. You may also revoke your proxy by voting in person at the
annual meeting.