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. )
Filed by the Registrantx
Filed by a Party other than the Registrant☐
Check the appropriate box:
Preliminary Proxy Statement |
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
Definitive Proxy Statement |
Definitive Additional Materials |
Soliciting Material Pursuant to §240.14a-12 |
THE NEW YORK TIMES COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
No fee required. |
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
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The New York Times
Company
Notice of 20102011
Annual Meeting and
Proxy Statement
620 Eighth Avenue New York, NY 10018
tel 212-556-1234 |
Invitation to 20102011 Annual Meeting of Stockholders
DATE: Tuesday,Wednesday, April 27, 20102011
TIME: 10:00 a.m.
PLACE: TheTimesCenter
242 West 41st Street, New York, NY 10018
March 12, 201018, 2011
Dear Fellow Stockholder:
Please join me at our Annual Meeting on Tuesday,Wednesday, April 27, 2010,2011, where you will be asked to vote on the election of the Board of Directors the adoption of a new 2010 Incentive Compensation Plan and the ratification of the selection of auditors.
There We are a few changespleased to the Board slate this year. Daniel H. Cohen, a memberannounce that all of the Ochs-Sulzberger family, Scott Galloway and William E. Kennard are not standingour directors have agreed to stand for electionre-election at this year’s Annual Meeting. Each provided invaluable advice during his tenure, and we are grateful for their many contributions.
I am very pleasedIn addition, our Class B stockholders will be asked to haveCarolyn D. Greenspon as a new nominee for election to our Board this year.She is a fifth-generation member of the Ochs-Sulzberger family and brings a deep appreciation of the values and societal contributions of The New York Times and our Company throughout their history.vote on advisory resolutions on executive compensation.
The Company is once again taking advantage of the Securities and Exchange Commission rule that allows us to provide proxy materials over the Internet. On or about March 12, 2010,18, 2011, we will begin mailing a Notice of Internet Availability of Proxy Materials to stockholders informing them that the Proxy Statement, 20092010 Annual Report and voting instructions are available online. As more fully described in that Notice, all stockholders may choose to access proxy materials on the Internet or may request to receive paper copies of the proxy materials.
In addition to the formal items of business at the Annual Meeting, my colleagues and I will review the major Company developments over the past year and share with you our plans for the future. You will have an opportunity to ask questions and express your views to the senior management of The New York Timesthe Company. Members of the Board of Directors will also be present.
Whether or not you are able to attend the Annual Meeting in person, it is important that your shares be represented. Please vote your shares using the Internet or the designated toll-free telephone number, or by requesting a printed copy of the proxy materials and completing and returning by mail the proxy card you will receive in response to your request. Instructions on each of these voting methods are outlined in the enclosed Proxy Statement. Please vote as soon as possible.
I hope to see you on April 27th.
ARTHUR SULZBERGER, JR.
Chairman of the Board
620 Eighth Avenue New York, NY 10018
tel 212-556-1234 |
Notice of Annual Meeting of Stockholders
To be held Tuesday,Wednesday, April 27, 20102011
To the Holders of Class A and Class B
Common Stock of The New York Times Company:
The Annual Meeting of Stockholders of The New York Times Company will be held at 10:00 a.m., local time, on Tuesday,Wednesday, April 27, 2010,2011, at TheTimesCenter, 242 West 41st Street, New York, NY 10018, for the following purposes:
1. | To elect a Board of 13 members; |
2. | To |
3. | To |
4. | To ratify the selection of Ernst & Young LLP, an independent registered public accounting firm, as auditors for the fiscal year ending December |
To transact such other business as may properly come before the meeting. |
Holders of the Class A and Class B common stock as of the close of business on February 26, 2010,28, 2011, are entitled to notice of and to attend this meeting as set forth in the Proxy Statement. Class A stockholders are entitled to vote for the election of four of the 13 directors. Class B stockholders are entitled to vote for the election of nine of the 13 directors, and on the advisory resolutions on executive compensation and the frequency of future advisory votes on executive compensation. Class A and Class B stockholders, voting together as a single class, are entitled to vote on the proposal to approve the 2010 Incentive Plan and to ratify the selection of Ernst & Young LLP as auditors for the 20102011 fiscal year. Class B stockholders are entitled to vote for the election of nine of the 13 directors and on allany other matters presented toat the meeting.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, PLEASE VOTE AS PROMPTLY AS POSSIBLE USING THE INTERNET OR THE DESIGNATED TOLL-FREE TELEPHONE NUMBER, OR BY REQUESTING A PRINTED COPY OF THE PROXY MATERIALS AND COMPLETING AND RETURNING BY MAIL THE PROXY CARD YOU WILL RECEIVE IN RESPONSE TO YOUR REQUEST. THIS IS IMPORTANT FOR THE PURPOSE OF ENSURING A QUORUM AT THE MEETING.
New York, NY
March 12, 201018, 2011
By Order of the Board of Directors
KDENNETHIANE A. RBICHIERIRAYTON
Senior Vice President,Secretary and Assistant General Counsel & Secretary
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The New York Times Company
Proxy Statement
Annual Meeting of Stockholders to be Held on April 27, 20102011
Voting on Matters Before the Annual Meeting
Q: | What am I voting on? |
A: | There are |
♦ | Proposal |
♦ | Proposal |
♦ | Proposal |
♦ | Proposal 4:Ratification of the selection of Ernst & Young LLP as auditors for the fiscal year ending December |
Q: | Who is entitled to vote? |
A: | The New York Times Company has two classes of outstanding voting securities: Class A stock and Class B stock. Stockholders of record of Class A or Class B stock as of the close of business on February |
♦ | Proposal |
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♦ | Proposal |
Q: | Why did I receive a notice in the mail regarding the Internet availability of the proxy materials instead of a paper copy of the proxy materials? |
A: | We have elected to furnish to our stockholders this Proxy Statement and our |
Q: | How do I get electronic access to the proxy materials? |
A: | The Notice will provide you with instructions regarding how |
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You may request to receive all future stockholder communications (i.e., the annual report, proxy statement and other correspondence) electronically by email, instead of in print, and we encourage you to do so. You may choose this method of delivery in the “Investors” section of our Web site athttp://www.nytco.com/investors/shareholderservices. If you choose to receive future stockholder communications electronically, you will receive an email next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by email will remain in effect until you terminate it or for so long as the email address provided by you is valid.
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Q: | What is the difference between holding shares as a “registered holder” and as a “beneficial owner” of shares held in street name? |
A: | ♦ | Registered Holder. If your shares are registered directly in your name on the books of the Company maintained with the Company’s transfer agent, BNY Mellon Shareowner Services, you are considered the “registered holder” of those shares and the |
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♦ | Beneficial Owner of Shares Held in Street |
Q: | How do I cast my |
A: |
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Annual Meeting. If you choose to vote by proxy, you may do so by using the Internet or the designated toll-free telephone number, or |
mail. Whichever method you use to vote by proxy, each valid proxy received in time will be voted at the Annual Meeting in accordance with your instructions. To ensure that your proxy is voted, it should be received by the close of business on April 26, |
♦ | Vote by |
You can vote your shares by Internet on the voting Web site,http://www.proxyvote.com. Internet voting is available 24 hours a day, seven days a week. Follow the instructions and have your Notice, proxy card or voting instruction form in hand, as you will need to reference your assigned Control Number(s).
♦ | Vote by Telephone |
You can also vote your shares by telephone by calling the toll-free telephone number provided on the voting Web site,http://www.proxyvote.com, and on the proxy card. Telephone voting is available 24 hours a day, seven days a week.
♦ | Vote by Mail |
If you received a printed copy of the proxy materials, you can vote by completing the enclosed proxy card or voting instruction form and returning it in the return envelope provided. If you received a Notice, you can request a printed copy of the proxy materials by following the instructions contained in the Notice. If you voted by Internet or telephone, you do not need to return your proxy card or voting instruction form.
♦ | Voting in Person at the Annual Meeting |
If you wish to vote at the Annual Meeting, written ballots will be available at the Annual Meeting. If you are a street name holder, while you are invited to attend the Annual Meeting, you may only vote your shares in person at the Annual Meeting if you bring with you a legal proxy from the registered holder and submit it with a written ballot. A legal proxy may be obtained from your broker, bank or other nominee.
If you are a registered holder and submit a proxy without giving instructions, your shares will be voted as recommended by the Board of Directors.
If you are a beneficial owner of shares, voting your shares is critical due to a New York Stock Exchange (“NYSE”) rule that prohibits your broker from voting your shares on Proposals 1, 2 and 3 without your instructions. See “What is a broker non-vote?”
If you have any questions about this NYSE rule or the proxy voting process in general, the U.S. Securities and Exchange Commission (the “SEC”) also has a Web site (http://www.sec.gov/spotlight/proxymatters.shtml) with more information about your rights as a stockholder.
Q: | How do I |
A: | If you are a |
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401(k) Plans) have adequate time to tabulate the voting instructions. The plan trustee will vote those shares as you instruct. If you do not |
others who do vote.
Q: | How does the Board of Directors recommend voting? |
A: | The Board of Directors recommends voting: |
♦ | FOR each nominee to the Board of Directors; |
♦ | FOR the approval, on an advisory basis, of the executive compensation of our named executive officers; and |
♦ | FOR the |
The Audit Committee of the Board recommends voting:
♦ | FOR ratification of Ernst & Young LLP as |
Q: | How will my stock be voted on other business brought up at the Annual Meeting? |
A: | By submitting your proxy, you authorize the persons named as proxies to use their discretion in voting on any other matter brought before the Annual Meeting. The New York Times Company does not know of any other business to be considered at the Annual Meeting. |
Q: | Can I change my vote or revoke my proxy? |
A: | Yes. If you are a registered holder, you can change your vote or revoke your proxy at any time before it is voted at the Annual Meeting by executing a later-dated proxy on the Internet, by telephone or mail or by voting by ballot at the Annual Meeting. |
If you are a beneficial owner of shares, you may submit new voting instructions by contacting your broker, bank or other nominee. You may also vote in person at the Annual Meeting if you obtain a legal proxy as described above.
Q: | What is the quorum requirement for the Annual Meeting? |
A: | The holders of record of a majority of the Company’s shares of stock issued and outstanding on the record date and entitled to vote, in person or by proxy, constitutes a quorum for the transaction of business at the Annual Meeting. However, as described elsewhere in this Proxy Statement, the Certificate of Incorporation of the Company provides that Class A stockholders, voting separately, are entitled to elect 30% of the Board of Directors (or the nearest larger whole number) and the Class B stockholders, voting separately, are entitled to elect the balance of the Board of Directors. Accordingly, with respect to the election of |
Q: |
A: | The voting requirements are as follows: |
♦ | Proposal 1: Directors are elected by a plurality of the votes cast. |
♦ | Proposals 2 and 3: The advisory say-on-pay resolution on executive compensation and the advisory resolution on the frequency of future say-on-pay votes require the affirmative vote of a majority of the shares of Class B stock represented at the Annual Meeting, in person or by proxy, and entitled to vote on the proposal. |
However, given the multiple voting choices available to Class B stockholders under Proposal 3, it is possible that none of the alternatives of one, two or three years will receive a majority vote. Nevertheless, the Board of Directors considers this vote the equivalent of a poll of the Class B stockholders and will consider the number of votes each alternative receives when making future decisions as to the timing of say-on-pay votes.
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♦ | Proposal 4: Ratification of the selection of Ernst & Young LLP as auditors for the fiscal year ending December 25, 2011, requires the affirmative vote of a majority of the shares of Class A and Class B stock represented at the Annual Meeting, in person or by proxy, and entitled to vote on the proposal, voting together as a single class. |
Q: | What is a broker non-vote? |
A: | If you are a beneficial owner whose shares are held by a broker, bank or other nominee, you must instruct the broker, bank or other nominee how to vote your shares. If you do not provide voting instructions, your shares will not be voted on proposals on which brokers do not have discretionary authority, namely: Proposal 1 (election of the Board of Directors), Proposal 2 (advisory resolution on executive compensation) or Proposal 3 (advisory resolution on the frequency of future advisory say-on-pay votes on executive compensation). This is called a “broker non-vote.” Your shares will be counted as present at the meeting for quorum purposes but not present and entitled to vote for purposes of these specific proposals.Therefore, it is very important that beneficial owners instruct their broker, bank or other nominee how they wish to vote their shares. |
If you do not provide your broker, bank or other nominee with voting instructions with respect to Proposal 4 (ratification of the selection of Ernst & Young as auditors for the fiscal year ending December 25, 2011), your broker, bank or other nominee may vote your shares on this proposal, which is considered a “routine” management proposal on which your broker, bank or other nominee has discretion to vote.
Q: | How will broker non-votes, withheld votes or abstentions affect the voting results? |
A: |
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Q: | Who pays for the solicitation of proxies and how are they solicited? |
A: | Proxies are being solicited by our Board of Directors. We will bear the costs of the solicitation of the proxies on behalf of the Board of Directors. Our |
♦ | Forwarding the Notice to beneficial owners of our common stock; |
♦ | Forwarding our printed proxy materials by mail to beneficial owners who specifically request them; and |
♦ | Obtaining beneficial owners’ voting instructions. |
We will also reimburse those firms for their reasonable expenses in accordance with applicable rules. If you choose to access the proxy materials and/or vote on the Internet, you are responsible for Internet access charges you may incur. If you choose to vote by telephone, you are responsible for telephone charges you may incur. We have engaged Georgeson Inc. to assist in soliciting proxies, and we expect to pay this firm a fee of $10,000, plus out-of-pocket expenses. |
Q: | Who will serve as inspector of elections? |
A: | Broadridge Financial Solutions, Inc. has been engaged as the independent inspector of election to tabulate stockholder votes at the Annual Meeting. |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR
THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 27, 2010.2011.
This Proxy Statement is available athttp://www.nytco.com/investors/financials/proxy_statements.html, and the 2010 Annual Report is available athttp://www.nytco.com/investors/financials/annual_reports.html. Information on how to obtain directions to attend the Annual Meeting is available athttp://thetimescenter.com | . |
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Voting MethodsGlossary of Certain Terms
We have been advisedTo improve the readability of this Proxy Statement, we use certain shortened “defined terms” to refer to various terms that are used frequently throughout the Proxy Statement. These defined terms are generally provided the first time the longer term appears in the text and, for your convenience, are also set forth below.
“1991 Incentive Plan” means the Company’s 1991 Executive Stock Incentive Plan;
“1997 Trust” means the trust created in 1997 by our legal counsel that the procedures that have been put in place are consistent withfour children of Iphigene Ochs Sulzberger (Marian S. Heiskell, Ruth S. Holmberg, Judith P. Sulzberger (now deceased) and Arthur Ochs Sulzberger (the “grantors”)) for the requirementsbenefit of applicable state law.Please remember that if your stock is held through a brokereach of the grantors and his or bank, you will receive voting instructions from your bankher family;
“2010 Incentive Plan” means The New York Times Company 2010 Incentive Compensation Plan;
“Banco Inbursa” means Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa;
“Board” or broker describing“Board of Directors” means The New York Times Company Board of Directors;
“Class A stock” means the available processes for voting your stock. In addition, if you hold shares through aCompany’s Class A Common Stock, $.10 par value per share;
“Class B stock” means the Company’s Class B Common Stock, $.10 par value per share;
“Company” means The New York Times Company;
“the Company 401(k) Plan” means The New York Times Companies Supplemental Retirement and Investment Plan;
“DEC” means The New York Times Company Deferred Executive Compensation Plan;
“Directors Deferral Plan” means the Company’s Non-Employee Directors Deferral Plan;
“Directors’ Stock Option Plan” means the Company’s Non-Employee Directors’ Stock Option Plan;
“Directors’ Incentive Plan” means the Company’s 2004 Non-Employee Directors’ Stock Incentive Plan;
“Directors’ Plans” means the Directors’ Stock Option Plan you will receive instructions on how you mayand the Directors’ Incentive Plan;
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended;
“frequency vote” means the advisory vote the shares attributed to your account by mail, by telephone or on the Internet.frequency of future advisory say-on-pay votes on executive compensation under Proposal 3;
“GFI” means Grupo Financiero Inbursa, S.A.B. de C.V.;
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“Inmobiliaria” means Inmobiliaria Carso, S.A. de C.V.;
“Notice” means the Notice of Internet Availability of Proxy Materials;
“NYSE” means the New York Stock Exchange;
“Pension Plan” means The New York Times Companies Pension Plan;
“Restoration Plan” means The New York Times Company Savings Restoration Plan;
“Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002 (officially known as the Public Company Accounting Reform and Investor Protection Act of 2002);
“SARs” means stock appreciation rights awarded under the 1991 Incentive Plan;
“say-on-pay vote” means the advisory vote on executive compensation under Proposal 2;
“SEC” means the U.S. Securities and Exchange Commission;
“Section 162(m)” means Section 162(m) of the Internal Revenue Code of 1986, as amended;
“SERP” means The New York Times Companies Supplemental Executive Retirement Plan;
“SESP” means The New York Times Company Supplemental Executive Savings Plan; and
“Trustees” means the current trustees of the 1997 Trust: James M. Cohen, Lynn G. Dolnick, Susan W. Dryfoos, Gertrude A.L. Golden, Michael Golden, Carolyn D. Greenspon, Eric M.A. Lax and Arthur Sulzberger, Jr.
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Where to Find More Information on The New York Times Company
Documents Filed with the Securities and Exchange Commission (“SEC”)
♦ | This Proxy Statement is accompanied by our |
♦ | You can obtain any of the documents that we file with the SEC (including a copy of our Annual Report on Form 10-K for the fiscal year ended December |
The New York Times Company
620 Eighth Avenue
New York, NY 10018
Phone: (212) 556-1234
Attention: Senior Vice President, General
Counsel &Corporate Secretary
We will send you the requested documents without charge, excluding exhibits.
Additional Information
There are a number of other sources for additional information on The New York Times Company:
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♦ | The New York Times Company Web |
http://www.nytco.com/corporate_governance/index.html | : |
—Corporate Governance Principles
—Board Committee Charters:
♦ | Audit Committee |
♦ | Compensation Committee |
♦ | Nominating & Governance Committee |
♦ | Finance Committee |
—Code of Ethics for the Chairman, Chief Executive Officer, Vice Chairman and Senior Financial Officers
—Code of Ethics for Directors
—Business Ethics Policy
—Policy on Transactions with Related Persons
Please note that information contained on our Web site does not constitute part of this Proxy Statement.
IMPORTANT NOTE:
This Proxy Statement is dated March 12, 2010.18, 2011. You should not assume that the information contained in this Proxy Statement is accurate as of any date other than such date, and the furnishing of this Proxy Statement to stockholders shall not create any implication to the contrary.
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Since the purchase of The New York Times newspaper by Adolph S. Ochs in 1896, control of The New York Times and related properties has rested with his family. Family members have taken an active role in the stewardship and management of The New York Times Company. The title of Publisher of The New York Times has been held by various family members, from Adolph S. Ochs to the current Publisher, Arthur Sulzberger, Jr., who also serves as the current Chairman of the Board.
In February 1990, on the death of Adolph S. Ochs’s daughter, Iphigene Ochs Sulzberger (“Mrs. Sulzberger”), control passed to her four children through the automatic termination of a trust established by Mr. Ochs. That trust held 83.7% of the Class B stock of the Company, which is not publicly traded and the holders of which have the right to elect approximately 70% of the Board of Directors. Mrs. Sulzberger’s four children are: Marian S. Heiskell, Ruth S. Holmberg, Judith P. Sulzberger (now deceased) and Arthur Ochs Sulzberger (the “grantors”).
In 1997, the grantors executed an indenture (the “Trust Indenture”) creating a trust (the “1997 Trust”) for the benefit of each of the grantors and his or her family. The grantors transferred to the 1997 Trust all shares of Class B stock previously held by the trust established by Adolph S. Ochs, together with a number of shares of Class A stock. The 1997 Trust currently holds 738,810 shares of Class B stock and 1,400,000 shares of Class A stock. The primary objective of the 1997 Trust is to maintain the editorial independence and the integrity of The New York Times and to continue it as an independent newspaper, entirely fearless, free of ulterior influence and unselfishly devoted to the public welfare (“the primary objective of the 1997 Trust”).
The current trustees of the 1997 Trust are Daniel H. Cohen, James M. Cohen, Lynn G. Dolnick, Susan W. Dryfoos, Gertrude A.L. Golden, Michael Golden, Carolyn D. Greenspon, Eric M. A.M.A. Lax and Arthur Sulzberger, Jr. (the “Trustees”).
The 1997 Trust will continue in existence until the expiration of 21 years after the death of the last remaining survivor of all descendants of Mrs. Sulzberger living on December 14, 2000. The Trust Indenture is subject to the terms and provisions of a 1986 shareholders agreement (the “Shareholders Agreement”) among the grantors, their children and the Company, which restricts the transfer of Class B stock that is held by the trust by requiring, prior to any sale or transfer, the offering of those shares among the other family stockholders and then to the Company at the Class A stock market price then prevailing (or if the Company is the purchaser, at the option of the selling stockholder, in exchange for Class A stock on a share-for-share basis). The Shareholders Agreement provides for the conversion of such shares into Class A stock if the purchase rights are not exercised by the family stockholders or the Company and such shares of Class A stock are to be transferred to a person or persons other than family stockholders or the Company. There are certain exceptions for gifts and other transfers within the family of Adolph S. Ochs, provided that the recipients become parties to the Shareholders Agreement.
In addition, the Shareholders Agreement provides that if the Company is a party to a merger (other than a merger solely to change the Company’s jurisdiction of incorporation), consolidation or plan of liquidation in which such Class B stock is exchanged for cash, stock, securities or any other property of the Company or of any other corporation or entity, each signing stockholder will convert his or her shares of such Class B stock into Class A stock prior to the effective date of such transaction so that a holder of such shares will receive the same cash, stock or other consideration that a holder of Class A stock would receive in such a transaction. Except for the foregoing, each signing stockholder has agreed not to convert any shares of such Class B stock received from a trust created under the will of Adolph S. Ochs into Class A stock. The Shareholders Agreement will terminate upon the expiration of 21 years after the death of the last remaining survivor of all descendants of Mrs. Sulzberger living on August 5, 1986.
The Trustees, subject to the limited exceptions described below, are directed to retain the Class B stock held in the 1997 Trust and not to sell, distribute or convert such shares into Class A stock and to vote such Class B stock against any merger, sale of assets or other transaction pursuant to which control of The New York Times passes from the Trustees, unless they determine that the primary objective of the 1997 Trust can be achieved better by the sale, distribution or conversion of such stock or by the implementation of such transaction. If upon such determination any Class B stock is distributed to the beneficiaries of the 1997 Trust, it must be distributed only to descendants of Mrs. Sulzberger, subject to the provisions of the Shareholders Agreement (if it is still in effect). Similarly, any sale by the 1997 Trust of Class B stock upon such determination can be made only in compliance with the Shareholders Agreement.
The Trustees are granted various powers and rights, including among others: (i) to vote all of the shares of Class A and Class B stock held by the 1997 Trust; (ii) to nominate the successor trustees who may also serve on the Company’s Board of Directors; and (iii) to amend certain provisions of the Trust Indenture, but not the provisions
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relating to retaining the Class B
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stock or the manner in which such shares may be distributed, sold or converted. The Trustees act by the affirmative vote of six of the eight Trustees. Generally, a Trustee may be removed by the agreement of six of the remaining seven Trustees. In general, four of the trustees will be appointed by all eight trustees; the remaining four trustees will be elected by the beneficiaries of the 1997 Trust.
Upon the termination of the 1997 Trust at the end of the stated term thereof, the shares of Class A and Class B stock held by such trust will be distributed to the descendants of Mrs. Sulzberger then living.
On February 26, 2010,28, 2011, the Trustees also controlled, through a limited liability company, an additional 4,300,197 shares of Class A stock that are held in various family limited partnerships.
We have been informed by representatives of the Ochs-Sulzberger family that on February 26, 201028, 2011, the aggregate holdings of the 1997 Trust and the descendants of Mrs. Sulzberger represent approximately 19%18% of the Company’s total equity (i.e.(i.e., Class A and Class B stock of the Company).
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Principal Holders of Common Stock
The following table sets forth the only persons who, to the knowledge of management, owned beneficially on February 26, 2010,28, 2011, more than 5% of the outstanding shares of either Class A or Class B stock:
Shares (%) | Shares (%) | |||||||||||||||||||||||
Name and Address | Class A | Class B | Class A | Class B | ||||||||||||||||||||
1997 Trust1,2 620 Eighth Avenue New York, NY 10018 | 6,439,007 | (4.4%) | 738,810 | (89.6%) | ||||||||||||||||||||
Daniel H. Cohen1,2,3 620 Eighth Avenue New York, NY 10018 | 6,590,280 | (4.5%) | 740,430 | (89.8%) | ||||||||||||||||||||
James M. Cohen1,2,4 620 Eighth Avenue New York, NY 10018 | 6,618,264 | (4.6%) | 740,430 | (89.8%) | ||||||||||||||||||||
Lynn G. Dolnick1,2,5 620 Eighth Avenue New York, NY 10018 | 6,568,750 | (4.5%) | 739,928 | (89.8%) | ||||||||||||||||||||
Susan W. Dryfoos1,2,6 620 Eighth Avenue New York, NY 10018 | 6,847,177 | (4.7%) | 739,770 | (89.7%) | ||||||||||||||||||||
Michael Golden1,2,7 620 Eighth Avenue New York, NY 10018 | 6,897,414 | (4.7%) | 739,930 | (89.8%) | ||||||||||||||||||||
Carolyn D. Greenspon1,2,8 620 Eighth Avenue New York, NY 10018 | 6,471,560 | (4.5%) | 739,170 | (89.7%) | ||||||||||||||||||||
Eric M. A. Lax1,2,9 620 Eighth Avenue New York, NY 10018 | 6,470,083 | (4.5%) | 738,810 | (89.6%) | ||||||||||||||||||||
Arthur Sulzberger, Jr.1,2,10 620 Eighth Avenue New York, NY 10018 | 7,105,711 | (4.9%) | 739,770 | (89.7%) | ||||||||||||||||||||
1997 Trust1,2 620 Eighth Avenue New York, NY 10018 | 6,439,007 | (4.4%) | 738,810 | (90.2%) | ||||||||||||||||||||
James M. Cohen1,2,3 620 Eighth Avenue New York, NY 10018 | 6,638,846 | (4.5%) | 740,430 | (90.4%) | ||||||||||||||||||||
Lynn G. Dolnick1,2,4 620 Eighth Avenue New York, NY 10018 | 6,551,105 | (4.5%) | 739,928 | (90.3%) | ||||||||||||||||||||
Susan W. Dryfoos1,2,5 620 Eighth Avenue New York, NY 10018 | 6,817,577 | (4.6%) | 739,770 | (90.3%) | ||||||||||||||||||||
Gertrude A.L. Golden1,2,6 620 Eighth Avenue New York, NY 10018 | 6,518,884 | (4.4%) | 739,928 | (90.3%) | ||||||||||||||||||||
Michael Golden1,2,7 620 Eighth Avenue New York, NY 10018 | 6,894,805 | (4.7%) | 739,930 | (90.3%) | ||||||||||||||||||||
Carolyn D. Greenspon1,2,8 620 Eighth Avenue New York, NY 10018 | 6,483,497 | (4.4%) | 739,170 | (90.2%) | ||||||||||||||||||||
Eric M.A. Lax1,2,9 620 Eighth Avenue New York, NY 10018 | 6,513,996 | (4.4%) | 738,810 | (90.2%) | ||||||||||||||||||||
Arthur Sulzberger, Jr.1,2,10 620 Eighth Avenue New York, NY 10018 | 7,182,761 | (4.9%) | 739,770 | (90.3%) | ||||||||||||||||||||
Carlos Slim Helú11 Paseo de las Palmas 736 Colonia Lomas de Chapultepec 11000 México, D.F., México | 25,950,000 | (16.2%) | 25,950,000 | (16.0%) | ||||||||||||||||||||
Harbinger Capital Partners Group12 450 Park Avenue, 30th Floor New York, NY 10022 | 18,386,799 | (12.7%) | ||||||||||||||||||||||
Optimum Investment Advisors12 100 S. Wacker Dr., Ste. 2100 Chicago, IL 60606 | 10,871,540 | (7.4%) | ||||||||||||||||||||||
T. Rowe Price Associates, Inc.13 100 E. Pratt Street Baltimore, MD 21202 | 11,593,739 | (8.0%) | 10,572,400 | (7.2%) |
1. |
Each of the Trustees shares voting and investment power with respect to the shares owned by the 1997 Trust. Thus, under SEC regulations, each may be deemed a beneficial owner of the shares held by the 1997 Trust. Such shares are therefore included in the amounts listed in this table for each of them. As a result of this presentation, there are substantial
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duplications in the number of shares and percentages shown in the table. By virtue of their being co-trustees of the 1997 Trust, the Trustees could be deemed to comprise a “group” within the meaning of SEC regulations. Such group is the beneficial owner in the aggregate of 8,528,422 shares of Class A stock, representing approximately 5.8% of the outstanding shares of Class A stock. This amount includes those shares directly or indirectly held by the 1997 Trust, as well as (i) 1,066,659 shares of Class A stock directly or indirectly held by individual Trustees, including attributed amounts based on holdings in the Company Stock Fund of The New York Times Companies Supplemental Retirement and Investment Plan (the “Company 401(k) Plan”); (ii) 7,256 shares of Class A stock issuable upon the conversion of 7,256 shares of Class B stock held by individual Trustees, and (iii) 923,054 shares of Class A stock that could be acquired within 60 days upon the exercise of options and 92,446 restricted stock units, pursuant to which shares of Class A stock are granted upon vesting, in each case, granted under the Company’s 1991 Executive Stock Incentive Plan (the “1991 Incentive Plan”), its 2010 Incentive Compensation Plan (the “2010 Incentive Plan”), its Non-Employee Directors’ Stock Option Plan (the “Directors’ Stock Option Plan”) or its 2004 Non-Employee Directors’ Stock Incentive Plan (the “Directors’ Incentive Plan,” and together with the Directors’ Stock Option Plan, the “Directors’ Plans”). In addition, the Company has been informed by representatives of the Ochs-Sulzberger family that the aggregate holdings of the 1997 Trust and the descendants of Mrs. Sulzberger represent approximately 18% of the Company’s total equity (i.e., Class A and Class B stock of the Company).
2. | Class B stock is convertible into Class A stock on a share-for-share basis. Ownership of Class B stock is therefore deemed to be beneficial ownership of Class A stock under SEC regulations. For purposes of the table of Class A stock ownership, it has been assumed that each person listed therein as holding Class B stock has converted into Class A stock all shares of Class B stock of which that person is deemed the beneficial owner. Thus all shares of Class B stock held by the 1997 Trust and by the Trustees have been included in the calculation of the total amount of Class A stock owned by each such person as well as in the calculation of the total amount of Class B stock owned by each such person. As a result of this presentation, there are substantial duplications in the number of shares and percentages shown in the table. |
3. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for |
4. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Ms. Dolnick include (a) 55,554 shares of Class A stock and 1,118 shares of Class B stock held jointly with her husband, (b) 24,000 shares of Class A stock that could be acquired within 60 days upon the exercise of options granted under the Directors’ Plans, (c) 30,861 shares of Class A stock held by two trusts of which Ms. Dolnick is the sole trustee and (d) 565 shares of Class A stock held by a trust of which Ms. Dolnick is a co-trustee. Ms. Dolnick disclaims beneficial ownership of the shares held by the trusts described in (c) and (d) above. In addition, 16,549 Class A stock units have been credited to Ms. Dolnick’s account under the Company’s Non-Employee Directors Deferral Plan (the “Directors Deferral Plan”). |
5. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Ms. |
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6. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Ms. |
7. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for |
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Class A stock |
8. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Ms. Greenspon include (a) |
9. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Mr. Lax include (a) |
10. | In addition to the amounts of Class A and Class B stock described in notes 1 and 2, the holdings for Mr. Sulzberger, Jr. include (a) |
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11. | According to information contained in a filing with the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of December 31, 2009, Inmobiliaria Carso, S.A. de |
Accordingly, pursuant to Rule 13d-3(d)(1)(i) of the Exchange Act, each of Inmobiliaria and GFI is deemed to beneficially own 7,950,000 shares of Class A stock issuable upon exercise of the warrants. Furthermore, according to the filing, Carlos Slim Helú, Carlos Slim Domit, Marco Antonio Slim Domit, Patrick Slim Domit, María Soumaya Slim Domit, Vanessa Paola Slim Domit and Johanna Monique Slim Domit (collectively, the “Slim Family”), are beneficiaries of a trust which in turn owns all of the outstanding voting securities of Inmobiliaria and a majority of the outstanding voting equity securities of GFI. As a result, the Slim Family may be deemed to beneficially own indirectly (a) the shares of Class A stock beneficially owned by Inmobiliaria and (b) the warrants and the shares of Class A stock that may be obtained and beneficially owned by Inmobiliaria and GFI upon exercise of the warrants. See “Interests of Related Persons in Certain Transactions of the Company—Transaction with Carlos Slim Helú and Affiliates” on page |
12. | According to information contained in a filing with the SEC pursuant to the Exchange Act, as of |
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13. | According to information contained in a filing with the SEC pursuant to the Exchange Act, as of December 31, |
1213
Security Ownership of Management and Directors
The following table shows the beneficial ownership, reported to the Company as of February 26, 2010,28, 2011, of Class A and Class B stock, including shares as to which a right to acquire ownership exists (by the exercise of stock options or the conversion of Class B stock into Class A stock) within the meaning of Rule 13d-3(d)(1) under the Exchange Act of each Director and nomineedirector named in this Proxy Statement, the chief executive officer, the chief financial officer and the three other most highly compensated executive officers of the Company during 20092010 and all Directors, nomineesdirectors and executive officers of the Company as a group. A portion of the shares reported below are held by the 1997 Trust, whose Trustees share voting and, in some cases, investment power with respect thereto. See “The“General Information—The 1997 Trust.” The table also shows, under “Class A Stock Units and SAR Awards,SARs,” in the case of non-employee Directors,directors, cash-settled phantom stock units credited under the Company’s Non-Employee Directors Deferral Plan and, in the case of executive officers, cash-settled restricted stock units and stock appreciation rights (“SARs”)SARs awarded under the NYT Stock1991 Incentive Plan.
Class A Stock | Percent of Outstanding Class A Stock | Class A Stock Units and SAR Awards | Class B Stock | Percent of Class B Stock | ||||||||
P. Steven Ainsley1,2,3 | 370,436 | * | 9,000 | 0 | ||||||||
Publisher, The Boston Globe (retired, effective December 31, 2009) | ||||||||||||
Raul E. Cesan4 | 65,000 | * | 53,925 | 0 | ||||||||
Director | ||||||||||||
Daniel H. Cohen5,6 | 6,590,280 | 4.5 | % | 10,869 | 740,430 | 89.8 | % | |||||
Director | ||||||||||||
Robert E. Denham4 | 23,000 | * | 9,164 | 0 | ||||||||
Director | ||||||||||||
Lynn G. Dolnick5,6 | 6,568,750 | 4.5 | % | 13,529 | 739,928 | 89.8 | % | |||||
Director | ||||||||||||
James M. Follo2,3 | 155,097 | * | 14,253 | 0 | ||||||||
Senior Vice President and Chief Financial Officer | ||||||||||||
Scott Galloway4 | 8,000 | * | 9,164 | 0 | ||||||||
Director | ||||||||||||
Michael Golden3,5,6 | 6,897,414 | 4.7 | % | 16,305 | 739,930 | 89.8 | % | |||||
Vice Chairman, President and Chief Operating Officer, Regional Media Group, and Director | ||||||||||||
Carolyn D. Greenspon5,6 | 6,471,560 | 4.5 | % | 0 | 739,170 | 89.7 | % | |||||
Nominee for Director | ||||||||||||
James A. Kohlberg4 | 8,000 | * | 9,164 | 0 | ||||||||
Director | ||||||||||||
Dawn G. Lepore4 | 8,000 | * | 9,164 | 0 | ||||||||
Director | ||||||||||||
David E. Liddle4 | 42,600 | * | 13,529 | 0 | ||||||||
Director | ||||||||||||
Ellen R. Marram4 | 44,000 | * | 26,381 | 0 | ||||||||
Director | ||||||||||||
Thomas Middelhoff4 | 26,709 | * | 13,529 | 0 | ||||||||
Director | ||||||||||||
Janet L. Robinson2,3 | 1,208,536 | * | 221,984 | 0 | ||||||||
President, Chief Executive Officer and Director | ||||||||||||
Arthur Sulzberger, Jr.3,5,6 | 7,105,711 | 4.9 | % | 96,984 | 739,770 | 89.7 | % | |||||
Chairman of the Board, Publisher, The New York Times, and Director | ||||||||||||
Doreen A. Toben4 | 24,500 | * | 40,119 | 0 | ||||||||
Director | ||||||||||||
All Directors, Nominees and Executive Officers5 | 10,988,726 | 7.4 | % | 651,658 | 743,988 | 90.2 | % | |||||
(23 individuals) |
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Class A Stock | Percent of Outstanding Class A Stock | Class A Stock Units and SARs | Class B Stock | Percent of Class B Stock | ||||||||||||||||
Raul E. Cesan1 | 65,000 | * | 60,256 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Robert E Denham1 | 27,000 | * | 12,184 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Lynn G. Dolnick2,3 | 6,551,105 | 4.5 | % | 16,549 | 739,928 | 90.3 | % | |||||||||||||
Director | ||||||||||||||||||||
James M. Follo4,5 | 261,605 | * | 14,253 | 0 | ||||||||||||||||
Senior Vice President and Chief Financial Officer | ||||||||||||||||||||
Michael Golden2,3,5 | 6,894,805 | 4.7 | % | 16,305 | 739,930 | 90.3 | % | |||||||||||||
Vice Chairman, President and Chief Operating Officer, Regional Media Group, and Director | ||||||||||||||||||||
Carolyn D. Greenspon2,3 | 6,483,497 | 4.4 | % | 3,020 | 739,170 | 90.2 | % | |||||||||||||
Director | ||||||||||||||||||||
Scott Heekin-Canedy4,5 | 457,032 | * | 17,305 | 0 | ||||||||||||||||
President and General Manager, The New York Times | ||||||||||||||||||||
James A. Kohlberg1 | 12,000 | * | 12,184 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Dawn G. Lepore1 | 12,000 | * | 12,184 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
David E. Liddle1 | 42,600 | * | 16,549 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Ellen R. Marram1 | 44,000 | * | 29,401 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Thomas Middelhoff1 | 30,709 | * | 16,549 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
Janet L. Robinson4,5 | 1,490,294 | 1.0 | % | 317,817 | 0 | |||||||||||||||
President, Chief Executive Officer and Director | ||||||||||||||||||||
Arthur Sulzberger, Jr.2,3,5 | 7,182,761 | 4.9 | % | 130,317 | 739,770 | 90.3 | % | |||||||||||||
Chairman of the Board, Publisher, The New York Times, and Director | ||||||||||||||||||||
Doreen A. Toben1 | 28,500 | * | 48,630 | 0 | ||||||||||||||||
Director | ||||||||||||||||||||
All Directors and Executive Officers2 | 11,238,653 | 7.4 | % | 791,391 | 742,368 | 90.6 | % | |||||||||||||
(20 individuals) |
* | Indicates beneficial ownership of less than 1%. |
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1. |
The amounts reported include shares of Class A stock that could be acquired within 60 days upon the exercise of stock options under the Directors’ Plans, as follows: Mr. Cesan: 40,000; Mr. Denham: |
Class B stock is convertible into Class A stock on a share-for-share basis. Ownership of Class B stock is therefore deemed to be beneficial ownership of Class A stock under SEC regulations. For purposes of the presentation of ownership of Class A stock in this table, it has been assumed that each |
See “Principal Holders of Common Stock” and |
4. | The amounts reported include shares of Class A stock that could be acquired within 60 days upon the exercise of stock options awarded under the 1991 Incentive Plan, as follows: Mr. Follo: 219,667 shares; Mr. Heekin-Canedy: 404,703 shares; and Ms. Robinson: 1,264,217 shares. Also, the amounts reported include restricted stock units, pursuant to which an executive would be awarded shares of Class A stock upon vesting, granted under the 1991 Incentive Plan or the 2010 Incentive Plan as follows: Mr. Follo: 24,533 shares; Mr. Heekin-Canedy: 25,533 shares; and Ms. Robinson: 98,413 shares. In addition, the amounts reported include shares of Class A stock equivalents attributed to an executive officer based on their respective holdings in the Company Stock Fund of the Company 401(k) Plan as follows: Mr. Follo: 1,221 shares; Mr. Heekin-Canedy: 1,380 shares; and Ms. Robinson: 1,425 shares. |
5. | The amounts reported under “Class A Stock Units and SARs” include: (i) cash-settled restricted stock units awarded under the 1991 Incentive Plan as follows: Mr. Follo: 14,253 units; Mr. Heekin-Canedy: 17,305 units; and Ms. Robinson: 63,650 units; and (ii) cash-settled SARs, entitling holders upon exercise to receive cash equal to the excess of fair market value per share of Class A stock, multiplied by the number of SARs being exercised, awarded under the 1991 Incentive Plan to the extent such SARs could be exercised within 60 days as follows: Ms. Robinson: 254,167 SARs. |
Section 16(a) Beneficial Ownership Reporting Compliance
The Company’s Directorsdirectors and executive officers and the beneficial holders of more than 10% of the Class A stock are required to file reports with the SEC of changes in their ownership of Company stock. Based on its review of such reports, the Company believes that all such filing requirements were met during 2009,2010, except that Inmobiliaria and the Slim FamilyCarolyn Greenspon did not timely file a Form 4 reporting the purchaseaward of 46,000 shares of Class Aoptions and phantom stock units that she received after her election as a director to the Board at the 2010 Annual Meeting on January 20, 2009. Inmobiliaria and the Slim FamilyApril 27, 2010. She subsequently filed a Form 4 on February 23, 2009,May 4, 2010, to report this, and other,these transactions.
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Election of Directors
Thirteen Directorsdirectors will be elected to the Board of The New York Times Company at the 20102011 Annual Meeting. Nominees proposed for election as Directorsdirectors are listed below. Directors will hold office until the next Annual Meetingannual meeting and until their successors are elected and qualified. Each of the nominees except for Carolyn D. Greenspon, is now a member of the Board of Directors and was elected at the 20092010 Annual Meeting for which proxies were solicited.
The Certificate of Incorporation of the Company provides that Class A stockholders have the right to elect 30% of the Board of Directors (or the nearest larger whole number). Accordingly, Class A stockholders will elect four of the 13 Directors;directors; Class B stockholders will elect nine. Directors are elected by a plurality of the votes cast. (Please see our policy described on page 27 regarding directors who do not receive more “for” votes than “withheld” votes.) Although approximately 30% of the Directorsdirectors are elected by the holders of the Company’s Class A stock and the remaining Directorsdirectors by the holders of the Company’s Class B stock, once elected, our Directorsdirectors have no ongoing status as “Class A” or “Class B” Directorsdirectors and have the same duties and responsibilities to all stockholders. Our Board serves as one Board with fiduciary responsibilities to all stockholders of the Company.
Class A Nominees (4) | Class B Nominees (9) | |
Raul E. Cesan |
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If any of the nominees become unavailable for election, all uninstructed proxies will be voted for such other person or persons designated by the Board. The Board has no reason to anticipate that this will occur.
Proxies will be used to vote for the election of the nominees named above unless you withhold the authority to do so when you vote your proxy. Each person nominated for election has consented to being named in this Proxy Statement and has agreed to serve if elected.
Notes on Nominees
♦ | Michael Golden and Lynn G. Dolnick are siblings. |
♦ | Ms. Dolnick and Mr. Golden are cousins of Arthur Sulzberger, Jr. |
♦ | Ms. Greenspon is the daughter of a cousin of Ms. Dolnick and Messrs. Golden and Sulzberger, Jr. |
Board of Directors—Experience and Qualifications
Consistent with the Company’s Corporate Governance Principles, the Nominating & Governance Committee is responsible for reviewing with the Board, on an annual basis, the requisite skills and characteristics of Directordirector nominees, as well as the composition of the Board as a whole. This assessment includes consideration of Directors’directors’ independence, diversity, character, judgment and business experience, as well as their appreciation of the Company’s core purpose, core values and journalistic mission. We believe that the 13 Directordirector nominees possess the requisite mix of skills, qualifications and experiences that will enable the Board and each committee of the Board to continue to provide sound judgment and leadership and to function effectively as a group. Each current non-employee Directordirector has completed the comprehensive orientation program described below under “Board of Directors and Corporate Governance—Director Orientation.” In addition, in accordance with newly adopted rules of the SEC, the biographical information for each Directordirector nominee includes, this year, under the caption “Specific Experience,” a summary of the specific experience, qualifications, attributes or skills that led the Board to conclude that the person should serve as a Directordirector of the Company. It would not be possible to detail all experience, qualifications, attributes or skills possessed by each Director.director. Rather, we have attempted to set out those unique and important professional characteristics that each particular person brings to the Board.
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Profiles of Nominees for the Board of Directors
The following information was provided by the nominees:
RAUL E. CESAN | ||||
Age: | ||||
Director Since: |
1999 | |||
Committee Memberships: |
Audit (Chair) and Finance | |||
Principal Occupation: |
Founder and Managing Partner, Commercial Worldwide LLC (an investment firm) (from 2001) | |||
Recent Business Experience: |
President and Chief Operating Officer of Schering-Plough Corporation (from 1998 to 2001); Executive Vice President of Schering-Plough Corporation and President of Schering-Plough Pharmaceuticals (from 1994 to 1998); President of Schering Laboratories, U.S. Pharmaceutical Operations (from 1992 to 1994); President of Schering-Plough International (from 1988 to 1992) | |||
Specific Experience: |
During his nearly twenty-five year career at Schering-Plough Corporation, Mr. Cesan served in various capacities, including as the President and Chief Operating Officer as well as the President of Schering-Plough International. Mr. Cesan’s international business and general management experience are valuable assets to the Company and the Board. In addition, Mr. Cesan brings significant financial expertise to the Company, the Board and the Audit |
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ELLEN R. MARRAM | ||||
Age: | 64 | |||
Director Since: | 1998 | |||
Committee Memberships: | Finance (Chair), Compensation and Nominating & Governance | |||
Principal Occupation: | President, The Barnegat Group, LLC (a business advisory firm) (from 2006) | |||
Recent Business Experience: | Operating Advisor (from 2006), Managing Director (from 2000 to 2005), North Castle Partners, LLC; President and Chief Executive Officer of efdex, Inc. (from August 1999 to May 2000); President (from 1993 to 1998) and Chief Executive Officer (from 1997 to 1998), Tropicana Beverage Group; Executive Vice President, The Seagram Company Ltd. and Joseph E. Seagram & Sons Inc. (from 1993 to 1998); Senior Vice President, Nabisco Foods Group, and President and Chief Executive Officer, Nabisco Biscuit Company (from 1988 to 1993) | |||
Specific Experience: | Ms. Marram has spent more than 30 years building brands and companies, serving in key positions at public companies and private equity firms and advising private and public companies. As a result, she brings to the Company and the Board her extensive management, business, consumer brand and marketing experience. In addition, Ms. Marram’s experience in advising companies provides her with multiple perspectives on successful strategies across a variety of businesses. Furthermore, Ms. Marram brings to her role as Presiding Director extensive experience serving on the boards (and various board committees) of other large public companies. | |||
Other Directorships: |
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THOMAS MIDDELHOFF | ||||
Age: | 57 | |||
Director Since: | 2003 | |||
Committee Memberships: | Compensation and Finance | |||
Principal Occupation: | Chairman, Pulse Capital Partners (an asset management firm) (from 2010) | |||
Recent Business Experience: | Founder, Partner and Executive Chairman, Berger Lahnstein Middelhoff & Partners LLP (from 2009 to 2010); Chief Executive Officer and Chairman of the Management Board (from 2005 to 2009) and Non-executive Chairman (from 2004 to 2005), Arcandor AG (in June 2009, Arcandor AG filed with the Essen District Court (Germany) to initiate insolvency proceedings); Managing Director, Investcorp Ltd. (from 2003 to 2005); Chairman and Chief Executive Officer (from 1997 to 2002), Head of Corporate Development and Coordinator of Multimedia Business (from 1994 to 1998), and Member of The Board Industry Division (from 1990 to 1994), Bertelsmann AG; Managing Director (from 1989 to 1990), Mohndruck Graphische Betriebe GMBH Gutersloh | |||
Specific Experience: | Dr. Middelhoff has a strong background in international media and Internet businesses, which is highly valued by the Company and the Board as the Company continues to expand its digital businesses. Dr. Middelhoff brings to the Board more than 25 years of international experience and a global perspective gained through his leadership roles at various public and private European-based companies. | |||
Other Directorships: | Senator Entertainment AG (from 2006); Marseille-Kliniken AG (from 2009);3W Power Holdings S.A. (formerly Germany1 Acquisition Limited)/AEG Power Solutions AG (from 2010); Germany1 Acquisition Limited (from 2008 to 2009); Thomas Cook Group plc (from 2005 to 2009); Arcandor AG (Chairman of the Management Board) (from 2005 to 2009); APCOA Parking AG (from 2004 to 2007) |
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DOREEN A. TOBEN | ||||
Age: | 61 | |||
Director Since: | 2004 | |||
Committee Memberships: | Audit and Finance | |||
Principal Occupation: | Director of various public corporations | |||
Recent Business Experience: | Executive Vice President and Chief Financial Officer, Verizon Communications, Inc. (from 2002 to 2009); Senior Vice President and Chief Financial Officer, Telecom Group, Verizon Communications, Inc. (from 2000 to 2002); Vice President and Controller (from 1999 to 2000) and Vice President and Chief Financial Officer, Telecom/Network, Bell Atlantic Inc. (from 1997 to 1999) | |||
Specific Experience: | Ms. Toben has over 25 years of experience in the communications industry, most recently serving, until 2009, as Executive Vice President and Chief Financial Officer of Verizon Communications, Inc., where she was responsible for Verizon’s finance and strategic planning efforts. In addition to her deep communications industry experience, Ms. Toben’s financial and accounting expertise is a valuable asset to the Company, the Board and the Audit and Finance Committees. | |||
Other Directorships: | Liz Claiborne, Inc. (from 2009); Virgin Media Inc. (from 2010); J.P. Morgan Chase & Co. (National Advisory Board Member) (from 2003 to 2008) |
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ROBERT E. DENHAM | ||||
Age: | ||||
Director Since: |
2008 | |||
Committee Memberships: |
Audit and Nominating & Governance (Chair) | |||
Principal Occupation: |
Partner, Munger, Tolles & Olson LLP (a law firm) (from 1998) | |||
Recent Business Experience: |
Chairman and Chief Executive Officer of Salomon Inc (from 1992 to 1998), General Counsel of Salomon Inc and Salomon Brothers (from 1991 to 1992); Managing Partner of Munger, Tolles & Olson LLP (from 1985 to 1991); Partner at Munger, Tolles & Olson LLP (from 1973 to 1991) | |||
Specific Experience: |
Mr. Denham’s legal practice emphasizes advising clients on strategic and financial issues and providing disclosure and corporate law advice to public and private corporations and boards of directors. In addition, as Chairman and Chief Executive Officer of Salomon Inc, Mr. Denham successfully guided that investment banking firm as it was rebuilding. Mr. Denham also has extensive experience serving on the boards (and various board committees) of other large public companies and brings significant financial expertise to the Company, the Board and the Audit Committee. Mr. Denham has also held numerous leadership positions with associations and councils focusing on corporate governance, executive compensation, accounting, professional ethics and business, including serving as Chairman of the Financial Accounting Foundation from 2004 to 2009. | |||
Other Directorships: |
Chevron Corporation (from 2004); Fomento Económico Mexicano, S.A. de C.V. (from 2001); Wesco Financial Corporation (from 2000); Alcatel-Lucent S.A. (and its predecessor, Lucent Technologies Inc.) (from 2002 to 2008)
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LYNN G. DOLNICK | ||||
Age: | ||||
Director Since: |
2005 | |||
Committee |
Finance | |||
Principal Occupation: |
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Recent Business Experience: |
Associate Director, Exhibits and Outreach (from 1998 to 2004), Head, Division of Exhibits (from 1993 to 1998), Head, Office of Exhibit Interpretation (from 1991 to 1993), Special Assistant to Director (from 1986 to 1991), Director, NOAHS Center (New Opportunities in Animal Health Sciences) (from 1985 to 1987), Smithsonian’s National Zoological Park | |||
Specific Experience: |
Ms. Dolnick is a fourth-generation member of the Ochs-Sulzberger family and brings to the Board a deep appreciation of the values and societal roles of The New York Times and the Company throughout their history. Her alignment with stockholder interests makes Ms. Dolnick an important part of the Board’s leadership and decision-making process.
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MICHAEL GOLDEN | ||||
Age: | ||||
Director Since: |
1997 | |||
Principal Occupation: |
Vice Chairman of the Company (from 1997) and President and Chief Operating Officer, Regional Media Group of the Company (from 2009) | |||
Recent Business Experience: |
Publisher, The International Herald Tribune (from 2003 to 2008); Senior Vice President of the Company (from 1997 to 2004); Vice President, Operations Development, of the Company (from 1996 to 1997); Executive Vice President, NYT Sports/Leisure Magazines, and Vice President and Publisher,Tennis magazine (from 1994 to 1996) and Executive Vice President and General Manager, NYT Women’s Magazines (from 1991 to 1994) | |||
Specific Experience: |
Mr. Golden is a fourth-generation member of the Ochs-Sulzberger family and brings a deep appreciation of the values and societal contributions of The New York Times and the Company throughout their history to his roles as
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CAROLYN D. GREENSPON | ||||
Age: | ||||
Director Since: | 2010 | |||
Committee Membership: | Finance | |||
Principal Occupation: |
Associate (from 2010), Relative Solutions, LLC (a family business consulting firm); Psychotherapist (from 2002), Comprehensive Psychiatric Associates | |||
Recent Business Experience: |
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Specific Experience: |
Ms. Greenspon is a fifth-generation member of the Ochs-Sulzberger family and
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JAMES A. KOHLBERG | ||||
Age: | 53 | |||
Director Since: | 2008 | |||
Committee Memberships: | Compensation and Nominating & Governance | |||
Principal Occupation: | Co-Founder and Chairman, Kohlberg & Company (a middle-market private equity firm) (from 1987) | |||
Recent Business Experience: | Co-Founder and Chairman (from 2008), Kohlberg Ventures LLC; Co-Founder and Chairman (from 2007), Halogen Media Networks (formerly Helium Group, LLC) (d/b/a HalogenGuides.com); Chairman (from 2004), ClearEdge Power; Investment Professional (from 1984 to 1987), Kohlberg Kravis Roberts & Co. | |||
Specific Experience: | Mr. Kohlberg brings to the Company and the Board his broad business and financial experience. He co-founded and serves on the boards of several private companies, including as Chairman of Kohlberg & Company, a private equity firm with portfolio companies ranging from $100 to $1 billion. | |||
Other Directorships: | Kohlberg Capital Corporation (Vice Chairman) (from 2006 to 2008); Stanadyne Holdings, Inc. and Stanadyne Corporation (from 2004 to 2007); Katy Industries, Inc. (from 2001 to 2007) |
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DAWN G. LEPORE | ||||
Age: | 56 | |||
Director Since: | 2008 | |||
Committee Membership: | Compensation | |||
Principal Occupation: | Chairman, President and Chief Executive Officer, drugstore.com, inc. (an online provider of health, beauty, vision and pharmacy products) (from 2004) | |||
Recent Business Experience: | Vice Chairman, Technology, Active Trader, Operations, Business Strategy and Administration (from 2003 to 2004), Vice Chairman, Technology, Operations, Business Strategy and Administration (2003), Vice Chairman, Technology, Operations and Administration (from 2002 to 2003), Vice Chairman, Technology and Administration (from 2001 to 2002), Vice Chairman and Chief Information Officer (from 1999 to 2001), Executive Vice President and Chief Information Officer (from 1993 to 1999), Vice President, Applications Development and Support (from 1987 to 1993), The Charles Schwab Corporation and Charles Schwab & Co., Inc. | |||
Specific Experience: | Ms. Lepore has deep experience in the digital and retail industries and relationships in both Silicon Valley and the Seattle technology communities. This experience, including her principal executive role at drugstore.com, and her extensive expertise managing complex global information technology systems, aligns with the Company’s strategy to grow its digital businesses. | |||
Other Directorships: | drugstore.com, inc. (from 2004); eBay Inc. |
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DAVID E. LIDDLE | ||||
Age: | ||||
Director Since: |
2000 | |||
Committee Memberships: |
Audit and Compensation (Chair) | |||
Principal Occupation: |
Partner, U.S. Venture Partners (a venture capital firm) (from 2000) | |||
Recent Business Experience: |
Chairman (1999), Co-Founder, President and Chief Executive Officer (from 1992 to 1999) | |||
Specific Experience: |
Dr. Liddle’s background in developing technologies for interaction between people and computers has given him deep experience in articulating technological trends and directions, which is instrumental to the Company’s strategy to grow its digital businesses. His current role as partner at U.S. Venture Partners provides him with exposure to investee companies in high-growth markets. In addition, Dr. Liddle brings significant financial expertise to the Company, the Board and the Audit Committee. | |||
Other Directorships: |
MaxLinear, Inc. (from 2004)
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JANET L. ROBINSON | ||||
Age: | ||||
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Director Since: |
2004 | |||
Principal Occupation: |
President and Chief Executive Officer of the Company (from 2005) | |||
Recent Business Experience: |
Executive Vice President and Chief Operating Officer of the Company (2004); Senior Vice President, Newspaper Operations, of the Company (from 2001 to 2004); President and General Manager, The New York Times (from 1996 to 2004) | |||
Specific Experience: |
As the Company’s President and Chief Executive Officer, Ms. Robinson is a key member of the Company’s management team and has primary responsibility for overseeing and coordinating all of the Company’s operations and business units. Ms. Robinson has over 25 years of experience in the media industry, including serving in critical executive positions at the Company and in leadership roles in industry groups. As a result of her long tenure with the Company in various executive roles and as the Company’s President and Chief Executive Officer, Ms. Robinson provides a unique perspective to the Board about the strategic and operational opportunities and challenges, industry trends and competitive and financial position of the Company and its businesses.
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ARTHUR SULZBERGER, JR. | ||||
Age: | ||||
Director Since: |
1997 | |||
Principal Occupation: |
Chairman of the Company (from 1997) and Publisher, The New York Times (from 1992) | |||
Recent Business Experience: |
Deputy Publisher (from 1988 to 1992) and Assistant Publisher (from 1987 to 1988), The New York Times | |||
Specific Experience: |
Mr. Sulzberger, Jr. is a fourth-generation member of the Ochs-Sulzberger family and brings a deep appreciation of the values and societal contributions of The New York Times and the Company throughout their history to his roles as Chairman and Publisher of The New York Times. He has served in a variety of critical positions since joining the Company in 1978. As a long-time employee of the Company, including over 18 years as Publisher of the New York Times and over 13 years as Chairman, Mr. Sulzberger, Jr. has extensive knowledge of our Company and businesses and provides a unique insight and perspective to the Board about the Company’s business strategy and industry opportunities and challenges. In addition, his life-long affiliation with the Company provides the Board with an important historical perspective and a focus on the long-term interests of the Company.
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Interests of Related Persons in Certain Transactions of the Company
Policy on Transactions with Related Persons. See “Policy“Board of Directors and Corporate Governance—Policy on Transactions with Related Persons” on pages 28-2930-31 for a description of the Company’s policy regarding any transaction between the Company and a “related person.”
Interests of Directors in Certain Transactions of the Company. In the ordinary course of business, the Company and its subsidiaries from time to time engage in transactions with other corporations whose officers or directors are also Directorsdirectors of the Company. These include the Company’s purchase of products and services from Verizon Communications, Inc. and the running of advertising in Company properties for the products and services of Chevron Corporation, eBay Inc., Eli Lilly and Company, and Ford Motor Company, and Verizon Communications, Inc., as well as other Director-affiliateddirector-affiliated companies. All of these arrangements are conducted on an arm’s-length basis. The relevant outside Directordirector does not participate in these business relationships or profit directly from them. Due to the nature of these transactions, they may not even come to the attention of the Company’s Board or the relevant Director.director.
Members of the Ochs-Sulzberger Family Employed by the Company During 2009.2010. Arthur Sulzberger, Jr. was employed as Chairman of the Company and Publisher of The New York Times, and Michael Golden was employed as Vice Chairman, and President and Chief Operating Officer, Regional Media Group, of the Company. See “Compensation of Executive Officers” for a description of Mr. Sulzberger, Jr.’stheir compensation. Samuel Dolnick was employed as a staff reporter for The New York Times and Mr. Golden’s compensation.was paid a total of $89,159. James Dryfoos was employed as a Manager within Enterprise Services, The New York Times Company, and as Associate Director, Project Management, NYTimes.com, and was paid a total of $144,673.$160,101. Michael Greenspon was employed as Project Director, The New York Times (Strategic Planning), and Interim General Manager, News Services for The New York Times, and was paid a total of $176,961.$296,565. Rachel B. GoldenKirscht was employed as a Marketing Associate and Marketing Manager for NYTimes.com, and was paid a total of $82,136.$92,572. Arthur Gregg Sulzberger was employed as a staff reporter for The New York Times and was paid a total of $73,503. In September 2009, Samuel Dolnick joined the Company as a staff reporter for$100,646, including relocation benefits related to his transfer to The New York Times and was paid a total of $27,846.Times’s Kansas City bureau. In 2010, David Perpich joined the Company as an Executive Director for NYTimes.com.NYTimes.com Paid Products and was paid a total of $134,769.
Mr.Arthur Sulzberger, Jr. is a cousin of Daniel H. Cohen and of Lynn G. Dolnick and Mr.Michael Golden, who are also siblings. Carolyn D. Greenspon is the daughter of a cousin of Messrs.Arthur Sulzberger, Jr., Michael Golden and CohenLynn G. Dolnick. Samuel Dolnick is the son of Lynn G. Dolnick. James Dryfoos and Ms. Dolnick. Messrs. Dryfoos andMichael Greenspon are each the son of a cousin of Messrs.Arthur Sulzberger, Jr., Michael Golden and Cohen and Ms.Lynn G. Dolnick. Ms.Carolyn D. Greenspon and Mr.Michael Greenspon are siblings. Ms. GoldenRachel B. Kirscht is the daughter of Mr.Michael Golden. Mr.Arthur Gregg Sulzberger is the son of Mr.Arthur Sulzberger, Jr., and Mr. Dolnick is the son of Ms. Dolnick. Mr.David Perpich is the son of Mr.Arthur Sulzberger, Jr.’s sister.
Transaction with Carlos Slim Helú and Affiliates. On January 19, 2009, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) withissued to Inmobiliaria Carso, S.A. de C.V. (“Inmobiliaria”) and Banco Inbursa S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa (“Banco Inbursa”) (each an “Investor” and collectively the “Investors”), pursuant to which the Company issued to the Investors for an aggregate purchase price of $250,000,000 (net of a $4,500,000 investor funding fee) (1) $250,000,000 aggregate principal amount of 14.053% Senior Unsecured Notes due January 15, 2015, (the “Notes”), and (2) detachable warrants (the “Warrants”) to purchase 15,900,000 shares of the Company’s Class A stock at a price of $6.3572 per share. Each Investor purchased an equal number of Notes and Warrants. The closing of this transaction occurred on January 21, 2009. Carlos Slim Helú and members of his family are beneficiaries of a trust whichthat in turn owns all of the outstanding voting securities of Inmobiliaria and a majority of the outstanding voting equity securities of Grupo Financiero Inbursa, S.A.B. de C.V.,GFI, which is the parent company of Banco Inbursa. AsAccording to information contained in a result offiling with the issuance of the Warrants,SEC, Mr. Slim, members of his family, Inmobiliaria and the InvestorsBanco Inbursa are currently deemed to beneficially own on February 26, 2010, an aggregate of 16.2%16.0% of the Company’s outstanding Class A stock.
Preemptive Rights Offering. As a resultstock.See “Principal Holders of the agreement to issue the Warrants to the Investors, under the Company’s Certificate of Incorporation and the New York Business Corporation Law, each holder of the Company’s Class B stock received a non-transferable preemptive right to purchase, for each share of Class B stock owned, 0.1112 warrants (the “Preemptive Warrants”), at a price of $1.33 per warrant, to purchase shares of the Company’s Class A stock, at a price of $6.35 per share. The terms of the Preemptive Warrants were substantially the same as those of the Warrants issued to the Investors.Common Stock.”
As previously mentioned on page 6 the 1997 Trust holds 738,810 shares of Class B stock of the Company, or approximately 90% of the outstanding shares of the Class B stock. The 1997 Trust and the Trustees holding an aggregate of 746,568 shares of Class B stock waived their preemptive rights triggered by the agreement to issue the Warrants to the Investors. Accordingly, an aggregate of 8,917 Preemptive Warrants were offered to the holders of an aggregate of 80,184 shares of Class B stock, and an aggregate of 559 Preemptive Warrants were issued to holders who accepted the offer.
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Board of Directors and Corporate Governance
The Board of Directors is responsible for overseeing the direction, affairs and management of the Company. The Board recognizes its fiduciary duty to both Class A and Class B stockholders.
The following highlights key corporate governance practices applicable to the Board:
Board Leadership Structure. Since 1997, the Company has separated the positions of Chairman of the Board of Directors and Chief Executive Officer. Given the demanding nature of these positions, and taking into account that our Chairman is currently also the Publisher of The New York Times, the Board believes it is appropriate to separate the positions of Chairman and Chief Executive Officer. Furthermore, since our Chairman is an executive officer of the Company, the Board believes it is appropriate to have a lead independent director who, among other things, chairs all executive sessions of our non-employee and independent Directorsdirectors and serves as a liaison between our Chairman, our Chief Executive Officer and our independent Directors.directors. Ellen Marram, our Presiding Director, currently serves in this role. See “Presiding“—Presiding Director” on page 27.29.
The Board’s Role in Risk Oversight. Risk is an integral part of the Board and Committee deliberations throughout the year. The Audit Committee oversees the management of the Company’s enterprise risk management program and the Audit Committee annually reviews an assessment prepared by management of the critical risks facing the Company, their relative magnitude and management’s actions to mitigate these risks.
Management implemented an enterprise risk management program in 2008 as a Companywide initiative to enhance our existing processes involving an integrated effort to identify, evaluate and manage risks that may affect our ability to execute our corporate strategy and fulfill our business objectives. The activities of the enterprise risk management program entail the identification, prioritization and assessment of a broad range of risks (e.g.(e.g., strategic, operational, financial, legal/regulatory and reputational) and the formulation of plans to mitigate their effects.
Corporate Governance Principles. NYSE rules require listed companies to adopt corporate governance principles. A printable copy of the current version of the Company’s Corporate Governance Principles, most recently amended on February 18, 2010, is available on our Web site, as described on page 5.6.
Majority Voting for Directors. Our Corporate Governance Principles provide that each nominee for election to the Board must agree to resign upon the request of the Board if, in an uncontested election, he or she is elected to the Board but fails to receive a majority of the votes cast. In determining whether to require the Directordirector to resign, the Board, with such person not participating, will consider all relevant facts and circumstances. The Board must make the request within 60 days and the Company must disclose the Board’s decision within 65 days.
Director Nominee Rotation. Our Corporate Governance Principles provide that it is the policy of the Company to have an annual rotation of the nominees for election to the Board by holders of the publicly traded, Class A stock. It is intended that each of the independent directors be nominated for election by the Class A stockholders at least once every three years and that the annual slate of Class A nominees include at least one member of each of the Audit, Compensation and Nominating & Governance Committees.
This policy reinforces the principle that, once elected, our Directorsdirectors have no ongoing status as “Class A” or “Class B” Directors.directors. All Directorsdirectors owe fiduciary duties and responsibilities to all of our stockholders.
Director Election. All Directorsdirectors stand for election annually. Voting is not cumulative. Under our Certificate of Incorporation, 30% (or the nearest larger whole number) of the Directorsdirectors are elected by the holders of the Company’s Class A stock and the remaining Directorsdirectors are elected by the holders of the Company’s Class B stock. Under the New York Business Corporation Law and our Corporate Governance Principles, once elected, our Directorsdirectors have no ongoing status as “Class A” or “Class B” Directorsdirectors and haveserve as one Board with the same fiduciary duties and responsibilities to all stockholders. Our Board serves as one Board with fiduciary responsibilities to the Company and all of our stockholders.
Director Attendance at Annual Meetings. All Directorsdirectors are expected to attend the Company’s annual meeting of stockholders. All Directorsdirectors attended the Company’s 2009 annual meeting of stockholders2010 Annual Meeting in person, except for Daniel Cohen,Dr. Middelhoff, who could not attend due to personal health reasons.
Director Retirement Age. None of our Directorsdirectors will stand for re-election after his or her 70th birthday, unless the Board determines otherwise.
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Directors as Stockholders. To encourage alignment of the interests of our Directorsdirectors and stockholders, all Directorsdirectors are expected to own stock in the Company equal in value to at least three times the annual Board cash retainer as set from time to time by the Board. Each Directordirector is expected to accumulate this stock over a reasonable period of time, which in the view of the Nominating & Governance Committee is an approximately five-year period. Subject to the right of new Directorsdirectors to acquire the requisite holdings over time, no Directordirector currently fails to comply with this
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stock ownership policy. Stock units held by a Directordirector under the Company’s Non-Employee Directors Deferral Plan are included in calculating the value of ownership to determine whether this minimum ownership has been accumulated.
Director Orientation. The Company has a comprehensive orientation program for all new non-employee Directorsdirectors with respect to their role as directors and as members of the particular Board committees on which they will serve. It includes one-on-one meetings with senior management and top New York Times editors and extensive written materials on each of the Company’s different business units. The senior management meetings cover a corporate overview, the Company’s strategic plans, its significant financial, accounting and risk management issues, its compliance programs, and its business conduct policies. All other Directors are also invited to attend each orientation program.
Ongoing Director Education. From time to time, the Company will provide Directorsdirectors with additional educational materials and presentations from Company and/or third-party experts on subjects that would enable them to perform better their duties and to recognize and deal appropriately with issues that arise. In addition, the Company will pay all reasonable expenses for any Directordirector who wishes to attend a director continuing education program.
“Controlled Company” Exception to NYSE Rules. The Company’s Board of Directors has determined not to take advantage of an available exception fromto certain of the NYSE rules. A company of which more than 50% of the voting power for the election of directors is held by a single entity, a “controlled company,” need not comply with the requirements for a majority of independent directors or for independent compensation and nominating/corporate governance committees. As a result of the 1997 Trust’s holdings of Class B stock, the Company would qualify as a controlled company and could elect not to comply with these independence requirements. However, the Company’s Board of Directors has determined to comply in all respects with the NYSE rules.
Independent Directors. The NYSE rules require listed companies to have a board of directors with at least a majority of independent directors. The Company has now, and has had for many years, a majority of independent Directors.directors.
The NYSE rules specify five categories of relationships between an individual and a listed company that render the individual ineligible to be independent. The Board has determined that none of the Company’s independent Directorsdirectors has a relationship with the Company that falls within these categories.
Under the NYSE rules, a Directordirector qualifies as “independent” so long as he or she has none of these impermissible relationships with the Company and upon the Board affirmatively determining that he or she has no other material relationship with the Company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the Company).
For the purpose of assisting the Board in determining Directordirector independence, the Board has adopted categorical standards definingguidelines with respect to “material relationships.” Under these standards,guidelines, the Board has determined that the following relationships—provided they are not required to be disclosed in the Company’s public filings by SEC rules—are immaterial to the Company for this purpose:purposes of director independence:
♦ | if the |
♦ | if the |
The Board has determined that each of the Company’s independent Directorsdirectors has only immaterial relationships with the Company consistent with these categorical standards.guidelines. In addition, in the course of the Board’s determination regarding independence, it considered certain transactions, relationships and arrangements, all of which were deemed to be in the ordinary course of business and conducted on an arm’s-length basis. See “Interests of Related Persons in Certain Transactions of the Company—Interests of Directors in Certain Transactions of the Company.”
Based on the foregoing, the Board has affirmatively determined that each of Messrs. Cesan, Denham Galloway and Kohlberg, Ms. Lepore, Dr. Liddle, Ms. Marram, Dr. Middelhoff and Ms. Toben has no material relationships with the Company and, therefore, each is independent pursuant to applicable NYSE rules. Of the remaining Directors, Messrs.directors, Mr. Golden, Ms. Robinson and Mr. Sulzberger, Jr. and Golden and Ms. Robinson are executive officers of the Company,Company. Ms. Dolnick is a cousin of Mr. Sulzberger, Jr. and a sister of
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Mr. Golden and Mr. Cohen is a cousin of Messrs. Sulzberger, Jr. and Golden. Ms. Greenspon a nominee for Director, is the daughter of a cousin of Messrs. Sulzberger, Jr. and Golden. Due to their family relation to Messrs. Sulzberger, Jr. and Golden, Ms.Mss. Dolnick and Mr. CohenGreenspon are not considered independent and Ms. Greenspon will not be considered independent.
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Board Committees. Both the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and the NYSE rules require the Company to have an audit committee comprised solely of independent directors, and the NYSE rules also require the Company to have independent compensation and nominating/corporate governance committees. The Company is in compliance with these requirements.
Under the Sarbanes-Oxley Act, members of an audit committee must have no affiliation with the issuer, other than the Board seat, and receive no compensation in a capacity other than as a director/committee member. Each member of our Audit Committee meets this independence standard.
Audit Committee Financial Experts. Rules promulgated by the SEC under the Sarbanes-Oxley Act of 2002 require the Company to disclose annually whether our Audit Committee has one or more “audit committee financial experts,” as defined by the SEC. The Board has determined that each member of the Audit Committee including the Chair of the Audit Committee, Mr. Cesan, qualifies as an “audit committee financial expert.”
Codes of Ethics. The Company has adopted a Business Ethics Policy, applicable to all employees, a code of ethics that applies not only to the Company’s Chairman, Chief Executive Officer, Vice Chairman and senior financial officers, as required by the SEC, but also to its Chairman and Vice Chairman, and a code of ethics for Directors.directors. A printable version of each of these documents is available on our Web site, as described on page 5.6.
Non-Employee Directors. The NYSE rules require that, at the listed company’s option, either non-employee directors or independent directors of such company meet periodically in executive sessions without management participation. The Company’s non-employee Directorsdirectors meet separately at the end of each regular meeting of the Board. Additionally, at least once a year the independent Directorsdirectors meet in executive session. Ms.Mss. Dolnick and Mr. CohenGreenspon are non-employee Directorsdirectors who, due to their family relation to Messrs. Sulzberger, Jr. and Golden, are not considered independent. If elected,Ms. Greenspon will be a non-employee Director who, due to her family relation to Messrs. Sulzberger, Jr. and Golden, will not be considered independent.
Presiding Director. Ms. Marram currently serves as our Presiding Director. In addition to chairing all executive sessions of our non-employee and independent Directors,directors, our Presiding Director:
♦ | serves as a liaison between our Chairman, our Chief Executive Officer and our independent |
♦ | reviews proposed plans for Board meeting presentations; |
♦ | consults with any of the senior executives of the Company as to any concerns the executive might have; and |
♦ | makes herself available for direct consultation with major stockholders. |
Stockholders and other interested parties may express their concerns to the Company’s non-employee Directorsdirectors or the independent Directorsdirectors by contacting the Presiding Director, care of the Senior Vice President, General Counsel &Corporate Secretary, The New York Times Company, 620 Eighth Avenue, New York, NY 10018. All such correspondence will be relayed to the Presiding Director.
Communications with the Board. Stockholders may communicate with the Board of Directors care of the Senior Vice President, General Counsel &Corporate Secretary, The New York Times Company, 620 Eighth Avenue, New York, NY 10018. All such correspondence will be relayed to the entire Board of Directors.
Board and Committee Evaluations. Our Board has a Board and Committee evaluation process to examine and discuss how our Board and Committees function as groups and with senior management of our Company. We believe that our stockholders’ interests can be best protected by acknowledging the separate responsibilities of management and our Board and its Committees and by ensuring an open environment for Board and management discussions and actions.
No Interlocking Directorships. The Chairman of the Board, who also serves as Publisher of The New York Times, does not sit on any other company board. Although other members of senior management without editorial responsibilities are not so precluded, none sit on the boards of directors of any company at which one of our Directorsdirectors is the chief executive officer or chief operating officer.
Succession Planning. Recognizing the critical importance of executive leadership to the success of the Company, the Board works with senior management to ensure that effective plans are in place for both short-term and long-term executive succession at The New York Times Company.
Senior Management Evaluation. In consultation with all non-employee Directors,directors, the Compensation Committee annually evaluates the performance of our Chairman, President and Chief Executive Officer and Vice Chairman.
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Corporate Financial Ethics Hotline. The Company has established a corporate financial ethics hotline to allow an employee to lodge a complaint, confidentially and anonymously, about any accounting, internal control or auditing matter that is of concern.
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Executive Stock Ownership Guidelines. Those executive officers named in the “Summary Compensation Table” are subject to stock ownership guidelines. The Chairman is required to own shares of Class A stock equal to three times his base salary. The President and Chief Executive Officer, the Vice Chairman and the Chief Financial Officer are required to hold an amount equal in value to two times his or her base salary in Company stock. All other named executive officers are required to hold an amount equal in value to their base salary in Company stock. Shares held through the Company 401(k) Plan and restricted stock units are counted in calculating ownership. An executive officer’s stock holdings are valued at the greater of the fair market value at year end or the officer’s tax basis in the shares (or in the case of restricted stock units, the grant date fair market value). An affected executive officer has five years to attain the holding requirements. All of our named executive officers are currently in compliance with the guidelines.
Board Policy on Recoupment of Bonuses Upon Restatement Due to Fraud or Misconduct. In the event of a restatement of the Company’s financial statements due to fraud or intentional misconduct, the Board will review performance-based bonuses to executive officers whose fraud or intentional misconduct caused the restatement, and the Company will seek to recoup bonuses paid for performance during the period or periods that are the subject of the restatement.
Independent Compensation Consultant. The Compensation Committee has directly engaged an independent compensation consultant, Exequity LLP.LLP (“Exequity”). In 2009,2010, Exequity reported on its review of data from nationally recognized compensation surveys. The review analyzed salary, annual and long-term cash incentive bonuses and equity compensation, as well as total compensation, for comparable executive positions at a comparative group of companies that includes traditional newspaper companies, other print publishing companies, news and information companies, and a selection of similarly-sized general industry companies and, for operating unit positions, at other comparable media companies. Exequity also provided general advice on executive compensation trends and programs, made compensation recommendations for our Chairman and Chief Executive Officer and supplied consulting services to the Compensation Committee in connection with the design and preparation of the Company’s 2010 Incentive Plan, which was approved at the 2010 Annual Meeting, including evaluating the plan against RiskMetrics proxy voting guidelines. Exequity has not provided any services to the Company, other than those relating to its role as compensation adviser to the Committee, during the Company’s 20092010 fiscal year.
See “Compensation Committee—Compensation Committee Procedures.”
Policy on Transactions with Related Persons. The Board of Directors recognizes the fact that transactions with related persons present a heightened risk of conflicts of interests and/or improper valuation (or the perception thereof).
Any transaction in which the Company or any of its subsidiaries is a participant and a Director, Directordirector, director nominee, executive officer or beneficial holder of more than 5% of the Company’s total equity (i.e.(i.e., Class A and Class B stock of the Company), or any immediate family member of the foregoing (each, a “related person”) has a direct or indirect material interest, and where the amount involved exceeds $120,000, must be specifically disclosed by the Company in its public filings.
Any such transaction would be subject to the Company’s written policy respecting the review, approval or ratification of related person transactions.
Under this policy:
♦ | the Company or any of its subsidiaries may employ a related person in the ordinary course of business consistent with the Company’s policies and practices with respect to the employment of non-related persons in similar positions; and |
♦ | any other related person transaction that would be required to be publicly disclosed must be approved or ratified by the Board of Directors, delegated to the Nominating & Governance Committee or other committee, or if it is impractical or undesirable to defer consideration of the matter until a Board or committee meeting, by the Chair of the Nominating & Governance Committee (or, if he or she is not disinterested, by the Presiding Director). |
If the transaction involves a related person who is a Directordirector or an immediate family member of a Director,director, that Directordirector may not participate in the deliberations or vote. In approving or ratifying a transaction under this policy, the Board, the committee or Directordirector considering the matter must determine that the transaction is fair and reasonable to the Company.
A printable version of this written policy is available on our Web site, as described on page 5.6.
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Our Code of Ethics applicable to Directorsdirectors discourages Directorsdirectors from engaging in transactions that present a conflict of interest or the appearance of one. Our Business Ethics Policy applicable to employees, including executive officers and others who may be “related persons”persons,” similarly discourages transactions where there is or could be an appearance of a conflict of interest. In addition, that policy requires specific approval by designated members of management of transactions involving the Company and in which employees have an interest. Specifically, an
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employee’s retention for the provision of goods or services to the Company of any business in which he or she has an interest must be approved by the employee’s supervisor, and an employee’s direct or indirect financial interest in a business enterprise that does business with the Company must be approved by or on behalf of the President/Chief Executive Officerpresident/chief executive officer of that employee’s operating unit. There are exceptions for small holdings in public companies.
These provisions of the Code of Ethics applicable to Directorsdirectors and the Company’s Business Ethics Policy are intended to operate in addition to, and independently of, the policy on transactions with related persons described above.
See “Interests of Related Persons in Certain Transactions of the Company” for a description of transactions between the Company and related persons in 20092010 and 2010 through the date of this Proxy Statement.
Board Meetings in 2009:2010: Six
Board Committees: Four Standing Committees: Audit, Compensation, Finance and Nominating & Governance. See “Board Committees” for Committee descriptions and membership. Due to the suspension of certain activities of The New York Times Company Foundation, the Board determined in February 2010 to dissolve the Foundation Committee. Certain remaining responsibilities of the Foundation Committee were assumed by the Finance Committee.
Total Committee Meetings in 2009:2010: 2221
20092010 Attendance: All incumbent Directorsdirectors attended 75% or more of the total Board and Committee meetings on which they served.
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Name of Committee and Members | Principal Functions of the Committee | Meetings in 2010 | ||||
Audit Raul E. Cesan, Chair Robert E. Denham David E. Liddle Doreen A. Toben | ♦ | Engages the Company’s independent auditors, subject to ratification by the stockholders, and receives periodic reports from the auditors and management regarding the auditors’ independence and other matters. Recommends appropriate action to ensure the auditors’ independence. | 6 | |||
♦ | Reviews with management and the independent auditors the Company’s quarterly and annual financial statements and other financial disclosures, the adequacy of internal controls and major issues regarding accounting principles and practices, including any changes resulting from amendments to SEC or Financial Accounting Standards Board rules. | |||||
♦ | Meets regularly with the Company’s senior internal audit executive, representatives of management and the independent auditors in separate executive sessions. | |||||
♦ | Reviews and approves the scope of the audit at the outset and reviews the performance of the independent auditors and any audit problems or difficulties encountered. | |||||
♦ | Reviews the Company’s risk assessment and risk management policies. | |||||
♦ | Reviews the organization, resources and competence of the Company’s internal audit department. Prepares the report to stockholders included in the annual Proxy Statement. | |||||
Compensation David E. Liddle, Chair James A. Kohlberg Dawn G. Lepore Ellen R. Marram Thomas Middelhoff | ♦ | Approves compensation arrangements for the Company’s executive officers other than the Chairman, the Chief Executive Officer and the Vice Chairman, including base salaries, salary increases, incentive compensation plans and awards. Reviews the reasonableness and appropriateness of all such compensation. | ||||
♦ | In consultation with all non-employee | |||||
♦ | Adopts and oversees the administration of incentive compensation and executive stock plans and determines awards granted to executive officers under such plans. | |||||
♦ | Advises the Board on the reasonableness and appropriateness of executive compensation plans and levels generally, including whether these effectively serve the interests of the Company and its stockholders by creating appropriate incentives for high levels of individual and Company performance. | |||||
♦ | Appoints the ERISA Management Committee, which oversees administration of the Company’s health, benefit and savings plans and which reports to the Compensation Committee once a year. | |||||
♦ | Has sole authority to engage an executive compensation consultant. | |||||
♦ | Reviews and discusses the Compensation Discussion and Analysis with management and prepares a report to stockholders stating that it has recommended that it be included in the annual Proxy Statement. | |||||
Nominating & Governance Robert E. Denham, Chair
Ellen R. Marram | ♦ | Makes recommendations to the Board regarding the composition of the Board and its Committees, including size and qualifications for membership. | ||||
♦ | Recommends candidates to the Board for election to the Board at the Annual Meeting. | |||||
♦ | Advises the Board on appropriate compensation for outside directors. | |||||
♦ | Advises the Board on corporate governance matters. | |||||
♦ | Oversees periodic evaluation of the Board. | |||||
♦ | Has sole authority to engage a search firm to identify director candidates. |
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Name of Committee and Members | Principal Functions of the Committee | Meetings in 2010 | ||||
Finance Ellen R. Marram, Chair Raul E. Cesan
Lynn G. Dolnick
Thomas Middelhoff Doreen A. Toben | ♦ | Reviews the Company’s financial policies, including, without limitation, dividend policy, investment of cash, stock repurchase, | 6 | |||
♦ | Establishes (and adjusts from time to time) investment policies for the Company’s retirement and savings plans. | |||||
♦ | Appoints the Pension Investment Committee, which appoints and reviews the performance of the trustees and investment managers for the Company’s retirement and savings plans and which reports to the Finance Committee from time to time. | |||||
♦ | Reviews and makes recommendations to the Board with respect to the Company’s contributions to The New York Times Company Foundation. |
Nominating & Governance Committee
Our Nominating & Governance Committee consists of three non-employee Directors,directors, Robert E. Denham, Chair, Scott GallowayJames A. Kohlberg and Ellen R. Marram. Our Board has determined that each Committee member is “independent” under the corporate governance listing standards of the NYSE.
Effective November 20, 2009, our former director, William E. Kennard, who served as Chair of the Committee, resigned from our Board and the Committee upon the confirmation of his nomination to serve as Representative of the United States of America to the European Union, with the rank of Ambassador. Effective upon his resignation, our Board of Directors appointed Mr. Denham Chair of the Committee.
The Committee operates under a written charter adopted by the Board of Directors. The principal functions of the Committee include making recommendations to the Board regarding the composition of the Board and its Committees, including size and qualifications for membership, recommending nominees to the Board for election and advising the Board on corporate governance matters. The chart set forth in “Board Committees” describes the principal functions of the Committee under its charter. A printable version of the charter is available on our Web site, as described on page 5.6.
Whenever a vacancy exists on the Board due to expansion of the Board’s size or the need to replace a resigning or retiring Director,director, the Committee begins a process of identifying and evaluating potential Directordirector nominees. The Committee considers recommendations of management, stockholders and others. The Committee has sole authority to retain and terminate any search firm to be used to identify Directordirector candidates, including approving its fees and other retention terms. In this regard, from time to time the Committee has retained a global executive recruiting firm, whose function is to bring specific Directordirector candidates to the attention of the Committee. As discussed elsewhere in this Proxy Statement, the 1997 Trust, as holder of a majority of our Class B stock, has the right to elect 70% of our Board. The Committee considers, among other potential nominees, recommendations of the trustees of the 1997 Trust for nominees to be elected by the holders of the Class B stock. Carolyn D. Greenspon, who is a Director nominee for election by the holders of Class B stock, was brought to the attention of the Committee by the trustees of the 1997 Trust. Ms. Greenspon is herself one of the trustees and a fifth-generation member of the Ochs-Sulzberger family.
As noted, the Committee will consider Directordirector candidates recommended by stockholders. Stockholders wishing to recommend Directordirector candidates for consideration by the Committee may do so by writing to the Senior Vice President, General Counsel &Corporate Secretary, giving the recommended nominee’s name, biographical data and qualifications, accompanied by the written consent of the recommended nominee.
Consistent with the Company’s Corporate Governance Principles, the Committee considers various criteria in Board candidates, including, among others, independence, character, judgment and business experience, as well as their appreciation of the Company’s core purpose, core values and journalistic mission, and whether they have time available to devote to Board activities.
In addition, pursuant to the Company’s Corporate Governance Principles, the Committee considers as one factor among many the diversity of Board candidates, which may include diversity of skills and experience as well as geographic, gender, age, and ethnic diversity. The Committee does not, however, have a formal policy with regard to the consideration of diversity in identifying Board candidates.
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The Committee also considers whether a potential nominee would satisfy:
♦ | the NYSE’s criteria of director “independence”; |
♦ | the NYSE’s “financial literacy” and “financial management expertise” standards; and |
♦ | the SEC’s definition of “audit committee financial expert.” |
Director candidates are evaluated in light of the then-existing composition of the Board, including its overall size, structure, backgrounds and areas of expertise of existing Directorsdirectors and the relative mix of independent and management Directors.directors. The
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Committee also considers the specific needs of the various Board committees. The Committee recommends potential Directordirector nominees to the Board, and final approval of a candidate is determined by the Board. This evaluation process is the same for Directordirector nominees who are recommended by our stockholders.
Ms. Greenspon first met with the Presiding Director and Chair of the Committee, who then recommended that the Committee recommend to the Board that she be a Director nominee at the 2010 Annual Meeting.
Compensation Committee Procedures
Our Board of Directors has established a Compensation Committee and charged it with the responsibility to review and either act on behalf of the Board or make recommendations to the Board concerning executive compensation and employee benefits. The Compensation Committee consists of the following individuals:
five non-employee directors, David E. Liddle, Chair,
James A. Kohlberg,
Dawn G. Lepore,
Ellen R. Marram
and Thomas MiddelhoffMiddelhoff.
Our Board has determined that each Committee member is “independent” under the corporate governance listing standards of the NYSE.
The Committee operates under a written charter adopted by the Board of Directors. A printable version of the charter is available on our Web site, as described on page 5.6. The chart set forth in “Board Committees” describes the principal functions of the Committee under its charter, as well as the number of its meetings in 2009.2010.
Together with the other non-employee members of the Board, the Committee evaluates the performance of our Chairman, Chief Executive Officer, and Vice Chairman and together with the other independent Directorsdirectors approves their compensation. In addition, the Committee approves all compensation for our other executive officers and discusses with management in general terms the compensation of non-executive employees.
In the past, the Committee has delegated, and may in the future on an annual basis delegate, the authority to make option and other equity grants in limited circumstances, such as to newly hired or recently promoted employees, to a three-member management committee authorized to grant a limited number of options and other equity awards under specified parameters. To ensure compliance with its longstanding procedures, the Committee has adopted a written grant policy.
Under its charter, the Committee has sole authority to retain and terminate a consulting firm to assist in its evaluation of executive compensation. In accordance with this authority, in 2009,2010, it directly engaged an independent compensation consultant, Exequity LLP.Exequity. Exequity reported on its review of data from nationally recognized compensation surveys. The review analyzed salary, annual and long-term cash incentive bonuses and equity compensation, as well as total compensation, for comparable executive positions at a comparative group of companies that includes traditional newspaper companies, other print publishing companies, news and information companies, and a selection of similarly-sized general industry companies and, for operating unit positions, at other comparable media companies. Exequity also provided general advice on executive compensation trends and programs and made compensation recommendations for our Chairman and Chief Executive Officer. In the course of advising the Committee, Exequity occasionally is asked to provide guidance and support to management in connection with matters that are reviewed by the Committee. These matters may pertain to, among other things, competitive analysis, program design recommendations, technical support and cost modeling. Exequity also supplied consulting services to the Committee in connection with the design and preparation of the 2010 Incentive Plan, including evaluating the plan against RiskMetrics proxy voting guidelines. Exequity hasdid not providedprovide any services to the Company, other than those relating to its role as compensation adviser to the Committee, during the Company’s 20092010 fiscal year.
In 2010, the Committee retained Hay Group to undertake an independent and thorough review of our executive compensation programs. Hay Group concluded that the executive compensation structure provided strong alignment in the areas of strategy, stockholders, pay for performance, and effectiveness and efficiency.
The Committee generally consults with management regarding executive compensation matters, and our Chief Executive Officer makes compensation recommendations for executive officers, excluding herself and our Chairman. The Company’s human resources department supports the Committee in its work.
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Throughout the year, the Committee meets to discuss the Company’s executive compensation program and related matters. In February of each year, the Committee generally takes the following actions:
♦ | sets salaries for the year; |
♦ | sets annual bonus potentials and the related financial targets for the year; |
♦ | sets award potentials and the financial targets and performance period for the upcoming long-term performance cycle; and |
♦ | awards equity-based compensation. |
In addition, each February, the Committee meets to certify the achievement of performance goals for the recently completed year and long-term cycles and approve the payment of the annual bonuses and long-term performance awards. Other meetings are scheduled throughout the year as the Committee deems appropriate.
In February 2010, the Committee reviewed and recommended to the Board of Directors for approval the 2010 Incentive Plan. See “Proposal No. 2—Adoption of The New York Times Company 2010 Incentive Compensation Plan.”
The Committee has reviewed and discussed with Company management the section of this Proxy Statement titled “Compensation of Executive Officers—Compensation Discussion and Analysis,” and its report to stockholders stating that it has recommended the inclusion of such discussion and analysis appears below under “Compensation of Executive Officers” on page 38.40.
Compensation Committee Interlocks and Insider Participation
No member of the Committee is now, or was during 20092010 or any time prior thereto, an officer or employee of the Company. No member of the Committee had any relationship with the Company during 20092010 pursuant to which disclosure would be required under applicable SEC rules pertaining to the disclosure of transactions with related persons. None of our executive officers currently serves or ever has served as a member of the board of directors, the compensation committee, or any similar body, of any entity one of whose executive officers serves or served on our Board or the Committee.
To the Stockholders of The New York Times Company:
The Audit Committee consists of four non-employee Directors,directors, Raul E. Cesan, Chair, Robert E. Denham, David E. Liddle and Doreen A. Toben. The Board of Directors has determined that:
♦ | each Committee member is “independent” under the corporate governance listing standards of the NYSE and is “financially literate” as defined by the NYSE; |
♦ | each Committee member satisfies the “financial management expertise” standard, as required by the NYSE; and |
♦ | each Committee member |
The Committee operates under a written charter adopted by the Board of Directors. A printable version of the charter is available on our Web site, as described on page 5.6.
Management has the primary responsibility for the financial statements and the financial reporting process, including the system of internal control over financial reporting. The Company’s independent registered public accounting firm is responsible for performing an independent integrated audit of (i) the Company’s consolidated financial statements in accordance with auditing standards of the Public Company Accounting Oversight Board (United States) and (ii) the Company’s internal control over financial reporting, and for issuing their reports thereon. The Committee is responsible for assisting the Board in monitoring:
♦ | the integrity of the Company’s financial statements; |
♦ | the Company’s compliance with legal and regulatory requirements; |
♦ | the Company’s internal control over financial reporting; |
♦ | the Company’s independent registered public accounting firm’s qualifications and independence; and |
♦ | the performance of the Company’s internal audit function and independent registered public accounting firm. |
In addition, the Committee has established procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters and the confidential and anonymous submission by Company employees of concerns regarding accounting or auditing matters.
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During 2009,2010, the Committee met six times and held separate discussions with management, the Company’s internal auditors and the Company’s independent registered public accounting firm, Ernst & Young LLP (“Ernst & Young”).LLP. The Committee’s Chair, as representative of the Committee, discussed the Company’s interim financial information contained in each quarterly earnings announcement with the Company’s Chief Financial Officer
34
and/or Controller and Ernst & Young prior to public release. Each other member of the Committee also generally participated in this discussion. The full Committee reviews the Company’s quarterly financial statements with management and Ernst & Young. In addition, the Committee reviewed and discussed the Company’s compliance with the requirements of the Sarbanes-Oxley Act of 2002 with respect to internal control over financial reporting.
Management has represented to the Committee that the Company’s 20092010 annual consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America. The Committee reviewed and discussed with management and Ernst & Young the Company’s 20092010 annual consolidated financial statements and Ernst & Young’s audit report thereon and Ernst & Young’s audit report on the effectiveness of the Company’s internal control over financial reporting. In addition, the Committee reviewed and discussed with management the annual report of management on the Company’s internal control over financial reporting. The Committee has also discussed the following with Ernst & Young:
♦ | the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (Communication with Audit Committees), which include, among other items, matters related to the conduct of the audit of the Company’s |
♦ | the critical accounting policies and practices used in the preparation of the Company’s |
♦ | other material written communications between Ernst & Young and management. |
In addition, the Committee has received and reviewed the written disclosures and the letter from Ernst & Young required by applicable requirements of the Public Company Accounting Oversight Board regarding Ernst & Young’s communications with the Committee concerning independence, and has discussed with Ernst & Young their firm’s independence from the Company and management, including all relationships between the firm and the Company. As part of its role of monitoring Ernst & Young’s independence, the Committee has adopted a “Policy on Auditor Independence and Non-Audit Services” (which, among other things, requires management and the Committee to consider whether Ernst & Young’s provision of any non-audit services would impair Ernst & Young’s independence) and a “Policy on Hiring Current or Former Employees of the Company’s or Plan’s Independent Auditors.” Both of these policies are available athttp://www.nytco.com.
In addition, the Committee obtains and reviews annually a report by Ernst & Young describing:
♦ | the firm’s internal quality-control procedures; and |
♦ | any material issues raised by (i) the most recent internal quality-control review (or peer review) of the firm, or (ii) any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues. |
The Committee discussed with the Company’s internal auditors and Ernst & Young the overall scope and plans for their respective audits. The Committee met with the internal auditors and Ernst & Young, with and without management present, to discuss the results of their respective audits, the evaluations of the Company’s internal control over financial reporting, and the overall quality of the Company’s financial reporting.
In reliance on the reviews and discussions referred to above, the Committee recommended to the Board of Directors, and the Board has approved, that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2009,26, 2010, for filing with the SEC.
The Committee also has recommended, subject to stockholder ratification, the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 26, 2010.
Raul E. Cesan, Chair
Robert E. Denham
David E. Liddle
Doreen A. Toben25, 2011.
Raul E. Cesan, Chair |
Robert E. Denham David E. Liddle Doreen A. Toben |
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20092010 Compensation of Non-Employee Directors
Compensation for our non-employee Directorsdirectors for 20092010 consisted of: cash compensation in the form of an annual retainer for all Board members, Committee Chairs and Committee members and the Presiding Director; and equity compensation, consisting of a grant of phantom Class A stock units and options to purchase Class A stock.
Our goal in setting compensation for our non-employee Directorsdirectors is to remain competitive in attracting and retaining high quality Directors.directors. We also recognize that over the past few years, there has been an increase in board responsibilities and potential liability.
Our Nominating & Governance Committee annually reviews and makes recommendations to the Board with respect to the compensation for non-employee Directors.directors. Each year, management reports to the Nominating & Governance Committee on non-employee Directordirector compensation at comparable companies and makes recommendations with respect to the amount and form of compensation for non-employee Directors.
Based on such review, our Nominating & Governance Committee recommended to the Board and the Board unanimously agreed, effective January 1, 2009, to a 5% reduction in the cash compensation payable to non-employee Directors in order to reduce our cost structure and operating expenses. This reduction was generally in line with a salary reduction approved for our nonunion employees, including our executive officers. In 2010, cash compensation payable to non-employee Directors was reinstated to levels paid in 2008.directors.
Each of the current components of our non-employee Directordirector compensation is described in more detail below.
Cash Compensation: In 2009,2010, we paid an annual retainer to all Board members, Committee Chairs and Committee members as follows:
♦ | Annual cash Board retainer of |
♦ | Annual cash Committee Chair retainer of |
♦ | Annual cash Committee retainers in the following amounts: |
♦ | Audit—$ |
♦ | Compensation—$ |
♦ | Finance—$ |
♦ | Nominating & Governance—$ |
♦ | Foundation—$ |
The Presiding Director received an additional $9,500$10,000 annual retainer. In addition, the Board determined in February 2010 to dissolve the Foundation Committee. As a result, the cash retainer for serving on the Foundation Committee was paid on a pro rata basis based on the time served in 2010.
Non-Employee Directors Deferral Plan: The Company’s Non-Employee Directors Deferral Plan allows our non-employee Directorsdirectors to defer the receipt of all or a portion of their cash compensation. We credit deferred amounts to a cash account or a phantom Class A stock unit account, as elected by the Director.director. Amounts deferred as phantom Class A stock are initially held as cash and are converted to phantom stock units as of the date of our next succeeding Annual Meeting.annual meeting. Cash accounts are credited with interest at a market rate. Phantom Class A stock unit accounts are credited with dividend equivalents. Subsequent to a non-employee Director’sdirector’s retirement, we pay him or her the cash value of amounts accumulated in his or her account.
Phantom Stock Units: Under the Company’s Non-Employee Directors Deferral Plan, a discretionary grant of phantom stock units worth $35,000 was credited to each non-employee Director’sdirector’s account on the date of the 20092010 Annual Meeting. The number of phantom stock units credited was based on the average closing price of a share of Class A stock for the 30 trading days prior to the date of the 20092010 Annual Meeting. It is anticipated that a similar grant will be made on the date of the 20102011 Annual Meeting.
Stock Options: Our Board’s longstanding practice is to award stock options annually to our non-employee Directors,directors on the date of the Annual Meetingannual meeting under our 2004 Non-Employeethe Directors’ Stock Incentive Plan (the “Directors’ Plan”).Plan. The option exercise price for those awards is set at the average of the high and low stock prices as quoted on the NYSE on the date of the Annual Meeting.annual meeting. Options vest on the date of the next succeeding Annual Meetingannual meeting and have a term of 10 years from the date of grant.
In 2009,2010, options to purchase 4,000 shares of our Class A stock were granted to non-employee Directorsdirectors under the Directors’ Incentive Plan. It is anticipated that a similar grant will be made on the date of the 20102011 Annual Meeting.
Matching Gifts Program: Through our foundation, The New York Times Company Foundation, we matched 100% of charitable contributions made by Directors prior to May 22, 2009, to colleges, schools, cultural, journalism or environmental organizations, up to a maximum contribution of $3,000 per person per year. We also matched charitable contributions of retired Directors. This matching gifts program was suspended as of May 22, 2009.
Expenses: We reimburse reasonable expenses incurred for attendance at Board and Committee meetings.
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Non-Employee Director Compensation Table
The total 20092010 compensation of our non-employee Directorsdirectors is shown in the following table. Mr. Kennard stepped down fromMs. Greenspon was elected to the Board effective November 20, 2009.on April 27, 2010. The table includes hisMs. Greenspon’s compensation from that date through December 31, 2010. Messrs. Cohen and Galloway did not stand for election at the 2010 Annual Meeting on April 27, 2010. The table includes their compensation for the period through that date.
(a) | (b) | (c) | (d) | (g) | (h) | (b) | (c) | (d) | (g) | (h) | ||||||||||||||||||||
Name | Fees Earned or Paid in Cash1 ($) | Stock Awards2,3 ($) | Option Awards4,5 ($) | All Other Compensation6 ($) | Total ($) | Fees Earned ($) | Stock Awards2,3 ($) | Option Awards4,5 ($) | All Other Compensation ($) | Total ($) | ||||||||||||||||||||
Raul E. Cesan | 80,750 | 35,000 | 6,840 | 172 | 122,762 | 85,000 | 35,000 | 18,720 | 630 | 139,350 | ||||||||||||||||||||
Daniel H. Cohen | 52,250 | 35,000 | 6,840 | 472 | 94,562 | 17,830 | 0 | 0 | 0 | 17,830 | ||||||||||||||||||||
Robert E. Denham | 68,365 | 35,000 | 6,840 | 3,172 | 113,377 | 81,000 | 35,000 | 18,720 | 630 | 135,350 | ||||||||||||||||||||
Lynn G. Dolnick | 64,600 | 35,000 | 6,840 | 172 | 106,612 | 56,786 | 35,000 | 18,720 | 630 | 111,136 | ||||||||||||||||||||
Scott Galloway | 48,450 | 35,000 | 6,840 | 6,172 | 96,462 | 16,533 | 0 | 0 | 0 | 16,533 | ||||||||||||||||||||
William E. Kennard | 60,955 | 35,000 | 0 | 15,837 | 117,792 | |||||||||||||||||||||||||
Carolyn D. Greenspon | 37,321 | 35,000 | 18,720 | 630 | 91,671 | |||||||||||||||||||||||||
James A. Kohlberg | 52,250 | 35,000 | 6,840 | 172 | 94,262 | 59,071 | 35,000 | 18,720 | 630 | 113,421 | ||||||||||||||||||||
Dawn G. Lepore | 61,750 | 35,000 | 6,840 | 172 | 103,762 | 58,242 | 35,000 | 18,720 | 630 | 112,592 | ||||||||||||||||||||
David E. Liddle | 80,750 | 35,000 | 6,840 | 172 | 122,762 | 85,000 | 35,000 | 18,720 | 630 | 139,350 | ||||||||||||||||||||
Ellen R. Marram | 86,450 | 35,000 | 6,840 | 172 | 128,462 | 91,000 | 35,000 | 18,720 | 630 | 145,350 | ||||||||||||||||||||
Thomas Middelhoff | 61,750 | 35,000 | 6,840 | 172 | 103,762 | 65,000 | 35,000 | 18,720 | 608 | 119,328 | ||||||||||||||||||||
Doreen A. Toben | 64,600 | 35,000 | 6,840 | 172 | 106,612 | 72,198 | 35,000 | 18,720 | 630 | 126,548 |
1. | Includes a Presiding Director retainer for Ms. Marram and a Committee Chair retainer for each of Messrs. Cesan |
2. |
3. | The following table shows the aggregate phantom stock units outstanding at December |
Name | Aggregate Phantom Stock Units Outstanding at December (#) | |||
Raul E. Cesan | 60,256 | |||
Daniel H. Cohen | 0 | |||
Robert E. Denham | 12,184 | |||
Lynn G. Dolnick | 16,549 | |||
Scott Galloway | 0 | |||
| 3,020 | |||
James A. Kohlberg | 12,184 | |||
Dawn G. Lepore | 12,184 | |||
David E. Liddle | 16,549 | |||
Ellen R. Marram | 29,401 | |||
Thomas Middelhoff | 16,549 | |||
Doreen A. Toben | 48,630 |
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4. | On April |
5. | The following table shows outstanding stock option awards as of December |
Name | Number of Securities Underlying Unexercised Options (#) Exercisable/ Unexercisable | In-the-money Amount of Unexercised Options ($) Exercisable/ Unexercisable(a) | ||||||
Raul E. Cesan | 36,000/4,000 | $ | 20,160/0 | |||||
Daniel H. Cohen | 8,000/ | 0/ | ||||||
Robert E. Denham | 8,000/4,000 | $ | 20,160/0 | |||||
Lynn G. Dolnick | 20,000/4,000 | $ | 20,160/0 | |||||
Scott Galloway | 8,000/0 | $ | 20,160/0 | |||||
Carolyn D. Greenspon | 0/4,000 | |||||||
| 0/0 | |||||||
James A. Kohlberg | 8,000/4,000 | $ | 20,160/0 | |||||
Dawn G. Lepore | 8,000/4,000 | $ | 20,160/0 | |||||
David E. Liddle | 36,000/4,000 | $ | 20,160/0 | |||||
Ellen R. Marram | 36,000/4,000 | $ | 20,160/0 | |||||
Thomas Middelhoff | 24,000/4,000 | $ | 20,160/0 | |||||
Doreen A. Toben | 24,000/4,000 | $ | 20,160/0 |
(a) | The closing price of the underlying Class A stock on the NYSE on December |
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Directors’ and Officers’ Liability Insurance
The Company maintains directors’ and officers’ liability insurance effective May 1, 2009,2010, with an expiration date of May 1, 2010.2011. This is part of ourthe Company’s combined coverage, which was purchased at an annual cost of $1,679,375.$1,508,730. The insurance companies providing directors’ and officers’ liability insurance are AceZurich American Insurance Company, ACE American Insurance Company, St. Paul Mercury Insurance Company, Endurance American Insurance Company, Allied World Assurance Company, Great American Insurance Company, Carolina Casualty Insurance Company Endurance American Insurance Company, Great American Insurance Company,and Liberty Mutual Insurance Company, St. Paul Mercury Insurance Company and Zurich American Insurance Company.
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Compensation of Executive Officers
Compensation Committee Report
The Compensation Committee has reviewed and discussed with Company management the “Compensation Discussion and Analysis” appearing below, and based on such review and discussions, the Committee has recommended to the Board that such Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into the Company’s 20092010 Annual Report on Form 10-K.
David E. Liddle, Chair James A. Kohlberg Dawn G. Lepore Ellen R. Marram Thomas Middelhoff |
Compensation Discussion and Analysis
We believe that our executive officers are critical to our success and to the creation of long-term stockholder value. We structure compensation for our executive officers based on the following objectives:
♦ | to |
|
♦ | to link our executives’ total compensation to the interests of our |
♦ | to enable us to attract, retain and motivate the highest caliber of executives by offering competitive compensation and rewarding superior performance. |
The following discussion analyzes 20092010 executive compensation for those executive officers identified in the Summary Compensation Table, whom we refer to as our named executive officers.
Our For 2010, our named executive officers include our President and Chief Executive Officer, our Chief Financial Officer, and the three other most highly compensated executive officers based on total compensation, which is calculated under SEC regulations. For 2009, these are:
♦ | Arthur Sulzberger, Jr., Chairman of the Board and Publisher, The New York Times; |
♦ | Janet L. Robinson, President and Chief Executive Officer; |
♦ | Michael Golden, Vice Chairman, and President and Chief Operating Officer, Regional Media Group; |
♦ | James M. Follo, Senior Vice President and Chief Financial Officer; and |
♦ |
|
OverviewExecutive Summary
Executive Compensation Governance
The Company’s executive compensation program includes the following governance components:
♦ | Our executive officers have no employment or severance agreements. |
♦ | Notwithstanding an exemption from NYSE rules available for controlled companies, the Compensation Committee consists solely of independent directors. |
♦ | The Compensation Committee’s independent compensation consultant, Exequity, is retained directly by the Committee and performs services in support of the Committee. |
♦ | Each year, the Compensation Committee approves the compensation for the Company’s executive officers other than the Chairman, Chief Executive Officer and Vice Chairman. For those three officers, the final compensation decisions are made by the independent members of our Board of Directors. |
♦ | The Compensation Committee’s annual review and approval of compensation includes a review of performance-based incentive plans for all employees. In this regard, the Compensation Committee has reviewed the Company’s executive compensation program, including the annual and long-term performance-based cash potentials and stock-based incentive awards, and does not believe that the compensation program creates risks that are reasonably likely to have a material adverse effect on the Company. |
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♦ | The Company’s executive officers are subject to a compensation recoupment or “clawback” policy and stock ownership guidelines, as described further below. |
♦ | The Company has generally eliminated so-called tax “gross-ups” and does not pay or reimburse its executive officers for the amount of income and Medicare taxes owed by them in respect of regularly provided perquisites and benefits. |
♦ | At our 2010 annual meeting, stockholders approved the Company’s 2010 Incentive Plan. The 2010 Incentive Plan, which replaces our former plans, allows the Compensation Committee to grant a variety of stock-based and cash-based incentive awards to employees in a manner consistent with recent practices. The 2010 Incentive Plan prohibits the repricing of any stock option or stock appreciation right without stockholder approval; provides for accelerated vesting upon a change in control only in the event of a “double trigger,” in which there is first a change in control and subsequently a qualifying termination of employment; and does not contain an “evergreen” share reserve, meaning that the shares of Class A stock reserved for awards are fixed by number rather than by reference to a percentage of the Company’s total outstanding shares. |
♦ | In 2010, the Committee retained Hay Group to undertake an independent and thorough review of our executive compensation programs. Hay Group concluded that the executive compensation structure provided strong alignment in the areas of strategy, stockholders, pay for performance, and effectiveness and efficiency. |
2010 Compensation Highlights
In 2010, our management team remained focused on enhancing long-term stockholder value by continuing our transition to a multiplatform company and long-term incentive programs aretaking steps that resulted in an improved financial condition. Defining actions included significantly growing operating profit and reducing costs while continuing to expand news operations, digital technologies and related applications. This was accomplished against the backdrop of an uneven economic recovery and challenging advertising environment.
Through these efforts, we continued to maintain our position as a global leader in providing high-quality news, information and opinion. In 2010, our award-winning journalism included compelling and informative news and commentary, receiving many industry and peer accolades, including three Pulitzer Prizes at The New York Times.
Digital initiatives, a key strategic focus, significantly contributed to our revenue mix and provided meaningful diversification. Total digital revenues increased approximately 15% to $387 million in 2010, accounting for more than 16% of overall revenue for the Company. In 2010, we also made a significant investment in our pay strategy for NYTimes.com through an approach designed to linkpreserve the compensation of our named executive officerssite’s significant audience reach and advertising inventory.
In addition to the overall success of the Company and further our longstanding compensation principles of supporting the Company’s business strategy and performance. Our 2009 results reflected the difficult economic environment we faced during the year. The effect of the global economic downturn, coupled withrevenue initiatives, management remained aggressive in managing costs to respond to the secular changes affecting newspapers, resulted in significant revenue declines as advertisers pulled back on print placementsour industry, eliminating $171 million in all categories.
However,costs in 2009, we accomplished many of the goals that we believe are critical to the success of our long-term strategy. As the advertising marketplace, particularly in print, changes, we have continued to explore payment models as well as other approaches to generate revenues from our online content, and in January 2010 we announced that we would introduce a paid model for NYTimes.com at the beginning of 2011 to create a second revenue stream while preserving NYTimes.com’s robust advertising business. In addition, we continue to evaluate our circulation pricing models at all our properties and in 2009 increased prices for subscription and newsstand copies of The Times and the Globe. Our circulation revenues increased 2.9% in 2009 compared with 2008, due2009. This is in addition to higher prices.$475 million in cost reductions in 2009. Since 2006, management has reduced operating costs by approximately $850 million, a decrease of 29% in our cost base.
WeLiquidity and debt reduction have also continued our multi-year drive to reduce expenses. In 2009, our operating costs declined approximately $475 million, or 17%, compared with 2008, with reductions in nearly all major expense categories, including wages and benefits, the single largest expense category.
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We also undertook a major restructuring effort at the New England Media Group, which includes the Globe, the Worcester Telegram & Gazette and their Web sites. To address the secular and cyclical forces affecting these properties, we developed a strategic plan that included the consolidation of the Globe’s printing facilities, circulation price increases, compensation and headcount reductions and extensive negotiations with the Globe’s unions on various cost-cutting measures. In the second and third quarters of 2009, employees of the Globe represented by various unions ratified amendments to their collective bargaining agreements.
Finally, debt restructuring has been aremained key areaareas of strategic focus. We continue to grow our cash balance and have made significant progress in loweringsignificantly reduced our total debt level throughand capital lease obligations, net of cash, flow from operations, divestiture activities, suspensioncash equivalents and short-term investments. In November 2010, we completed a $225 million debt offering of dividend payments6.625% senior unsecured notes due 2016. The Company intends to use the net proceeds for general corporate purposes, including reducing debt and other actions. Our total debt level at year-end 2009 decreased to $769 million from $1.1 billion at the end of 2008.
Detailed disclosurefinancial obligations as part of our 2009refinancing strategy. Our ability to execute this transaction on these terms underscores the confidence that the financial and investment communities have in our future.
Details of our 2010 financial results appearsappear in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the fiscal year ended December 27, 2009. It is within this context that the Compensation26, 2010.
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The Committee analyzed compensation programs for 2009. Tables comparing our 2009 target and actual compensation appear on pages 48-49.
2009-2010 Key Compensation Highlights
In 2009 and 2010, the key highlights with respect to the Company’sevaluated executive compensation program werein light of the above and awarded key components of 2010 executive compensation as follows:
♦ | Salaries: |
♦ | Annual Bonuses: |
♦ | Long-Term Performance Awards: |
♦ |
|
♦ | Retirement Benefits: |
|
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Tables comparing our 2010 target and actual compensation appear on page 51.
Compensation-Setting Process
Role of Board, Compensation Committee and Executive Officers
The Compensation Committee, which consists solely of independent directors, is primarily responsible for overseeing compensation for our executive officers, including the named executive officers. The Committee approves annually the compensation for the Company’s executive officers other than the Chairman, Chief Executive Officer and Vice Chairman. With respect to these three officers, the Committee makesfinal compensation recommendations todecisions are made by the independent members of our Board of Directors. The independent directors consultDirectors, in consultation with the other non-employee Directors, but the final compensation decision is theirs.directors.
The Committee generally consults with management regarding employee compensation matters, and our Chief Executive Officer reports on the performance of, and makes compensation recommendations for, executive officers other than herself and our Chairman. In developing recommendations, the Chief Executive Officer consults with the Chairman and the head of the human resources department. In addition, our human resources, legal, controllers and treasury departments support the Committee in its work and help administer our compensation programs. The Committee’s independent compensation consultant, Exequity LLP, advises on executive compensation matters and provides compensation recommendations for our Chairman and Chief Executive Officer. In addition, theThe members of the Committee also familiarize themselves with compensation trends and competitive conditions through periodic consultations with compensation experts, including Exequity, and the review of market data and other information about relevant market practices.
The table below summarizes our compensation recommendation and approval process:
A discussion of the composition and procedures of the Committee, including the role of Exequity, is set forth above under “Compensation Committee—Compensation Committee Procedures.”
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Components of Compensation
To achieve our compensation objectives, we rely on the following compensation components, each of which is discussed in more detail below:below. The compensation structure is performance-oriented, with annual cash and long-term incentive programs designed to link the compensation of our named executive officers to the overall success of the Company and support the Company’s business strategy and performance.
Pay Component | Structure and Intended Purpose | |||
Fixed | ||||
Salary | Fixed cash component designed to compensate individual for responsibility level of position held. | |||
Variable | ||||
Annual performance-based cash awards | Variable cash component of pay designed to motivate and reward individual’s contributions to the achievement of short-term objectives by linking compensation to important annual financial
| |||
Long-term incentive compensation, including performance-based cash awards and equity incentives in the form of stock options and restricted stock units | ♦ | Performance-based cash awards designed to reinforce the relationship between pay and performance by linking compensation to the achievement of important long-term financial performance measures set by the Committee in advance. Target payout is set as a specific amount, with higher targets for individuals with greater responsibility. | ||
♦ | Targets set in | |||
♦ | Stock options designed to focus executives on increasing our Class A stock price over a specified vesting period and option term because the options produce value only if the stock price increases over the exercise price. | |||
♦ | Restricted stock units designed to retain executives by conditioning delivery of the underlying shares of Class A stock | |||
Other benefits | ♦ | The SERP, |
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Pay Component | Structure and Intended Purpose | |||
♦ | A deferred executive compensation plan (the “DEC”), which allows executives to defer portions of their salary, annual bonus and long-term performance award. The DEC does not provide for earnings at above-market or preferential rates, and the Company does not make contributions on behalf of participants. | |||
♦ | Other employee benefit plans available to substantially all employees, including medical, life insurance and disability plans, and a Company match for contributions to the Company 401(k) | |||
♦
| Limited |
Key Factors in Setting Compensation
In setting or recommending the amount of each component of an executive’s compensation and considering his or her overall compensation package, the Committee evaluates each of the following factors:
♦ | Benchmarking—Each year, the Committee reviews market data for corporate executives in positions comparable to those of Mr. Sulzberger, Jr., Ms. Robinson and Messrs. Golden and Follo, to the extent available, and operating unit executives in positions comparable to that of Mr. |
Apollo Group, Inc. Advance Publications, Inc.
Beckman Coulter, Inc.
Belo Corp.
Cablevision Systems Corporation
Cox Enterprises, Inc.
Dow Jones & Company, Inc.
Gannett Co., Inc. Google Inc. | GTECH Corporation
Houghton Mifflin Harcourt
John Wiley & Sons, Inc. KB Home The McClatchy Company | The McGraw-Hill Companies, Inc. Media General, Inc. Meredith Corporation
Perot Systems Corporation PolyOne Corporation Quintiles Transnational Corp. R.H. Donnelley (now Dex One Corporation) Ralcorp Holdings, Inc. The Reader’s Digest Association, Inc. | Reed Business Information Reuters America, Inc. Scholastic Corporation The Schwan Food Company Shire plc Terra Industries Inc. The Scotts Miracle-Gro Company
The E.W. Scripps Company
The Washington Post Company Time Inc. Time Warner Cable Inc. Tribune Company
United
Viacom Inc. Vulcan Materials Company
Yahoo! Inc. |
The Committee believes that this group provided an effective comparison because it included a sizable number of direct competitors as well as general industry companies representative of those with which the Company competes for senior executive talent. |
|
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corporate executives against the 50th percentile; target total compensation (salary plus target bonus plus the value of long-term incentive awards) was reviewed against the 60th |
|
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♦ | Performance—The Committee ties a substantial portion of each named executive officer’s total potential compensation to Company and individual performance. All executive officers, including the named executive officers, are eligible for annual cash bonuses and long-term performance cash awards that reinforce the relationship between pay and performance by linking compensation to the achievement of important short- and long-term financial, strategic, operating and individual performance targets set by the Committee in advance based on the Company objectives set out in the operating budget. |
The Committee considers the individual performance of each named executive officer by reviewing, among other factors, recommendations of the Chief Executive Officer (insofar as they relate to the named executive officers other than herself and our Chairman) |
♦ | Internal Pay Equity—The Committee’s approach to compensation is that executives holding comparable positions of responsibility should have similar compensation opportunities, adjusted to reflect their responsibilities and role within the Company and recognizing that actual rewards earned should reflect achievement of individual performance objectives. |
In setting compensation for 2009,2010, the Committee reviewed tally sheets detailing the total compensation of the named executive officers. These tally sheets identified all components of compensation for these executives, including the compensation such executives would be eligible to receive under different termination scenarios, as described in “—Potential Payments Payment Upon Termination or Change-in-Change in Control Table.” At the conclusioncompletion of this review, the Committee concluded that the amounts of compensation to be paid were appropriate and reasonable in light of the factors discussed above.
Setting Performance TargetsGoals
A substantial portion of each named executive officer’s annual compensation depends on achievement of pre-defined performance goals. In setting financial performance targets, the Committee reviews our operating budget for the fiscal year and the most current three-year financial plan and sets specific incentive targets that are directly linked to short- or long-term financial performance objectives. Annual operating budgets and three-year plans are developed and submitted to the Board by management annually based on an assessment of the state of the business, the industry and expectations regarding annual and long-term performance. The annual budgets and three-year plans set financial performance objectives that management believes are aggressive but achievable based on the underlying strategic and operating assumptions regarding revenue and cost control initiatives. Typically, the Committee will set a target performance level for a 100% payout at the same level as the relevant objective. While future results cannot be predicted, the Committee believes that these performance targets are set at levels such that achievement of the target levels would requirerequires significant effort on the part of the executive officers and that payment of the maximum amounts would occur only upon the achievement of results substantially in excess of internal and market expectations.expectations at the time the targets are set.
Operating budgets and three-year plans are created independent of, and therefore the financial performance targets generally exclude, the effect of specified non-recurring or non-operational events, such as acquisitions and dispositions, changes in accounting rules, the cost of employee buyouts and changes in newsprint prices not reflected in our budget, shutdown costs associated with the closure of a business or facility and non-cash impairment charges.
Executive Compensation
Salaries
Salaries for executive officers are reviewed annually and are intended to provide competitive compensation to each executive based on position, scope of responsibility, business and leadership experience and performance. For
From April 1, 2009, salary levels initially remained unchanged from 2006 levels. However, effective Aprilto December 31, 2009, the Committee approved a 5% reduction in base salarysalaries for executive officers through December 31, 2009. The action was in connection with salary reductions that generally affectedwere reduced 5% from the Company’s nonunion employees.
prior levels (which had remained frozen from 2006-2008). In January 2010, salary levels for Mr. Sulzberger, Jr. and Ms. Robinson were setreset at the 2006-2008 levels.prior levels, except in the case of Mr. Golden’sGolden, whose salary, like thatthose of each employeeothers in the Regional Media Group, was reduced 2.5% from the prior level for the first half of 2010 and then restored to his 2006-2008 levels. Mr. Follo’s salary waslevel for the second half of the year. Effective March 1, 2010, salaries for Messrs. Follo and Heekin-Canedy were increased by 5%, to bring histheir compensation more in line with corporate executives in comparable positions.
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In 2011, salary levels for Mr. Sulzberger, Jr., Ms. Robinson and Mr. Golden remained at the 2006-2008 levels. Salaries for the named executive officers other than Mr.Messrs. Follo have not beenand Heekin-Canedy were increased since 2006.3% and 4%, respectively.
Annual Bonuses
In February 2009,2010, the Committee set 20092010 annual bonus targets for all executives, including the named executive officers, as a percentage of salarysalary. The target percentages reflect prevailing external practices based on the results of the annual benchmarking analysis and the Committee’s consideration of internal pay equity. Generally, the more responsible the executive officer’s position, is, the higher the target bonus percentage. For the named executive officers, target amounts ranged from 55%70% to 100% of base salary. Depending on the achievement of the Company and individual goals discussed below, theThe potential payout for each executive ranged from zero to 200% of the target amount.
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amount, depending on the achievement of the Company and individual goals discussed below.
The Committee structured 20092010 annual bonuses for corporate executives, including Mr. Sulzberger, Jr., Ms. Robinson, and Messrs. Golden and Follo, to dependsuch that 75% of the award opportunity was contingent on the achievement of annual Companywide financial targets designed to advance our strategy, and 25% depended on the achievement of individual goals. For operating unit executives, including Mr. Ainsley,Heekin-Canedy, 35% of the annual bonus depended onrelated to the Companywide targets and 65% depended onreflected achievement with respect to unit and individual goals.objectives.
For the 20092010 awards, the Committee based the financial target portion on EBITDA excluding certain items. For this purpose, EBITDA is computed as operating profit plus depreciation and amortization net income from joint ventures, and net loss attributable to the noncontrolling interest adjusted to exclude the effect of acquisitions and dispositions,dispositions; changes in accounting rules,rules; the cost of employee buy-outsbuyouts not reflected in our budget,budget; shutdown costs associated with the closure of a business or facility, andfacility; non-cash impairment charges.charges; and the effect of changes in newsprint prices not reflected in the budget. The Committee believes that EBITDA, as so adjusted, is a useful measure of our performance for compensation purposes because it facilitates comparisons of our historical operating performance on a consistent basis. In addition, EBITDA is a measure often used by investors, analysts and others and serves to align the interests of our executives and our stockholders.
In setting EBITDA targets, the Committee considered our Companywide strategic and operating plans. Our 20092010 budget and, as a result, the performance targets, took into account a projected challenging print advertising environment. The target performance level for a 100% payout was set at the operating budget objectives,objective, with potential payouts ranging from 0zero to 200% of target based upon a predetermined performance scale. In 2009,2010, the Company exceeded its EBITDA target by a substantial margin, resulting in a potential payout at 185%200% of target. However, on the recommendation of management, the Committee exercised its discretion to reduce the payout to 128% of target. This was achieved through adjustments resulting in a net reduction of EBITDA. These discretionary adjustments excluded from EBITDA the savings from union and nonunion salary reductions, benefits generally from above-target performance of the New England Media Group, charges and curtailment gains related to various pension actions and miscellaneous other items. The following table reflects the target, the achievement level and potential and actual payout percentages.percentages for the financial component of the 2010 bonus.
2009 Target | 2009 Actual | |||
(dollars in thousands) | ||||
Company EBITDA, as adjusted | $223,965 | $266,984 | ||
Potential payout percentage | 100% | 185% | ||
Actual payout percentage (after discretionary adjustments approved by the Committee) | — | 128% |
2010 Financial Target for 100% Payout | 2010 Financial Target for 200% Payout | 2010 Actual | ||||
(dollars in thousands) | ||||||
Company EBITDA, as adjusted | $290,722 | $340,583 | $366,797 |
The following table shows the computation of adjusted EBITDA, as defined above, and the further adjustments made for purposes of reducing the amountfinancial component of the 20092010 annual bonuses.
(in thousands) | ||||
Operating profit | $ | 74,059 | ||
Depreciation and amortization | 133,696 | |||
Net income from joint ventures | 20,667 | |||
Net loss attributable to the noncontrolling interest (pre-tax) | 54 | |||
228,476 | ||||
Pre-approved adjustments to exclude the effect of: | ||||
Acquisitions and dispositions, net | (5,124 | ) | ||
Changes in accounting rules | 0 | |||
Employee buy-outs in excess of budget | 22,229 | |||
Shutdown costs associated with the closing of a business or facility | 18,320 | |||
Noncash impairment charges | 3,083 | |||
Total pre-approved adjustments | 38,508 | |||
EBITDA, as adjusted | 266,984 | |||
Discretionary adjustments approved by the Committee | (23,919 | ) | ||
Final adjusted EBITDA | $ | 243,065 | ||
(in thousands) | ||||
Operating profit | $234,120 | |||
Depreciation and amortization | 120,950 | |||
355,070 | ||||
Pre-approved adjustments1 to exclude the effect of: | ||||
Acquisitions and dispositions, net | (1,267 | ) | ||
Changes in accounting rules | — | |||
Employee buyouts not reflected in budget | (4,550 | ) | ||
Shutdown costs associated with the closing of a business or facility | 4,395 | |||
Noncash impairment charges | 16,148 | |||
Effect of changes in newsprint prices not reflected in the budget | (2,999 | ) | ||
Total pre-approved adjustments | 11,727 | |||
EBITDA, as adjusted | 366,797 | |||
1. | In 2010, pre-approved adjustments had no effect on the payout percentage. |
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As noted above, bonuses also depended upon the officer’s achievement of individual goals, which are based on the executive’s contribution to EBITDA improvement, revenue growth and cost management for the Company and/or the executive’s operating unit, customer satisfaction, Company culture and innovation and other factors. Performance relativefactors related to target achievementthe executive’s span of control and accountability. Taking into account performance and results with regardrespect to these measures, the Committee assessed each executive’s individual measures was assessedperformance as follows:
Individual Performance | |||
Arthur Sulzberger, Jr. | |||
Janet L. Robinson | |||
Michael Golden | |||
James M. Follo | |||
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In making its recommendations for Mr. Sulzberger, Jr. and Ms. Robinson, the Committee assessed their fulfillment of the goals outlined above as well as their execution of the Company’s strategic efforts.
The Committee also retained the discretion to increase or decrease the individual component of the total bonus paid to each executive by up to 10% based on the continuing development of a diverse work force, including the inclusion of diverse candidates in hiring processes and the demonstration of personal commitment to diversity through participation in diversity-related activities, such as mentoring and sponsorship of affinity groups. For 2009, an increase2010, increases of 5% wasand 10%, respectively, were approved for Mr. Golden.Golden and Mr. Heekin-Canedy. No increase or decrease was made to the annual bonus of any other named executive officer.
The following table illustratesidentifies the 2009 annualrange of potential bonus program as discussed above. Forpayments for each named executive officer, including the table sets out theminimum, target, maximum and actual bonus amount, bothamounts awarded, in dollars and as a percentage of 2009the executive’s 2010 base salary.
Name | Minimum ($) | Target ($) (% of base salary) | Maximum ($) (% of base salary) | Actual ($) (% of base salary) | |||||||||||
Arthur Sulzberger, Jr. | 0 | 1,087,000 | (100%) | 2,174,000 | (200%) | 1,451,145 | (134 | %) | |||||||
Janet L. Robinson | 0 | 1,000,000 | (100%) | 2,000,000 | (200%) | 1,360,000 | (136 | %) | |||||||
Michael Golden | 0 | 438,900 | (70%) | 877,800 | (140%) | 576,879 | (92 | %) | |||||||
James M. Follo | 0 | 264,000 | (55%) | 528,000 | (110%) | 332,640 | (69 | %) | |||||||
P. Steven Ainsley1 | 0 | 275,000 | (55%) | 550,000 | (110%) | 0 |
Name | Minimum ($) | Target ($) (% of | Maximum ($) (% of base salary) | Actual ($) (% of base salary) | ||||
Arthur Sulzberger, Jr. | 0 | 1,087,000 (100%) | 2,174,000 (200%) | 2,010,950 (185%) | ||||
Janet L. Robinson | 0 | 1,000,000 (100%) | 2,000,000 (200%) | 1,850,000 (185%) | ||||
Michael Golden | 0 | 427,928 (70%) | 855,856 (140%) | 793,539 (130%) | ||||
James M. Follo | 0 | 350,000 (70%) | 700,000 (140%) | 634,375 (127%) | ||||
Scott Heekin-Canedy | 0 | 380,990 (70%) | 761,980 (140%) | 675,305 (124%) |
In February 2010,2011, the Committee determined to structure 20102011 annual cash bonuses for corporate executives based on a similar allocation of 75% for Companywide performance and 25% for individual goals. For operating unit executives, 35% of the annual bonus will continue to depend on the Companywide performance targets and 65% will depend on individual goals. The Committee retainshas eliminated the discretion to increase or decrease the portion of the bonus dependent upon individual goals by up to 10% based on the level of achievement of goals regarding the continuing developmentrelated to diversity efforts and instead will evaluate achievement as part of a diverse workforce.its assessment of individual performance. Performance targets will again be based on the adjusted EBITDA measure discussed above, further adjusted for 2010 to exclude (i) income/loss from joint ventures and (ii) the effect of changes in newsprint prices not reflected in the budget. The Committee has set specific target amounts for each named executive officer as a percentage of base salary. The grants are designed to result in payouts at target amounts if the Company achieves its 20102011 budgeted goals.
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Long-Term Incentive Compensation
The Committee awards long-term compensation through long-term performance-based cash awards and equity incentives (in the form of stock options and restricted stock units). The Committee grants long-term incentive compensation opportunities to selected executives each year to promote alignment between shareholdersstockholders and management, to replicate prevailing compensation practices in its benchmarking peer group and to ensure that the Company can continue to provide competitive pay.
In February 2011, the Committee decided to rebalance long-term incentive compensation to increase targeted value delivered through equity awards and reduce cash amounts potentially payable through long-term performance awards. The shift is intended to strengthen the structural alignment of long-term incentive compensation with stockholder interests.
Long-Term Performance Awards
Long-term performance awards which are paid in cash, and are designed to align the interests of the executives with the fulfillment of our longer-term strategic objectives and to reward them in relation to the achievement of these objectives.goals.
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As a result of the Company’s previous shift from five-year to three-year cycles in 2007, two long-term performance cycles ended in 2009. The first, set in 2004, was2010. Awards for the three-year cycle 2008-2010 were based on relative total stockholder return, or TSR, for the Company as comparedachievement with respect to a group of comparable media companies measured over the five-year period 2005-2009. For this purpose, TSR is defined as the aggregate total return to a stockholder in respect of an investment in a company’s common stock, assuming reinvestment of all cash dividends. The “peer group” consisted of Gannett Co., Inc., Media General, Inc., The McClatchy Company and The Washington Post Company. Payouts depended on where the Company’s TSR ranked among those peers. For 2005-2009, the Company’s TSR ranked second among the peer group and, accordingly, a payout of 137.5% of target amounts was made. Amounts paid to the named executive officers under this five-year performance cycle are set forth below.
Name | Minimum ($) | Target ($) | Maximum ($) | Actual ($) | ||||
Arthur Sulzberger, Jr. | 0 | 700,000 | 1,225,000 | 962,500 | ||||
Janet L. Robinson | 0 | 650,000 | 1,137,500 | 893,750 | ||||
Michael Golden | 0 | 370,000 | 647,500 | 508,750 | ||||
James M. Follo | 0 | 222,000 | 388,500 | 305,250 | ||||
P. Steven Ainsley | 0 | 325,000 | 568,750 | 446,875 |
The second long-term performance cycle that ended in 2009 was a three-year cycle for the period 2007-2009, and was based on two performance measures:
♦ | 50% of the |
♦ | 50% of the |
We define ROIC as the quotient of:
♦ | our net operating profit after taxes (defined for these purposes as operating profit plus income tax expense/(benefit) plus net income/(loss) from joint ventures),divided by, |
♦ | our average “invested capital”—total assets less non-interest-bearing current liabilities (current liabilities other than short-term debt and capital lease obligations) |
WithPotential payments with respect to the revenue growth/expense growth performance measure potential payouts ranged from 25% to 175% of targeted amountstarget for revenue growth ranging fromof 0.5% to 1.5% (or above) in excess of expense growth, (with payouts of 100% of targeted amounttarget for revenue growth of 1.0%). With in excess of expense growth, to 175% of target for revenue growth of 1.5% or more in excess of expense growth.
Potential payments with respect to the ROIC performance measure potential payouts ranged upfrom 25% of target for 5.53% ROIC, 100% of target for ROIC of 6.71%, to 175% of targeted amountstarget for an ROIC of from 5.5%equal to 8.1% or above (withgreater than 7.89%.
For the 2008-2010 cycle, no payouts of 100% of targeted amounts for 7.3%). Thewere made. Performance with respect to revenue/expense management target was not achieved atfell short of the minimum targeted levels,level, as significant expense reductionreductions achieved as a result of the Company’s sustained cost-control efforts discussed above under “—Executive Summary—2010 Compensation Highlights,” did not offset advertising revenue declines. Achievement against the ROIC metric which is measured by referencedropped below the threshold performance level due to operating profit per dollar of average invested capital, was also adversely affected by lower advertising revenues and resulting operating profit declines. Accordingly,The following table summarizes the range of potential payments and actual awards earned based on results over the 2008-2010 long-term performance cycle.
Name | Minimum ($) | Target ($) | Maximum ($) | Actual ($) | ||||
Arthur Sulzberger, Jr. | 0 | 2,000,000 | 3,000,000 | 0 | ||||
Janet L. Robinson | 0 | 2,000,000 | 3,000,000 | 0 | ||||
Michael Golden | 0 | 400,000 | 700,000 | 0 | ||||
James M. Follo | 0 | 300,000 | 525,000 | 0 | ||||
Scott Heekin-Canedy | 0 | 400,000 | 700,000 | 0 |
The second long-term performance cycle to end in 2010 began in 2006. Awards for that five-year cycle were based on performance with respect to two measures:
♦ | 50% was tied to the percentage increase in the Company’s revenues in excess of the percentage increase in costs and expenses measured over the five-year period 2006-2010; and |
♦ | 50% was tied to relative total stockholder return, or “TSR” for the Company compared with the TSR for a group of comparable media companies over that period. |
The revenue growth/expense growth target for the 2006-2010 cycle was not achieved at minimum target levels as significant expense reductions did not offset advertising revenue declines, and no payout was made for this cycle.portion of the award. TSR was defined as the aggregate total return to a stockholder in respect of an investment in a company’s common stock, assuming reinvestment of all cash dividends. The following table summarizesgroup of comparable media companies consisted of Gannett Co., Inc., Media General, Inc., The McClatchy Company and The Washington Post Company. Payouts depended on where the resultsCompany’s TSR ranked among those peers. For 2006-2010, the Company’s TSR ranked second in the peer group, resulting in achievement of this three-year long-term performance cycle.
Name | Minimum ($) | Target ($) | Maximum ($) | Actual ($) | ||||
Arthur Sulzberger, Jr. | 0 | 1,000,000 | 1,750,000 | 0 | ||||
Janet L. Robinson | 0 | 1,000,000 | 1,750,000 | 0 | ||||
Michael Golden | 0 | 260,000 | 455,000 | 0 | ||||
James M. Follo | 0 | 250,000 | 437,500 | 0 | ||||
P. Steven Ainsley | 0 | 250,000 | 437,500 | 0 |
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ForThe range of potential awards payable and the long-termactual amounts paid to the named executive officers in respect of the 2006-2010 performance cycle are set forth below.
Name | Minimum ($) | Target ($) | Maximum ($) | Actual ($) | ||||||||||
Arthur Sulzberger, Jr. | 0 | 700,000 | 1,225,000 | 481,250 | ||||||||||
Janet L. Robinson | 0 | 690,000 | 1,207,500 | 474,375 | ||||||||||
Michael Golden | 0 | 370,000 | 647,500 | 254,375 | ||||||||||
James M. Follo | 0 | 296,000 | 518,000 | 203,500 | ||||||||||
Scott Heekin-Canedy | 0 | 370,000 | 647,500 | 254,375 |
Long-term performance awards granted in 2009 for2010 relate to the three-year period 2009-2011, amounts that may potentially be paid will depend2010-2012. Award payment depends on achievement with respect to two performance measures:
♦ | 50% of the potential award depends upon ROIC, as defined |
♦ | 50% of the potential award depends upon operating cash flow margin, defined as operating profit before depreciation, amortization and special itemsdivided by revenues over the three-year period. |
Both metrics will be adjusted for special items that include the effects of significant acquisitions and dispositions (i.e.(i.e., those above $10 million), shutdown costs associated with the closure of a business or facility, changes in accounting rules, the cost of employee buy-outsbuyouts and changes in newsprint prices not reflected in our budgetthree-year plan, and non-cash impairment charges for assets held for more than three years.
The Committee believes that the operating cash flow margin metric enhances the link between an award payment and the successful execution of our current revenue strategy and cost control initiatives, as reflected in the Company’s three-year plan, which are particularly important during the current period of historical transformation in the industry.
The Committee believes that the ROIC metric aligns the interests of our executives with those of our stockholders by awarding incentive payments that correspond with the long-term creation of stockholder value, while also ensuring a better balance with other elements of long-term compensation, such as options and restricted stock units, which are tied to stock market performance. The Committee also believes the ROIC metric enablesencourages plan participants to take actions that directly affect our achievement of the targets.
The Committee believes that the operating cash flow margin metric enhances the link between an award payment and the successful execution of our current revenue strategy and cost control initiatives, as reflected in the Company’s three-year plan, which are particularly important during the current period of historical transformation in the industry.
Achievement with respect to each element of the award iswill be independent of the other. The actual amount thataward paid will be paid will dependcontingent on performance relative to the two performance measures and will range from zero0% to 175% of the target amounts, depending on performance.amounts. For our named executive officers, the target amounts for the long-term performance awards granted in 20092010 for the three-year period 2009-20112010-2012 range from $300,000$400,000 to $2,000,000, with awards interpolated for performance between threshold and target and between target and maximum. The maximum payout for Mr. Sulzberger, Jr. and Ms. Robinson was set at $3,000,000 (rather than $3,500,000, or 175% of the target) due to an annual per person cap under the Company’s plans.
Name | Minimum ($) | Target ($) | Maximum ($) | Minimum ($) | Target ($) | Maximum ($) | ||||||||||
Arthur Sulzberger, Jr. | 0 | 2,000,000 | 3,000,000 | 0 | 2,000,000 | 3,000,000 | ||||||||||
Janet L. Robinson | 0 | 2,000,000 | 3,000,000 | 0 | 2,000,000 | 3,000,000 | ||||||||||
Michael Golden | 0 | 400,000 | 700,000 | 0 | 400,000 | 700,000 | ||||||||||
James M. Follo | 0 | 300,000 | 525,000 | 0 | 400,000 | 700,000 | ||||||||||
P. Steven Ainsley | 0 | 300,000 | 525,000 | |||||||||||||
Scott Heekin-Canedy | 0 | 400,000 | 700,000 |
For the long-term performance awards granted in February 20102011 for the three-year period 2010-2012,2011-2013, amounts that may potentially be paid will similarly depend 50% on ROIC from continuing operations and 50% based on operating cash flow margin. As discussed above, the targeted cash payouts payable upon the achievement of these goals were reduced, with a portion of total long-term incentive value shifted to equity awards.
Stock-Based Compensation
Stock-based compensation for eligible employees, including the named executive officers, consists of stock options and restricted stock units. Stock options have an exercise price set at the market price on the date of grant, calculated as the average of high and low stock prices, on the date of grant. Stock options granted to executive officers, including the named executive officers, in 2009 have a three-year vesting period, a decrease from the four-year vesting period of prior grants. The Committee determined that a three-year vesting period was more consistent with comparable programs at other companies. Stock optionsvest ratably over three years and expire after ten years. Restricted stock units granted to executive officers, including the named executive officers, in 20092010 were cash-settled units with a three-year vesting period.that vest at the end of three years. During this vesting period, the units are generally forfeited if the holder leaves our employ but vest in the eventother than as a result of death, disability or retirement.retirement (in which case the units vest).
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Our Committee makes annual equity grants to key employees, including executives, at a regularly scheduled meeting. In February 2009,2010, our named executive officers received the following grants:grants of stock options and cash-settled restricted stock units:
Name | Options (#) | Restricted Stock Units (#) | ||
Arthur Sulzberger, Jr. | 400,000 | 50,000 | ||
Janet L. Robinson | 400,000 | 50,000 | ||
Michael Golden | 115,000 | 12,000 | ||
James M. Follo | 115,000 | 10,000 | ||
P. Steven Ainsley | 90,000 | 9,000 |
Name | Options (#) | Restricted Stock Units (#) | ||||||
Arthur Sulzberger, Jr. | 181,650 | 13,650 | ||||||
Janet L. Robinson | 181,650 | 13,650 | ||||||
Michael Golden | 42,000 | 4,305 | ||||||
James M. Follo | 42,000 | 4,253 | ||||||
Scott Heekin-Canedy | 42,000 | 4,305 |
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These grantsIn 2010, our executives were determined by the Committee based upon the three factors discussed above. In determining equity grants for named executive officers, the Committee also considered the number and value of shares underlying thegranted significantly fewer stock options and restricted stock units than in 2009; however, the aggregate dollar value of each recipient’s stock-based compensation was generally equivalent from year to year, consistent with the Committee’s desire to maintain competitive compensation levels. The target values for these grants were based on the award sizes reported in the annual benchmarking analysis as being granted and the related effect on dilution to other stockholders, and took into account the numberrepresentative of shares that remain availableexternal norms for grant under our executive stock incentive plan.executives serving in similar positions.
In February 2010,2011, the Committee granted stock options and cash-settledstock-settled restricted stock units to executive officers, including the named executive officers (other than Mr. Ainsley, who retired on December 31, 2009). The sizeofficers.The following table shows the details of the 2010 restricted stock unit2011 grants was tied to the Company’s 2009 adjusted EBITDA performance target discussed above under “—Annual Bonuses.” Although specific individual target grants were not set in 2009, the Committee had determined that, at target adjusted EBITDA, the 2010 grants would be at levels generally comparable to the 2009 grants, and that the grants would range from 80% to 120% of those levels based upon actual adjusted EBITDA compared to the budget target of $223,965,000. Based on 2009 adjusted EBITDA of $243,065,000, the Committee granted restricted stock units at the 100% level. The following table shows for each named executive officer the details of the 2010 grants.officer.
Name | Options (#) | Restricted Stock Units (#) | Options (#) | Restricted Stock Units (#) | ||||||||
Arthur Sulzberger, Jr. | 181,650 | 13,650 | 165,735 | 73,413 | ||||||||
Janet L. Robinson | 181,650 | 13,650 | 165,735 | 73,413 | ||||||||
Michael Golden | 42,000 | 4,305 | 42,751 | 19,033 | ||||||||
James M. Follo | 42,000 | 4,253 | 42,751 | 19,033 | ||||||||
P. Steven Ainsley | — | — | ||||||||||
Scott Heekin-Canedy | 42,751 | 19,033 |
While the number of stock options and restricted stock units differed, the value of stock-based compensation granted in 2010 was equivalent to the value granted in 2009, consistent withThe grant amounts reflect the Committee’s desiredecision, described above, to maintain competitiverebalance long-term incentive compensation levels as recommended by its external consultant.to increase targeted value delivered through equity awards and reduce cash amounts potentially payable through long-term performance awards.
It has long been our policy to not grant “in-the-money options” in any manner, including granting an option with an exercise price set at the market price as of a date preceding the grant date. Awards made other than pursuant to the annual equity grant—for example, to newly hired or recently promoted employees—typically take place shortly after issuance of our quarterly earnings releases, and grants to new employees occur only after employment has commenced. In the past, the Committee has delegated, and may in the future on an annual basis delegate, the authority to make option and other equity grants in limited circumstances, such as for newly hired or recently promoted employees, to a three-member management committee authorized to grant a limited number of options and other equity awards under specified parameters. To ensure compliance with its long-standing procedures, the Committee has adopted a written grant policy.
During 2009, the Company discovered that portions of previously awarded stock option grants exceeded that permitted to be granted to a single individual during any calendar year under the terms of the Company’s plans. The maximum number of shares of common stock with respect to its stock options that may be granted to any individual in any calendar year is 400,000. In 2008, Ms. Robinson was granted 250,000 options in excess of this limit and in 2009, each of Mr. Sulzberger, Jr. and Ms. Robinson was granted 100,000 options in excess of this limit. Each of these officers has agreed with the Company that these excess stock options are null and void. In order to satisfy the original intent with respect to these individuals’ compensation and to preserve the Company’s tax deduction in respect of the associated compensation expense, after consulting with its outside compensation consultant, on September 17, 2009, the Committee recommended grants to Mr. Sulzberger, Jr. and Ms. Robinson of deferred payment stock appreciation rights equal in number to the void options. On September 17, 2009, these grants were approved by the independent Directors of the Board after consultation with all non-management Directors. The stock appreciation rights have economic terms comparable to the void options. The grant of these stock appreciation rights was described in a current report on Form 8-K filed by the Company on September 18, 2009.
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Actual Versus Target Compensation
The tables below set forth, for the named executive officers, a comparison between “target compensation” and “actual compensation,” for 2009.2010. The variance between 20092010 target and actual compensation arises from several factors that are discussed throughout this Compensation Discussion and Analysis.
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20092010 Target Compensation
Name | Base Salary ($)(1) | Annual Bonus ($)(2) | 2005-2009 LTIP ($)(3) | 2007-2009 LTIP ($)(3) | Stock Options ($)(4) | Restricted Units ($)(4) | Total ($) | Base Salary ($) | Annual Bonus ($)(1) | 2006-2010 Long-Term Cycle ($)(2) | 2008-2010 Long-Term Cycle ($)(2) | Stock Options ($)(3) | Restricted Stock Units ($)(3) | Total ($) | ||||||||||||||
Arthur Sulzberger, Jr. | 1,087,000 | 1,087,000 | 700,000 | 1,000,000 | 1,085,000 | 181,250 | 5,140,250 | 1,087,000 | 1,087,000 | 700,000 | 2,000,000 | 906,434 | 151,925 | 5,932,359 | ||||||||||||||
Janet L. Robinson | 1,000,000 | 1,000,000 | 650,000 | 1,000,000 | 1,435,750 | 181,250 | 5,267,000 | 1,000,000 | 1,000,000 | 690,000 | 2,000,000 | 906,434 | 151,925 | 5,748,359 | ||||||||||||||
Michael Golden | 627,000 | 438,900 | 370,000 | 260,000 | 147,775 | 43,500 | 1,887,175 | 619,163 | 427,928 | 370,000 | 400,000 | 209,580 | 47,915 | 2,074,586 | ||||||||||||||
James M. Follo | 480,000 | 264,000 | 222,000 | 250,000 | 147,775 | 36,250 | 1,400,025 | 500,000 | 350,000 | 296,000 | 300,000 | 209,580 | 47,336 | 1,702,916 | ||||||||||||||
P. Steven Ainsley | 500,000 | 275,000 | 325,000 | 250,000 | 115,650 | 32,625 | 1,498,275 | |||||||||||||||||||||
2009 Actual Compensation vs. Target | ||||||||||||||||||||||||||||
Name | Base Salary ($)(1) (% of Target) | Annual Bonus ($)(2) (% of Target) | 2005-2009 LTIP ($)(3) (% of Target) | 2007-2009 | Stock Options ($)(4) | Restricted Stock Units ($)(4) | Total ($) (% of Target) | |||||||||||||||||||||
Arthur Sulzberger, Jr. | 1,046,238 (96%) | 1,451,145 (134%) | 962,500 (137.5%) | 0 | 1,085,000 | 181,250 | 4,726,133 (91.9%) | |||||||||||||||||||||
Janet L. Robinson | 962,500 (96%) | 1,360,000 (136%) | 893,750 (137.5%) | 0 | 1,435,750 | 181,250 | 4,833,250 (91.8%) | |||||||||||||||||||||
Michael Golden | 603,488 (96%) | 576,879 (131%) | 508,750 (137.5%) | 0 | 147,775 | 43,500 | 1,880,392 (99.6%) | |||||||||||||||||||||
James M. Follo | 462,000 (96%) | 332,640 (126%) | 305,250 (137.5%) | 0 | 147,775 | 36,250 | 1,283,915 (91.7%) | |||||||||||||||||||||
P. Steven Ainsley | 481,731 (96%) | 0 | 446,875 (137.5%) | 0 | 115,650 | 32,625 | 1,076,881 (71.8%) | |||||||||||||||||||||
Scott Heekin-Canedy | 544,271 | 380,990 | 370,000 | 400,000 | 209,580 | 47,915 | 1,952,756 |
2010 Actual Compensation vs. Target
Name | Base Salary ($) (% of Target) | Annual Bonus ($)(1) (% of Target) | 2006-2010 Long-Term Cycle ($)(2) (% of Target) | 2008-2010 Long-Term Cycle ($)(2) | Stock Options ($)(3) | Restricted Stock Units ($)(3) | Total ($) (% of Target) | |||||||
Arthur Sulzberger, Jr. | 1,087,000 (100%) | 2,010,950 (185%) | 481,250 (68.75%) | 0 | 906,434 | 151,925 | 4,637,559 (78%) | |||||||
Janet L. Robinson | 1,000,000 (100%) | 1,850,000 (185%) | 474,375 (68.75%) | 0 | 906,434 | 151,925 | 4,382,734 (76%) | |||||||
Michael Golden | 619,163 (100%) | 793,539 (185%) | 254,375 (68.75%) | 0 | 209,580 | 47,915 | 1,924,572 (93%) | |||||||
James M. Follo | 500,000 (100%) | 634,375 (181%) | 203,500 (68.75%) | 0 | 209,580 | 47,336 | 1,594,791 (94%) | |||||||
Scott Heekin-Canedy | 544,271 (100%) | 675,305 (177%) | 254,375 (68.75%) | 0 | 209,580 | 47,915 | 1,731,446 (89%) |
1. |
Annual bonuses for |
Stock option and restricted stock unit grants for |
Other Elements of Executive Compensation
Our executive officers, including the named executive officers, have historically participated in the SERP, a non-qualified plan designed to provide benefits to a select group of executives that, when added to retirement income provided under other Company plans, will ensure payment of a competitive level of retirement income to these individuals. In NovemberEffective December 31, 2009, the Company made the decision to freeze the defined benefit pension plan for nonunion employees, the SERP and several other defined benefit plans effective December 31, 2009.were frozen. Benefits earned by participants prior to January 1, 2010, were not affected.
At In connection with the same time,freezing of the SERP, the Company increased contributions toadded an employer-paid non-elective contribution under the Company 401(k) Plan and approved the adoption ofadopted two unfunded supplemental defined contribution plans. Under the first, The New York Times Company Savings Restoration Plan (the “Restoration Plan”), participants are provided with that portion of the 3% 401(k) basic contribution that cannot be provided under the Company 401(k) Plan as a result of Internal Revenue Code limits. Under the second, The New York Times Company Supplemental Executive Savings Plan (the “Supplemental Executive Savings Plan”), a participant’s account is credited each year with a “supplemental contribution” equal to: (i) 10% of his or her compensationplans for SERP participants on December 31, 2009; or (ii) 5% for those who were not SERP participants on December 31, 2009.executives. For a further discussion of the SERP see “—Post-Employment Compensation” and “—Restoration Plan and Supplemental Executive Savings Plan” below.
The Company’s executive officers, including the named executive officers, currently participate in the Company’s pension plan, the Company 401(k) Plan and the SERP, and effective January 1, 2010, participate in the Restoration Plan and Supplemental Executive Savings Plan. Certain participants in the Supplemental Executive Savings Plan, including Mr. Follo, will receive an additional 10% transition credit in addition to the contributions provided to other executives, through age 62. Transition credits are intended to be partial replacement benefits for those executives whose SERP benefits are reduced by more than 20% as a result of the freeze.two new plans, see “—Pension Benefits” below.
We provide certain limited perquisites to our executive officers. Perquisites provided in 20092010 consisted primarily of financial planning services as well as, for Mr. Golden, tax preparation services provided in connection with his overseas assignment as Publisher of the International Herald Tribune and his relocation to New York from Paris, France,
50
in 2008, and for Mr. Ainsley, reimbursement of expenses related to his relocation from Tampa to Boston in 2006.services. Our Committee believes that these perquisites provided to executive officers are relatively modest compared to those provided to executives at other public companies.
Retirement of P. Steven Ainsley
52
Effective December 31, 2009, Mr. Ainsley retired. In connection with his retirement, he and the Company entered into a Separation Agreement and General Release (the “Separation Agreement”), which memorializes the terms of payments and other benefits to be provided to Mr. Ainsley pursuant to existing arrangements and as agreed by the Company in connection with his retirement. The Company will provide Mr. Ainsley:
|
|
|
|
Mr. Ainsley is a participant in the SERP, and the SERP Committee has consented to his early retirement. He is therefore eligible to receive SERP benefits pursuant to its terms. In connection with his retirement, he will receive a pro rated portion of any long-term performance awards made pursuant to performance cycles in effect at December 31, 2009, as, if and when such long-term performance awards are paid out to other plan participants. Payments will be based on the portion of the cycle elapsed through December 31, 2009. In addition, in accordance with their terms, his previously unvested restricted stock units and stock options vested on December 31, 2009 (or vested or will vest shortly thereafter).
The Separation Agreement also contains Mr. Ainsley’s and the Company’s mutual release of each other from all claims.
The terms of the Separation Agreement were described in a current report on Form 8-K filed by the Company on January 14, 2010.
Recoupment of Compensation
The Company has a policy on recoupment of performance-based bonuses in the event of certain restatements of financial results arising due to an executive officer’s fraud or intentional misconduct. This policy is described above under “Board Policy on Recoupment of Bonuses Upon Restatement Due to Fraud or Misconduct.”
Stock Ownership Guidelines
Since 2004, we have maintained minimum stock ownership guidelines for those executive officers named in the “Summary Compensation Table.” The Chairman is required to own shares of the Company’s Class A stock equal in value to three times his current annual base salary, and the other named executive officers are required to own shares equal in value to one or two times his or her current annual base salary. Stock- and cash-settled restricted stock units, as well as shares held through the Company 401(k) Plan, are counted in calculating ownership, but stock options and SARs are not. An executive officer’s stock holdings are valued at the greater of the fair market value at year end or the officer’s tax basis in the shares (or in the case of restricted stock units, the grant date fair market value). Each affected executive officer has five years from becoming subject to the guidelines to attain the full holding requirements. The Committee is advised annually of the holdings of each affected officer. All of our named executive officers are in compliance with the guidelines.
In addition, as part of our insider trading policy, executive officers may not engage in short-term, speculative trading in Company stock, such as entering into short sales, buying, selling or writing puts or calls, or engaging in hedging or other derivative transactions, or hold Company stock in a margin account or pledge Company stock as collateral for a loan.
Tax Matters
The Internal Revenue Code imposes certain limitations on the deductibility of compensation paid to certain executive officers named in the “Summary Compensation Table.” Certain compensation, including performance-based compensation meeting specified requirements, is exempt from this deduction limit. To the extent consistent with corporate performance objectives, we have structured, and intend to continue to structure, performance-based compensation to executive officers who may be subject to these limitations in a manner that maximizes the available deduction. However, we have awarded non-deductible compensation in the past, and we expect to do so in the future when we deem that it is necessary to further the objectives of executive compensation.
The principal components of non-deductible compensation include the individual and diversity components of the executive officers’ annual bonus,bonuses and restricted stock units and perquisites.units. The Committee continues to evaluate these items on an annual basis. The Committee believes that retaining the discretion to award annual bonuses based in part on individual goals and diversity efforts furthers the interests of the Company notwithstanding the increased cost of awarding non-deductible compensation.
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Summary Compensation Table
The following table summarizes the total compensation earned by each named executive officer for the fiscal year ended December 27, 2009.26, 2010.
Name and Principal Position | Fiscal Year | Salary ($)1 | Bonus ($) | Stock ($)2 | Option ($)2 | Non-Equity Incentive Plan Compensation ($)3 | Change in Non-qualified ($)4 | All Other Compensation ($)5 | Total ($) | |||||||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||||||||||||||||||||||||
Arthur Sulzberger, Jr. Chairman of the Board and Publisher, The New York Times | 2010 2009 2008 |
1,087,000 |
|
| 151,925 181,250 — |
|
| 2,413,645 597,850 | 1,256,497 1,307,165 559,826 | 108,412 31,693 48,878 | 6,002,468 6,064,991 2,331,599 |
| ||||||||||||||||||||||||||||
Janet L. Robinson President and Chief Executive Officer | 2010 2009 2008 |
1,000,000 |
|
| 151,925 181,250 1,315,275 |
|
| 2,253,750 562,500 | 794,309 1,833,441 898,171 | 102,166 31,693 46,368 | 5,279,209 6,698,384 4,753,314 |
| ||||||||||||||||||||||||||||
Michael Golden Vice Chairman, and President and Chief Operating Officer, Regional Media Group | 2010 2009 2008 |
627,000 |
|
|
— |
|
| 627,774 342,736 | 49,431 70,144 263,883 | 2,183,977 2,578,310 1,496,959 |
| |||||||||||||||||||||||||||||
James M. Follo Senior Vice President and Chief Financial Officer | 2010 2009 2008 |
480,000 |
| — — 21,600 |
| | 209,580 147,775 224,000 | 837,875 637,890 161,700 | — — — |
| 13,354 7,144 | 1,796,005 1,297,269 1,096,794 |
| |||||||||||||||||||||||||||
| 2010 2009 2008 |
|
|
|
252,938 |
|
|
|
| 2,372,635 2,608,562 2,093,591 |
1. |
2. | In accordance with |
Beginning in 2008, the Compensation Committee elected to make annual equity awards in February of each year, when annual and long-term cash bonuses are approved for the most recently completed performance cycle, rather than in December, as was the case in 2006 and prior years. As a result, no restricted stock units or stock options were granted to any of the named executive officers in 2007, other than to Mr. Follo, who received grants in connection with his joining the Company that year.
At their request, Messrs. Sulzberger, Jr. and Golden received no restricted stock unit or stock option awards in 2008, (or in December 2006), significantly reducing their compensation.
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3. | The “Non-Equity Incentive Plan Compensation” column reflects payments in connection with our annual bonus and long-term performance awards as follows: |
Name | Annual Bonus | Long-Term Performance Award (2005-2009 Cycle) | Long-Term Performance Award (2007-2009 Cycle) | ||||
Arthur Sulzberger, Jr. | $ | 1,451,145 | $962,500 | 0 | |||
Janet L. Robinson | 1,360,000 | 893,750 | 0 | ||||
Michael Golden | 576,879 | 508,750 | 0 | ||||
James M. Follo | 332,640 | 305,250 | 0 | ||||
P. Steven Ainsley | 0 | 446,875 | 0 |
In connection with union negotiations at The Boston Globe, all members of New England Media Group management, including Mr. Ainsley, agreed to forgo annual bonuses for 2009. See “—Compensation Discussion and Analysis” for an explanation of our annual and long-term performance awards.
Name | Annual Bonus | Long-Term Performance Award (2006-2010 Cycle) | Long-Term Performance Award (2008-2010 Cycle) | |||||||
Arthur Sulzberger, Jr. | $ | 2,010,950 | $481,250 | 0 | ||||||
Janet L. Robinson | 1,850,000 | 474,375 | 0 | |||||||
Michael Golden | 793,539 | 254,375 | 0 | |||||||
James M. Follo | 634,375 | 203,500 | 0 | |||||||
Scott Heekin-Canedy | 675,305 | 254,375 | 0 |
4. |
The increases in the actuarial present value are for the most part a function of the assumed discount rate and the fact that each executive is a year closer to retirement. As the benefit can only be paid in the form of an annuity, and not as a lump sum, a change in the present value has no impact on the amount an individual will receive. The table below shows, for each named executive officer,Company froze the increase from 2008 toPension Plan and the SERP effective December 31, 2009, inand accordingly, the anticipated annual Pension Plan and SERP payments to the named executive officers, assuming retirement at or after age 60 with ten years of service (the first point at which the applicable year end. See “—Post-Employment Compensation.”named executive officers would be eligible to retire with unreduced benefits under the SERP), have not increased from 2009 to 2010.
Name | 2008 | 2009 | Change | |||||||
Arthur Sulzberger, Jr. | $ | 954,891 | $ | 954,891 | $ | 0 | ||||
Janet L. Robinson | 793,664 | 820,328 | 26,664 | |||||||
Michael Golden | 495,912 | 495,912 | 0 | |||||||
James M. Follo | — | — | — | |||||||
P. Steven Ainsley | 323,357 | 294,133 | (29,224 | ) |
In November 2009,Concurrently with the Company amendedfreezing of the Pension Plan to freeze existing accrued benefits effective December 31, 2009. In connection withand the freeze, the Company also froze the SERP. At the same time,SERP, the Company increased matching contributions under the Company 401(k) Plan and approved the adoption ofadopted two unfunded supplemental defined contribution plans for executives.executives, the Savings Restoration Plan (the “Restoration Plan”) and the Supplemental Executive Savings Plan (the “SESP”). See “—Post-Employment Compensation.Pension Benefits.”
UnderNone of the DEC, participants are allowed to defer portions of their salary, annual bonus and long-term performance award. See “—Nonqualified Deferred Compensation” below. These deferrals are credited with earnings based on the rates of return earned by various third-party mutual funds offered under the DEC from time to time and selected by the participant. The DEC does notRestoration Plan or SESP provide for earnings at above-market or preferential rates. As a result, no earnings related to the DECthese plans are included in column (h).
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5. | The table below shows the |
Name | Perquisitesa | Tax Payments or Reimbursementsb | 401(k) Contributionsc | Life Insurance Premiumsd | Retirement Paymentse | ||||||
Arthur Sulzberger, Jr. | $ 17,143 | — | $12,250 | $2,300 | — | ||||||
Janet L. Robinson | 17,143 | — | 12,250 | 2,300 | — | ||||||
Michael Golden | 28,643 | $27,815 | 12,250 | 1,436 | — | ||||||
James M. Follo | — | — | 12,250 | 1,104 | — | ||||||
P. Steven Ainsley | 173,245 | 81,565 | 12,250 | 1,150 | $ | 544,153 |
Name | Perquisitesa | Contributions to Savings | SESP Creditsc | Life Insurance Premiumsd | ||||||||||||
Arthur Sulzberger, Jr. | $17,510 | $88,394 | — | $2,508 | ||||||||||||
Janet L. Robinson | 16,500 | 83,050 | — | 2,616 | ||||||||||||
Michael Golden | — | 47,896 | — | 1,535 | ||||||||||||
James M. Follo | — | 33,482 | 166,528 | 1,204 | ||||||||||||
Scott Heekin-Canedy | 16,500 | 43,693 | 104,809 | 2,014 |
(a) | Amounts for |
(b) |
Amounts for Mr. Golden include tax reimbursements in respect of income taxes paid on account of tax equalization payments and the tax preparation services described in Note (a) above, relating to his overseas assignment as Publisher of the International Herald Tribune until January 2008.
Amounts for Mr. Ainsley include tax reimbursements on the taxable portion of his relocation perquisites, described in Note (a) above.
Amounts represent our match of employee contributions (per Internal Revenue Service limits) |
(c) | Amounts represent the available credits to the named executive officers’ accounts under the SESP. Under the terms of the SESP, in no event may the sum of the benefits payable under the SESP and the SERP exceed the value of the SERP benefit that the participant would have received had the SERP not been frozen as of December 31, 2009. The amounts included in the table reflect the reduction to the nominal credited amount that would be made to each named executive officer’s account as of December 31, 2010 in accordance with the foregoing plan provision. See “—Nonqualified Deferred Compensation—Supplemental Executive Savings Plan.” |
(d) | We pay premiums for basic life insurance for eligible employees, including our executive officers. Coverage is equal to an employee’s annual salary, with a minimum of $20,000 and a maximum of $1 million. |
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Grants of Plan-Based Awards
The table below summarizes grants of annual and long-term performance awards, restricted stock units and stock options/SARs to our named executive officers in 2009.2010.
Name (a) | Award Type | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | All other Units4 (i) | All Other (#) (j) | Exercise or Option/SAR | Closing Market Price ($/Sh)6 | Grant Date | |||||||||||||
Grant Date | Threshold ($) (c) | Target ($) (d) | Maximum ($) (e) | |||||||||||||||||
Arthur Sulzberger, Jr. | Long-Term Performance Award1 | — | 0 | 2,000,000 | 3,000,000 | |||||||||||||||
Annual Bonus Program2 | — | 0 | 1,087,000 | 2,174,000 | ||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/19/2009 | 50,000 | 181,250 | |||||||||||||||||
Annual Option Grant4 | 2/19/2009 | 400,000 | 3.625 | 3.51 | 514,000 | |||||||||||||||
SARs 5 | 9/17/2009 | 100,000 | 3.625 | 8.42 | 571,000 | |||||||||||||||
Janet L. Robinson | Long-Term Performance Award1 | — | 0 | 2,000,000 | 3,000,000 | |||||||||||||||
Annual Bonus Program2 | — | 0 | 1,000,000 | 2,000,000 | ||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/19/2009 | 50,000 | 181,250 | |||||||||||||||||
Annual Option Grant4 | 2/19/2009 | 400,000 | 3.625 | 3.51 | 514,000 | |||||||||||||||
SARs5 | 9/17/2009 | 100,000 | 3.625 | 8.42 | 571,000 | |||||||||||||||
SARs5 | 9/17/2009 | 250,000 | 20.235 | 8.42 | 350,750 | |||||||||||||||
Michael Golden | Long-Term Performance Award1 | — | 0 | 400,000 | 700,000 | |||||||||||||||
Annual Bonus Program2 | — | 0 | 438,900 | 877,800 | ||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/19/2009 | 12,000 | 43,500 | |||||||||||||||||
Annual Option Grant4 | 2/19/2009 | 115,000 | 3.625 | 3.51 | 147,775 | |||||||||||||||
James M. Follo | Long-Term Performance Award1 | — | 0 | 300,000 | 525,000 | |||||||||||||||
Annual Bonus Program2 | — | 0 | 264,000 | 528,000 | ||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/19/2009 | 10,000 | 36,250 | |||||||||||||||||
Annual Option Grant4 | 2/19/2009 | 115,000 | 3.625 | 3.51 | 147,775 | |||||||||||||||
P. Steven Ainsley | Long-Term Performance Award1 | — | 0 | 300,000 | 525,000 | |||||||||||||||
Annual Bonus Program2 | — | — | — | — | ||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/19/2009 | 9,000 | 32,625 | |||||||||||||||||
Annual Option Grant4 | 2/19/2009 | 90,000 | 3.625 | 3.51 | 115,650 |
55
Name (a) | Award Type | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | All Other Units (i) | All Other (#) (j) | Exercise or Base Price of Option | Grant Date | ||||||||||||||||||||||||||
Grant Date | Threshold ($) (c) | Target ($) (d) | Maximum ($) (e) | |||||||||||||||||||||||||||||
Arthur Sulzberger, Jr. | Long-Term Performance Award1 | 2/18/2010 | 0 | 2,000,000 | 3,000,000 | |||||||||||||||||||||||||||
Annual Bonus Program2 | 2/18/2010 | 0 | 1,087,000 | 2,174,000 | ||||||||||||||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/18/2010 | 13,650 | 151,925 | |||||||||||||||||||||||||||||
Annual Option Grant4 | 2/18/2010 | 181,650 | 11.13 | 906,434 | ||||||||||||||||||||||||||||
Janet L. Robinson | Long-Term Performance Award1 | 2/18/2010 | 0 | 2,000,000 | 3,000,000 | |||||||||||||||||||||||||||
Annual Bonus Program2 | 2/18/2010 | 0 | 1,000,000 | 2,000,000 | ||||||||||||||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/18/2010 | 13,650 | 151,925 | |||||||||||||||||||||||||||||
Annual Option Grant4 | 2/18/2010 | 181,650 | 11.13 | 906,434 | ||||||||||||||||||||||||||||
Michael Golden | Long-Term Performance Award1 | 2/18/2010 | 0 | 400,000 | 700,000 | |||||||||||||||||||||||||||
Annual Bonus Program2 | 2/18/2010 | 0 | 427,928 | 855,856 | ||||||||||||||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/18/2010 | 4,305 | 47,915 | |||||||||||||||||||||||||||||
Annual Option Grant4 | 2/18/2010 | 42,000 | 11.13 | 209,580 | ||||||||||||||||||||||||||||
James M. Follo | Long-Term Performance Award1 | 2/18/2010 | 0 |
| 400,000 |
| 700,000 | |||||||||||||||||||||||||
Annual Bonus Program2 | 2/18/2010 | 0 | 350,000 | 700,000 | ||||||||||||||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/18/2010 | 4,253 | 47,336 | |||||||||||||||||||||||||||||
Annual Option Grant4 | 2/18/2010 | 42,000 | 11.13 | 209,580 | ||||||||||||||||||||||||||||
Scott Heekin-Canedy | Long-Term Performance Award1 | 2/18/2010 | 0 | 400,000 | 700,000 | |||||||||||||||||||||||||||
Annual Bonus Program2 | 2/18/2010 | 0 | 380,990 | 761,980 | ||||||||||||||||||||||||||||
Annual Restricted Stock Unit Grant3 | 2/18/2010 | 4,305 | 47,915 | |||||||||||||||||||||||||||||
Annual Option Grant4 | 2/18/2010 | 42,000 | 11.13 | 209,580 |
1. | Long-term performance award: threshold, target and maximum amounts in connection with our long-term performance awards for the |
2. | Annual bonus program: threshold, target and maximum amounts in connection with our |
3. | Restricted stock units granted in |
57
entitled to receive payments equivalent to dividends, if any, that may be paid on Class A stock; no preferential rate is paid. The Company paid no dividends in |
4. | Stock options granted in |
5. |
This column shows the grant date fair values of |
5658
Outstanding Equity Awards at Fiscal Year-End
The following table shows outstanding stock options, (including the SARs described above in “—Grants of Plan-Based Awards”) and restricted stock units as of December 27, 2009.26, 2010. At their request, no stock-based compensation was awarded to Messrs. Sulzberger, Jr. and Golden at the time of the annual grants to other executives in December 2006 and February 2008. Mr. Ainsley retired effective December 31, 2009. The terms of Mr. Ainsley’s stock options and restricted stock units provide for vesting upon (or shortly after) his retirement.
Option Awards1 | Stock Awards | Option Awards1 | Stock Awards | |||||||||||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable1 | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of ($) | Number of Securities Underlying Unexercised Options (#) Exercisable1 | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of ($) | ||||||||||||||||||||||||
(a) | (b) | (c) | (e) | (f) | (g) | (h) | (b) | (c) | (e) | (f) | (g) | (h) | ||||||||||||||||||||||||
Arthur Sulzberger, Jr.3 | 0 | 400,000 | 3.625 | 2/19/2019 | 80,000 | 972,800 | 0 | 181,650 | 11.13 | 2/18/2020 | 63,650 | 633,954 | ||||||||||||||||||||||||
0 | 100,000 | 3.625 | 2/19/2019 | 73,334 | 266,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
0 | 0 | — | 2/21/2018 | 33,334 | 66,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
0 | 0 | — | 12/14/2016 | 0 | 0 | — | 2/21/2018 | |||||||||||||||||||||||||||||
150,000 | 0 | 27.445 | 12/20/2015 | 0 | 0 | — | 12/14/2016 | |||||||||||||||||||||||||||||
59,000 | 0 | 39.595 | 12/16/2014 | 150,000 | 0 | 27.445 | 12/20/2015 | |||||||||||||||||||||||||||||
90,000 | 0 | 46.340 | 12/18/2013 | 59,000 | 0 | 39.595 | 12/16/2014 | |||||||||||||||||||||||||||||
150,000 | 0 | 46.015 | 12/12/2012 | 90,000 | 0 | 46.340 | 12/18/2013 | |||||||||||||||||||||||||||||
150,000 | 0 | 43.055 | 12/18/2011 | 150,000 | 0 | 46.015 | 12/12/2012 | |||||||||||||||||||||||||||||
150,000 | 0 | 40.250 | 12/20/2010 | 150,000 | 0 | 43.055 | 12/18/2011 | |||||||||||||||||||||||||||||
Janet L. Robinson | 0 | 400,000 | 3.625 | 2/19/2019 | 214,000 | 2,602,240 | 0 | 181,650 | 11.13 | 2/18/2020 | 153,650 | 1,530,354 | ||||||||||||||||||||||||
0 | 100,000 | 3.625 | 2/19/2019 | 133,334 | 266,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
62,500 | 187,500 | 20.235 | 2/21/2018 | 33,334 | 66,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
100,000 | 300,000 | 20.235 | 2/21/2018 | 125,000 | 125,000 | 20.235 | 2/21/2018 | |||||||||||||||||||||||||||||
168,750 | 56,250 | 23.830 | 12/14/2016 | 200,000 | 200,000 | 20.235 | 2/21/2018 | |||||||||||||||||||||||||||||
149,000 | 0 | 27.445 | 12/20/2015 | 225,000 | 0 | 23.830 | 12/14/2016 | |||||||||||||||||||||||||||||
55,000 | 0 | 39.595 | 12/16/2014 | 149,000 | 0 | 27.445 | 12/20/2015 | |||||||||||||||||||||||||||||
48,000 | 0 | 46.340 | 12/18/2013 | 55,000 | 0 | 39.595 | 12/16/2014 | |||||||||||||||||||||||||||||
80,000 | 0 | 46.015 | 12/12/2012 | 48,000 | 0 | 46.340 | 12/18/2013 | |||||||||||||||||||||||||||||
80,000 | 0 | 43.055 | 12/18/2011 | 80,000 | 0 | 46.015 | 12/12/2012 | |||||||||||||||||||||||||||||
80,000 | 0 | 40.250 | 12/20/2010 | 80,000 | 0 | 43.055 | 12/18/2011 | |||||||||||||||||||||||||||||
Michael Golden4 | 0 | 115,000 | 3.625 | 2/19/2019 | 24,000 | 291,840 | 0 | 42,000 | 11.13 | 2/18/2020 | 16,305 | 162,398 | ||||||||||||||||||||||||
0 | 0 | — | 2/21/2018 | 38,334 | 76,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
0 | 0 | — | 12/14/2016 | 0 | 0 | — | 2/21/2018 | |||||||||||||||||||||||||||||
60,000 | 0 | 27.445 | 12/20/2015 | 0 | 0 | — | 12/14/2016 | |||||||||||||||||||||||||||||
29,670 | 0 | 39.595 | 12/16/2014 | 60,000 | 0 | 27.445 | 12/20/2015 | |||||||||||||||||||||||||||||
48,000 | 0 | 46.340 | 12/18/2013 | 29,670 | 0 | 39.595 | 12/16/2014 | |||||||||||||||||||||||||||||
80,000 | 0 | 46.015 | 12/12/2012 | 48,000 | 0 | 46.340 | 12/18/2013 | |||||||||||||||||||||||||||||
80,000 | 0 | 43.055 | 12/18/2011 | 80,000 | 0 | 46.015 | 12/12/2012 | |||||||||||||||||||||||||||||
80,000 | 0 | 40.250 | 12/20/2010 | 80,000 | 0 | 43.055 | 12/18/2011 | |||||||||||||||||||||||||||||
James M. Follo | 0 | 115,000 | 3.625 | 2/19/2019 | 25,500 | 310,080 | 0 | 42,000 | 11.13 | 2/18/2020 | 29,753 | 296,340 | ||||||||||||||||||||||||
25,000 | 75,000 | 20.235 | 2/21/2018 | 38,334 | 76,666 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
27,000 | 27,000 | 23.865 | 2/02/2017 | 50,000 | 50,000 | 20.235 | 2/21/2018 | |||||||||||||||||||||||||||||
40,500 | 13,500 | 23.865 | 2/02/2017 | |||||||||||||||||||||||||||||||||
P. Steven Ainsley | 0 | 90,000 | 3.625 | 2/19/2019 | 34,500 | 419,520 | ||||||||||||||||||||||||||||||
Scott Heekin-Canedy | 0 | 42,000 | 11.13 | 2/18/2020 | 36,305 | 361,598 | ||||||||||||||||||||||||||||||
25,625 | 76,875 | 20.235 | 2/21/2018 | 41,667 | 83,333 | 3.625 | 2/19/2019 | |||||||||||||||||||||||||||||
48,750 | 16,250 | 23.830 | 12/14/2016 | 57,500 | 57,500 | 20.235 | 2/21/2018 | |||||||||||||||||||||||||||||
40,000 | 0 | 27.445 | 12/20/2015 | 65,000 | 0 | 23.830 | 12/14/2016 | |||||||||||||||||||||||||||||
26,120 | 0 | 39.595 | 12/16/2014 | 60,000 | 0 | 27.445 | 12/20/2015 | |||||||||||||||||||||||||||||
24,000 | 0 | 46.340 | 12/18/2013 | 26,120 | 0 | 39.595 | 12/16/2014 | |||||||||||||||||||||||||||||
40,000 | 0 | 46.015 | 12/12/2012 | 24,000 | 0 | 46.340 | 12/18/2013 | |||||||||||||||||||||||||||||
20,000 | 0 | 43.055 | 12/18/2011 | 23,000 | 0 | 46.015 | 12/12/2012 | |||||||||||||||||||||||||||||
20,000 | 0 | 40.250 | 12/20/2010 | 23,000 | 0 | 43.055 | 12/18/2011 |
1. | Stock options granted to these executives before 2009 |
5759
2. | Market value at December |
Name | Restricted Stock Units | Grant Date | Vesting Date | |||||||||
Arthur Sulzberger, Jr. | 13,650 | 2/18/2010 | 2/18/2013 | |||||||||
50,000 | 2/19/2009 | 2/19/2012 | ||||||||||
0 | 2/21/2008 | 2/21/2011 | ||||||||||
0 | 12/14/2006 | |||||||||||
12/ | ||||||||||||
Janet L. Robinson | 13,650 | 2/18/2010 | 2/18/2013 | |||||||||
50,000 | 2/19/2009 | 2/19/2012 | ||||||||||
65,000 | 2/21/2008 | 2/21/2011 | ||||||||||
25,000 | 12/14/2006 | |||||||||||
12/ | ||||||||||||
Michael Golden | 4,305 | 2/18/2010 | 2/18/2013 | |||||||||
12,000 | 2/19/2009 | 2/19/2012 | ||||||||||
0 | 2/21/2008 | 2/21/2011 | ||||||||||
0 | 12/14/2006 | |||||||||||
12/ | ||||||||||||
James M. Follo | 4,253 | 2/18/2010 | 2/18/2013 | |||||||||
10,000 | 2/19/2009 | 2/19/2012 | ||||||||||
10,000 | 2/21/2008 | 2/21/2011 | ||||||||||
5,500 | 2/2/2007 | 2/2/2012 | ||||||||||
| 4,305 | 2/18/2010 | 2/18/2013 | |||||||||
13,000 | 2/19/2009 | 2/19/2012 | ||||||||||
12,500 | 2/21/2008 | 2/21/2011 | ||||||||||
6,500 | 12/14/2006 | |||||||||||
12/ |
3. | Mr. Sulzberger, Jr. has transferred the following stock options included in the table above to |
Amount | Option Expiration Date | |||
|
Mr. Sulzberger, Jr. has transferred the following stock options included in the table above to his former wife.
| ||||
75,000 | 12/20/2015 | |||
29,500 | 12/16/2014 | |||
45,000 | 12/18/ | |||
75,000 | 12/12/2012 | |||
| ||||
| ||||
75,000 | 12/ |
4. | Mr. Golden has transferred the following stock options included in the table above to a family limited partnership of which his wife is a general partner. |
Amount | Option Expiration Date | |||
20,000 | 12/12/2012 | |||
40,000 | 12/18/2011 | |||
|
5860
Option Exercises and Stock Vested
The following table shows amounts received upon the exercise of stock options or vesting of restricted stock.stock units.
Option Awards | Stock Awards | Option Awards | Stock Awards | |||||||||||||||||||||
Name | Number of Shares (#) | Value Realized on ($) | Number of Shares (#) | Value Realized on Vesting ($) | Number of Shares (#) | Value Realized on ($) | Number of Shares (#) | Value Realized on ($) | ||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (b) | (c) | (d) | (e) | ||||||||||||||||
Arthur Sulzberger, Jr. | — | — | — | — | 60,000 | $287,484 | 1 | 30,000 | $294,000 | 2 | ||||||||||||||
Janet L. Robinson | — | — | — | — | — | — | 74,000 | 725,200 | 2 | |||||||||||||||
Michael Golden | — | — | 5,000 | 19,950 | — | — | 12,000 | 117,600 | 2 | |||||||||||||||
James M. Follo | — | — | — | — | — | — | — | — | ||||||||||||||||
P. Steven Ainsley | — | — | — | — | ||||||||||||||||||||
Scott Heekin-Canedy | — | — | 12,000 | 117,600 | 2 |
Post-Employment Compensation
1. | Represents the difference between the market price of Class A stock ($8.4164) on November 8, 2010, and the exercise price of the options ($3.625). |
The following table shows the number of years of credited service and actuarial present value of accumulated benefit under The New York Times Companies Pension Plan (the “Pension Plan”) and the Supplemental Executive Retirement Plan (the “SERP”) as of December 27, 2009, the measurement date for each plan. The present value amounts are estimates only, and do not necessarily reflect the actual amounts that will be paid to the named executive officers.
2. | Represents the market value of shares of Class A stock upon vesting on December 20, 2010 ($9.80), of restricted stock units granted on December 20, 2005. |
Pension Benefits
The following table shows the number of years of credited service and actuarial present value of accumulated benefit under the Pension Plan and the SERP as of December 26, 2010, the measurement date for each plan. The present value amounts are estimates only, and do not necessarily reflect the actual amounts that will be paid to the named executive officers.
Name (a) | Plan Name | Number of Years Credited Service (#) (c) | Present Value of Accumulated Benefit ($)1 (d) | Payments During Last Fiscal Year ($) (e) | ||||
Arthur Sulzberger, Jr. | Pension Plan | 31 | 807,129 | 0 | ||||
SERP | 31 | 9,381,328 | 0 | |||||
Janet L. Robinson | Pension Plan | 26 | 746,706 | 0 | ||||
SERP | 26 | 8,899,723 | 0 | |||||
Michael Golden | Pension Plan | 25 | 646,641 | 0 | ||||
SERP | 25 | 4,939,911 | 0 | |||||
James M. Follo | Pension Plan | 2 | — | 0 | ||||
SERP | 2 | — | 0 | |||||
P. Steven Ainsley | Pension Plan | 31 | 755,471 | 0 | ||||
SERP | 31 | 2,047,898 | 0 |
Name (a) | Plan Name (b) | Number of Years Credited Service (#) (c) | Present Value of Accumulated Benefit ($)1 (d) | Payments During Last (e) | ||||||||||
Arthur Sulzberger, Jr. | Pension Plan | 31 | 924,001 | 0 | ||||||||||
SERP | 31 | 10,599,206 | 0 | |||||||||||
Janet L. Robinson | Pension Plan | 26 | 889,136 | 0 | ||||||||||
SERP | 26 | 9,987,231 | 0 | |||||||||||
Michael Golden | Pension Plan | 25 | 741,020 | 0 | ||||||||||
SERP | 25 | 5,232,974 | 0 | |||||||||||
James M. Follo | Pension Plan | 2 | — | 0 | ||||||||||
SERP | 2 | — | 0 | |||||||||||
Scott Heekin-Canedy | Pension Plan | 19 | 476,944 | 0 | ||||||||||
SERP | 19 | 3,778,471 | 0 |
1. | The assumed retirement age used to calculate the actuarial present value of each named executive officer’s accumulated benefit is the age at which the named executive officer would be eligible to receive unreduced benefits. Under the Pension Plan, |
61
Pension Plan
The Pension Plan is a defined benefit pension plan that is intended to qualify for favorable tax treatment under Section 401(a) of the Internal Revenue Code. It is designed to provide retirement income to eligible employees and their beneficiaries. Employees who were hired prior to January 1, 2009, who are at least 21 years old and are not covered by a collective bargaining agreement are eligible to participate in
59
the Pension Plan after completing one year of service, during which they completed at least 1,000 hours of service. All of the named executive officers are participants. Effective December 31, 2009, the Company froze the Pension Plan, meaning no additional benefits accrue after that date.
Computation of Pension Plan Benefits
Previously accrued benefits are determined under a formula that provides an annual annuity benefit at normal retirement age (65). This amount is the sum of:
♦ | 1 1/2% of final average earnings (as of December 31, 2008) times years of service up to 25 years (as of December 31, 2008) plus |
♦ | 5/8% of final average earnings (as of December 31, 2008) times years of service in excess of 25 years up to 40 years (as of December 31, 2008) plus |
♦ | 5/8% of final average earnings (as of December 31, 2009) times years of service from December 31, 2008 to January 1, 2010; |
provided no more than 40 years of service in total may be used in the formula. However, if greater, the annual annuity benefit at normal retirement age is 1.1% of final average earnings times years of service up to 40 years (as of December 31, 2009). times years of service (as of December 31, 2009) up to 40 years.
“Final average earnings” are based on the highest 60 consecutive calendar months of earnings during the 120 consecutive months before terminationDecember 31, 2008 or December 31, 2009, if earlier.as applicable. For this purpose, earnings include total earnings from base salary, annual cash bonuses, and sales commissions, if any, but are limited each year in accordance with Internal Revenue Service rules ($245,000 in 2009)2010).
Payment of Benefits
Benefits are payable at age 65 (unless the participant is eligible for early retirement and elects to commence payment before age 65). The normal payment form is a straight life annuity for unmarried participants and subsidized joint and 50% spouse’s annuity for married participants. A variety of other payment forms are available. A participant may not elect to receive retirement benefits in a single lump sum payment.
Early Retirement
Reduced benefits are available to participants retiring after age 55 with at least five years of service. As of December 27, 2009,26, 2010, the last day of our 20092010 fiscal year, each of our named executive officers, other than Mr. Follo, was eligible for early retirement.
Age and Service Credits
We do not have a policy of granting additional age or service credit under the Pension Plan, although the Company has on anad hoc basis amended the Pension Plan to grant age and/or service credits to specific groups of employees in connection with divestitures or in connection with employees who elected to be covered by a voluntary buyout plan. None of our named executive officers have been granted age or service credits under the Pension Plan beyond his or her actual service.
Supplemental Executive Retirement Plan
The SERP is a non-qualified defined benefit pension plan designed to provide participants with a competitive amount of total retirement income when added to the retirement income from the Pension Plan. Only key senior Company executives designated by the SERP Committee, a Company management committee, can participate in the SERP. All of the named executive officers are participants.
Like the Pension Plan, the SERP was amended effective December 31, 2009, to discontinue future benefit accruals.
62
SERP Benefits
SERP retirement benefits are based on a participant’s years of service with the Company and final average earnings, both determined as of December 31, 2009. Final average earnings for purposes of the SERP are computed the same way as under the Pension Plan, except that there is no annual limit on the amount of earnings that can be taken into account when computing SERP benefits. A participant vests in his or her SERP benefit upon attaining age 55 and completing ten years of service. The normal payment form is the straight life annuity for unmarried participants and subsidized joint and 50% spouse’s annuity for married participants. A variety of other payment forms are available, all actuarially equivalent in value. A participant may not elect to receive a lump sum payment. Distributions are subject to compliance with Section 409A of the Internal Revenue Code. All participants are subject to non-competition restrictions for the duration of the period during which the participant is receiving benefits under the SERP.
Normal Retirement
The annual SERP retirement benefit payable at normal retirement age (age 65) to a participant with at least 20 years of service as of December 31, 2009 is equal to 50% of “final average earnings” as of December 31, 2009, minus the benefits paid under the Pension Plan at age 65 for participants with 20 years or more of service as of December 31, 2008.65. All of the named executive officers, except Mr. Follo and Mr. Heekin-Canedy, have at least 20 years of service.
As a result of SERP amendments effective January 1, 2009, and December 31, 2009, participants with less than 20 years of service as of December 31, 2008, receive an annual SERP retirement benefit payable at normal retirement age (age 65) equal to (a) 2.5% of final average earnings as of
60
December 31, 2009 for each year of service as of December 31, 2008, plus (b) 2.2% of final average earnings as of December 31, 2009 for each year of service after December 31, 2008 and prior to January 1, 2010, provided that the aggregate years of service shall not exceed 20 years of service, minus (c) benefits under the Pension Plan at age 65. Mr. Follo hasand Mr. Heekin-Canedy have less than 20 years of service, and accordingly his benefittheir benefits will be determined at the reduced rate.
Early Retirement
A SERP participant who retires between the ages of 60 and 65 with 10 or more years of service will receive a benefit based on the participant’s service and final average earnings at retirement. This benefit will not be reduced because of early commencement. However, the benefit of a SERP participant who retires with 10 or more years of service between ages 55 and 60 will be reduced by1/3 of 1% for each month benefits commence prior to age 60.
As of December 27, 2009,26, 2010, the last day of our 20092010 fiscal year, each of our named executive officers, other than Mr. Follo, was eligible for early retirement with SERP Committee consent.
Age and Service Credits
The service credit that is used for calculating SERP retirement benefits can be more than a participant’s actual service in specified situations authorized by the committee that administers the SERP. In the past, the SERP committeeCommittee has authorized additional service credit in connection with individual voluntary severance arrangements. None of our named executive officers have been granted age or service credits under the SERP beyond his or her actual years of service.
63
Nonqualified Deferred Compensation
The following table shows Company and participant contributions, earnings and balances as of December 31, 2010, under the Restoration Plan, the SESP and our Deferred Executive Compensation Plan (the “DEC”).DEC.
Name (a) | Executive ($) (b) | Registrant (c) | Aggregate (d) | Aggregate (e) | Aggregate ($) (f) | ||||||
Arthur Sulzberger, Jr. | — | — | 13,467 | 3,384,096 | 394,910 | ||||||
Janet L. Robinson | — | — | (40,064 | ) | 592,878 | — | |||||
Michael Golden | — | — | 641,432 | — | 2,842,501 | ||||||
James M. Follo | — | — | — | — | — | ||||||
P. Steven Ainsley | — | — | (9,977 | ) | 547,923 | 156,171 |
Name (a) | Plan | Executive ($)1 (b) | Registrant (c) | Aggregate (d) | Aggregate (e) | Aggregate ($) (f) | ||||||||||||||||
Arthur Sulzberger, Jr. | Restoration Plan | — | 68,794 | — | — | 68,794 | ||||||||||||||||
SESP | — | — | — | — | — | |||||||||||||||||
DEC | — | — | 38,568 | — | 433,478 | |||||||||||||||||
Total | — | 68,794 | 38,568 | — | 502,272 | |||||||||||||||||
Janet L. Robinson | Restoration Plan | — | 63,450 | — | — | 63,450 | ||||||||||||||||
SESP | — | — | — | — | — | |||||||||||||||||
DEC | — | — | — | — | — | |||||||||||||||||
Total | — | 63,450 | — | — | 63,450 | |||||||||||||||||
Michael Golden | Restoration Plan | — | 28,296 | — | — | 28,296 | ||||||||||||||||
SESP | — | — | — | — | — | |||||||||||||||||
DEC | — | — | 455,387 | 109,764 | 3,188,125 | |||||||||||||||||
Total | — | 28,296 | 455,387 | 109,764 | 3,216,421 | |||||||||||||||||
James M. Follo | Restoration Plan | — | 17,629 | — | — | 17,629 | ||||||||||||||||
SESP | — | 166,528 | — | — | 166,528 | |||||||||||||||||
DEC | — | — | — | — | — | |||||||||||||||||
Total | — | 184,157 | — | — | 184,157 | |||||||||||||||||
Scott Heekin-Canedy | Restoration Plan | — | 24,093 | — | — | 24,093 | ||||||||||||||||
SESP | — | 104,809 | — | — | 104,809 | |||||||||||||||||
DEC | — | — | 16,611 | — | 138,045 | |||||||||||||||||
Total | — | 128,902 | 16,611 | — | 266,947 |
1. | Participants are not permitted to make contributions under the Restoration Plan or the SESP. |
2. | Under the terms of the SESP, in no event may the sum of the benefits payable under the SESP and the SERP exceed the value of the SERP benefit that the participant would have received had the SERP not been frozen as of December 31, 2009. The amounts included as of December 31, 2010 in the table reflect the reduction to the nominal credited amount that would be made to each named executive officer’s account in accordance with the foregoing plan provision. The amount of the credits to the named executive officers’ accounts under the Restoration Plan and the SESP for 2010 are also included in the “Summary Compensation Table” under “All Other Compensation.” We make no contributions to the DEC. |
Deferred Executive Compensation Plan
All of the named executive officers, other than Mr. Follo, have participated in the DEC.
Permitted Deferrals
Under the DEC, participants are currently allowed to defer up to:
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Also, any participant who is a “covered employee” as defined in Section 162(m) of the Internal Revenue Code may defer 100% of any bonus if the bonus would cause the participant’s compensation to exceed the deductible amount under Section 162(m) of the Internal Revenue Code.
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Earnings on Deferrals
DEC deferrals are credited with earnings. Earnings are based on the rates of return earned by various well known third-party mutual funds offered under the DEC from time to time.
When a participant makes a deferral, the participant elects which of the available mutual funds will be used to measure earnings on the deferral. A participant can change his or her earnings election at any time through our third-party administrator. There are no restrictions on the frequency of changes, and any election changes are applied prospectively only. Currently, we offer participants the choice of nine funds to measure earnings under the DEC. For 2009, the rates of return ranged from 0.98% to 35.20%.
Distribution of Deferrals
When a participant elects to make a deferral, the participant must also elect the duration of the deferral period. The deferral period can be no less than two years and no more than 15 years. (A participant may subsequently elect to extend the deferral period for a minimum of five and a maximum of 15 additional years if he or she continues to be employed. A terminated participant may elect to extend the deferral period if he or she terminates employment on or after attaining age 55 and completing at least 10 years of service or incurs a total and permanent disability. In all cases, participants can extend the deferral period if requirements specified in the DEC are met.) At the same time, a participant must also elect the form in which the deferral will be paid. The choices are a single lump sum payment, five, 10 or 15 substantially equal annual installments, or a combination of a lump sum and annual installments. Regardless of any deferral and payment elections a participant has in effect, the executive’s entire DEC account balance will be paid to the participant in a single lump sum upon a change of control of the Company.
Restoration Plan and Supplemental Executive Savings Plan
In connection with the freeze of the SERP, as discussed above under “—Post-Employment Compensation,” the Company established two non-qualified deferred compensation plans, The New York Times Company Savings Restoration Plan (the “Restoration Plan”) and The New York Times Company Supplemental Executive Savings Plan (the “Supplemental Executive Savings Plan”) effective as of January 1, 2010. Participants are not permitted to make contributions under these plans. All contributions under these plans are made by the Company.
Restoration Plan
Executive officers who participated in the SERP on December 31, 2009, the date it was frozen, became participants in the Restoration Plan on January 1, 2010. Participants in the Company 401(k) Plan receive an annual employer contribution in cash equal to 3% of their earnings, up to applicable limits under the Internal Revenue Code. Under the Restoration Plan, participants, including executive officers, are provided with that portion of the 3% basic contribution that cannot be provided
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under the Company 401(k) Plan as a result of Internal Revenue Code limits. Annually, participants’ accounts will be credited with interest based on the yield of the Barclays Capital Long Credit index, or a successor index. As the initial credits under these plans were made as of December 31, 2010, no interest accrued through that date.
Participants vest in their accounts pursuant to a five-year graded vesting schedule or, upon a change in control, death, disability, retirement or attainment of age 65 while employed, become 100% vested.
Upon termination of employment, participants will receive a lump sum payment of their account balances. Payments to “specified employees,” as defined under Section 409A of the Internal Revenue Code, will be delayed for six months following termination from employment.
Supplemental Executive Savings Plan
The named executive officers also participate in the Supplemental Executive Savings PlanSESP effective January 1, 2010. The SERP Committee may designate other executives as participants in the Supplemental Executive Savings Plan.SESP.
Under the Supplemental Executive Savings PlanSESP a participant’s account will be credited each year with a “supplemental contribution” equal to: (i) 10% of his or her compensation for SERP participants on December 31, 2009; or (ii) 5% for those who were not SERP participants on December 31, 2009. Certain participants, including Mr. Follo, are eligible for a transition credit“transition credit” equal to 10% of their compensation. Compensation means a participant’s base salary, annual cash bonuses and sales commissions and deferrals topaid during the year, including amounts deferred under the DEC. Annually, participants’ accounts will be credited with interest based on the yield of the Barclays Capital Long Credit index, or a successor index. As the initial credits under these plans were made as of December 31, 2010, no interest accrued through that date.
In no event would the sum of the benefits payable under the Supplemental Executive Savings PlanSESP and the SERP exceed the value of the SERP benefit that the participant would have received had the SERP not been frozen. The value of the participant’s Supplemental Executive Savings PlanSESP account will be reduced as necessary to ensure that this limit is not exceeded.
Participants will vest in their benefit upon attaining age 55 and completing 10 years of service or upon a change in control.
Upon termination of employment, participants will receive a lump sum payment. Payments to “specified employees,” as defined under Section 409A of the Internal Revenue Code, will be delayed for six months following termination from employment.
Deferred Executive Compensation Plan
Certain of the named executive officers participate in the DEC.
Permitted Deferrals
Under the DEC, participants are currently allowed to defer up to:
♦ | 33% of their base salary, |
♦ | 85% of their annual bonus, |
♦ | 85% of their long-term performance awards, and |
♦ | 85% of amount payable to them, if any, under our advertising and circulation sales incentive plan. |
Also, any participant who is a “covered employee” as defined in Section 162(m) of the Internal Revenue Code may defer 100% of any bonus if the bonus would cause the participant’s compensation to exceed the deductible amount under Section 162(m) of the Internal Revenue Code.
Earnings on Deferrals
DEC deferrals are credited with earnings. Earnings are based on the rates of return earned by various well-known third-party mutual funds offered under the DEC from time to time, as determined by the ERISA Management Committee.
When a participant makes a deferral, the participant elects which of the available mutual funds will be used to measure earnings on the deferral. A participant can change his or her earnings election at any time through our third-party administrator. There are no restrictions on the frequency of changes, and any election changes are applied prospectively only. Currently, we offer participants the choice of ten investment funds to measure earnings under the DEC. For 2010, the rates of return for these funds ranged from 0.06% to 26.52%.
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Distribution of Deferrals
When a participant elects to make a deferral, the participant must also elect the duration of the deferral period. The deferral period can be no less than two years and no more than 15 years. (A participant may subsequently elect to extend the deferral period for a minimum of five and a maximum of 15 additional years if he or she continues to be employed. A terminated participant may elect to extend the deferral period if he or she terminates employment on or after attaining age 55 and completing at least 10 years of service or incurs a total and permanent disability. In all cases, participants can extend the deferral period if requirements specified in the DEC are met.) At the same time, a participant must also elect the form in which the deferral will be paid. The choices are a single lump sum payment, five, 10 or 15 substantially equal annual installments, or a combination of a lump sum and annual installments. Regardless of any deferral and payment elections a participant has in effect, the executive’s entire DEC account balance will be paid to the participant in a single lump sum upon a change of control of the Company.
Potential Payments Upon Termination or Change-In-ControlChange in Control
We have no employment agreements with any of our named executive officers, and we have not agreed to any plans or arrangements that would entitle them to any benefit upon a change in control or upon resignation, severance, retirement or other termination that is not generally available to salaried employees, other than as described under “—Nonqualified Deferred Compensation” and “—Restoration Plan and Supplemental Executive Savings Plan.Compensation.”
Certain elements of compensation are, however, treated differently upon various termination of employment scenarios, as described below. The following describes how elements of compensation are handled under these scenarios for the named executive officers, assuming termination as of the last day of the 20092010 fiscal year.
♦ | Base salary—Base salary is paid through the last day worked, regardless of reason for termination of employment. |
♦ | Annual and long-term performance awards—Eligible employees who work through the last day of the fiscal year are eligible for annual and long-term performance awards payable for that year, if terminated because of death, disability or retirement. Participants in ongoing long-term performance award cycles are generally entitled (if, as and when such long-term performance awards are paid to other participants) to a |
♦ | Stock options—Treatment depends on the reason for termination of employment. |
— | Termination—All stock options that were not vested are forfeited effective upon the date of termination. Vested stock options that were not exercised prior to termination are exercisable up to one year, not to extend beyond the original expiration date. |
— | Death, Disability or Retirement—Stock options granted in the year prior to termination that would be exercisable on the first anniversary of grant become immediately exercisable and remain so until the original expiration date. Options that would become exercisable more than one year from grant will generally become exercisable 30 days after death, disability or retirement (in the absence of action by the Compensation Committee of the Board of Directors of the Company) and remain so until the original expiration date. Options granted after 2010 (which are not reflected in the table) will generally become exercisable immediately upon death, disability or retirement. |
♦ | Restricted stock units—Treatment depends on the reason for termination of employment. |
— | Termination—All restricted stock units that were not vested are forfeited effective upon the date of termination. |
— | Death, Disability or Retirement—Restricted stock units immediately vest (subject to applicable tax regulations). |
♦ | Retirement benefits (Pension Plan and SERP)—Benefits will be paid out upon retirement as described above under “— |
♦ | Nonqualified deferred |
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♦ | Severance benefits—Pursuant to the Company’s severance plan for nonunion employees, each of the named executive officers would be entitled to certain severance pay and certain other benefits in the case of a termination of his or her employment by the Company generally in connection with a reduction in force. Payments are based on the employee’s length of service and base salary at the time of termination. |
♦ | Perquisites and other executive benefits—In most cases, participation ends on the last day worked, unless otherwise agreed by the Compensation Committee. |
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The following table and footnotes quantify the payments and benefits that each named executive officer would be required to be paid under the Company’s compensation programs upon various scenarios for termination of employment or a change in control of the Company as of December 27, 2009,26, 2010, the last day of our 20092010 fiscal year.
Payment Upon Termination or Change-in-ControlChange in Control Table
Name | Termination ($) | Resignation1 ($) | Death, Disability or ($) | Change in ($) | Termination ($) | Resignation1 ($) | Death, Disability or ($) | Change in ($) | ||||||||||||||||
Arthur Sulzberger, Jr. | ||||||||||||||||||||||||
Salary | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Annual and long-term performance awards4 | 0 | 2,560,000 | 2,560,000 | 0 | 0 | 4,492,200 | 4,492,200 | 0 | ||||||||||||||||
Stock options | 0 | 4,267,500 | 4,267,500 | 0 | 0 | 2,111,658 | 2,111,658 | 0 | ||||||||||||||||
Restricted stock units | 0 | 972,800 | 972,800 | 0 | 0 | 633,954 | 633,954 | 0 | ||||||||||||||||
Present value of Pension Plan and SERP benefits5 | 9,947,349 | 9,947,349 | 9,947,349 | 0 | 0 | 11,871,201 | 11,871,201 | 0 | ||||||||||||||||
Non-qualified deferred compensation | 394,910 | 394,910 | 394,910 | 394,910 | ||||||||||||||||||||
Nonqualified deferred compensation | 502,272 | 502,272 | 502,272 | 433,478 | ||||||||||||||||||||
Severance benefits under Company’s Severance Pay Plan | 1,087,000 | 0 | 0 | 0 | 1,087,000 | 0 | 0 | 0 | ||||||||||||||||
Janet L. Robinson | ||||||||||||||||||||||||
Salary | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Annual and long-term performance awards4 | 0 | 2,552,000 | 2,552,000 | 0 | 0 | 4,324,375 | 4,324,375 | 0 | ||||||||||||||||
Stock options | 0 | 4,267,500 | 4,267,500 | 0 | 0 | 2,111,658 | 2,111,658 | 0 | ||||||||||||||||
Restricted stock units | 0 | 2,602,240 | 2,602,240 | 0 | 0 | 1,530,354 | 1,530,354 | 0 | ||||||||||||||||
Present value of Pension Plan and SERP benefits5 | 9,030,768 | 9,030,768 | 9,030,768 | 0 | 0 | 10,864,104 | 10,864,104 | 0 | ||||||||||||||||
Non-qualified deferred compensation | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Nonqualified deferred compensation | 63,450 | 63,450 | 63,450 | 0 | ||||||||||||||||||||
Severance benefits under Company’s Severance Pay Plan | 1,000,000 | 0 | 0 | 0 | 1,000,000 | 0 | 0 | 0 | ||||||||||||||||
Michael Golden | ||||||||||||||||||||||||
Salary | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Annual and long-term performance awards4 | 0 | 696,000 | 696,000 | 0 | 0 | 1,447,914 | 1,447,914 | 0 | ||||||||||||||||
Stock options | 0 | 981,525 | 981,525 | 0 | 0 | 485,679 | 485,679 | 0 | ||||||||||||||||
Restricted stock units | 0 | 291,840 | 291,840 | 0 | 0 | 162,398 | 162,398 | 0 | ||||||||||||||||
Present value of Pension Plan and SERP benefits5 | 4,919,438 | 4,919,438 | 4,919,438 | 0 | 0 | 6,072,552 | 6,072,552 | 0 | ||||||||||||||||
Non-qualified deferred compensation | 2,842,501 | 2,842,501 | 2,842,501 | 2,842,501 | ||||||||||||||||||||
Nonqualified deferred compensation | 3,216,421 | 3,216,421 | 3,216,421 | 3,188,125 | ||||||||||||||||||||
Severance benefits under Company’s Severance Pay Plan | 602,900 | 0 | 0 | 0 | 627,000 | 0 | 0 | 0 | ||||||||||||||||
James M. Follo | ||||||||||||||||||||||||
Salary | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Annual and long-term performance awards4 | 0 | 0 | 522,222 | 0 | 0 | 0 | 1,171,208 | 0 | ||||||||||||||||
Stock options | 0 | 0 | 981,525 | 0 | 0 | 0 | 485,679 | 0 | ||||||||||||||||
Restricted stock units | 0 | 0 | 310,080 | 0 | 0 | 0 | 296,340 | 0 | ||||||||||||||||
Present value of Pension Plan and SERP benefits5 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Non-qualified deferred compensation | 0 | 0 | 0 | 0 | ||||||||||||||||||||
Nonqualified deferred compensation | 14,985 | 14,985 | 14,985 | 0 | ||||||||||||||||||||
Severance benefits under Company’s Severance Pay Plan | 36,923 | 0 | 0 | 0 | 58,152 | 0 | 0 | 0 | ||||||||||||||||
P. Steven Ainsley6 | ||||||||||||||||||||||||
Scott Heekin-Canedy | ||||||||||||||||||||||||
Salary | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Annual and long-term performance awards4 | 0 | 596,000 | 596,000 | 0 | 0 | 1,329,680 | 1,329,680 | 0 | ||||||||||||||||
Stock options | 0 | 768,150 | 768,150 | 0 | 0 | 527,915 | 527,915 | 0 | ||||||||||||||||
Restricted stock units | 0 | 419,520 | 419,520 | 0 | 0 | 361,598 | 361,598 | 0 | ||||||||||||||||
Present value of Pension Plan and SERP benefits5 | 2,237,564 | 2,237,564 | 2,237,564 | 0 | 0 | 4,457,366 | 4,457,366 | 0 | ||||||||||||||||
Non-qualified deferred compensation | 156,171 | 156,171 | 156,171 | 156,171 | ||||||||||||||||||||
Nonqualified deferred compensation | 266,947 | 266,947 | 266,947 | 138,045 | ||||||||||||||||||||
Severance benefits under Company’s Severance Pay Plan | 500,000 | 0 | 0 | 0 | 485,322 | 0 | 0 | 0 |
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1. | Mr. Sulzberger, Jr., Ms. Robinson, Mr. Golden and Mr. |
2. | The amounts shown for stock options and restricted stock units represent the in-the-money value of unexercisable stock options, SARs and restricted stock units that would become exercisable and/or deliverable in shares or cash, upon retirement, death or disability of the named executive officer, based on the Company’s closing stock price on December |
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3. | The Company’s only |
(i) | any person or group acquires Company stock that, together with stock they already hold, equals 50% or more of the fair market value of the Company’s outstanding common stock or that has the ability to elect 50% or more of the Company’s directors; |
(ii) | a majority of the Company’s directors are replaced during any 12-month period by directors who were not endorsed by a majority of the existing directors; or |
(iii) | any person or group acquires Company assets during any 12-month period that have a total fair market value equal to 40% or more of the total fair market value of all the Company’s assets immediately before the acquisition, except in certain limited circumstances described in the DEC. |
Upon a change in control, the executive’s entire DEC account balance would be paid in a single lump sum.
Arthur Sulzberger, Jr. | $ | 804,178 | |
Janet L. Robinson | 721,754 | ||
Michael Golden | 414,657 | ||
James M. Follo | 0 | ||
P. Steven Ainsley | 178,660 |
Although the total present value of retirement benefits is shown, lump sum payments are not permitted. The present values shown are less than those shown above under “—Post-Employment Compensation—Pension Benefits” because this presentation assumes a December 27, 2009, retirement. All of the named executive officers, other than Mr. Follo, are eligible for early retirement with benefits at these levels.
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Equity Compensation Plan Information
The following table presents information regarding the Company’s existing equity compensation plans as of December 27, 2009.
Plan category | Number of securities to and rights (a) | Weighted average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining (c) | ||||||
Equity compensation plans approved by security holders | |||||||||
Stock options | 26,338,000 | 1 | $ | 35 | 9,727,000 | 2 | |||
Employee Stock Purchase Plan | – | – | 7,736,000 | 3 | |||||
Stock awards | 737,000 | 4 | – | 295,000 | 5 | ||||
Total | 27,075,000 | – | 17,758,000 | ||||||
Equity compensation plans not approved by security holders | None | None | None |
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Adoption of The New York Times Company 2010 Incentive Compensation Plan
The Board of Directors and the Compensation Committee believe that attracting and retaining executives and other key employees of high quality has been and will continue to be essential to the Company’s growth and success. Consistent with this view, at the Annual Meeting, stockholders will be asked to approve the 2010 Incentive Plan, which was approved by the Board of Directors on February 18, 2010. Our current NYT Stock Plan and 1991 Executive Cash Bonus Plan (the “NYT Cash Plan,” and together with the NYT Stock Plan, the “1991 Plans”) will expire on December 31, 2010. If the stockholders do not approve the 2010 Incentive Plan, after December 31, 2010, we will have no plan in effect pursuant to which stock options or other equity compensation awards may be provided to executives or other employees.
The 2010 Incentive Plan is designed to enable us to formulate and implement a compensation program that will attract, motivate and retain employees who we expect will contribute to our financial success and will align the interests of those individuals with those of our stockholders. The 2010 Incentive Plan will allow the Compensation Committee to grant a variety of stock-based and cash-based incentive awards to employees of the Company and its subsidiaries. The 2010 Incentive Plan will replace the 1991 Plans, and upon approval of the 2010 Incentive Plan by stockholders, no further awards will be granted under the 1991 Plans. Awards currently outstanding under the 1991 Plans will remain outstanding in accordance with their terms. However, to the extent that outstanding options granted under the NYT Stock Plan expire unexercised or stock-settled restricted stock units are forfeited without the issuance of shares, the reservation of shares for such awards will lapse and such shares will not increase the 2010 Incentive Plan share reserve.
The 2010 Incentive Plan will also allow us to grant awards to our non-employee directors. However, we do not currently intend to grant any suchNo awards under the 2010 Incentive Plan and intend that non-employee directors will continue to receivewere outstanding as of December 26, 2010. For future awards, under the Directors’ Plan.
We are seeking stockholder approval of the 2010 Incentive Plan in order to satisfy certain legal requirements, including requirements under our Certificate of Incorporation and rules of the NYSE. The Board also regards stockholder approval of the 2010 Incentive Plan as desirable and consistent with good corporate governance practices.
In addition, by obtaining stockholder approval of the 2010 Incentive Plan, we will preserve our ability to claim tax deductions for compensation paid, to the greatest extent practicable. Section 162(m) of the Internal Revenue Code limits the deductions a publicly held company can claim for compensation in excess of $1 million in a given year paid to (i) the chief executive officer; or (ii) each of the three highest-paid officers, other than the chief executive officer and chief financial officer, in either case serving on the last day of the fiscal year (generally referred to as the “covered employees”). “Performance-based” compensation that meets certain requirements is not counted against the $1 million deductibility cap, and therefore remains fully deductible. We are seeking stockholder approval of the 2010 Incentive Plan in order to meet a key requirement for certain awards to qualify as “performance-based” under Section 162(m). If the 2010 Incentive Plan is not approved, after December 31, 2010, we will no longer be able to grant “performance-based” compensation.
Stockholder approval will permit designated stock options to qualify as incentive stock options under the Internal Revenue Code. Such qualification can give the holder of the options more favorable tax treatment, as explained below.
The approval of the 2010 Incentive Plan will not affect the Company’s ability to make stock-based or cash-based awards outside of the 2010 Incentive Plan, to the extent consistent with our Certificate of Incorporation, applicable law and stock exchange rules.
The 2010 Incentive Plan has several provisions designed to protect the interests of stockholders and to facilitate effective corporate governance. Specifically, the 2010 Incentive Plan:
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The 2010 Incentive Plan will authorize the issuance of up to 8,000,000 shares of Class A stock of the Company (the “Shares”). We expect this number of authorized Shares will be sufficient for three to four years under our current compensation practices.
“Overhang” is a term that refers to the potential dilutive effect of outstanding and future equity awards. Overhang is calculated by adding (i) the number of shares subject to currently outstanding stock options and stock-settled awards and (ii) the number of shares available for future grant of equity awards (such sum, the “Potential Award Shares”) and then dividing the Potential Award Shares by the sum of the total shares of Class A and Class B stock outstanding and the Potential Award Shares. The Company’s current overhang is approximately 20.2%. Assuming approval of the 2010 Incentive Plan, and no change to existing outstanding stock options and stock-settled awards, overhang would decrease to 19.8% because fewer shares will be reserved for issuance under the 2010 Incentive Plan, than are currently reserved for issuance under the NYT Stock Plan (exclusive of shares reserved for outstanding awards under the NYT Stock Plan).
We expect that this overhang isupon a short-term issue that will decrease over time. Options account for substantially all of our overhang (as of February 26, 2010, options to purchase 26,938,547 shares, 707,626 stock-settled restricted stock units, and 18,360 other stock-settled awards are outstanding). As of February 26, 2010, outstanding options, which have remaining terms of one to 10 years, have a weighted average exercise price of approximately $34.56, compared with our Class A stock’s closing market price of $10.94 on February 26, 2010. Accordingly, it is likely that a significant number of currently outstanding options will expire unexercised. As noted above, the expiration of unexercised options will not increase the share reserve under the 2010 Incentive Plan.
As of February 26, 2010, only 1.9 million of the outstanding options were in-the-money. Counting only these
in-the-money options (and the 725,986 other outstanding stock-settled awards), current overhang would be only approximately 7.5%, and approval of the 2010 Incentive Plan would resultchange in a decreased overhang of only approximately 6.9%. The Company does not expect to grant any options, restricted stock units, or other stock-settled awards during the period beginning on February 26, 2010 and ending prior to April 27, 2010.
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The following chart highlights the key terms of the 2010 Incentive Plan and is qualified in its entirety by reference to the full text of the 2010 Incentive Plan annexed hereto as Appendix I.
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The following is a brief description of the material features of the 2010 Incentive Plan and is qualified in its entirety by reference to the full text of the 2010 Incentive Plan annexed hereto as Appendix I.
Administration. The Compensation Committee (or another committee appointed by the Company’s Board of Directors and generally consisting of persons who are both non-employee directors, as defined under Rule 16b-3 under the Exchange Act, and “outside directors,” within the meaning of Section 162(m) of the Internal Revenue Code) (in either case, the “Committee”), will administer the 2010 Incentive Plan. The Committee will have the authority to select award recipients, determine the type, size and other terms and condition of the award, and make all other decisions and determinations as may be required under the terms of the 2010 Incentive Plan or as the Committee may deem necessary or advisable for the administration of the 2010 Incentive Plan. The Committee will be permitted to delegate to a sub-committee or to one or more officers of the Company all or any portion of its authority, as it may deem necessary or advisable, to the extent such delegation is consistent with applicable law and the applicable rules of the NYSE. The Nominating & Governance Committee reviews and makes recommendations to the Board with respect to the compensation for non-employee directors, and will continue to do so in the event the 2010 Incentive Plan is used for grants to non-employee directors.
Eligibility. Officers, other employees, and other service providers of the Company and its subsidiaries are eligible to be selected as award recipients. The 2010 Incentive Plan will also allow for grants to non-employee directors.
Type of Awards. The Company’s current stock-based compensation is generally comprised of stock options and restricted stock units. The 2010 Incentive Plan gives the Committee the flexibility to grant a variety of other equity instruments in addition to stock options and restricted stock units, including restricted stock, bonus shares, and stock appreciation rights. The 2010 Incentive Plan also provides the Committee with the authority to grant awards payable in cash, the amount of which is determined other than by reference to the value of a specific number of shares of Class A stock, which would include the grant of a right to receive an amount equal to any per share dividends declared, granted with respect to awards of restricted stock units or stock units. The Company’s current incentive cash compensation is generally comprised of cash bonuses, the payment of which is conditioned upon attainment of short-term or long-term performance measures. See “Compensation of Executive Officers—Compensation Discussion and Analysis.” We do not currently expect the adoption of the 2010 Incentive Plan to result in significant changes to executive compensation practices.
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Below is a description of the types of awards that we currently expect to be granted under the 2010 Incentive Plan:
Stock Options. A stock option is a right to purchase a specified number of Shares at an exercise price established at the date of grant. Stock options granted may be either non-qualified stock options or incentive stock options (which are intended to qualify as “incentive stock options” within Section 422 of the Internal Revenue Code). The exercise price of any stock option granted under the 2010 Incentive Plan may not be less than the fair market value of the underlying share of Class A stock on the date of grant. The Committee will specify at the time an option is granted, when, and in what proportions, an option becomes vested and exercisable, as well as the exercise price and expiration date of the option. The Committee will not have the authority to reprice stock options without prior stockholder approval.
Restricted Stock Units. An award of restricted stock units entitles the recipient to receive Shares at some later date once the holder has satisfied certain requirements. At that time (and not before), the Shares will be delivered and the recipient will be entitled to all stockholder rights. Thus, upon grant, the Shares covered by the restricted stock units are not considered issued and are not included in the Company’s total number of Shares outstanding until all conditions have been satisfied. Dividends may accrue, or be paid, on restricted stock units as bonus compensation, at the discretion of the Committee.
Performance-Based Awards. The Committee may grant performance awards, which may be cash-based or stock-based. Generally, performance awards require satisfaction of pre-established performance goals, consisting of one or more business criteria and a targeted performance level with respect to such criteria, as a condition of awards being granted, becoming exercisable or settleable, or as a condition to accelerating the timing of such events. We generally grant cash-based performance awards in the form of cash bonuses based on attainment of short-term or long-term performance goals.
Awards may be granted alone or in combination with any other award granted under the 2010 Incentive Plan or any other plan. The Committee will determine the size of each award to be granted (including, where applicable, the number of Shares to which an award will relate), and all other terms and conditions of each award.
Performance Goals. The Committee will set the performance goals used to determine the amount payable pursuant to a performance award. In order to comply with the requirements for tax deductibility under Section 162(m) of the Internal Revenue Code, the business criteria used by the Committee in establishing performance goals applicable to performance awards to the covered employees must be selected from among the following:
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Performance goals may be set based on consolidated Company performance and/or for specified subsidiaries, affiliates, divisions, or other business units of the Company and may be with fixed, qualitative targets; targets relative to past performance; or targets compared to the performance of other companies, such as a published or special index or a group of companies selected by the Committee for comparison.
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To the extent applicable, the determination of achievement of performance goals will be determined based on the relevant financial measure, computed in accordance with U.S. generally accepted accounting principles (“GAAP”), and in a manner consistent with the methods used in the Company’s audited financial statements. However, to the extent permitted by Section 162(m) of the Internal Revenue Code, in setting the performance goals, the Committee may provide for appropriate adjustment for one or more of the following items:
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Limitations on Awards. The aggregate number of Shares that may be issued pursuant to awards under the 2010 Incentive Plan will not exceed 8,000,000. If the exercise price of a stock option granted under the 2010 Incentive Plan, or the tax withholding requirements with respect to any award granted under the 2010 Incentive Plan, is satisfied by tendering Shares to the Company or withholding Shares otherwise to be delivered pursuant to such award, or if a stock appreciation right is exercised, only the number of Shares issued, net of the Shares tendered or withheld, if any, will be deemed issued for purposes of the share limitations in the 2010 Incentive Plan. Any Shares underlying any award under the Plan that is cancelled, forfeited, lapses or is otherwise terminated without an issuance of Shares being made thereunder may again be subject to awards under the Plan. The reservation of shares for issuance under the NYT Stock Plan (but not subject to awards outstanding under the NYT Stock Plan) will lapse effective upon stockholder approval of the 2010 Incentive Plan. In addition, to the extent that outstanding options granted under the NYT Stock Plan expire unexercised or stock-settled restricted stock units are forfeited without the issuance of shares, the reservation of shares for such awards will lapse and such shares will not increase the 2010 Incentive Plan reserve of Shares.
In any calendar year, no participant may be granted stock options or stock appreciation rights for more than 1,000,000 Shares in the aggregate, or any other stock-based awards intended to constitute performance based compensation for more than 500,000 Shares in the aggregate. In addition, in any calendar year, a participant may not be granted cash-based awards: (i) that are intended to constitute performance based compensation with respect to a performance period of no more than one year, than can be settled for more than $5,000,000 in the aggregate; and (ii) cash-based awards that are intended to constitute performance based compensation with respect to a performance period that may exceed one year, that can be settled for more than $5,000,000 in the aggregate.
Adjustments. In the event of a stock dividend, spinoff, recapitalization, or stock split; combination or exchange of Shares; merger, reorganization, or consolidation; classification or change in par value; or other extraordinary or unusual event affecting the Company’s outstanding capital stock without the Company’s receipt of consideration, or if the value of outstanding Class A stock is substantially reduced as a result of a spinoff or the Company’s payment of an extraordinary dividend or distribution, the Committee shall equitably adjust the maximum number of Shares available for issuance under the 2010 Incentive Plan, the maximum number of Shares for which any individual may receive awards in any year, the kind and number of Shares covered by outstanding awards, the kind and number of Shares issued and to be issued under the 2010 Incentive Plan, the price per share or applicable market value of such awards, and the exercise price, grant price or purchase price relating to any award. The Committee is also authorized to adjust performance conditions and other terms of awards in response to these kinds of events or to changes in applicable laws, regulations, or accounting principles.
Change in Control. In the event of a Change in Control of the Company, if the unvested portion of time-based awards are to be cancelled, forfeited, or otherwise expire without payment or other consideration, the time-based awards will become fully vested immediately prior to the Change in Control. If the unvested portion of time-based awards remain outstanding or is replaced with a new award
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following a Change in Control and a participant’s employment is involuntarily terminated within 12 months following the Change in Control, the unvested portion of such award will become fully vested, unless such termination is on account of the participant’s willful and gross misconduct or willful failure to perform services, for his employer, or on account ofwithin 12 months following the participant’s death, disability or retirement (in which case the terms of such award applicablechange in such event will govern). Whether and the extent to which performance-based awards become vested upon a Change in Control will be determined on a grant-by-grant basis by the Committee.
control. For purposes of the 2010 Incentive Plan, a Changechange in Controlcontrol will generally be deemed to occur:
(i) | if a person or group (other than descendants of Iphigene Ochs Sulzberger) obtains the right or ability to elect or designate for election a majority of the Company’s Board of Directors; or |
(ii) | upon the consummation of any share exchange, consolidation or merger of the Company pursuant to which the Company’s common stock will be converted into cash, securities or other property, or any sale, lease or other transfer of the consolidated assets of the Company and its subsidiaries substantially as an entirety; provided, however, that any such share exchange, consolidation or merger will not be a |
4. | The amounts shown include, for annual and long-term performance awards paid in February 2011, the actual amounts paid, and for long-term performance awards payable in future years, a prorated portion (through December 2010) of the target amounts. Actual payments of such ongoing long-term performance awards would be made at the end of the relevant performance period and would depend on the Company’s achievement of the applicable targets. |
5. | The amounts shown represent the actuarial present value of the aggregate anticipated annual payments under the Pension Plan and the SERP payments assuming retirement at December 26, 2010, based on the following anticipated annual payments: |
Arthur Sulzberger, Jr. | $ | 926,244 | ||
Janet L. Robinson | 837,069 | |||
Michael Golden | 495,912 | |||
James M. Follo | 0 | |||
Scott Heekin-Canedy | 347,507 |
Although the total present value of retirement benefits is shown, lump sum payments are not permitted. The present values shown are less than those shown above under “—Pension Benefits” because this presentation assumes a December 26, 2010, retirement. All of the named executive officers, other than Mr. Follo, are eligible for early retirement with benefits at these levels.
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RestrictionProposals Number 2 and 3—
Advisory Votes on RepricingExecutive Compensation
General
On July 21, 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) was signed into law by President Obama. The Act provides for a number of corporate governance and executive compensation reforms, including the requirement that U.S. public companies provide stockholders a non-binding advisory vote on the compensation of the company’s named executive officers (a “say-on-pay” vote). The 2010 Incentive Plan includessay-on-pay vote must occur at least once every three years, and stockholders must also be given, at least once every six years, an advisory vote regarding whether future say-on-pay votes will occur every one, two or three years (a “frequency vote”). The initial say-on-pay and frequency votes must occur at a restriction that, unless authorized by stockholders, the Companycompany’s first annual stockholder meeting taking place on or after January 21, 2011. Accordingly, these matters will not amend or replace stock options or stock appreciation rights previously granted under the 2010 Incentive Plan in a transaction that constitutes a “repricing” as that term is defined under NYSE rules. In addition, the Board of Directors may not amend the 2010 Incentive Plan to permit repricing of options or stock appreciation rights without prior stockholder approval. Adjustments to the exercise price or number of Shares subject to an option or stock appreciation right to reflect the effects of a stock split or other extraordinary corporate transaction generally will not constitute a “repricing.”be voted on at our 2011 Annual Meeting.
Amendment, Termination. The Board may amend, suspend, discontinue, or terminate the 2010 Incentive Plan, any provision of the 2010 Incentive Plan, or the Committee’s authority to grant awards under the 2010 Incentive Plan without stockholder approval, provided that any amendment requiring stockholder approval pursuant to the Company’sUnder our Certificate of Incorporation, an advisory vote on compensation or any applicable law, regulation oron the frequency of such votes is not among the expressly enumerated items as to which the Class A stock exchange rule will be subject to stockholder approval. No amendment, suspension, discontinuation or terminationhas a vote. As a result, for the Company, the say-on-pay vote and the frequency vote are items reserved for a vote of the 2010 Incentive Plan may materially impairClass B stockholders.
Proposal Number 2— Say-on-Pay Vote
Executive compensation is an important matter for the rights of a participant under any previously granted award without the participant’s consent. The Board may amend the 2010 Incentive Plan and awards in the event of changes in applicable law or regulations. Unless earlier terminated by the Board of Directors, the 2010 Incentive Plan will terminate on April 26, 2020, which is the day immediately preceding what will be the tenth anniversary of the plan’s effective date, if the plan is approved by stockholders.
The federal income tax consequences arising with respect to awards granted under the 2010 Incentive Plan will depend on the type of award. From the recipients’ standpoint, as a general rule, ordinary income will be recognized at the time of payment of cash or delivery of actual Shares. Future appreciation on Shares held beyond the ordinary income recognition event will be taxable at capital gains rates when the shares are sold. The Company, as a general rule, will be entitled to a tax deduction that corresponds in time and amount to the ordinary income recognized by the recipient, and the Company will not be entitled to any tax deduction in respect of capital gain income recognized by the recipient. Exceptions to these general rules may arise under the following circumstances:Company. We structure compensation for our executive officers:
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The foregoing provides only a general description of the application of federal income tax laws to certain awards under theWe believe our compensation program, as currently structured and as implemented for 2010, Incentive Plan. This discussion is intended for the information of stockholders considering how to vote at the Annual Meeting and not as tax guidance to participants in the 2010 Incentive Plan, as the tax consequences may varystrongly aligned with the typeslong-term interests of awards made,our stockholders. We urge you to read “Compensation of Executive Officers,” including the identity of the recipients“Compensation Discussion and Analysis,” compensation tables and the methodnarrative discussion, beginning on page 40 of payment or settlement. This summary does not address the effects of other federal taxes (including possible “golden parachute” excise taxes) or taxes imposed under state, local, or foreign tax laws.this Proxy Statement, for details on our executive compensation.
Future benefits under the 2010 Incentive Plan generally will be granted at the discretion of the Committee and are therefore not currently determinable.
During 2009, stock options, stock appreciation rights, and cash-settled restricted stock units were granted under the NYT Stock Plan to the named executive officers as set forth above under “Executive Compensation—Summary Compensation Table” and “—Grants of Plan-Based Awards.In addition, in 2009 1,013,000 stock options and 480,080 cash-settled restricted stock units were granted to employees of the Company and its subsidiaries (other than the named executive officers) under the NYT Stock Plan.
Recommendation and Vote Required
The Board of Directors recommends athat the Class B stockholders voteFOR the following resolution, which will be presented at the Annual Meeting:Meeting.
RESOLVED,, that adoptionthe compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the “Compensation Discussion and Analysis,” compensation tables and narrative discussion, is hereby approved.
As an advisory vote, the result is non-binding on the Company and the Board of Directors. However, the Board of Directors and the Compensation Committee value the opinions of our stockholders and will consider the outcome of the 2010 Incentive Plan described in Proposal 2 in The New York Times Company’s 2010 Proxy Statement be, and the same hereby is, ratified, confirmed and approved.vote when making future compensation decisions for our named executive officers.
The affirmative vote of the holders of a majority of the shares of Class A and Class B stock represented at the Annual Meeting, in person or by proxy, voting together as one class,and entitled to vote on the proposal, is required for approval of this resolution. As a result, abstentions andadvisory proposal. Accordingly, broker non-votes will have no effect on this proposal and abstentions will have the same effect as a votevotes against thethis proposal.
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Proposal Number 3—
Frequency of Future “Say-on-Pay” Votes
Pursuant to the Act, we are also asking our Class B stockholders to vote on whether future say-on-pay votes will occur every one, two or three years. In voting on this proposal, Class B stockholders will have four choices – recommending that say-on-pay votes occur every one, two or three years, or abstaining from voting on this proposal. As an advisory vote, this vote is also non-binding. However, as with the say-on-pay vote described above, the Board of Directors will consider the outcome of the vote when making a future decision as to the frequency of say-on-pay votes.
Recommendation and Vote Required
The Board of Directors recommends that the Class B stockholders voteon the following resolution, which will be presented at the Annual Meeting, for a recommendation that the say-on-pay vote occurEVERY YEAR:
RESOLVED, that the compensation paid to the Company’s named executive officers for the preceding year, as disclosed pursuant to Item 402 of Regulation S-K, including the “Compensation Discussion and Analysis,” compensation tables and narrative discussion, be subject to an advisory vote of the Company’s Class B stockholders:
every year | every two years | every three years |
Notwithstanding the Board’s recommendation, as noted above, Class B stockholders will have four choices on the frequency vote and, thus, may vote to recommend a say-on-pay vote every two or three years, or abstain from voting, in addition to voting in accordance with the recommendation of the Board.
Under the Company’s By-laws (and New York law), the affirmative vote of a majority of the shares represented at a meeting, in person or by proxy, and entitled to vote on a proposal is required to adopt the advisory proposal. Given the multiple voting choices available to Class B stockholders, it is possible that none of the alternatives of one, two or three years will receive a majority vote. It is unclear as to the exact legal effect of a frequency vote with such an outcome. Nevertheless, the Board of Directors considers this vote the equivalent of a poll of the Class B stockholders and will consider the number of votes each alternative receives when making future decisions as to the timing of say-on-pay votes. An abstention on this proposal will have the effect of increasing the possibility that no alternative receives a majority vote; a broker non-vote will have no such effect.
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Selection of Auditors
The Audit Committee has selected the firm of Ernst & Young LLP, an independent registered public accounting firm, as our auditors for the fiscal year ending December 26, 2010,25, 2011, subject to ratification of such selection by our Class A and Class B stockholders voting together as one class.
We have been informed by Ernst & Young that their firm has no direct financial interest nor any material indirect financial interest in us or any of our affiliated companies. Ernst & Young has not had any connection during the past three years with us or any of our affiliated companies in the capacity of promoter, underwriter, voting trustee, director, officer or employee.
A representative of Ernst & Young will be present at the Annual Meeting and will be afforded the opportunity to make a statement if he or she decides to do so. The representative will also be available to respond to appropriate questions from stockholders at the Annual Meeting.
Audit Committee’s Pre-Approval Policies and Procedures
Our Audit Committee Charter, among other things, requires the Audit Committee to pre-approve the rendering by our independent registered public accounting firm of all auditing services, internal control-related services and permitted non-audit services. The Chair of the Audit Committee may pre-approve the rendering of such services (other than internal control-related services) on behalf of the Committee, provided the matter is then presented to the full Committee at the next scheduled meeting.
The following table presents the aggregate fees incurred for audit and other services rendered by Ernst & Young during fiscal year 20092010 and 2008:2009:
Service Type | Fiscal 2009 | Fiscal 2008 | Fiscal 2010 | Fiscal 2009 | ||||||||||||||
Audit Fees | $ | 3,092,000 | $ | 3,549,000 | $ | 3,072,000 | $ | 3,092,000 | ||||||||||
Audit-Related Fees | 1,000 | 115,990 | 1,000 | 1,000 | ||||||||||||||
Tax Fees | 222,000 | 261,000 | 93,000 | 222,000 | ||||||||||||||
All Other Fees | — | — | 95,000 | — | ||||||||||||||
Total Fees Billed | $ | 3,315,000 | $ | 3,925,990 | $ | 3,261,000 | $ | 3,315,000 | ||||||||||
Audit Fees ($3,092,000; $3,549,000)3,072,000; $3,092,000). This category includes the aggregate fees billed by Ernst & Young for professional services rendered for the audit of the Company’s annual financial statements, the reviews of the financial statements included in the Company’s quarterly reports on Form 10-Q, consents related to documents filed with the SEC, work related to the issuance of comfort letters, and services normally provided by the independent auditor in connection with statutory and regulatory filings. Audit fees also include fees for professional services rendered for the audit of the effectiveness of internal control over financial reporting.
Audit-Related Fees ($1,000; $115,990)$1,000). Audit-related fees for 2009 were due to a financial statement audit of an employee benefit plan. Audit-related fees for 2008 were due to pre-software implementation review and enterprise risk assessment fees incurred in 2008.
Tax Fees ($222,000; $261,000)93,000; $222,000). This category includes the aggregate fees billed by Ernst & Young for tax services. Fees for assistance in the preparation of tax returns, claims for refunds and tax payment planning, including support during income tax audits or inquiries, were $21,000 in 2010 and $73,000 in 2009 and $45,000 in 2008.2009. The remaining $72,000 in 2010 and $149,000 in 2009 and $216,000 in 2008 was for tax advice, planning and consulting.
All Other Fees.Fees ($95,000; —). Other fees in 2010 were related to consulting services. No other fees were paid in either 2009 or 2008.2009.
Recommendation and Vote Required
The Audit Committee of the Board of Directors recommends a voteFOR the following resolution, which will be presented at the Annual Meeting:
RESOLVEDRESOLVED,, that the selection, by the Audit Committee of the Board of Directors, of Ernst & Young LLP, an independent registered public accounting firm, as auditors of The New York Times Company for the fiscal year ending December 26, 2010,25, 2011, is hereby ratified, confirmed and approved.
The affirmative vote of the holders of a majority of the shares of Class A and Class B stock represented at the Annual Meeting, in person or by proxy, and entitled to vote on the proposal, voting together as onea single class, is required for approval of this resolution. As a result, abstentions will have the same effect as a vote against the proposal.
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Submission of Stockholder Proposals for 20112012
Stockholders who intend to present proposals at the 20112012 Annual Meeting under SEC Rule 14a-8 must ensure that such proposals are received by the Secretary of the Company not later than November 12, 2010.19, 2011. Such proposals must meet the requirements of the SEC to be eligible for inclusion in the Company’s 20112012 proxy materials.
The Company’s By-laws provide that the nomination of persons for election to the Board and the proposal of business to be considered by stockholders may be made at the annual meeting as set out in the Company’s notice of such meeting, by or at the direction of the Board or by any stockholder of the Company who is entitled to vote at the meeting on such nomination or other proposal, and who, in the case of a holder of Class A stock, complies with certain notice procedures. Any holder of Class A stock proposing to nominate an individual for election to the Board by the Class A holders or proposing business to be considered by the Class A holders at an annual meeting must give written notice and certain information to the Secretary of the Company generally not less than 90 days nor more than 120 days before the first anniversary of the preceding year’s annual meeting. As a result, stockholders who intend to present proposals at the 20112012 Annual Meeting under these provisions must give written notice to the Secretary, and otherwise comply with the By-law requirements, generally no earlier than December 28, 2010,29, 2011, and no later than January 27, 2011.
The execution of a proxy is not intended to result in the revocation of any prior proxies or powers of attorney other than the revocation, in accordance with Section 609 of the New York Business Corporation Law and applicable federal securities laws, of any proxy previously granted specifically in connection with the voting of the Class A or Class B stock subject thereto.28, 2012.
Certain Matters Relating to Proxy Materials
The Company may satisfy SEC rules regarding delivery of proxy materials by delivering a single copy of these materials to an address shared by two or more Company stockholders. This delivery method is referred to as “householding” and can result in meaningful cost savings for the Company. Under this procedure, the Company has delivered only one copy of the proxy statement and annual report, or individual Notices, in one envelope to multiple stockholders who hold their shares through a broker or bank and share an address and last name and who do not participate in electronic delivery of proxy materials, unless contrary instructions were received from impacted stockholders prior to the mailing date. We undertake to deliver promptly upon written or oral request a separate copy of the proxy statement and/orand annual report or Notice in a separate envelope, as requested,applicable, to a stockholder at a shared address to which a single copy of these documents was delivered. If your stock is held through a broker or bank and you prefer to receive separate copies of athe proxy statement, or annual report or Notice in a separate envelope either now or in the future, please contact such brokerBroadridge Financial Solutions, Inc. at (800) 542-1061 or bank.in writing at Broadridge, Householding Department, 51 Mercedes Way, Edgewood, New York 11717.
If you are currently receiving separate copies and wish to receive only one copy of future proxy statements, annual reports or individual Notices, in one envelope, for your household, please contact Broadridge at the above phone number or address.
By order of the Board of Directors
Kenneth A. RichieriDiane Brayton
Senior Vice President,Secretary and Assistant General Counsel & Secretary
New York, NY
March 12, 2010
THE NEW YORK TIMES COMPANY
2010 INCENTIVE COMPENSATION PLAN
1.Purpose of the Plan
The purpose of this 2010 Incentive Compensation Plan (the “Plan”) is to advance the interests of the Company and its stockholders by providing a means (a) to attract, retain, and reward directors, officers, other employees, and persons who provide services to the Company and its Subsidiaries, (b) to link compensation to measures of the Company’s performance in order to provide additional incentives, including stock-based incentives and cash-based incentives, to such persons for the creation of stockholder value, and (c) to enable such persons to acquire or increase a proprietary interest in the Company in order to promote a closer identity of interests between such persons and the Company’s stockholders. The Plan is intended to replace the Company’s 1991 Executive Stock Incentive Plan and the Company’s 1991 Executive Cash Bonus Plan, provided that awards outstanding under such plans as of the Effective Date shall remain outstanding in accordance with their terms.
2.Definitions
Capitalized terms used in the Plan and not defined elsewhere in the Plan shall have the meaning set forth in this Section.
2.1 “Award” means a Cash-Based Award or a Share-Based Award.
2.2 “Beneficiary” means the person(s) or trust(s) entitled by will or the laws of descent and distribution to receive any rights with respect to an Award that survive such Participant’s death, provided that if at the time of a Participant’s death, the Participant had on file with the Committee a written designation of a person(s) or trust(s) to receive such rights, then such person(s) (if still living at the time of the Participant’s death) or trust(s) shall be the “Beneficiary” for purposes of the Plan.
2.3 “Board” means the Board of Directors of the Company.
2.4 “Cash-Based Award” means a compensatory award made pursuant to the Plan pursuant to which a Participant receives, or has the opportunity to receive, cash, other than an award pursuant to which the amount of cash is determined by reference to the value of a specific number of Shares. For the avoidance of doubt, Dividend-Equivalent Rights constitute Cash-Based Awards.
2.5 “Change in Control” shall mean, unless otherwise provided by the Committee with respect to an Award:
(a) a “person” or “group” within the meaning of Section 13(d) of the Exchange Act (other than any descendant (or any spouse thereof) of Iphigene Ochs Sulzberger or any beneficiary or trustee (as the same may change from time to time) of a trust over 50% of the individual beneficiaries of which are descendants (or any spouses thereof) of Iphigene Ochs Sulzberger) shall have obtained the right or ability by voting power, contract or otherwise to elect or designate for election at least a majority of the Board; or
(b) consummation of any share exchange, consolidation or merger of the Company pursuant to which the Common Stock will be converted into cash, securities or other property or any sale, lease or other transfer in one transaction or a series of transactions of the consolidated assets of the Company and its Subsidiaries substantially as an entirety to any “person” or “group” within the meaning of Section 13(d) of the Exchange Act, other than one of the Subsidiaries; provided, however, that any such share exchange, consolidation or merger will not be a Change in Control if holders of the Common Stock immediately prior to such transaction collectively own, directly or indirectly, more than 50% of all classes of common equity of the continuing or surviving corporation or transferee or the parent thereof immediately after such transaction in substantially the same proportion as such ownership immediately prior to such share exchange, consolidation or merger.
2.6 “Code” means the Internal Revenue Code of 1986, as amended, including regulations thereunder and successor provisions and regulations thereto.
2.7 “Committee” means the Compensation Committee of the Board, or another committee appointed by the Board to administer the Plan or any part thereof, or the Board, where the Board is acting as the Committee or performing the functions of the Committee, as set forth in Section 3.
2.8 “Common Stock” means the Class A and Class B Common Stock of the Company, or such other class or classes of capital stock of the Company that shall have the right to vote in the election of Board members.
2.9 “Company” means The New York Times Company, a corporation organized under the laws of the State of New York.
2.10 “Dividend-Equivalent Right” means the right to receive an amount, calculated with respect to a Share-Based Award, which is determined by multiplying the number of Shares subject to the applicable Award by the per-Share cash dividend, or the per-Share Fair Market Value (as determined by the Committee) of any dividend in consideration other than cash, paid by the Company on Shares.
2.11 “Effective Date” means the date the Plan is approved by the Company’s stockholders.
2.12 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
2.13 “Fair Market Value” means, with respect to the Shares, the average of the highest and lowest sale price for the Shares as reported by the composite transaction reporting system for securities listed on the New York Stock Exchange (or such other national securities exchange on which the Shares may be listed at the time of determination, and if the Shares are listed on more than one exchange, then the one located in New York, or if the Shares are listed on the Nasdaq stock market, then on such exchange) on the date as of which such determination is being made or on the most recently preceding date on which there was such a sale.
2.14 “Non-Employee Director” means a member of the Board who is not employed by the Company or any Subsidiary.
2.15 “Participant” means any employee, director, or other service provider who has been granted an Award under the Plan.
2.16 “Qualified Member” means a member of the Committee who is a “non-employee director” of the Company as defined in Rule 16b-3(b)(3) under the Exchange Act and an “outside director” within the meaning of Regulation § 1.162-27 under Code Section 162(m).
2.17 “Retirement” means retirement as defined by the terms of “The New York Times Companies Pension Plan” which became effective December 31, 1988, or any successor retirement plan, whether or not the Participant is a member of such retirement plan, and, in the case of employees of Affiliated Publications, Inc., or any subsidiary thereof, who retire under the terms of the Globe Newspaper Company Retirement Plan, which became effective January 1, 1994 (the “Globe Pension Plan”) or any successor retirement plan, “Retirement” shall also mean retirement as defined by the terms of the Globe Pension Plan or any successor plan.
2.18 “Share-Based Award” means a compensatory award made pursuant to the Plan pursuant to which a Participant receives, or has the opportunity to receive, Shares, or receives, or has the opportunity to receive, cash, where the amount of cash is determined by reference to the value of a specific number of Shares. Share-Based Awards shall include, without limitation, stock options, stock appreciation rights, restricted stock, restricted stock units, stock units, and bonus shares.
2.19 “Shares” means shares of Class A Common Stock of the Company and such other securities as may be substituted or resubstituted for Shares pursuant to Section 7.
2.20 “Subsidiary” means: (a) any entity in which the Company owns at least 50% of the equity interests; and (b) any entity that is, either directly or through one or more intermediaries, controlled by the Company, as determined by the Committee.
2.21 “Time-Based Award” means any Share-Based Award, the vesting of which is conditional solely upon a Participant’s continued employment with the Company or any Subsidiary.
3.Administration
3.1 Committee. A Committee appointed by the Board, all of whom shall be Non-Employee Directors, shall administer the Plan. At any time that a member of the Committee is not a Qualified Member, (a) any action of the Committee relating to an Award intended by the Committee to qualify as “performance-based compensation” within the meaning of Code Section 162(m) and regulations thereunder may be taken by a subcommittee, designated by the Committee or the Board, composed solely of two or more Qualified Members, and (b) any action relating to an Award granted or to be granted to a Participant who is then subject to Section 16 of the Exchange Act in respect of the Company may be taken either by the Board, a subcommittee of the Committee consisting of two or more Qualified Members or by the Committee but with each such member who is not a Qualified Member abstaining or recusing himself or herself from such action, provided that, upon such abstention or recusal, the Committee remains composed of two or more Qualified Members. Such action, authorized by such a subcommittee or by the Committee upon the abstention or recusal of such non-Qualified Member(s), shall be the action of the Committee for purposes of the Plan. The Committee shall serve at the pleasure of the Board and shall have such powers as the Board may from time to time confer upon it. Other provisions of the Plan notwithstanding, the Board may perform any function of the Committee under the Plan, and that authority specifically reserved to the Board under the terms of the Plan, the Company’s Certificate of Incorporation, By-Laws, or applicable law shall be exercised by the Board and not by the Committee. The Board shall serve as the Committee in respect of any Awards made to any Non-Employee Director.
3.2 Powers and Duties of Committee. In addition to the powers and duties specified elsewhere in the Plan, the Committee shall have full authority and discretion to:
(a) adopt, amend, suspend, and rescind such rules and regulations and appoint such agents as the Committee may deem necessary or advisable to administer the Plan;
(b) correct any defect or supply any omission or reconcile any inconsistency in the Plan, construe and interpret the Plan, any Award, any rules and regulations hereunder, or other instrument hereunder, and correct any defect or inconsistency with the terms of the Plan with respect to any Award hereunder;
(c) make determinations relating to eligibility for and entitlements in respect of Awards, and to make all factual findings related thereto; and
(d) make all other decisions and determinations as may be required under the terms of the Plan or as the Committee may deem necessary or advisable for the administration of the Plan.
All determinations and decisions of the Committee shall be final and binding upon a Participant or any person claiming any rights under the Plan from or through any Participant, and the Participant or such other person may not further pursue his or her claim in any court of law or equity or other arbitral proceeding.
3.3 Delegation by Committee. The Committee may delegate, on such terms and conditions as it determines in its sole and absolute discretion, to a sub-committee or to one or more officers of the Company, all or any portion of its authority, to the extent consistent with applicable law, including Section 16 of the Exchange Act and Code Section 162(m); the applicable rules of any stock exchange; and Section 5.2 of the Plan. Any such allocation or delegation may be revoked by the Committee at any time.
3.4 Limitation of Liability. Each member of the Committee shall be entitled to, in good faith, rely or act upon any report or other information furnished to him or her by any officer or other employee of the Company or any Subsidiary, the Company’s independent registered public accounting firm, or any executive compensation consultant, legal counsel, or other professional retained by the Company to assist in the administration of the Plan. No member of the Committee, nor any officer or employee of the Company acting on behalf of the Committee, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan, and all members of the Committee and any officer or employee of the Company acting on behalf of the Committee shall, to the extent permitted by law, be fully indemnified and protected by the Company with respect to any such action, determination, or interpretation.
4.Awards
4.1 Eligibility. The Committee shall have the discretion to select Award recipients from among the following categories of eligible recipients: (a) individuals who are employees (including officers) of the Company or any Subsidiary, (b) persons who provide services to the Company or any Subsidiary who are not otherwise employed by the Company, and (c) Non-Employee Directors. Notwithstanding the foregoing, employees of, or service providers to, Subsidiaries in which the Company owns, directly or indirectly, less than 50% of the equity interests are eligible to receive an Award only to the extent that such Award is based upon legitimate business criteria, consistent with Code Section 409A.
4.2 Type of Awards. The Committee shall have the discretion to determine the type of Award to be granted to a Participant. The Committee is authorized to grant Awards as a bonus, or to grant Awards in lieu of obligations of the Company or any Subsidiary to pay cash or grant other awards under other plans or compensatory arrangements, to the extent permitted by such other plans or arrangements.
4.3 Terms and Conditions of Awards.
(a)Generally.The Committee shall determine the size of each Award to be granted (including, where applicable, the number of Shares to which an Award will relate, subject to Section 6.1), and all other terms and conditions of each such Award (including, but not limited to, any exercise price, grant price, or purchase price, any restrictions or conditions relating to transferability, forfeiture, exercisability, or settlement of an Award, any schedule or performance conditions for the lapse of such restrictions or conditions, and accelerations or modifications thereof, based in each case on such considerations as the Committee shall determine, and any expiration date). Notwithstanding the foregoing but subject to Section 7, (i) the price per Share at which Shares may be purchased upon the exercise of a stock option shall not be less than 100% of the Fair Market Value per Share on the date of grant of such stock option; (ii) with respect to stock appreciation rights, the price per Share from which stock appreciation is measured shall not be less than one hundred percent (100%) of the Fair Market Value of such Share on the date of grant of the stock appreciation right; and (iii) Dividend-Equivalent Rights shall not be granted with respect to stock options or stock appreciation rights. The Committee may determine whether, to what extent, and under what circumstances an Award may be settled, or the exercise price of an Award may be paid, in cash, Shares, other Awards, or other consideration, or an Award may be canceled, forfeited, or surrendered. The right of a Participant to exercise or receive a grant or settlement of any Award, and the timing thereof, may be subject to such performance conditions as may be specified by the Committee. The Committee may use such business criteria and measures of performance as it may deem appropriate in establishing performance conditions, and may exercise its discretion to reduce or increase the amounts payable under any Award subject to performance conditions, except as limited under Section 5.1 in the case of a Performance Award intended to qualify under Code Section 162(m). Notwithstanding the foregoing, Dividend-Equivalent Rights shall not be paid with respect to unvested performance shares and performance units, and any amounts accruing with respect to such Awards will only be paid to the extent the performance shares or performance units become vested.
(b)Vesting in connection with a Change in Control.Notwithstanding Section 4.3(a), unless otherwise provided with respect to an Award:
(i) if, pursuant to action taken by the Committee pursuant to Section 7, the unvested portion of a Time-Based Award that is outstanding at the time of a Change in Control is to be cancelled, forfeited or otherwise expire upon the Change in Control without the receipt of consideration therefor, then such Time-Based Award shall become fully vested immediately prior to the Change in Control; and
(ii) if the unvested portion of the Time-Based Award is to remain outstanding following the Change in Control or is substituted with a new award, the portion of the Time-Based Award or substituted award that remains outstanding but unvested at the time of any termination of the Participant’s employment by his or her employer within 12 months following the Change in Control shall become fully vested immediately prior to such termination, unless such termination is on account of the Participant’s total and permanent disability; Retirement; death; or willful and gross misconduct or willful failure to perform services for his or her employer.
4.4 Option Repricing. Notwithstanding anything in the Plan to the contrary, the Committee may not reprice stock options or stock appreciation rights, nor may the Board amend the Plan to permit repricing of stock options or stock appreciation rights, unless the stockholders of the Company provide prior approval for such repricing. The term “repricing” shall have the meaning given that term in Section 303A.08 of the New York Stock Exchange Listed Company Manual, as in effect from time to time, and shall not include adjustments pursuant to Section 7 of the Plan.
4.5 Stand-Alone, Additional, Tandem, and Substitute Awards. Subject to Section 4.4, Awards granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution or exchange for, any other Award or any award granted under another plan of the Company, any Subsidiary, or any business entity to be acquired by the Company or a Subsidiary, or any other right of a Participant to receive payment from the Company or any Subsidiary, and in granting a new Award, the Committee may determine that the value of any surrendered Award or award may be applied to reduce the exercise price of any stock option or stock appreciation right or purchase price of any other Award.
4.6 Award Notice. The Committee shall cause each Participant to be notified of each Award hereunder and the terms thereof pursuant to such means as the Committee may determine. The Committee may, but shall not be obligated to, require that a Participant enter into an agreement evidencing any Award hereunder.
5.Performance Awards
5.1 Performance Awards Granted to Designated Covered Employees. If the Committee determines that an Award to be granted to an eligible person who is designated by the Committee as likely to be a Covered Employee (as defined below) should qualify as “performance-based compensation” for purposes of Code Section 162(m), the grant, exercise, and/or settlement of such Award (a “Performance Award”) shall be contingent upon achievement of preestablished performance goals and other terms set forth in this Section 5.1. This Section 5.1 shall not apply to Awards that otherwise qualify as “performance-based compensation” by reason of Regulation §1.162-27(e)(2)(vi) (relating to certain stock options and stock appreciation rights).
(a)Performance Goals Generally. The performance goals for such Performance Awards shall consist of one or more business criteria and a targeted level or levels of performance with respect to each such criteria, as specified by the Committee consistent with this Section 5.1. Performance goals shall be objective and shall otherwise meet the requirements of Code Section 162(m) and regulations thereunder (including Regulation §1.162-27 and successor regulations thereto), including the requirement that the level or levels of performance targeted by the Committee result in the achievement of performance goals being “substantially uncertain.” The Committee may determine that such Performance Awards shall be granted, exercised, and/or settled upon achievement of any one performance goal or that two or more of the performance goals must be achieved as a condition to grant, exercise, and/or settlement of such Performance Awards. Performance goals may differ for Performance Awards granted to any one Participant or to different Participants.
(b)Business Criteria. One or more of the following business criteria for the Company, on a consolidated basis, and/or for specified Subsidiaries, affiliates, divisions, or other business units of the Company (where the criteria are applicable), shall be used by the Committee in establishing performance goals for Performance Awards:
(i) earnings per share, adjusted earnings per share, or growth in earnings per share;
(ii) revenues or revenue growth, including revenue growth compared to expense growth;
(iii) cash flow, free cash flow, operating cash flow, or operating cash flow margin;
(iv) return on investment, return on assets, return on net assets, return on capital, return on stockholder’s equity, return on invested capital, or return on sales;
(v) profitability;
(vi) economic value added, as measured by the amount by which a business unit’s earnings exceed the cost of the equity and debt capital used by the business unit during the relevant performance period;
(vii) operating margins, operating cash flow margins or profit margins;
(viii) income or earnings before or after taxes; earnings before or after taxes, interest, depreciation and amortization; operating profit; operating earnings; pretax operating earnings, before or after interest expense and before or after incentives; net income (before or after taxes), adjusted net income, or net sales;
(ix) total stockholder return, stockholders’ equity, or stock price;
(x) book value per share;
(xi) costs, expense management, operating expenses, or operating expenses as a percentage of revenue;
(xii) improvements in capital structure; working capital;
(xiii) market share; and
(xiv) any of the above goals as compared to the performance of a published or special index deemed applicable by the Committee including, but not limited to, the Standard & Poor’s 500 Stock Index or a group of comparator companies.
(c)Performance Period; Timing for Establishing Performance Award Terms. Achievement of performance goals in respect of such Performance Awards shall be measured over a performance period as specified by the Committee. Performance goals, amounts payable upon achievement of such goals, and other material terms of Performance Awards shall be established by the Committee (a) while the performance outcome for that performance period is substantially uncertain; and (b) no more than 90 days after the commencement of the performance period to which the performance goal relates or, if less, the number of days which is equal to 25 percent of the relevant performance period. To the extent consistent with Code
Section 162(m), the Committee shall specify the circumstances in which such Performance Awards shall be paid or forfeited in the event of termination of the Participant’s employment prior to the end of a performance period or settlement of Performance Awards, including providing any Participant with a pro rata portion of the amount payable pursuant to any Performance Award in the event of such termination of employment, based on actual levels of achievement during such performance period.
(d)Performance Award Pool. The Committee may establish a Performance Award pool, which shall be an unfunded pool, for purposes of measuring performance of the Company in connection with Performance Awards. The amount of such Performance Award pool shall be based upon the achievement of a performance goal or goals based on one or more of the business criteria set forth in Section 5.1(b) hereof during the given performance period, as specified by the Committee in accordance with Section 5.1(c) hereof. The Committee may specify the amount of the Performance Award pool as a percentage of any of such business criteria, a percentage thereof in excess of a threshold amount, or as another amount which need not bear a strictly mathematical relationship to such business criteria. In such case, Performance Awards may be granted as rights to payment of a specified portion of the Award pool, and such grants shall be subject to the requirements of Section 5.1(c).
(e)Settlement of Performance Awards; Other Terms. Settlement of such Performance Awards shall be in cash, Shares, or other Awards, in the discretion of the Committee. The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with such Performance Awards, but may not exercise discretion to increase any such amount payable to a Covered Employee in respect of a Performance Award subject to this Section 5.1.
(f)Impact Of Extraordinary Items Or Changes In Accounting. To the extent applicable, subject to the following sentence, the determination of achievement of performance goals shall be determined based on the relevant financial measure, computed in accordance with U.S. generally accepted accounting principles (“GAAP”), and in a manner consistent with the methods used in the Company’s audited financial statements. To the extent permitted by Code Section 162(m), in setting the performance goals within the period prescribed in Section 5.1(c), the Committee may provide for appropriate adjustment for one or more of the following items: asset write-downs; litigation or claim judgments or settlements; changes in accounting principles; changes in tax law or other laws affecting reported results; changes in commodity prices, including newsprint; severance, contract termination, and other costs related to exiting, modifying or reducing any business activities; costs of, and gains and losses from, the acquisition, disposition, or abandonment of businesses or assets; gains and losses from the early extinguishment of debt; gains and losses in connection with the termination or withdrawal from a pension plan; stock compensation costs and other non-cash expenses; any extraordinary non-recurring items as described in Accounting Principles Board Opinion No. 30 and/or in management’s discussion and analysis of financial condition and results of operation appearing in the Company’s annual report to stockholders for the applicable year; and any other specified non-operating items as determined by the Committee in setting performance goals.
5.2 Written Determinations. Determinations by the Committee as to the establishment of performance goals, the amount potentially payable in respect of Performance Awards, the achievement of performance goals relating to Performance Awards, and the amount of any final Performance Award shall be recorded in writing. Specifically, the Committee shall certify in writing, in a manner conforming to applicable regulations under Code Section 162(m), prior to settlement of each Performance Award, that the performance goals and other material terms of the Performance Award upon which settlement of the Performance Award was conditioned have been satisfied. The Committee may not delegate any responsibility relating to such Performance Awards.
5.3 Status of Section 5.1 Awards under Code Section 162(m). It is the intent of the Company that Performance Awards under Section 5.1 constitute “performance-based compensation” within the meaning of Code Section 162(m) and regulations thereunder. Accordingly, the terms of Sections 5.1, 5.2 and 5.3, including the definitions of Covered Employee and other terms used therein, shall be interpreted in a manner consistent with Code Section 162(m) and regulations thereunder. The foregoing notwithstanding, because the Committee cannot determine with certainty whether a given Participant will be a Covered Employee with respect to a fiscal year that has not yet been completed, the term “Covered Employee” as used herein shall mean only a person designated by the Committee, at the time of grant of a Performance Award, as likely to be a Covered Employee with respect to a specified fiscal year. If any provision of the Plan as in effect on the date of adoption of any agreements relating to Performance Awards does not comply or is inconsistent with the requirements of Code Section 162(m) or regulations thereunder, such provision shall be construed or deemed amended to the extent necessary to conform to such requirements.
6.Limitations on Awards
6.1 Aggregate Number of Shares Available for Awards. Subject to Section 7, the number of Shares issued to Participants or their Beneficiaries upon the grant, exercise or other settlement of all Awards shall not exceed 8,000,000
Shares. Upon stockholder approval of the Plan, no further awards will be made under the Company’s 1991 Executive Stock Incentive Plan or the Company’s 1991 Executive Cash Bonus Plan. If the exercise price of an option to purchase Shares granted under the Plan, or the tax withholding requirements with respect to any Award, is satisfied by tendering Shares to the Company (by either actual delivery or by attestation) or withholding Shares otherwise to be delivered pursuant to such Award, or if a stock appreciation right is exercised, only the number of Shares issued, net of the Shares tendered or withheld, if any, will be deemed issued for purposes of this Section 6.1. Any Shares underlying any Award under the Plan that is cancelled, forfeited, lapses or is otherwise terminated without an issuance of Shares being made thereunder will no longer be counted against the foregoing maximum share limitation and may again be made subject to Awards under the Plan. Shares issued under the Plan may be authorized but unissued Shares or treasury Shares, including Shares purchased by the Company on the open market for purposes of the Plan or otherwise.
6.2 Per Participant Limitation on Share-Based Awards. In any calendar year, no Participant may be granted any Share-Based Awards in the form of either stock options or stock appreciation rights for more than 1,000,000 Shares in the aggregate. In addition, in any calendar year, a Participant shall not be granted any other Share-Based Awards that are intended to be Performance Awards that relate to more than 500,000 Shares. If the number of Shares ultimately payable in respect of an Award is a function of future achievement of performance targets, then for purposes of these limitations, the number of Shares to which such Award relates shall equal the number of Shares that would be payable assuming maximum performance was achieved.
6.3 Per Participant Limitation on Cash-Based Awards. In any calendar year, no Participant may be granted (i) Cash-Based Awards that are intended to be Performance Awards, with respect to which performance will be measured over a period that cannot exceed one year, that can be settled for more than $5,000,000 in the aggregate; and (ii) Cash-Based Awards that are intended to be Performance Awards, with respect to which performance will be measured over a period that may exceed one year, that can be settled for more than $5,000,000 in the aggregate.
7.Adjustments
If there is any change in the number or kind of Shares outstanding (a) by reason of a stock dividend, spinoff, recapitalization, stock split, or combination or exchange of Shares, (b) by reason of a merger, reorganization or consolidation, (c) by reason of a reclassification or change in par value, or (d) by reason of any other extraordinary or unusual event affecting the Company’s outstanding capital stock without the Company’s receipt of consideration, or if the value of outstanding Shares is substantially reduced as a result of a spinoff or the Company’s payment of an extraordinary dividend or distribution, the maximum number of Shares available for issuance under the Plan, the maximum number of Shares for which any individual may receive Awards in any year, the kind and number of Shares covered by outstanding Awards, the kind and number of Shares issued and to be issued under the Plan, and the price per Share or the applicable market value of such Awards and the exercise price, grant price or purchase price relating to any Award shall be equitably adjusted by the Committee to reflect any increase or decrease in the number of, or change in the kind or value of, the issued shares of Company capital stock to preclude, to the extent practicable, the enlargement or dilution of rights and benefits under the Plan and such outstanding Awards;provided,however, that any fractional shares resulting from such adjustment shall be eliminated. In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards (including cancellation of Awards in exchange for the intrinsic (i.e., in-the-money) value, if any, of the vested portion thereof, substitution of Awards using securities or other obligations of a successor or other entity, acceleration of the expiration date for Awards, or adjustment to performance goals in respect of Awards) in recognition of unusual or nonrecurring events (including, without limitation, a Change in Control, events described in the preceding sentence, and acquisitions and dispositions of businesses and assets) affecting the Company, any Subsidiary or any business unit, or the financial statements of the Company or any Subsidiary, or in response to changes in applicable laws, regulations, or accounting principles. In addition, in the event of a Change in Control of the Company, the provisions of Section 4.3(b) of the Plan shall apply. Any adjustments determined by the Committee shall be final, binding and conclusive.
8.General Provisions
8.1 Compliance with Laws and Obligations. The Company shall not be obligated to issue or deliver Shares in connection with any Award or take any other action under the Plan in a transaction subject to the registration requirements of any applicable securities law, any requirement under any listing agreement between the Company and any securities exchange or automated quotation system, or any other law, regulation, or contractual obligation of the Company, until the Company is satisfied that such laws, regulations, and other obligations of the Company have been complied with in full. Shares issued under the Plan will be subject to such stop-transfer orders and other restrictions as may be applicable under such laws, regulations, and other obligations of the Company, including any requirement that a legend or legends be placed thereon.
8.2 Limitations on Transferability. Awards and other rights under the Plan will not be transferable by a Participant except to a Beneficiary in the event of the Participant’s death (to the extent any such Award, by its terms, survives the Participant’s death), and, if exercisable, shall be exercisable during the lifetime of a Participant only by such Participant or his guardian or legal representative;provided,however, that, if and only to the extent permitted by the Committee, Awards and other rights hereunder may be transferred during the lifetime of the Participant, for purposes of the Participant’s estate planning or other purposes consistent with the purposes of the Plan (as determined by the Committee), and may be exercised by such transferees in accordance with the terms of such Award. Awards and other rights under the Plan may not be pledged, mortgaged, hypothecated, or otherwise encumbered, and shall not be subject to the claims of creditors. A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Award applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.
8.3 No Right to Continued Employment; Leaves of Absence. Neither the Plan, the grant of any Award, nor any other action taken hereunder shall be construed as giving any employee, consultant, director, or other person the right to be retained in the employ or service of the Company or any of its Subsidiaries (for the vesting period or any other period of time), nor shall it interfere in any way with the right of the Company or any of its Subsidiaries to terminate any person’s employment or service at any time. Unless otherwise specified with respect to an applicable Award and to the extent consistent with Code Section 409A, (a) an approved leave of absence shall not be considered a termination of employment or service for purposes of an Award under the Plan, and (b) any Participant who is employed by or performs services for a Subsidiary shall be considered to have terminated employment or service for purposes of an Award under the Plan if such Subsidiary is sold or no longer qualifies as a Subsidiary of the Company, unless such Participant remains employed by the Company or another Subsidiary.
8.4 Taxes. The Company and any Subsidiary is authorized to withhold from any delivery of Shares in connection with an Award, any other payment relating to an Award, or any payroll or other payment to a Participant, amounts of withholding and other taxes due or potentially payable in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Company, its Subsidiaries and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award. This authority shall include authority to withhold or receive Shares or other consideration and to make cash payments in respect thereof in satisfaction of withholding tax obligations.
8.5 Changes to the Plan and Awards. The Board may amend, suspend, discontinue, or terminate the Plan, any provision thereof, or the Committee’s authority to grant Awards under the Plan without the consent of stockholders or Participants, except that any amendment shall be subject to the approval of the Company’s stockholders, in accordance with the Company’s Certificate of Incorporation, at or before the next annual meeting of stockholders for which the record date is after the date of such Board action if such stockholder approval is required by the Company’s Certificate of Incorporation or any applicable law, regulation or stock exchange rule. The Board may otherwise, in its discretion, determine to submit other such amendments to stockholders for approval. Without the consent of an affected Participant, no amendment, suspension, discontinuation, or termination of the Plan may materially impair the rights of such Participant under any Award theretofore granted. The Committee may amend, suspend, discontinue, or terminate any Award theretofore granted;provided,however, that, without the consent of an affected Participant, no such action may materially impair the rights of such Participant under such Award. Unless the Plan is terminated earlier by the Board, the Plan shall terminate on the day immediately preceding the tenth anniversary of its Effective Date. The termination of the Plan shall not impair the power and authority of the Committee with respect to an outstanding Award. Any action taken by the Committee pursuant to Section 7 shall not be treated as an action described in this Section 8.5. Notwithstanding anything in the Plan to the contrary, the Board may amend the Plan and Awards in such manner as it deems appropriate in the event of a change in applicable law or regulations.
8.6 No Right to Awards; No Stockholder Rights. No Participant or other person shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Participants, employees, directors, and other service providers. No Award shall confer on any Participant any of the rights of a stockholder of the Company unless and until Shares are duly issued or transferred and delivered to the Participant in accordance with the terms of the Award.
8.7 Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Company;provided,however, that the Committee may authorize the creation of trusts or make other arrangements to meet the
Company’s obligations under the Plan to deliver cash, Shares, other Awards, or other consideration pursuant to any Award, which trusts or other arrangements shall be consistent with the “unfunded” status of the Plan unless the Committee otherwise determines.
8.8 Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board nor the submission of the Plan or of any amendment to stockholders for approval shall be construed as creating any limitations on the power of the Board to adopt such other compensatory arrangements as it may deem desirable, including the granting of awards otherwise than under the Plan, and such arrangements may be either applicable generally or only in specific cases.
8.9 Successors and Assigns. The Plan and Awards may be assigned by the Company to any successor to the Company’s business. The Plan and any Awards shall be binding on all successors and assigns of the Company and a Participant, including any permitted transferee of a Participant, the Beneficiary or estate of such Participant and the executor, administrator or trustee of such estate, or any receiver or trustee in bankruptcy or representative of the Participant’s creditors.
8.10 Governing Law. The Plan and all Awards shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.
8.11 Severability of Provisions. If any provision of the Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and the Plan shall be construed and enforced as if such provisions had not been included.
8.12 Section 409A.Notwithstanding the other provisions hereof, the Plan and the Awards are intended to comply with the requirements of Code Section 409A. Accordingly, all provisions herein and with respect to any Awards shall be construed and interpreted to be consistent with the requirements of Code Section 409A to the maximum extent possible;provided,however, that in no event shall the Company be obligated to reimburse a Participant or Beneficiary for any additional tax (or related penalties and interest) incurred by reason of application of Code Section 409A, and the Company makes no representations that Awards are exempt from or comply with Code Section 409A and makes no undertakings to ensure or preclude that Code Section 409A will apply to any Awards. Notwithstanding anything herein to the contrary, in the event that any Awards constitute nonqualified deferred compensation under Code Section 409A, if (a) the Participant is a “specified employee” of the Company as of the specified employee identification date for purposes of Code Section 409A (as determined in accordance with the policies and procedures adopted by the Company) and (b) the delivery of any cash or Shares payable pursuant to an Award is required to be delayed for a period of six (6) months after separation from service pursuant to Code Section 409A, such cash or Shares shall be paid within fifteen (15) days after the end of the six-month period. If the Participant dies during such six-month period, the amounts withheld on account of Code Section 409A shall be paid to the Participant’s Beneficiary within thirty (30) days of the Participant’s death. The Committee shall have the discretion to provide for the payment of an amount equivalent to interest, at such rate or rates fixed by the Committee, on any delayed payment.
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The New York Times Company
Annual Meeting of Stockholders
10:00 A.M., Tuesday, April 27, 2010
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242 West 41st Street
New York, NY 10018
The New York Times Company
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THE NEW YORK TIMES COMPANY
620 EIGHTH AVENUE, 18th FLOOR
NEW YORK, NY 10138-0258
Attn: Corporate Secretary
The New York Times Company
ANNUAL MEETING OF STOCKHOLDERS
APRIL 27, 2010
10:00 A.M.
TheTimesCenter
242 WEST 41ST STREET
NEW YORK, NEW YORK 10018
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VOTE BY INTERNET -www.proxyvote.com▼ FOLD AND DETACH HERE ▼PROXYClass ATHE NEW YORK TIMES COMPANYProxy Solicited on Behalf of the Board of Directors ofthe Company for the Annual Meeting on April 27, 2010The undersigned hereby constitutes and appoints Arthur Sulzberger, Jr. and Kenneth A. Richieri, and each of them, as proxies with full power of substitution in each, to represent the undersigned at the Annual Meeting of Stockholders of THE NEW YORK TIMES COMPANY to be held at 10:00 A.M., local time, at TheTimesCenter, 242 West 41st Street, New York, New York 10018, on Tuesday, April 27, 2010, or at any adjournments or postponements thereof, and to vote on all matters coming before said meeting including the proposals indicated on the reverse side hereof.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. Your shares cannot be voted unless you sign and return this card.(Continued and to be marked, dated and signed, on the other side)Address Change/Comments(Mark the corresponding box on the reverse side) BNY MELLON SHAREOWNER SERVICES P.O. BOX 3550 SOUTH HACKENSACK, NJ 07606-9250
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Internet and telephone voting are available through 11:59 PM Eastern Time the day prior to the Annual Meeting.
Use the Internet to Web site and follow the instructions to obtain your records and to create an electronic voting instruction form. | ||||
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. | ||||
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Use any touch-tone telephone to call and then follow the instructions. | ||||
VOTE BY MAIL | ||||
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. | ||||
401(K) PLAN PARTICIPANTS | ||||
All votes by participants in The New York Times Companies Supplemental Retirement and Investment Plan, the Mechanical Unions Savings Trust 401(k) Plan or the BNG/Boston Globe Savings 401(k) Plan submitted over the Internet, by phone or mail must be received by 11:59 p.m. Eastern Time on April 24, 2011. | ||||
If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
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Your Internet or telephone vote authorizes the named proxies to vote |
▼ FOLD AND DETACH HERE ▼
This proxy when properly executed will be voted in the manner directed herein. If no direction is given, this proxy will be voted FOR the election of directors and FOR proposals 2 and 3.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
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The Board of Directors recommends a vote FOR the election of directors and FOR proposals 2 and 3.
DETACH AND RETURN THIS PORTION ONLY | ||||||||
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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| All | All | Except | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | ||||||||||||||||||||||||||
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1. | Election of Directors | ¨ | ¨ | ¨ | ||||||||||||||||||||||||||
Class A Nominees: | ||||||||||||||||||||||||||||||
01) | Raul E. Cesan | |||||||||||||||||||||||||||||
02) | Ellen R. Marram | |||||||||||||||||||||||||||||
03) | Thomas Middelhoff | |||||||||||||||||||||||||||||
04) | Doreen A. Toben | |||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR the following proposal: | For | Against | Abstain | |||||||||||||||||||||||||||
4. | Ratification of Ernst & Young LLP as Auditors | ¨ | ¨ | ¨ | ||||||||||||||||||||||||||
NOTE: Such other business as may properly come before the meeting or | ||||||||||||||||||||||||||||||
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Please indicate if you plan to attend this meeting. | ¨ | ¨ | ||||||||||||||||||||||||||||
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No | |||||||||||||||||||||||||||||
IF VOTING BY MAIL, YOU MUST DATE, SIGN AND RETURN THIS CARD IN ORDER FOR THE SHARES TO BE VOTED. | ||||||||||||||||||||||||||||||
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Please sign exactly as | ||||||||||||||||||||||||||||||
Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
The New York Times CompanyTHE NEW YORK TIMES COMPANY
ANNUAL MEETING OF STOCKHOLDERS
APRIL 27, 20102011
10:00 A.M. Eastern Time
TheTimesCenter
242 WEST 41ST STREET
NEW YORK, NEW YORK 10018
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on April 27, 2011:
The Notice of Annual Meeting and Proxy Statement and Annual Report are available atwww.proxyvote.com
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▼ FOLD AND DETACH HERE ▼
THE NEW YORK TIMES COMPANY Proxy Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Arthur Sulzberger, Jr., Kenneth A. Richieri and Diane Brayton, and each of them, as proxies, each with the power to appoint his or her substitute, and hereby authorizes them to represent and to vote, as designated on all matters coming before said meeting, including the matters on the reverse side of this card, all of the shares of CLASS A COMMON STOCK of THE NEW YORK TIMES COMPANY that the undersigned is entitled to vote at the Annual Meeting of Stockholders to be held at 10:00 a.m. Eastern Time on April 27, 2011, at TheTimesCenter, 242 West 41st Street, New York, NY 10018, and any adjournment or postponement thereof. The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and Proxy Statement and revokes any proxies previously given. This proxy when properly executed, will be voted in the manner directed herein by the undersigned. If no direction is given, this proxy will be voted FOR the election of directors and FOR proposal 4. In their discretion, the proxies are authorized to vote on such other matters that may properly come before this meeting or any adjournment or postponement thereof. If the undersigned is a participant in The New York Times Companies Supplemental Retirement and Investment Plan, the Mechanical Unions Savings Trust 401(k) Plan or the BNG/Boston Globe Savings 401(k) Plan, this card will also be used to provide voting instructions to the trustee for any shares attributed to the undersigned’s account on the record date, as set forth in the Notice of Annual Meeting and Proxy Statement. |
The undersigned hereby constitutes and appoints Arthur Sulzberger, Jr. and Kenneth A. Richieri, and each of them, as proxies with full power of substitution in each, to represent the undersigned at the Annual Meeting of Stockholders of THE NEW YORK TIMES COMPANY to be held at 10:00 A.M., local time, at TheTimesCenter, 242 West 41st Street, New York, New York 10018, on Tuesday, April 27, 2010, or at any adjournments or postponements thereof, and to vote on all matters coming before said meeting including the proposals indicated on the reverse side hereof.
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. Your shares cannot be voted unless you sign and return this card.
(Continued and to be marked, dated and signed, on the other side)
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(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.) Continued and to be dated and signed on reverse side |
YOUR VOTE IS IMPORTANT. PLEASE VOTE TODAY.
We encourage you to take advantage of Internet or telephone voting.
Both are available 24 hours a day, 7 days a week.
Internet and telephone voting are available through 11:59 PM Eastern Time the day prior to the Annual Meeting.
NEW YORK, NY 10018 | VOTE BY INTERNET -www.proxyvote.com | |||
Use the Internet to
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If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. | ||||
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Use any touch-tone telephone to call and then follow the instructions. | ||||
VOTE BY MAIL | ||||
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. | ||||
If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
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Your Internet or telephone vote authorizes the named proxies to vote |
▼ FOLD AND DETACH HERE ▼
This proxy when properly executed will be voted in the manner directed herein . If no direction is given, this proxy will be voted FOR the election of directors and FOR proposals 2 and 3.
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The Board of Directors recommends a vote FOR the election of directors and FOR proposals 2 and 3.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
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DETACH AND RETURN THIS PORTION ONLY | |||||||||||||||||||||||
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THE NEW YORK TIMES COMPANY | For All | Withhold All | For All Except | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | ||||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR the following: | ||||||||||||||||||||||||||||||||||
1. |
Election of Directors | ¨ | ¨ | ¨ |
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Class B Nominees: | ||||||||||||||||||||||||||||||||||
01) | Robert E. Denham | 06) | Dawn G. Lepore | |||||||||||||||||||||||||||||||
02) | Lynn G. Dolnick | 07) | David E. Liddle | |||||||||||||||||||||||||||||||
03) | Michael Golden | 08) | Janet L. Robinson | |||||||||||||||||||||||||||||||
04) | Carolyn D. Greenspon | 09) | Arthur Sulzberger, Jr. | |||||||||||||||||||||||||||||||
05) | James A. Kohlberg | |||||||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR the following proposal: | For | Against | Abstain | |||||||||||||||||||||||||||||||
2. | Approval, on an advisory basis, of executive compensation | ¨ | ¨ | ¨ | ||||||||||||||||||||||||||||||
The Board of Directors recommends you vote 1 YEAR on the following proposal: | 1 Year | 2 Years | 3 Years | Abstain | ||||||||||||||||||||||||||||||
3. | Approval, on an advisory basis, of the frequency of future advisory votes on executive compensation | ¨ | ¨ | ¨ | ¨ | |||||||||||||||||||||||||||||
The Board of Directors recommends you vote FOR the following proposal: | For | Against | Abstain | |||||||||||||||||||||||||||||||
4. | Ratification of Ernst & Young LLP as Auditors | ¨ | ¨ | ¨ | ||||||||||||||||||||||||||||||
NOTE:Such other business as may properly come before the meeting or any adjournment or postponement thereof. | ||||||||||||||||||||||||||||||||||
For address changes and/or comments, please check this box and write them on the back where indicated. | ¨ | |||||||||||||||||||||||||||||||||
Please indicate if you plan to attend this meeting. | ¨ | ¨ | ||||||||||||||||||||||||||||||||
Yes |
No | |||||||||||||||||||||||||||||||||
IF VOTING BY MAIL, YOU MUST DATE, SIGN AND RETURN THIS CARD IN ORDER FOR THE SHARES TO BE VOTED. | ||||||||||||||||||||||||||||||||||
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, trustee or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer, giving full title as such.
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Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
THE NEW YORK TIMES COMPANY
ANNUAL MEETING OF STOCKHOLDERS
APRIL 27, 2011
10:00 A.M. Eastern Time
TheTimesCenter
242 WEST 41ST STREET
NEW YORK, NEW YORK 10018
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on April 27, 2011:
The Notice of Annual Meeting and Proxy Statement and Annual Report are available atwww.proxyvote.com
This proxy is solicited on behalf of the Board of Directors for the Annual Meeting on April 27, 2010.
INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark the “Exceptions” box and write that nominee’s name in the space provided below.
*Exceptions
Your signature on the proxy is your acknowledgment of receipt of the Notice of the Annual Meeting and 2010 Proxy Statement, both dated on or about March 12, 2010. The signer hereby revokes all proxies heretofore given by the signer to vote at said meeting or at any adjournment or postponement thereof.
THE NEW YORK TIMES COMPANY Proxy Solicited on Behalf of the Board of Directors for the Annual Meeting of Stockholders on April 27, 2011 | ||||||||||||||
The undersigned hereby appoints Arthur Sulzberger, Jr., Kenneth A. Richieri and Diane Brayton, and each of them, as proxies, each with the power to appoint his or her substitute, and hereby authorizes them to represent and to vote, as designated on all matters coming before said meeting, including the matters on the reverse side of this card, all of the shares of CLASS B COMMON STOCK of THE NEW YORK TIMES COMPANY that the undersigned is entitled to vote at the Annual Meeting of Stockholders to be held at 10:00 a.m. Eastern Time on April 27, 2011, at TheTimesCenter, 242 West 41st Street, New York, NY 10018, and any adjournment or postponement thereof. The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and Proxy Statement and revokes any proxies previously given. This proxy when properly executed, will be voted in the manner directed herein by the undersigned. If no direction is given, this proxy will be voted FOR the election of directors, FOR proposal 2, ONE YEAR for proposal 3 and FOR Proposal 4. In their discretion, the proxies are authorized to vote on such other matters that may properly come before this meeting or any adjournment or postponement thereof. |
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Address Changes/Comments: | ||||||||||||||
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| (If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
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